The 2024 MOSAIC Forum, themed Building Effective, Accountable, and Transparent Institutions for the Public Good, convened leaders from professional accountancy organizations (PAOs), donor agencies, and Supreme Audit Institutions (SAIs) in Bucharest, Romania, from September 16 to 18, hosted by the Supreme Audit Institution of Romania. Coinciding with the INTOSAI Donor Cooperation and Capacity Building Steering Committees, the event provided a platform to discuss how public financial management (PFM) and sustainability reporting standards can strengthen public institutions.
Sessions explored diverse areas, including public sector sustainability, impactful partnerships for capacity development, and the adoption of international accounting standards. Together, these discussions underscored the critical role of effective governance and accountability in enhancing trust and resilience within public institutions, especially in emerging economies.
Thank you to Arturo Herrera who set the tone of our sessions with an introduction focused on the importance of proper accounting for economic development and financial stability. The below session briefs provide a snapshot of the discussions, questions and comments posed as well as access to the forum recordings.
Sustainability Reporting for the Public Sector
Reporting on climate change is one of the most important issues in sustainability reporting, which also encompasses environmental, social and governance issues. This session highlighted the importance of the development of a public sector sustainability reporting framework to assist governments to measure and manage their critical contributions and actions take to address the global climate emergency. Ian Carruthers, IPSASB Chair, provided an overview of the IPSASB’s approach for the development of a public sector specific Climate-Related Disclosures standard which a draft of was released October 31, 2024. IPSASB Sustainability Reporting Standards (IPSASB SRS) aim to build on existing international frameworks, ensuring consistency and comparability. Lee White, IFAC CEO emphasized the importance of the standards. He encouraged development partners and SAI representatives to submit their comment letters to the exposure draft. He also noted that their collaboration with the accountancy profession will be critical in ensuring the effective implementation of the standards. Transparency in the use of resources is crucial for effective climate action and sustainability initiatives. Public sector entities must disclose their sustainability efforts and outcomes to build trust and facilitate informed decision-making. There is a strong focus on ensuring that these standards are practical and applicable across different public sector contexts.
The session emphasized the need for collaboration among various stakeholders, including governments, international organizations, and professional bodies. Serdar Yilmaz from the World Bank provided context on the call of the World Bank to the IPSASB to play a leading role in developing a framework for public sector sustainability reporting standards. It was noted that the support from entities like the World Bank is vital in providing the necessary resources and expertise to develop and implement these standards. Finally, Karma Terzin from IDI made a presentation during which he emphasized the development of effective audit and assurance arrangements alongside the public sector sustainability reporting standards. Supreme audit institutions (SAIs) play a key role in providing independent oversight, ensuring the reliability and accuracy of sustainability information.
The session on sustainability reporting highlighted the critical role of transparency and accountability in addressing sustainability challenges. By developing and implementing robust reporting standards, the public sector can enhance its efforts in climate action and sustainable development. Collaboration among stakeholders and the support of international organizations are essential to achieving these goals and ensuring a sustainable future for all.
Effective Partnerships for the Development of the Public Sector
The session on Effective partnerships for the development of the public sector focused on the partnership between IFAC, Gavi, and The Global Fund. IFAC, Gavi, and The Global Fund entered into a partnership in 2021. USAID Global Health bureau joined in 2022. The objective of the partnership is to support the implementation of capacity building initiatives aiming to strengthen PAO’s abilities to regulate the accountancy profession and to build the accounting and public financial management skills of their members working in the public and health sector.
As part of the partnership with Gavi and The Global Fund, IFAC committed to support the selection of pilot countries and facilitating the implementation of targeted PAO development activities. In September 2022, two pilot projects in Burkina Faso and in Ghana were launched with the support of the Pan African Federation of Accountants as the program manager for the implementation of this activities.
Investments in PAOs help ensure that public sector entities have access to well-trained professionals who can manage public funds effectively and transparently. The session showcased successful pilot projects in Ghana and Burkina Faso, supported by Gavi and The Global Fund.
In Burkina Faso, the project involved translating and contextualizing the African Professionalization Initiative (API) to suit the local context. In Ghana, the project focused on updating the professional qualifications of accountants, integrating health sector elements into the curriculum.
The session on effective partnerships highlighted the critical role of collaboration in building public sector capacity. Eric Boa from The Global Fund and Charles Ohene-Nyako from Gavi noted that by investing in PAOs and fostering long-term partnerships, stakeholders can ensure that public financial management systems are robust, transparent, and capable of meeting the challenges of the future. Collaboration between PAOs, SAIs, and development partners ensures that capacity-building efforts are sustainable and impactful. Meisie Nkau, AFROSAI-E CEO highlighted the African Professionalization Initiative (API) as a successful framework to building capacity in the public sector through tailored training and professional development programs.
The session also highlighted the disparity in the level of professionalization between different regions, particularly between Anglophone and Francophone countries. The session emphasized the need for tailored approaches to address these disparities and ensure that all regions benefit from capacity-building initiatives. These efforts are essential for achieving sustainable development and improving the lives of citizens worldwide.
Building Effective, Accountable and Transparent Institutions for the Public Good
The session highlighted the interconnectedness of various stakeholders, including professional accountancy organizations (PAOs), supreme audit institutions (SAIs), and development partners, in fostering effective and transparent public institutions. The session underscored the importance of PFM reforms and the adoption of international standards in enhancing public sector accountability. By investing in professionalization and fostering long-term partnerships, stakeholders can ensure that public institutions are equipped to manage resources effectively and transparently. These efforts are crucial for achieving sustainable development and improving public trust in government institutions.
Public financial management reforms are essential for ensuring that public resources are used efficiently and transparently. Effective PFM systems contribute to better governance, accountability, and trust in public institutions. The adoption of International Public Sector Accounting Standards (IPSAS) plays a crucial role in improving the quality of financial reporting in the public sector. Accrual-based accounting, as promoted by IPSAS, provides a more comprehensive view of a government’s financial position, enhancing decision-making and accountability.
Mr.Srinivas Gurazada from the World Bank, presentation on the Public Expenditure and Financial Accountability (PEFA) framework, which assesses the performance of PFM systems across countries, revealed that while many countries have basic compliance with good practices, there is significant room for improvement, particularly in financial reporting. Transitioning to accrual-based accounting and implementing PFM reforms can be challenging due to the need for skilled personnel and requires the implementation of a robust information systems, and a supportive institutional culture.
Ms.Tsakani Maluleke, the Auditor General of the Republic of South Africa and INTOSAI CBC Chair, shared the experience of South Africa where local governments faced difficulties in meeting high accounting standards due to a lack of capacity and resources. She emphasized the importance of professionalizing the public sector accounting and auditing workforce. She shared the experience in South Africa which demonstrated the importance of long-term partnerships and continuous professional development are key to building the necessary skills and capabilities in public institutions.
The MOSAIC Forum highlighted the value of partnership-driven capacity building and the importance of sustainable public financial management in achieving accountability and transparency. By aligning with organizations like the World Bank, Gavi, and The Global Fund, IFAC and its partners aim to address current challenges in PFM and sustainability reporting, equipping public sector institutions with the standards, skills, and resources needed to serve the public effectively. Enhanced collaborations between PAOs, SAIs, and development agencies will continue to be fundamental in building resilient institutions capable of tackling evolving public sector challenges and promoting sustainable development globally.
