This Study considers the elements (types or classes of financial information) to be reported in financial statements prepared under the different bases of accounting that may be employed by national governments and their major units and the way in which those elements may be defined. It also considers the implications of reporting particular elements, or subsets thereof, for the messages communicated by financial statements and the achievement of the objectives identified in Study 1.

The scope of the study is to consider:

This occasional paper aims to inform readers about a range of perspectives on accrual accounting from a number of contributors who have experience in implementing this accounting reform or who have observed its progress.

This paper describes the role played by the Audit Office in the development of the Financial Statements of the Government of New Zealand. The paper explains the role of the Audit Office in New Zealand and analyzes that role in terms of fundamental audit characteristics such as independence, criteria (in particular, accounting practices to provide a true and fair view in the absence of relevant accounting standards) and evidence. The audit and management processes involved in auditing the Financial Statements of the government of New Zealand are described.

The New Zealand public sector experienced major reform in the late 1980's and early 1990's. This reform changed public sector management from a system based on compliance with detailed and restrictive rules and budget cash limits to a performance and accountability-based regime. This paper focuses on the move by New Zealand government departments from cash to accrual accounting, and the project to produce the first set of Financial Statements for the Government of New Zealand.