Financial Management and Control of the Public Sector in Ghana

Generally Accepted Accounting Practice (UK), International Financial Reporting Standards, Consolidated Fund



1.0 Background of the study
Financial management issue in the public sector has become focus of increasing attention in recent years. Financial management could be defined as series of processes consisting of the operations, maintenance of capital and assets, monitoring of performance particularly financial reporting on the state of the finances. (Local Government Information Digest –November 2000.) Financial management is seen in this text as being proactive in the use of financial and other information to actively manage the public sector enterprise to achieve goals and lay down objectives and not merely as the provision of financial information. (Coombs and Jenkins 1994)

Financial managers control the financial aspect of an organization by monitoring system and procedures to ensure that development coincide with plans. Proper financial management is of importance to firms. The following are some importance of financial management; * Proper financial management ensures that each every staff is accountable to someone. * It enables an organization to utilize its revenue or income efficiently. * It enables an organization to eliminate waste in its revenue or income generation and disbursement. Financial managers performs various functions such as allocate funds to current and non-current assets, obtain the best mix of financing alternatives and develop an appropriate dividend policy within the firms objectives.

Public sector is that part of the economy that is significantly dominated by the central government. Public sector organizations include all organizations that are not privately owned and operated. In public sector organizations the individuals have no equity interest. The public sector is made up of diversely differing organizations. The diversity stems mainly from the differing objectives of these organizations. There are those...
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