Audit management reports of public sector entities often reveal vicious waste and misuse of public funds.
Required:
Explain FOUR mechanisms established by government to ensure that public organisations practice value for money in public financial management. (4 marks)
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- Laws and Regulations:
To ensure economic use of resources and value for money various laws and regulations have been established by government to serve as productivity factors, related efficiency yardsticks and prescriptions to prevent misuse of public funds and ensure value for money. Among these are the Financial Administration Act and Regulations, and The Public Procurement Act. - Regulatory Bodies:
As an integral part of government financial operations, regulatory institutions have been established to ensure efficiency management, use of public moneys and resources, safety of public property, cost of services provided to the general public and quality of services provided by the private sector the public and to state entities. These regulatory bodies include the Ministry of Finance, Controller and Accountant General’s Department, The President and Cabinet, Parliament, Audit Service, Internal Audit Agency and a host of others. - Price Commissions / Commissions of Enquiry:
Sometimes price commissions and commissions of enquiry are appointed by the President to frequently review some public entities and state financial transactions to ascertain the use of public economic resources and value for money in public contracts. - The Budget:
Budgetary principles of financial control, transparency, public participation, and public accountability provide checks and procedures to prevent misuse of state resources and ensure value for money.