The actual implementation of accruals accounting: Caveats from a case within the UK public sector

Abstract

Purpose

To ascertain the principal benefits and drawbacks that have been experienced in implementing accruals‐based resource accounting in the UK public sector.

Design/methodology/approach

In a unique study, which presents case research of the Northern Ireland experience within the wider UK context, semi‐structured interviews were held with key actors involved in the implementation, maintenance or oversight of resource accounting in Northern Ireland. This paper looks at the operation of a newly introduced system through the eyes of those who are in a position to understand and evaluate the impacts (accountants).

Findings

It finds that the actual implementation of accruals accounting is very different, in effect, in cost and in terms of timing, to that presented in pre‐implementation government publications. The result is a complex, expensive system that has provided few benefits to date. What is found is a story of overoptimistic claims and obfuscation of costs. The very best that could be suggested from this research is that a lengthy continuum of accounting change is underway.

Research limitations/implications

This research is a case study within the wider UK public sector and therefore any generalizing of the conclusions beyond the Northern Ireland context should be undertaken with care. However, although Northern Ireland departments are relatively small compared with Westminster departments, there are significant similarities between the modes of operation of all departments within the UK (whether in Westminster, Scotland or Wales). Furthermore, both the implementation of resource accounting and the challenges that it presents are common to all public sector bodies in the UK.

Originality/value

Gives some thought‐provoking arguments into the benefits and drawbacks of implementing accruals‐based resource accounting in the UK public sector which will provide interest to those in the field.

Citation

Connolly, C. and Hyndman, N. (2006), "The actual implementation of accruals accounting: Caveats from a case within the UK public sector", Accounting, Auditing & Accountability Journal, Vol. 19 No. 2, pp. 272-290. https://doi.org/10.1108/09513570610656123

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