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The purpose of this study was to investigate how senior accounting staff in Victorian local authorities are recording and reporting infrastructure assets (IAs) with their relevant depreciation in General Purpose Financial Reports (GPFRs) and the decisions made from this information. IAs are long‐lived assets such as roads, drains and bridges. The introduction of Australian Accounting Standard No. 27 Financial Reporting by Local Governments (AAS27), which applies to all Australian local authorities require IAs to be reported in the balance sheet and depreciation to be charged in the operating statement in order to reflect the loss of service potential in the operating period concerned. Before AAS27, the purpose of public sector accounting was to demonstrate that funds have been raised and expended strictly within the authority of the annual budget on a cash basis. The efficiency and effectiveness of decision‐making by users of this cash‐based information was impaired with this short‐term charge/discharge objective. The study was carried out to determine if information provided in an accrual accounting environment would be more efficient and effective for decision making by users than cash‐based information.

The study included a comprehensive literature review then interviews with 15 chief financial officers from Victorian local authorities. These authorities represented inner metropolitan, outer metropolitan, rural city, large rural and small councils.

The study reported the implications for change to accrual accounting method in accounting for IAs and the efficiency and effectiveness for decision making by both internal and external users. The question answered is whether the information provided by accrual accounting is used in the management of IAs. In some areas, it has been used and the benefits show from both an efficiency and effectiveness perspective. Concerns with this issue were identified by academics, parliamentary inquires, accounting authorities and local government interest groups.

This study is a comprehensive review of how senior local government accounting management are using the information generated from AAS27 on IAs and what value it has in their decision making.

Over the past decade Australian local government has undergone drastic change. The sheer pace of reform has made it difficult for practitioners and scholars alike to document and evaluate these rapid changes and even most recent extant analyses are now dated. Given the urgent need to review trends in Australian local government, this paper examines the recent programs of legislative, structural, workplace and financial reform.

The purpose of this paper is to answer the following questions: What are the theoretical and practical antecedents for recognising land under roads (LUR) as an asset in local government financial reports? Why was the process of regulating this aspect of accounting practice so protracted and so controversial?

The method used a critical analytical review and synthesis of relevant literature.

This study rejects the recognition of LUR, and suggests that the requirements to account for LUR should be withdrawn immediately. Regardless of the way that the debate has evolved as to the need or otherwise to value LUR or the methodology to be adopted, until the issue of a consistent, standards-based data set is addressed, there is unlikely to be a unified useful outcome.

The study’s findings provided opportunity to reach an overall conclusion and make policy recommendations regarding the saga of accounting for LUR by Australian local governments. However, the ability to generalise beyond Australia to other countries would need to be tested by additional research.

The study’s findings provided assessment of the impact of valuing LUR on financial reporting by local governments and suggested policy recommendations.

This study provided an understanding of Australian local governments’ accounting choices in regard to the valuation of LUR and documented the history of early adoption of valuation of LUR by local governments.

The literature on the public sector and accrual accounting is extensive and varied. However, there have been only isolated studies on the specific issue of LUR (Barton, 1999a, 1999b; Hoque, 2004; Rowles et al., 1998a, 1998b, 1998c, 1999). This study adds to the few isolated studies on the specific issue of accounting for LUR. Originality/value – This study provided policymakers with rich information about accounting for LUR and, it should have the capacity to impact on the future policy directions and recommendations.

The purpose of this paper is to explore the circumstances and implications of an episode of accounting change arising from the extended use of accrual accounting within the Australian public sector. The matter under scrutiny is the reporting of the library collections of Australia's public universities as assets in general purpose financial reports.

A survey is undertaken of the annual reports of Australia's 36 public universities for the period 2002 to 2006. The analysis of the findings is informed by new institutional sociology (NIS), with a focus on mimetic processes, and the concept of “accounting's margins”.

The survey reveals considerable diversity and subjectivity in the accounting practices adopted, as well as instances of sudden and dramatic changes in carrying values. The financial reporting of library collections is depicted as a “chaotic margin” of accounting, and the technical propriety of attempting to express and account for these non‐financial resources in financial terms is rendered problematic.

The study questions the reliability and usefulness of the information reported, with implications for the accountability of the institutions surveyed as well as the accounting profession in the comparatively neglected domain of the public sector.

Public heritage facilities – national parks, art galleries, museums and so on – are now required by professional accounting standards in Australia to be valued and included in government general purpose financial statements as assets. This study challenges the appropriateness of such an accounting treatment in relation to the SAC4 definition of assets and the purported usefulness of the information. Instead it is argued that these facilities are public goods, and that commercial accounting principles should not be applied to them. The article explains the nature and significance of public goods and how they differ from private goods. It explains why commercial accounting principles are irrelevant for public heritage facilities because their objectives are social rather than financial and why commercial valuations are irrelevant and unreliable if applied to them. Finally, it is contended that the facilities are assets held in trust for the nation by government and hence should not be included in its general purpose financial reports.

This paper aims to examine the conceptual arguments surrounding accounting for heritage assets and the resistance by some New Zealand museums to a mandatory valuing of their holdings.

Evidence was derived from museum annual reports, interviews and personal communications with representatives of the Institute of Chartered Accountants of New Zealand (ICANZ) and a range of New Zealand museums.

ICANZ's requirement that heritage assets be accounted for in a manner similar to other assets is shown as deriving from a managerialist rationality which, in espousing sector neutrality, assumes an unproblematic stance to the particular nature and circumstances of museums and their holdings. Resisting the imposition of the standard, New Zealand's regional museums evince an identity tied more strongly to notions of aesthetic, cultural and social value implicit in curatorship, than to a concern with the economic value of their holdings. Museum managers and accountants prefer to direct their attention to what they see as more vitally important tasks related to the conservation, preservation and maintenance of heritage assets, rather than to divert scarce funds to what they see as an academic exercise in accounting.

The paper points to some of the difficulties inherent in the application of a one‐size‐fits‐all application of an accounting standard to entities and assets differentiated in their purpose and essence.

Purpose – The aim of this paper is to examine whether there is potential for political parties to use flawed financial figures in performance measures designed to assist them in determining the viability and autonomy of New South Wales (NSW) local councils (NSW is the largest of Australia's eight states and territories). If in fact this is the case, then a mis‐match between the original objectives of the reform process (efficiency, effectiveness and accountability), current reporting practices and the manner in which decisions are made can be said to exist. Design/methodology/approach – Initial analytical analysis was carried out on all NSW local councils (170), followed by a more detailed study of 56 councils. The method adopted included archival research combined with interviews and case study analysis. Valuation and depreciation practices as applied to transport infrastructure assets were used as exemplars to investigate the study objective. Findings – Inconsistent asset value and depreciation practices were found to impact on key financial performance indicators included as part of the financial health check criteria which, in turn, were used by decision‐makers in their examination of a council's ability to continue as a viable going concern. Practical implications – Findings pave the way for future research to determine if any causal relationship exists between decisions regarding accounting for transport infrastructure assets and political policies current at the time. Originality/value – Very little research has occurred in Australia examining the accuracy of figures included in decision‐making. This paper lays the foundation for future research in other countries where local government reported figures are used in anyway by various stakeholders for political or other decision making.

In the past two decades, the public sector both in Australia and overseas has undergone a period of intense change. The focus has been on efficiency, effectiveness and value for money of public sector operations. The methods by which governments account and report on their operations has received scrutiny. While Treasuries and Departments of Finance in each Australian jurisdiction have traditionally formulated the reporting and accounting rules used in the public sector, since 1983, with the formation of the Public Sector Accounting Standards Board (PSASB), the accounting profession has become involved in the setting of accounting standards for the public sector. Several researchers have suggested that a “contest” exists between the accounting profession and the government regulators for control over the public sector accounting standards process. This paper explores the processes whereby the public sector in Australia formulates its financial reporting policies by examining the interactions between the PSASB and the government regulators in each of the Australian jurisdictions. Policy community and policy network theory are used to argue that policy is formulated by a “cooperative” grouping of accounting professionals from the central agencies of Treasuries and Departments of Finance and the PSASB. The paper concludes that this method of policy formulation has implications for the content of policy and for the access of stakeholders to the formulation of that policy.

Recently the inclusion of land under roads as an asset in financial reports by Australian local governments has led to several concerns arising from dissatisfaction with certain elements of the new accounting standards and concepts, particularly, the Australian Accounting Standard AAS 27 “Financial Reporting by Local Governments” and the Standard Accounting Concepts SAC 4 “Definition and Recognition of the Elements of Financial Statements.” These concerns have also meant that most local governments are opposing the recognition of land under roads as an asset for financial reporting purposes. With the inclusion of land under roads dominating the asset element of financial reports, the relevance and reliability of valuation of land under roads needs to be examined. Using an Australian case, this paper examines whether this information provides greater relevance and reliability to users. The paper suggests that, as lands under roads do not affect the Council’s economic position and this information has no value to the users of the information, there is no point in increasing the council’s financial reporting costs.