Search results

Will implementation of GASB Statement 34 induce the adoption of cost-accounting models in local governments? The authors address that question based on the findings of a national survey of local and county finance officers. Findings suggest that while finance officials recognize that GASB 34 will prompt greater accuracy and transparency in financial reporting, it may not serve to propagate greater utilization of activity-based costing (ABC) or its derivatives. Possible explanations may include feared impacts of increased cost accounting transparency as well as limited perceived payoff for investments in ABC-related tools. The authors acknowledge that this is a baseline “read” of attitudes; continued experience under GASB 34 may crystallize attitudes and lend greater support for future implementation of private-sector based- accounting methods.

This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the audited end of year financial reports for thirty midsized US cities. The analysis focuses on whether and how quickly and how extensively revenue and spending directions from past years are altered by recessions. A seven year series of Comprehensive Annual Financial Report (CAFR) data serves to explore whether citiesʼ revenues and spending, especially the traditional property tax and core functions such as public safety and infrastructure withstood the brief 2001 and the persistent 2007 recessions? The findings point to consumption (spending) over stability (revenue minus expense) for the recession of 2007, particularly in 2008 and 2009.