Conference Publication Details
Mandatory Fields
Turley, G., Robbins, G., and S. McNena
Irish Accounting and Finance Association
Assessment of the Financial Performance of Local Government: A Proposed Framework
Optional Fields
local government, performance measurement, financial indicators, Ireland
Assessment of the Financial Performance of Local Government: A Proposed Framework Abstract A framework to assess the financial performance of local governments is presented in this paper. The framework adapts and extends an earlier methodology used by Carmeli (2002) and includes new financial performance measures reflecting considerations in the literature of appropriate financial performance measures for local government units. Using 14 indicators, five broad financial performance measures are employed, assessing liquidity, autonomy, operating performance, collection efficiency and solvency. We apply this numerical and narrative analysis of key financial performance indicators to Irelandís primary local authorities during both the recent boom and bust period. The framework addresses concerns underlying calls for increased accountability and transparency of public sector organisations as part of NPM reforms. It allows citizen users to more easily interpret and compare the financial performance of their local authority with others facing similar financial conditions. We recommend the adoption of this framework as an extension to the annual financial statements of local authorities to help users more easily assess financial performance and to distinguish between relatively well-performing councils and those showing signs of financial trouble, with a view to early identification of councils in financial difficulty.
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