PracticeConsultingPUBLIC SECTOR – ’80 years’ of training prepares MOD for resource

PUBLIC SECTOR - '80 years' of training prepares MOD for resource

More than 30,000 training days have been spent preparing staff at the Ministry of Defence alone for the introduction of resource accounting, writes Gavin Hinks. Officials at the Treasury said the estimated figure – equivalent to more than 80 years – could be far short of the real figure and added it was impossible to estimate the total cost of introducing the accounting method. However, they confessed that the enormity of implementing the new method had gone beyond expectations. ‘It’s been a bigger task than anybody envisaged. It has been incredibly beneficial,’ said one official. From 1999/2000 the method, designed to bring government in line with commercial accounting practices, will be used to produce shadow accounts with full replacement taking place in 2001/02. Accounts will not include non-cash elements such as depreciation, capital charges and provisions, until 2002. This gives officers time to gain experience with new concepts. Resource accounting will see the government producing balance sheets with the equivalent of profit-and-loss accounts. The Treasury hopes to achieve better measurement of the economic costs of government work by including non-cash costs; allow the cost of capital projects to be spread over their lives; and require departments to report on how resources are allocated.

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