Topic: Public expenditure and financial accountability framework

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PSAF – Nov 2024 – L2 – Q5c – Functions of the State Interests and Governance Authority

Explains four functions of the State Interests and Governance Authority (SIGA) in overseeing state entities.

Question

The Nine Hundred and Ninetieth Act of the Parliament of the Republic of Ghana entitled the State Interests and Governance Authority Act, 2019 was established to oversee and administer state interests in state-owned enterprises, joint venture companies, and other state entities and to provide for related matters.

Required:

Explain FOUR functions of the State Interests and Governance Authority (SIGA).

Answer

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Topic: Public expenditure and financial accountability framework
Series: Nov 2024

PSAF – Nov 2024 – L2 – Q5b – Nolan’s Principles of Public Life

Explains four of Nolan’s Seven Principles of Public Life, which guide ethical behavior in public office.

Question

Nolan’s Seven Principles of Public Life serve as guidelines for ethical behavior in public service. They are not typically enforceable through direct legal actions; instead, they often operate as moral and professional standards shaping the behavior of individuals in public office.

Required:

Explain FOUR of these principles.

Answer

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Tags: Accountability, Integrity, Leadership, Nolan’s Principles, Professionalism, Public Ethics, Public Governance, Public Service, Selflessness
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: Nov 2024

PSAF – Nov 2024 – L2 – Q5a – Public Financial Management Regulations

Explains the provisions in PFM Regulation 2019 for a Principal Spending Officer in the payment process and differentiates between misapplication and misappropriation of funds.

Question

a) The Public Financial Management Regulation makes the Principal Spending Officer (PSO) personally responsible for all payments of the covered entity. To mitigate possible risk exposure of the PSO during the payment process, the regulations provide guidance to assist approving authorities before signing off any payment.

In recent times, the Auditor-General has faulted PSOs for infractions such as misapplication of funds, misappropriation of funds, and partially accounted payments among others. Similar observations were cited in the 2023 Management Letter of Nipa Ye Municipal Assembly.

Required:

i) With reference to the PFM Regulation 2019, LI 2378, explain the provisions available to the PSO in the payment process before approval.

ii) Distinguish between misapplication of funds and misappropriation of funds as used by the Auditor-General with an example each.

Answer

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Topic: Public expenditure and financial accountability framework
Series: Nov 2024

PSAF – Nov 2024 – L2 – Q3b – Public Expenditure and Financial Accountability (PEFA) Assessment

Evaluate the financial performance of a local government based on PEFA assessment results and recommend strategies for improvement.

Question

Accounting and reporting constitute a key pillar of an organised and transparent public financial management system in the public sector. The effectiveness of accounting and reporting reflects the integrity of financial data, the accuracy of in-year budget reports, and the quality of annual financial statements. In a recent Public Expenditure and Financial Accountability (PEFA) assessment, a local government had the following results:

Annual financial reporting: D
In-year budget report: D+
Financial data integrity: C

Required:
i) Explain the assessment performance to the Municipal Chief Executive of the local government.
ii) Recommend two strategies for improving the performance of the local government in each of the assessed areas.

Answer

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Tags: Budget Reporting, Data Integrity, EFA, financial assessment, Financial Reporting, Local Government
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: Nov 2024

PSAF – Nov 2016 – L2 – Q2d – Public Expenditure and Financial Accountability Framework.

Identifying essential provisions of the Financial Administration Act to protect public funds.

Question

In Ghana, the government has enacted the Financial Administration Act, 2003 and the Financial Administration Regulations (L.I. 1802) to ensure that public funds and resources are properly safeguarded and are used economically, efficiently, effectively and with due propriety.

Required:
Identify TWO essential provisions of the Financial Administration Act and Regulations meant to protect public funds and safeguard public resources and property. (4 marks)

Answer

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Tags: Financial Administration, Financial Laws, Government Spending, Public Funds, Public Resources
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: NOV 2016

PSAF – Nov 2016 – L2 – Q2a – Public Procurement.

Explain the stages involved in the national competitive tendering process for public procurement.

Question

Competitive tendering is a method of public procurement that seeks tenders from all potential suppliers or contractors to achieve value for money in public procurement. Competitive tendering is carried out in accordance with the competitive tendering procedures under the public procurement law.

Required: Explain FOUR procedures involved in carrying out national competitive tendering for the procurement of goods, services, and works. (6 marks)

Answer

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Tags: Competitive Tendering, Financial Laws, Government Spending, Procurement Procedure, Public Procurement
Level: Level 2

Topic: Public expenditure and financial accountability framework, Public Procurement, Public sector financing initiatives
Series: NOV 2016

PSAF – Nov 2016 – L2 – Q3c – Public expenditure and financial accountability framework.

Discuss four policy objectives ensuring adherence to public accountability principles by government institutions.

Question

Public accountability requires clear definition of responsibilities of public officials and a clear understanding of relationships between public officials and stakeholders on the need for transparency and accountability.
Required:
Discuss FOUR policy objectives of government that ensure that government institutions adhere to the principles of public accountability. (4 marks)

Answer

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Tags: Governance, Government Institutions, Policy Objectives, Public Accountability, Transparency
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: NOV 2016

PSAF – Nov 2016 – L2 – Q4e – Public Expenditure and Financial Accountability Framework.

Identify four procedures necessary for effective management of public expenditure.

Question

Effective management of public expenditure is an essential mechanism for the effective allocation and the use of public funds to achieve the nation’s policy objectives.

Required:
Identify four procedures necessary for effective management of public expenditure. (4 marks)

Answer

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Tags: Financial management, ICAG, Procedures, Professional Level 2, Public Expenditure
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: NOV 2016

PSAF – Nov 2016 – L2 – Q3d – Public sector fiscal planning and budgeting.

Explain four methods used by the government to ensure compliance with budgetary control regulations.

Question

The budgetary control function ensures effective control over government units in public spending and accountability for all funds, property, and other assets for which each department or agency is responsible.
Required:
Explain FOUR methods used by the government to ensure that government entities comply with budgetary control regulations. (4 marks)

Answer

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Tags: Budgetary Control, Government Accountability, Public Financial Management, Public Spending
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: NOV 2016

PSAF – Nov 2016 – L2 – Q5e – Public expenditure and financial accountability framework

Discuss how the Controller and Accountant-General ensures public accountability.

Question

“There shall be appointed in accordance with Article 195 of the 1992 Constitution, a Controller and Accountant-General who is responsible to the Minister of Finance.”Required:
Discuss how the Controller and Accountant-General ensures public accountability. (3 marks)

Answer

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Tags: Controller and Accountant General, ICAG, Public Accountability
Level: Level 2

PSAF – May 2021 – L2 – Q3a – Public expenditure and financial accountability framework

Explain the objective of the PEFA framework, its uses, and the sources of information for PEFA assessment.

Question

The Public Expenditure and Financial Accountability (PEFA) Framework has gained worldwide recognition due to its contribution to public financial management discussions. It is one framework that has received acceptance across the globe.

Required:
i) Explain the objective of the PEFA framework. (2 marks)
ii) Discuss FOUR (4) uses or applications of the PEFA Reports. (4 marks)
iii) Explain FOUR (4) sources of information for the PEFA assessment. (4 marks)

Answer

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Tags: Financial Reporting, Framework Objectives, PEFA, PEFA Report, Public Financial Management
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: MAY 2021

PSAF – Nov 2020 – L2 – Q3 – Public expenditure and financial accountability framework | Financial statements discussion and analysis

Explain the PEFA framework, compute financial ratios for two countries, and analyze their financial performance and position.

Question

a) Public financial management is critical for the successful implementation of government policies and developmental goals. Public financial management is a linchpin that ties together available resources, delivery of services, and achievement of government policy objectives. The need to assess the extent to which public financial management systems operate led to the development of the Public Expenditure and Financial Accountability (PEFA) framework by a coalition of seven international development partners. Since 2001, the PEFA framework has received recognition across the world.

Required:

i) Explain the purpose of the PEFA framework. (3 marks)
ii) Explain the key pillars of an open and orderly public financial management system under the PEFA framework. (7 marks)

b) Country A and Country B are Sub-Saharan African Countries that attained independence around the same period. Presented below are the financial statements of the two countries:

Statement of Financial Performance for the year ended December 31, 2018

Description	Country A (GH¢ million)	Country B (GH¢ million)
Domestic Tax	26,450	17,000
International trade tax	18,200	21,330
Non-tax revenue	7,500	12,800
Grants	1,300	1,100
Total revenue	53,450	52,230
Compensation for employees	29,800	20,300
Use of goods and services	10,300	14,000
Consumption of fixed capital	240	280
Exchange difference	990	600
Interest	19,660	10,460
Subsidies	510	120
Other expenses	1,600	1,430
Total Expenditure	63,100	47,190
Net Operation Result	(9,650)	5,040

Statement of Financial Position as at 31 December 2018

Description	Country A (GH¢ million)	Country B (GH¢ million)
Non-Current Assets
Property, plant and equipment	2,450	22,400
Equity investment	8,000	5,500
Total Non-Current Assets	10,450	27,900
Current Assets
Receivables	6,700	8,400
Cash and cash equivalent	4,700	18,000
Total Current Assets	11,400	26,400
Total Assets	21,850	54,300

Description	Country A (GH¢ million)	Country B (GH¢ million)
Funds and Liabilities
Accumulated Fund	(80,200)	4,800
Current Liabilities
Payables	6,200	4,100
Trust monies	1,400	900
Domestic debt	16,000	4,500
Total Current Liabilities	23,600	9,500
Non-current Liabilities
Domestic debt	36,000	18,000
External debt	42,450	22,000
Total Non-current Liabilities	78,450	40,000
Total Funds and Liabilities	21,850	54,300

Required:

a) From the information provided, compute for the two countries respectively:
i) Grant to Revenue ratio
ii) Wage Bill to Tax Revenue ratio
iii) Interest to Revenue ratio
iv) Capital Assets ratio
v) Debt to GDP ratio
vi) Capital expenditure per Capita
(4 marks)

b) Based on the result in question (a), write a report discussing and analyzing the financial performance and financial position of the two countries. Include in your report the limitations of the analysis of the two countries. (6 marks)

Answer

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Tags: Financial Analysis, Financial Ratios, PEFA, Public Financial Management, Public Sector Accounting
Level: Level 2

PSAF- Nov 2023 – L2 – Q3a – Public Expenditure and Financial Accountability Framework

Explain PEFA framework outcomes, limitations, and pillars of PFM systems.

Question

The Finance Minister at a recent public forum on Public Financial Management (PFM) Reforms indicated in his address that the wave of PFM reforms in Ghana has continued throughout the last three decades. The PFM reforms have helped Ghana to attain notable PFM capabilities over the periods, including stronger legislative base and external oversight function. This is evidenced by the country’s improved performance in the 2018 Public Expenditure and Financial Accountability (PEFA) scores in these dimensions.

Required:

As the Head of Finance of your entry;

i) Explain the THREE (3) key outcomes of the PEFA framework. (3 marks)
ii) State TWO (2) limitations with respect to the scope of the PEFA framework. (3 marks)

iii) Discuss FOUR (4) of the broad activity areas (pillars) of the PEFA framework used in assessing the quality of Public Financial Management Systems. (4 marks)

Answer

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Tags: Fiscal Discipline, PEFA Framework, Resource Allocation, Service Delivery
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: NOV 2023

PSAF – Mar 2023 – L2 – Q3a – Public expenditure and financial accountability framework

Describes the scope and goals of the Public Expenditure and Financial Accountability (PEFA) framework.

Question

The Public Expenditure and Financial Accountability (PEFA) program was initiated in 2001 by seven international development partners: The European Commission, International Monetary Fund, World Bank, and the governments of France, Norway, Switzerland, and the United Kingdom. PEFA began as a means to harmonize the assessment of PFM across the partner organizations. It subsequently established a standard methodology for PFM diagnostic assessments, the PEFA framework. Since 2001, PEFA has become the acknowledged standard for PFM assessments.

Required:
Describe the scope and goals of the PEFA framework.

Answer

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Tags: Accountability, International Development, PEFA, PFM Assessment, Public Financial Management
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: MAR 2023

PSAF – Mar 2023 – L2 – Q1b – Public expenditure and financial accountability framework

Discusses the statutory roles of the Internal Audit Agency and Ghana Audit Service in public financial management.

Question

In its quest of deepening public financial management in Ghana, the Government of the Republic, supported by the Development Partners, launched a reform project in the year 2003, called Public Financial Management Reform Programme (PUFMARP). This programme produced, among others, two important legislations to regulate internal and external audit practice in the public sector. These are Internal Audit Agency Act, 2003 (Act 658) and Audit Service Act, 2000 (Act 584) respectively.

Required:
Enumerate THREE (3) statutory roles each of Internal Audit Agency and Ghana Audit Service.
(10 marks)

Answer

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Tags: Ghana Audit Service, Internal Audit, Public Financial Management, Statutory Roles
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: MAR 2023

PSAF – March 2024 – L2 – Q3 – PEFA Framework and Budget Performance Report

Discuss the benefits of the PEFA framework, sources of information for PEFA assessment, and the preparation and interpretation of a budget performance report.

Question

a) The Public Financial Management Regulation, LI 2378 defines Public Financial Management (PFM) as laws, rules, systems, and processes used by the Government to mobilize revenue, allocate public funds, undertake public spending, account for funds, and audit results. In 2001, a group of development partners initiated the Public Expenditure and Financial Accountability (PEFA) framework to assess the status of public financial management at central and local government levels. Since then, Ghana has subjected itself to periodic assessments in an attempt to improve the country’s PFM system.

Required:
i) Discuss FOUR (4) benefits the use of the PEFA framework can bring to a country. (6 marks)
ii) Explain FOUR (4) sources of information for PEFA assessment. (4 marks)

b) Budget Performance Report is one of the major accountability provisions under the Public Financial Management laws. Regulation 215(2) of the Public Financial Management Regulation, 2019, LI 2378 provides that each Principal Account Holder shall not later than 31 March of the ensuing year submit an annual budget performance report to parliament. The following is an extract from the GIFMIS platform representing Government of Ghana funding for the Ministry of Sanitation for the year 2023.

Budget Item	Annual Appropriation (GH¢’000)	YTD Warrant (GH¢’000)	YTD Payments (GH¢’000)
Compensation of Employees	25,500	18,280	17,450
Goods and Services	5,000	3,450	3,400
Capital Expenditure	8,780	1,220	550
Total	39,280	22,950	21,400

Required:
i) Explain the meaning of Annual Appropriation and YTD Warrant to the Principal Account Holder of the ministry. (2 marks)
ii) Enumerate TWO (2) issues that should be specified in the Annual Budget Performance Report to be submitted by the Principal Account Holder according to the Regulations 215 of LI 2378. (2 marks)
iii) Prepare a Statement of Budget Performance Report for the year 2023 showing the budget-warrant outturns and warrant utilization rates. (3 marks)
iv) Interpret the budget performance statement in (iii) above to facilitate the Minister’s upcoming meeting with the select committee of parliament as required under the law. (3 marks)

Answer

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Tags: Budget Performance, Financial Reporting, Government Accounting, PEFA Framework, Public Financial Management
Level: Level 2

PSAF – Dec 2023 – L2 – Q3a – Public expenditure and financial accountability framework

Explain the five components of the Integrated Framework of Internal Control System recommended by COSO.

Question

An effective internal control system is a prerequisite for addressing risks and providing reasonable assurance that the assets of an organization are safeguarded. It also contributes to the achievement of an organization’s control objectives. In line with this, the Committee of Sponsoring Organizations (COSO) of the Treadway Commission recommended five integrated internal control components to appraise internal control systems.

Required:
Explain the FIVE (5) components of the Integrated Framework of Internal Control System recommended by COSO. (10 marks)

Answer

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Tags: COSO, Internal Control, Public Sector, Risk Management
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: DEC 2023

PSAF – Nov 2018 – L2 – Q5 – Public Procurement

Discuss corporate governance issues in the public sector and best practices for PPP arrangements.

Question

a) Good corporate governance is an important way of ensuring accountability and value for money in the public sector.

Required:
i) State and explain FOUR (4) corporate governance problems in the public sector of Ghana. (6 marks)

ii) Discuss FOUR (4) principles of corporate governance that ensure effective accountability and value for money in the public sector. (6 marks)

b) Public-Private Partnership (PPP) is one of the strategies governments can adopt to bridge the infrastructure gap in developing countries. To account effectively for a PPP arrangement, best practices are recommended in executing the arrangements.

Required:
Discuss FOUR (4) best practices that ensure effective PPP arrangements in the public sector. (8 marks)

Answer

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Tags: Accountability, Best Practices, Corporate Governance, PPP, Public Sector, Value for Money
Level: Level 2

Topic: Public expenditure and financial accountability framework, Public Procurement
Series: NOV 2018

PSAF – Nov 2021 – L2 – Q3a – Public expenditure and financial accountability framework

Distinguish between the Weakest Link Method and the Average Method in scoring PEFA indicators and compute and interpret the results for three indicators.

Question

One important pillar in Public Financial Management is accounting and financial reporting, according to the Public Expenditure and Financial Accountability (PEFA) Framework of 2016. The pillar has three indicators with ten dimensions scored using the Weakest Link Method (M1) and Average Method (M2).

The information below relates to the scoring of the accounting and reporting pillar for Ghana in the 2019-2020 PEFA Report:

Pillar (P1-07)	Accounting and Financial Reporting	Score
Indicator 1 (P1-07.1)	Financial data integrity	To be determined
Dimensions (M2)	Bank account reconciliation	D
	Suspense accounts	D
	Advance accounts	A
	Financial data integrity process	C
Indicator 2	In-year budget reports	To be determined
Dimensions (M1)	Coverage and comparability of reports	B
	Timing of in-year budget reports	C
	Accuracy of in-budget reports	B
Indicator 3	Annual financial reports	To be determined
Dimensions (M1)	Completeness of annual financial report	C
	Submission of reports for external audit	B
	Accounting standards	D

Required:

i) Distinguish between the weakest link method and the average method of scoring the performance indicators.
(3 marks)

ii) Compute the score for each of the three indicators using the appropriate method of scoring and interpret your result.
(5 marks)

iii) Suggest TWO (2) ways the government can improve its performance in indicator 3: Annual financial reports.
(2 marks)

Answer

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Tags: Average Method, Financial Reporting, PEFA, Public Sector Accounting, Weakest Link Method
Level: Level 2

Topic: Public expenditure and financial accountability framework
Series: NOV 2021

PSAF – Nov 2018 – L2 – Q2a -Public expenditure and financial accountability framework

State and explain four ways to safeguard public financial resources under the PFM Act 2016.

Question

The Public Financial Management (PFM) Act, 2016 (Act 921) was introduced to ensure that public funds and resources are properly safeguarded and are used economically, efficiently, effectively, and with due propriety.

Required:
State and explain FOUR (4) ways in which public financial resources can be safeguarded under the PFM Act 2016.

Answer

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Tags: Financial management, Governance, PFM Act 2016, Public Financial Resources, Safeguarding
Level: Level 2