ACCA Strategic Professional · Strategic Business Leader · Public sector governance
A government agency publishes a long annual report full of activity counts, such as the number of inspections carried out, but no information on whether safety outcomes improved or on spending against budget. Parliament complains it cannot judge value for money. What is the most appropriate recommendation?
The agency should report on economy, efficiency and effectiveness, linking spending and activity to the outcomes achieved. Activity counts alone show outputs, not whether safety improved or money was well used, so they do not give Parliament the value-for-money evidence it needs.
- AReport on the economy, efficiency and effectiveness of operations, linking inputs and outputs to outcomesCorrect
- BReplace the report with a press release summarising the year's achievements
- CReport only financial statements, as non-financial data is not relevant to public accountability
- DIncrease the number of inspections so the activity counts look stronger
Explanation
Public sector accountability is usually assessed through value for money: economy (cost of inputs), efficiency (output per input) and effectiveness (outcomes achieved). Activity counts show outputs only. Financial statements alone omit outcomes, and a press release reduces transparency.
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