Question

Explain in your own words why accountability is the cornerstone of all financial reporting in government.

Answer 1

Solution:-

Accountability is the cornerstone of all financial reporting in government due to the fact that it is the primary aspect and the central factors that help government to build trust with their constituents and enable non-for profit, such as charitable organizationand government entities to shape their accounting and reporting practices. When these entities are able to show accountabilities, they become trustworthy. Accountability helps build better communities because funds are being used for the purpose for which they were generated. Citizens are able to trust their government, derby opening new doors of opportunities for both government entities, the community they are governing and the citizens they are serving. For example, when government and non-profit entities could show accountabilities for donated funds, it creates new opportunity for inflow of donated funds. Likewise, if they are able show how tax dollars are being spent, citizens are more willing to pay their taxes in order to help government meets their objectives.

Accountability requires the government to answer to the citizens by providing justification on increasing taxes to increase resources. How can citizens trust anyone if they aren't held accountable? How do you know that your tax dollars go towards city improvements and not the Mayor's salary? By public disclosing their financial reports this creates a level of trust between the citizens and the government. Also by publicly disclosing the financial reports allows users to compare actual results to budgeted results, results of operations and financial position, determine compliance with laws, and evaluate the effectiveness of operations.

Accountability is based on the belief that the citizenry has a "right to know" about public resources raised during a fiscal period and the purposes for which the resources were used. In a democratic society, public officials have an obligation to be accountable to the public.