Dakar Conference : Financial Management Reforms Will Help Achieve the Africa We Want

6 November 2015
Content from a Premium Partner
International Federation of Accountants (New York)
press release By Mamour Fall, Asmaa Resmouki and Alta Prinsloo

Article 33 of the African Union Charter on Democracy, Governance and Elections states that: "African states shall institutionalise good economic and corporate governance through an efficient and effective tax system premised upon transparency and accountability."

Today, governments around the world fund public services through revenues largely comprised of taxes – whether from individuals, businesses or commerce. They are entrusted by citizens to implement and manage these public services in an effective and efficient way. This is a social contract spanning a multitude of governmental structures, which are expected fulfil this stewardship through transparent accounting practices that factor in revenue, expenditures, debt, inclusivity and macroeconomic stability.

It is in this spirit that, on 28th- 29th October, finance ministers, senior policymakers and public finance experts from 20 Francophone African countries joined with six international partners and accountancy professionals at a public financial management conference in Dakar, Senegal, to take stock of progress and tackle persisting challenges facing public financial management, and jointly recommended relevant reforms.
Cognisant of the need to enhance the governance of public resources for the benefit of all citizens, African states have taken key steps to optimise resource mobilisation and fight corruption, notably the African Union Convention on Preventing and Combating Corruption.

Several initiatives have been launched to give life to the spirit of the convention, including the work of the High Level Panel on Illicit Financial Flows from Africa, which concludes, among other findings, that such flows are large and increasing. According to some estimates, these flows amount to as much as US$50 billion every year, which is approximately double the official development assistance (ODA) that Africa receives. In the face of this challenge, more and more African countries are turning to public financial management reforms to optimise resource and revenue collection and allocation, public procurement systems, financial information provision, decision-making, budget preparation, service delivery, debt management as well as audit and control.

The Dakar conference underscored the need for transparency, accountability and control to provide an environment conducive to attracting investments, ensuring macroeconomic stability and spurring growth. To this end, the conference adopted a Call to Action that is aimed at accelerating the implementation of the six sets of WAEMU and CEMAC directives (adopted in 2009 and 2011 respectively). These directives are geared towards improving and modernising PFM, through the Transparency and Governance Code, Finance Act, Public Accounting Code, Government Chart of Accounts, Government Budget Chart, and Government Financial Reporting. The Call to Action envisions that this will be achieved as follows:

  • • Develop and implement a strategy to roll out these public sector standards in each country
  • • Implement these public sector standards by 2017
  • • Monitor, evaluate, and publicly report progress on an annual basis, with the first progress reports to be issued by 2018
  • • Take any corrective action on a timely basis

Why focus on the directives?

The journey towards enhanced financial reporting begins with governments committing to the implementation of internationally recognised financial standards that comprehensively capture their financial performance and position. The WAEMU and CEMAC directives are testament to this commitment and to the political capital already invested in the PFM agenda by member states of these regional bodies.

The critical question is therefore how to translate the directives into tangible legal and regulatory reforms that provide dividends for governments and citizens. This shall call for robust collaborative processes that involve the proverbial "village" of stakeholders, including governments themselves, development partners, the accountancy profession, intergovernmental organisations and most importantly, citizens.

It is therefore noteworthy that, in their response to the Call to Action, development partners attested that they shall follow the lead of governments by continuing to align and adapt their support to governments' PFM imperatives. Putting change into practice and fully integrating reforms across public processes are all the more daunting due to challenges such as capacity constraints and resistance from those who benefit from highly complex and deeply entrenched illicit financial practices in the public sector. Tackling these and other challenges will not be easy or cheap, but the outcomes will be worthwhile.

A community of action

The Dakar conference brought to the fore a critical element, which was also highlighted in the Call to Action: experience sharing within and across countries and stakeholders holds great potential to fast-tracking the learning process. As technocrats and policymakers from the various participating countries exchanged views, they also drew on each other's experiences.

In this regard, the Panafrican Federation of Accountants (PAFA), the Fédération internationale des Experts-Comptables Francophones (FIDEF) and the International Federation of Accountants (IFAC) have committed to continue fostering experience and knowledge sharing among their members on the one hand, and between their networks and governments on the other, with a view to learning from each other as equal partners in the journey towards better management of public resources. This also includes fostering south-to-south collaboration and learning, sensitisation of the accountancy profession and collaboration with all sectors of the economy.

Although their inputs were from their various vantage points, all the stakeholders agreed on one clear vision: Better management of public resources will give rise to a widening range of quality public services, sustainable economic growth, increased employment and, ultimately, a better opportunity to tackle poverty and inequality. It is in pursuit of this aim that they committed to galvanise their respective resources, expertise and perspectives in order to ensure that public financial management becomes ones of the pillars of the Africa We Want.

Mamour Fall is the president of the Fédération internationale des Experts-Comptables Francophones (FIDEF) - www.fidef.org

Asmâa Resmouki is the president of the Panafrican Federation of Accountants (PAFA) - www.pafa.org.za

Alta Prinsloo is the Executive Director & Chief Operating Officer, International Federation of Accountants - www.ifac.org

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