New development: Integration of budget and governmental accounting in Mexican states

ABSTRACT

Mexico recently introduced an accounting–budgeting framework compatible with the International Public Sector Accounting Standards (IPSAS). This article discusses the implementation of this framework, including the harmonization of information for the functional, administrative and economic budget categories for all Mexican states and for Mexico City. The author analysed public accounts and budgets prepared under the framework’s information requirements, as well as assessing the harmonization of accounts between the local, state and national levels of government. The results show an increase in both the amount and the harmonization of the public expenditure information being reported. This paper contributes to the literature of harmonization between financial reporting and budgeting processes (Dabbicco, G., & Mattei, G. (2020). The reconciliation of budgeting with financial reporting: A comparative study of Italy and the UK. Public Money & Management, 1–11).

IMPACT

Good financial information is necessary for the supervision and accountability of public officials. In developed countries, budget information is considered a protection from wastefulness and corruption. By analysing how budget information at the local, state and national levels in Mexico is presented by the corresponding authorities, and by assessing how harmonized this information is across the Mexican states, this article updates practitioners regarding the quality of governmental financial information and the ‘best practices’ in the country. In addition, the article is a key resource for stakeholders working on government accounting reforms in developing countries.

KEYWORDS:

• Accountability
• government policy and regulation
• Latin America
• Mexico
• public expenditure
• public sector accounting
• state and local government

Disclosure statement

No potential conflict of interest was reported by the author(s).