Introduction to Public Financial Management Explained | Summary Guide for Accounting Officers | PFM

a government can only fulfill its mandate of service delivery to the public when its finances are properly managed in essence better financial management leads to better utilization of government resources which in turn results in proper service delivery to the public in this video we will provide a summary into the introduction to public financial management as well as some of the general responsibilities of an accounting officer in relation to public financial management according to the pfma and the mfma [Music] welcome back to public administration 101 proudly brought to you by carno consultants for professional advice you can trust this video forms part of our series in public finance management this is where we aim to provide you with a clearer view and a basic understanding of public finance management within the south african context as indicated in this video we will provide a summary into the introduction to public financial management by first defining what we mean by public financial management we will then discuss the objectives of public financial management we will further list the various segments of public financial management we will also mention and explain some of the concepts one may encounter when dealing with financial management in the public sector we will then discuss some of the general responsibilities of an accounting officer according to the pfma and the mfma in relation to public financial management interdepartmental transactions debt management banking and cash management unauthorized irregular and wasteful expenditure gifts sponsorships and payments safeguarding of accounting records and we will conclude by discussing how the proper financial management in the public sector is closely linked to service delivery before we get into today's video we would like to remind you to please check out our other videos on public administration under this channel also remember to support the channel by clicking on the subscribe button and don't forget to like this video you can also engage with us by leaving us a comment below this video now let us get into today's video [Music] as a starting point what do we mean when we refer to public financial management public financial management or pfm relates to how the resources which are available to the government are utilized and accounted for public financial management essentially focuses on the prioritization and use of scarce resources as well as on ensuring effective stewardship over public money and assets and lastly on achieving value for money in meeting the objectives of government that is rendering the best possible service delivery to the public in the next section we will discuss the objectives of public financial management which are to ensure the efficient and effective use of public resources to maximize the government's capacity and capability to deliver services and to reduce fraud corruption and wasteful expenditure according to the guide for accounting officers issued by the national treasury financial management in the public sector can be linked to the following accounting functions supply chain management expenditure management control accounts and suspense accounts as well as revenue collection and revenue management for more on each of these segments please check out our future videos for now please check out this video on revenue management under our channel this is a good time to remind you to subscribe to our channel for more content and make sure that you turn on the notification button so that you don't miss out when we post new videos now back to the video under the following section we will list and explain some of the concepts and terminologies one may encounter when dealing with financial management in the public sector the following other concepts we will focus on as part of this video the first concept is standard chart of accounts commonly known as scoa which refers to a list of accounts in the accounting system that is used to properly classify record and report for the main purpose of constructing management reports and financial statements the next concept is expenditure management which is all about developing standard operating procedures to manage expenditure effectively and efficiently for all categories of expenditure the following concept is revenue management which is essentially the process of identifying collecting recording reconciling and safeguarding of revenue the last concept we will deal with is suspense accounts which is basically a temporary account utilized when there is insufficient information available to correctly identify the relevant account or in the case of timing differences or similar reasons in the following few sections we will discuss the general responsibilities of an accounting officer according to the pfma and the mfma one of the general responsibilities of an accounting officer is to ensure that the department or municipality has and maintains effective efficient and transparent systems of financial and risk management and internal control the next general responsibility of an accounting officer is in connection with inter-departmental transactions an accounting officer must ensure that a service level agreement is entered into and signed for all inter-departmental transactions prior to any goods or services being acquired interdepartmental transactions arise when one government organization provides a good or service towards or for another department for a fee or on a cost recovery basis or even for free the next general responsibility is in connection with debt management the accounting officer must have appropriate processes to manage debtors this will include the management of staff debts for overpayment of salaries breach of bursary debts overpayment to suppliers rental of buildings and rendering of services the next general responsibility of an accounting officer relates to banking and cash in terms of banking and cash management each government department or each municipality must open and maintain a primary bank account in the name of the respective department or municipality and all monies received by such government department or such municipality must be paid into its bank account and managed in terms of the act the next general responsibility of an accounting officer is in connection with unauthorized irregular fruitless and wasteful expenditure the pfma and mfma also requires that an accounting officer of a government department or an accounting officer of a municipality must take all reasonable steps to prevent unauthorized irregular and fruitless and wasteful expenditure to find out more about unauthorized irregular and fruitless and wasteful check out these videos under our channel where we explain these expenditures and the processes to be followed when such expenditures has occurred and is discovered another responsibility of an accounting officer relates to the management of gifts sponsorships and payments an accounting officer must maintain a register of all gifts donations sponsorship made in cash and in kind and disclose such gifts donations sponsorship in the financial statement to explain these terms a gift is something given willingly to someone without any source of payment while a donation is something that is given to a charity especially a sum of money or tangible or intangible items and lastly a sponsorship is when the department pays for contributes to the costs involved in staging an event such as sporting artistic or charity event in return of advertising the last responsibility that we will deal with is the safeguarding of accounting records an accounting officer is required to keep and maintain full and proper records of the financial affairs of the department or the municipality in accordance with the prescribed norms and standards in conclusion one of the core mandates of government is the provision of service delivery this can only be achieved through the effective and efficient management of public finances in essence better financial management equals better utilization of government resources which in turn results in the proper service delivery to the public this video was proudly brought to you by kano consultants for professional advice you can trust for more videos on public finance and public administration make sure that you subscribe to our channel you can also connect with us by following us on social media at consult carno or engage with us by leaving us a comment under this video or you can tag us on social media using the hashtag consult kano until next time check out these other videos and don't forget to join us again next time for another video [Music]

Channel: Kano

Views: 20,292

Keywords: public financial management, public management, finance management, public finance, budget management, local government, public employee, public administrator, public administration, public sector, finance, government finance, governance, public, online learning, government, government policy, budget cycle, n4, n5, n6, scoa, pfma, Accounting Officer, mfma, revenue, tvet, PFM, Study, Masters, Unauthorised Irregular and Wasteful Expenditure, municipality, Public Finance Management

Id: RI5TF5uTdeo

Length: 11min 32sec (692 seconds)

Published: Fri May 13 2022