Q1.

One important pillar in Public Financial Management is accounting and financial

reporting, according to the Public Expenditure and Financial Accountability (PEFA)
Framework of 2016. The pillar has three indicators with ten dimensions scored using the
Weakest Link Method (M1) and Average Method (M2).

The information below relates to the scoring of accounting and reporting pillar for Ghana
in the 2019-2020 PEFA Report.
Pillar (P1-07) Accounting and Financial Reporting
Indicators/dimensions Descriptions Score
Indicator 1 (P1-07.1) Financial data integrity To be determined
Dimensions (M2) Bank account reconciliation D
Suspense accounts D
Advance accounts A
Financial data integrity process C
Indicator 2 In-year budget reports To be determined
Dimensions (M1) Coverage and comparability of reports B
Timing of in-year budget reports C
Accuracy of in-budget reports B
Indicator 3 Annual financial reports To be determined
Dimensions (M1) Completeness of annual financial report C
Submission of reports for external audit B
Accounting standards D

Required:
i) Distinguish between the weakest link method and average method of scoring the
performance indicators. (3 marks)
ii) Compute the score for each of the three indicators using the appropriate method of scoring
and interpret your result. (5 marks)
iii) Suggest TWO (2) ways the government can improve its performance in indicator 3: Annual
financial reports.

Q2. Since the creation of Atuum District Assembly (ADA) in 2011, inadequate revenue
mobilisation has been its major challenge making the Assembly unpopular. The newly
appointed District Chief Executive (DCE) is concerned about the effectiveness of the revenue
budget system of the Assembly.

Below is the extract of the Revenue Budget of the Assembly for the 2021 financial year.
Revenue Annual Budget Actual to March
GH¢ GH¢
Licenses 880,000 244,000
Fees and Miscellaneous charges 3,400,000 890,000
Investment income 600,400 178,000
Property rate 5,400,000 1,310,000
Basic Rate 750,000 120,000
Grants and donations 1,000,000 320,000

The budget allocation over the various items over the quarters is in the ratio of 3:3:2:2. The
DCE indicates that the budget reliability measures of Public Expenditure and Financial
Accountability (PEFA) are ideal for assessing the budget performance of the Assembly. In
the framework, the following interpretation is given to budget outruns:
Outturn/variance not greater than 5% is scored as A, indicating very good budget reliability
Outturn higher than 5% but not exceeding 10% is scored B, indicating good budget
reliability.
Outturn higher than 10% but not exceeding 15% is scored C, indicating average budget
reliability.
Outturn higher than 15% is scored as D, indicating poor budget reliability.
 Note that each revenue item is treated as an indicator under the PEFA framework.

Required:
i) As the Budget Officer, prepare the statement of budget performance for the first quarter of
the 2021 financial year, indicating clearly the outturn percentage and the respective scores.
(5 marks)
ii) Write a report to the DCE on the budget performance of the Assembly and suggest ways
of improving the budget reliability of the Assembly. (6 marks)

Q3. Government Of Ghana’s Performance of PEM Dimensions for the 2018 PEFA Assessment
Report Are as Follows:

INDICATOR/DIMENSION METHOD DESCRIPTION SCORE FOR OVERALL

OF DIMENSION SCORE (TO BE
SCORING DETERMINED)
P1-13 Debt Management
M2 Recording And Reporting C
of Debt and Guarantees
Approval Of Debt and D
Guarantees
Debt Management B
Strategy

P1-19 Revenue Administration

M2 Right And Obligation for A
Revenue Measures
Revenue Risk D
Management
Revenue Audit and D
Investigation
Revenue And Monitoring D

P1-30 External Audit

M1 Audit Coverage and B
Standard
Submission Of Audit B
Reports to The Legislature
External Audit Follow-Up B
Supreme Audit Institution A
(SAI) Independence

A country performance of PFM dimensions are as follows:

a. For the Accounting for Revenue indicator, a score of C, B and D were obtained on three
dimensions. This indicator is measured using Method 1(Weakest Link).

b. Procurement as an indicator of PFM performance was measured using three dimension and the
scores obtained are A, C, B and D. This indicator is measured using method2 (Average
Method).

c. The Fiscal Risk Reporting indicator was also measure using four dimensions and score of D, C
and C were obtained. This indicator is measured using the method 2 (Average Method)
Required

Compute the score of each indicator in (A), (B) and (C) for the country and interpret the results