This presentation by Michal Svoboda was made at the 14th Annual OECD Public Sector Accruals Symposium, Paris 3-4 March 2014. Find out more at http://www.oecd.org/gov/budgeting/14thannualoecdpublicsectoraccrualssymposiumparis3-4march2014.htm

1. PUBLIC SECTOR FINANCIAL REPORTING
IN THE CZECH REPUBLIC –
TECHNICAL POINT OF VIEW
OECD Paris, France
March 3-4, 2014
Michal Svoboda
Head of unit
Department of Accounting and Audit
Ministry of Finance, Czech Republic

2. Pre-phase before 2010
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Several legal forms with their own rules and exceptions
Financial reporting for central government (since 1970´s)
Mix of cash and accrual base
Traces of chamber accounting
Lack of comparability, relevance, completeness, faithful
representation –
COULD NOT FIT ACTUAL USERS´ DEMANDS
Accountants insist on what their already know:
„why do you change something what has been
working well since decades?“

3. Initial phase
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2007 – Political decision on public sector accounting reform
• start in 2010
• both central and local governments involved
• more than 17 000 accounting entities
• Conceptual direction: IPSAS
2008 – conceptual rules set by the act on accounting
2009 – most of technical rules set by the decree
and standards
January 1, 2010 – START, some rules and methods
postponed up to 3 years – decreasing shock
Environment of continental European law system
– need for very detailed and in-depth rules

4. Conceptual issues
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Fully accrual based (pension benefits in following years)
statements of
• financial position, financial performance, changes in
equity, cash flow (indirect method now, direct in the
near future), notes
IPSAS not implemented, but very close to
Consolidation (multi-level) – pilot starts 2014
Financial statements approval – started 2013
• Accountability tool
• Pull in deputies and other representatives

5. Technical solution
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Central System of Accounting Information of the State
(CSSAI) – gathering of financial data
• Financial statements – quarterly
• Statistical reports – quarterly
• Operating data (central govt.) – monthly
• Budget statements – quarterly and monthly
Defined users of CSSAI:
• Central govt., esp. MoF
• Czech National Bank, Czech Statistical Office
• CZ SAI and other control bodies
• GENERAL PUBLIC
Defined interface (XML), NOT unique SW

6. Central System of State Accounting
Information (CSSAI)
CSSAI
ENTITIES
ENTRIES
Operational
reports
Central bank
reports
CR/DT Entries
Central
government
ALL ENTITIES
+ Entries for STAT
Local
government
+ Entries for
central bank
SIGINIFICANT
ENTITIES
Data quality
check
Reporting
area
Financial
statements
Statistical
reports
Regional
offices audit
Ministry
office audit
Public
portal
“Monitor”

7. Statistical reports (1)
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Effective since Q3/2012
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Reporting for Eurostat (ESA 95,…) and Czech National
Bank ensured using analytical accounts
– information obtained within making initial entries
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Reporting < 10 % of public sector entities,
but > 85 % of assets covered
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Significant change caused significant expenses
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Not only more reports, but a brand new system

8. Entities providing full range of records
as of Dec. 31st, 2012
TOTAL
Central Government
453
16 597
Local Government
TOTAL
17 050
as of Sept. 30th, 2013
TOTAL
Central Government
490
Local Government
16 563
TOTAL
17 053
PROVIDING ADDITIONAL ENTRIES
%
ASSETS COVERED [%]
no
79%
99%
360
5%
73%
896
1 256
7%
86%
PROVIDING ADDITIONAL ENTRIES
%
ASSETS COVERED [%]
no
490 100%
100%
937
6%
72%
1 427
8%
86%

9. Statistical reports (2)
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Direct connection between financial and statistical
reporting
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17 dynamical reports based on balance sheet and
P/L incl. related entities´ recognition and reporting
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almost no need for additional statistical
surveys and estimates
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no need for new semi-statistical financial
reporting standards to fulfill
STAT requirements

10. Data validity basis

11. Web application „Monitor“
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Portal for general public
Accrual next to budget data
Drill-down approach
„Duel“ – 1 to 1 municipalities´ KPI comparison
Open data compliant
Dynamical reports and analysis tool
(drag&drop pivot tables and charts, time series)
Available also in ENGLISH
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http://monitor.statnipokladna.cz/en

12. Further development
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Nowadays a routine operation
Step-by-step towards IPSAS, esp. towards IPSAS CFW
Broader and deeper education and methodological
support
Stress on publicity – general public incl. abroad
Getting known about further users´ information needs
Brand new webpage with all methodological and
technical info, also in ENGLISH, launch 2Q/2014
Uncertainty about EPSAS

13. Contact email:
michal.svoboda@mfcr.cz