Guest editorialHappy endings and successful stories in public sector financial management: a lesson drawing perspective

In the last decades, the modernization and reorganization of public administration has involved several innovations in public sector financial management, with important developments, changes and reforms that have been implemented, both in developed and developing countries. This process of reform started under the umbrella of new public management (NPM), but, either with a similar or different direction to NPM-type reforms, it is still ongoing. Public administrations are continuously experimenting with new processes, systems and structures that aim to achieve effective and efficient management of public financial resources as well as transparency and accountability at different levels of government. Public management is endlessly adapting to the challenges and pressures faced by governments, such as globalization, new technologies or financial and economic crises. As Pollitt and Bouckaert (2011) point out, reforms are one of the most politically popular answers to crises and changes in the international and national field, and most likely this will also be the case with the crisis provoked by the coronavirus disease 2019 (COVID-19) pandemic (Cohen et al., 2021).

The reforms and innovations carried out are varied and include, among others, accrual financial reporting (Bergmann et al., 2019), the introduction of performance measurement and management accounting (Lapsley and Wright, 2004; Goddard and Simm, 2017), public sector auditing and control (Guthrie et al., 1999; Pollitt and Bouckaert, 2011) and, more recently, the use of new formats of reporting, such as sustainability or popular reporting (Manes-Rossi, 2019).

The literature has taken note of these processes of reform, and there is a research strand focusing on the study of changes and reforms in public sector financial management from different perspectives and for different countries, including comparative studies (Pollitt et al., 2007; Pollitt and Bouckaert, 2011; Brusca et al., 2015). However, there is not enough evidence that confirms whether these developments and reforms have successfully achieved the effective use of public sector resources, while the how and why are also unclear (Dan and Pollitt, 2015). After three decades of reforms and changes, it is also important to get to know the conditions that support public financial management innovations and the factors that can lead to positive and durable improvements. Further research is necessary to go beyond the reform processes and examine the assumptions, the outcomes and the impacts of the reforms, with a critical view to analyze the achievements as well as the unexpected consequences, the limitations and the shortcomings of the changes introduced.

The aim of this special issue is to address these topics by analyzing a handful of experiences that led to the successful implementation of reforms and innovations and identifying what contextual factors can favor these successful outcomes. The objective is to evidence the results of the reforms, which can be framed in the fourth state of research in public management reforms (Pollitt and Bouckaert, 2011), where both the final outcomes and the processes leading to outcomes are pivotal. Focusing on the process, insights about the variables and the factors that have contributed to the outcome can be spotted although it is sometimes difficult to isolate the effects of each variable on the results.

As public financial management covers different activities and tools, each paper in this special issue focuses on a specific area: accrual accounting and International Public Sector Accounting Standards–like (IPSAS-like) standards, the usefulness of financial information and performance information, and introduction of outsourcing in audit. Furthermore, the papers included in this issue address different countries and administrative systems. Methodologically, they cover qualitative and quantitative analyses; they use different methods for collecting evidence, such as interviews, observations and secondary data. This pluralistic view of areas covered and methods employed is a positive component in the evaluation process of previous experiences.

In this editorial, a lesson drawing perspective is adopted to revisit the reforms and experiences analyzed in the literature in different areas. We are not analyzing the reforms carried out, but the messages and lessons that the reforms have evidenced in the literature, referring both to successful and unsuccessful experiences. The importance of a reform is not only about the achievement of predefined goals, but also about the capacity to learn from the mistakes made. In this sense, the aim of this editorial is the evaluation of the lessons that can be learned from past reform experiences.

The paper unfolds as follows: The next section provides a literature review regarding the factors evidenced to be relevant for the successful implementation of public management reforms, especially under the NPM doctrine. Section three focuses on accrual accounting reforms and their contribution to management and accountability improvements. Section four explains changes in performance measurement and management accounting and how they work in practice. Section five discusses different research methods, highlighting that case studies can be a valid methodological approach to do research in public financial management. The last section provides some conclusions.

Public financial management reforms have been carried out around the world in the last decades under the philosophy of NPM and new public financial management (NPFM), aiming at increasing accountability of governments and at improving the efficiency and effectiveness of public management (Hood, 1994; Olson et al., 1998; Lapsley and Miller, 2019).

Nearly all the countries have experienced this type of reforms, with differences in time, speed, depth and scope, as well as in the tools adopted (Pollitt et al., 2007). The literature has critically examined the achievements, outcomes and impacts of the reforms, evidencing that the level of success and achievements of NPM reforms has been very different among countries (Olson et al., 1998; Pollitt and Bouckaert, 2011; Dan and Pollitt, 2015) although less is known about the reasons of the differences. Questioning why and how the reforms have – or have not – achieved the intended improvements is also important, as reforms are multi-faceted, and it is possible that some of their elements actually work while others do not (Pollitt and Bouckaert, 2011). Furthermore, it is complicated to value the level of reform success due to difficulties in disentangling the extent of changes in outputs due to the reform or the outcome producing process (Pollitt and Bouckaert, 2011).

The literature shows that there are differences among countries, which can be explained by the institutional, political, organizational and environmental context. Lapuente and Van de Walle (2020) summarize that the level of the success or the failure of a reform depends on its administrative, political and policy context, and Pollitt et al. (2007) highlight that it is also important to consider the coevolving developments and evolution of the context. Under this general assumption, it is also crucial to know what context can favor or inhibit the success of national experiences.

Hammerschmid et al. (2019) try to assess the impact of NPM-style reforms in 20 European countries on public sector performance on the basis of the perceptions of top public sector officials. The results show that customer orientation and flexible employment practices have a positive impact on four dimensions of performance: cost efficiency, service quality, policy coherence and coordination, and equal access to services. However, there is limited information about the reasons of the positive effect of these two types of reforms and even less about potential differences among countries.

Dan and Pollitt (2015) make a classification of the level of success of NPM reforms linked to the conditions in the following seven types: NPM reforms do not work regardless of administrative capacity and the type of context, NPM reforms do not work mainly because of insufficient administrative capacity, NPM reforms do not work mainly because of the unfitting context, NPM reforms do not work because of insufficient administrative capacity or unfitting context but reforms can still lead to certain positive effects, NPM reforms can have significant positive effects, but they can be hindered by the insufficient administrative capacity or unfitting context, NPM reforms work although they can lead to certain unintended consequences and trade-offs, NPM reforms usually or always work. The authors conclude that in the analysis of the literature about Central and Eastern European countries, there is no evidence of a complete failure or a complete success, and they highlight that the administrative capacity, the sustainability of the reforms over time and a “fitting context” are the more relevant factors to ensure the success of the reforms.

In developing countries, reforms started later and there are also mixed results. In some cases, the reforms have been promoted and encouraged by international organizations, such as the World Bank or the International Monetary Fund. By providing financial support to developing countries, these organizations influence their policies and, in particular, public financial management. International donors need to monitor the use of the resources, which would be easier done with the implementation of tools linked to NPM reforms. This was the case for example in some African countries, such as Ghana, Tanzania and Uganda (Wynne, 2005) where the reforms resulted in contradictory outcomes. In Cambodia, after some initiatives with low impact in public performance, a program of reform launched in 2004 shows successful results mainly thanks to the political will (Taliercio, 2009), the coordination between donors and government, and the formation of civil service.

The reforms have been also extended to Latin American countries, evidencing influence from Anglo-Saxon and European continental countries, where the reforms are still ongoing, and the level of success has been diverse. The experience shows that the gradual approach adopted in most countries needs to be more pragmatic, encouraging different actors, developing the necessary Information and communications technology (ICT) systems, and enhancing the capacity of a number of professionals (Pimenta and Pessoa, 2015).

The above experiences of reform implementation in developing countries have evidenced some key factors for success and have taught some lessons. In this vein Ouda (2018), based on the experience of public financial management reforms in less developed countries, highlights that success requires time, political commitment and public support, so reforms need to be embedded in and become part of wider public sector reforms. Sarker (2006) points out that in order to guarantee some positive results in NPM implementation, some preconditions are needed: a basic management infrastructure, an acceptable level of economic development and experience with markets, as well as a developed judicial system, since NPM principles are essentially market-oriented. Other factors that influence the success are included under the concept of state capacity, characterized by institutional, technical, administrative and political factors.

More broadly, having a clear vision of the changes to be introduced, and well defined plans, building internal support for change and overcoming resistance, ensuring top-management support and commitment, building external support (politicians and other stakeholders) and providing resources are all elements that favor the institutionalization of comprehensive change (Fernandez and Rainey, 2006; Fattore et al., 2018). The above confirms, as pointed out by Liguori and Steccolini (2014) that reforms must be adapted to the particularities of governments and public services, which can be applied both at the macro and micro levels.

Factors that can contribute to successful implantation of public financial management reforms at the macro level can be identified as political support and commitment to the reforms, the necessary professional skills (Pollitt and Bouckaert, 2011), the need for global change in public administration that involves how governments think and operate (Lapsley and Miller, 2019) and the existence of internal incentives (Bloch and Bugge, 2013). At the micro level, essential factors include government strategy, strong leadership, long-term political and management commitments, information communication technology, technical skills and experience, administrative capacity, strategic pre-decision and a plan of development, control mechanisms and accurate performance measurement (Alkaraan, 2018). This means that all these factors have to be considered to choose what reforms are feasible, independently of what reforms are desirable for a particular country or a particular organization.

Specific tools used in NPM changes, for example, outsourcing, may also affect the success of reforms. Johnsen in his contribution Organizing municipal audit: contracting out and audit costs in Norway included in this special issue, describes how the introduction of contracting out audit has eventually resulted in lower audit costs. In particular, municipalities that combined inter-municipal cooperation and contracted a private auditor achieved the lowest costs in audit. The author concludes that the effects of the reform in the provision of this professional service can be extended to other services in the public sector, and mixed methods can achieve better results.

Increasing accountability and transparency to restore citizens' trust was a paramount objective of NPM (Hood, 1994), and clear and publicly available financial reporting was considered the main tool for this purpose. Undoubtedly, the adoption of business-style accruals accounting was a keystone in NPM reforms. Anglo-Saxon countries, such as Australia, New Zealand and UK were leaders in this movement. Accounting standards were eventually based on business standards, while in some cases the same standards were, with some adaptations and changes, applied.

Some European continental countries followed this trend and adopted accrual financial accounting for central government or local governments (Brusca et al., 2015; OCDE/IFAC, 2017), but far from achieving a global convergence, there is a variety of models (Manes-Rossi et al., 2016) and a pluralistic mosaic characterizes public sector accounting. Furthermore, there are some intermediate scenarios for countries moving to accrual accounting and adopting gradual implementation going through modified accounting bases.

The undisputed importance of having internationally comparable information of public administrations led to the establishment of the International Public Sector Accounting Standards Board (IPSASB) to elaborate accounting standards for public sector entities, the IPSAS. The standards' aim is to enhance the comparability of financial statements around the world, as well as to improve the quality of general purpose financial reporting produced by public sector entities. Following the trend of Anglo-Saxon countries, these standards are based on international business standards (International Financial Reporting Standards – IFRS) issued by the International Accounting Standards Board (Bergmann et al., 2019).

Considered a useful tool for the harmonization of public sector accounting, IPSAS have been promoted by international organizations, such as the Organization for Economic Cooperation and Development (OECD) or the International Monetary Fund (IMF), which have also adapted their accounting reports and accounting systems to IPSAS. Although moving to accrual accounting is self-evident, it is also problematic (Lapsley et al., 2009) and heterogeneity exists not only among countries, but even among the different levels of government in the same country (Manes-Rossi et al., 2016).

Several authors have pointed out problems that the practical implementation of accrual accounting may pose and advise for careful adoption, so as to avoid limited success of accrual accounting or even “perverse outcomes” production (Wynne, 2005; Lapsley et al., 2009).

Among the shortcomings identified, the difficulties in the recognition and measurement of heritage assets, infrastructure assets or community assets can be highlighted (Arnaboldi and Lapsley, 2009; Lapsley et al., 2009). Difficulties in the measurement of assets and liabilities in the public sector when concepts and bases defined for the private sector are used have been raised in the literature (Caruana, 2021). In addition, the non-neutrality of accrual accounting, which gives room for accounting discretion and creative accounting, can result in earnings management (Cohen and Malkogianni, 2021).

In spite of the above difficulties, accrual accounting and IPSAS are promoted in the public sector (Brusca et al., 2015; OECD/IFAC, 2017; Bergmann et al., 2019), in order to improve accountability and transparency, as well as comparability among countries. For example, in Latin American countries accrual accounting has been mainly inspired by the IPSAS, and it is still in an ongoing process. However, changes related to the institutionalization of accounting offices, the professionalization of public financial management technical experts and the improvement of information on public sector assets are already evident (Gómez-Villegas et al., 2020).

In this journey toward accrual and comparable information, the European Public Sector Accounting Standards (EPSAS) project requires special mention. EPSAS aim at the development of a set of accrual accounting standards for comparable information in European Union member countries. The project started in 2013 and is still ongoing (Dabbicco and Steccolini, 2019; Polzer and Reichard, 2019; Manes-Rossi et al., 2021). While it has been decided that EPSAS will be based on IPSAS, there is still no final decision about the enforcement of the standards (Polzer and Reichard, 2019). Moreover, some European countries keep on being reluctant to accept the superiority of accrual accounting.

Furthermore, two relevant questions still remain unanswered, and they are hardly resolved (Arnaboldi and Lapsley, 2009; van Helden and Reichard, 2019). The first question is whether accrual accounting has achieved the desired objectives of efficiency, accountability and transparency for governments. The second one is even more important: who is using the accounting information and what is the level of its usefulness? (van Helden and Reichard, 2019). If the use and usefulness of accounting information are low, we should admit that the success of accrual accounting implementation is still inconclusive.

Looking at the impact of the accrual accounting system on the efficiency of public expenditure, the evidence is limited and sometimes controversial. Burth and Hilgers (2014) undertook an empirical study to analyze the benefits of accrual budgeting and accounting in German municipalities. They evidenced that intergenerational equity, transparency and efficiency are perceived as direct determinant factors of the benefits – albeit efficiency being perceived as a rather weak determinant of benefits – while the improvement in management capabilities is considered an important indirect factor. The results of Lampe et al. (2015) concerning German local governments in the state of North Rhine-Westphalia, testify a higher efficiency of the municipalities. Contrariwise, Dorn et al. (2019) show that the German local governments of Bavaria moving to accrual accounting do not show differences in government efficiency, public debt or voter turnout. In the same realm, Christofzik (2019) supports that the overall financial balance of German municipalities that adopt an accrual-based accounting system is not affected by the switch. Further research is necessary to confirm that accrual data provide better information, which is used in decision-making processes and results in the rationalization and increased efficiency of public services.

As for the results on a country level, in New Zealand, one of the pioneers in extending business accounting to the public sector, Laswad and Redmayne (2015) found that managers appear to be users of public sector financial reports, and that preparers of the reports believe that the benefits of accrual reporting exceed the costs; the income statement is the most useful statement, while the cash flows statement is considered of low value. In Switzerland, the results of Fuchs et al. (2017) support the use of accrual accounting information in decision-making processes, such as to achieve resilient government finances.

On the opposite side, in countries with a duality of financial and budgetary accounting systems, where budgets are based on cash or modified cash methods so that cash-based and accrual-based financial information coexist, cash reporting relegates accrual accounting information to a lower level (Cohen et al., 2013; Brusca et al., 2021).

The stakeholder group of politicians has lately received attention in research, and in most cases there is evidence that their use of accounting information is low due to its complexity, the lack of skills or because the information is perceived as incomplete and outdated (Caruana et al., 2019; Jorge et al., 2019)

There is also a strand of research focused on the reasons related to the low level of use of accounting information, evidencing the relevance of cultural factors (Pollitt and Bouckaert, 2011) and of the administrative system. The latter can lead to a mismatch between the accounting systems in place and the information required for decision-making and accountability (Cohen et al., 2019). Another contributing factor is the complexity that accrual accounting information has (Hyndman, 2016).

The experiences of countries adopting accrual accounting also provide some lessons to learn from. Firstly, accrual accounting is more than a technique, and some prerequisites seem necessary for its successful implementation. These preconditions include the definition of the objectives of the new system, an analysis of the framework and the starting point in areas such as the information technology (IT) systems, organizational changes in the process and flow of information, training of both the preparers of the financial statements and the users, especially managers, policy-makers and other stakeholders. In fact, training and accounting literacy of politicians and the enhancement of the role of institutional intermediaries that support politicians in the use of financial information for political debates are pivotal (Jorge et al., 2019). Another important issue is the development of a transition path, as accrual accounting implementation usually takes a long time. While the story starts with a set of accrual financial statements, it needs to be continued with improvements in the quality, timeliness or relevance of financial information (Cavanagh et al., 2016).

This brief review highlights that further evidence and research are necessary to better identify conditions and factors that can allow accrual accounting systems to positively impact on decision-making and transparency.

Two papers contained in this special issue fall within the accrual accounting sphere, still from different fronts. Soguel and Luta in their contribution On the road towards IPSAS with a maturity model: a Swiss case study, present the differences among the Swiss cantons in the journey toward accrual accounting by comparing their accounting maturity. The results show that the maturity level reached by each canton varies. The cantons show high heterogeneity while some remain reluctant to change. The core message is that there is an increasing overall compliance with IPSAS, and that the incremental approach and the flexibility pay off. Leaving public entities to move at their own pace resulted in a successful story. The authors argue that the empirical evidence gives room for optimism in relation to EPSAS as they support the idea that gradual and flexible implementation of EPSAS will increase the chance that they are accepted by member states.

The second contribution entitled Perceived usability of local government financial statements by local councillors: Comparative study of Finland and Germany authored by Haustein, Lorson, Oulasvirta and Sinervo, touches upon the issue of the usability of financial statements. The paper compares the usability of financial statements by councilors in Finland and Germany, showing that in both countries the assessment is positive, indicating therefore a successful reform process. Among the factors that influence the usability of financial reports by councilors, the authors highlight the size of the relevant local government, its debt level, the local councilors' gender, political orientation and education. However, the authors conclude that councilors need more assistance and training in using financial statements.

The introduction and diffusion of performance measurement and management accounting tools have received special attention under NPM reforms. The focus on results encompasses the use of performance and achievement measures. Management accounting and performance measurement systems are considered a useful tool to provide information for resource allocation, decision-making and management control support. Quantification is a core objective in such reforms, and as a result activity-based costing (ABC), total quality management, benchmarking, key performance indicators and balanced scorecard have become popular. There are important differences between countries not only in the implementation of performance measurement tools but also in the way they have been embedded in decision-making and strategic management (Pollitt and Bouckaert, 2011).

Lapsley and Wright (2004) show that in the UK such techniques are adopted mainly when the government obliges or pushes public organizations or when the organizations are required to produce cost efficiencies. The authors found that UK financial managers from different organizations positively assess costing information produced by ABC. A later study of Goddard and Simm (2017) confirms the use of ABC in UK local governments and its positive effect on enhancing strategic capabilities. In the Netherlands, ter Bogt (2008) provides evidence that the provision of cost information was not considered an effective management change. However, cost information creates awareness among civil servants and politicians toward cost, which can lead to a change in organizational culture.

Performance measurement, including among others key performance indicators or benchmarking, has also spread around the world under the understanding that producing information focused on outputs and results with respect to goals and objectives could be useful both for internal management and for accountability purposes. Institutional theory has been used to explain its implementation in many cases (Akbar et al., 2015), and the adduced advantages for planning, control and results evaluation have been highlighted in the literature, including potential positive impacts on citizens (Yang and Holzer, 2006) and employees (Sanger, 2008).

The study of Akbar et al. (2015) suggests that three main factors contributed to the success or failure of performance measurement systems in the Indonesian local governments: the implementation from the top and management commitment; the capacities, in particular the skills of human resources; and the motivation.

A positive lesson learned from the above experiences is that the introduction of management accounting and performance measurement permits stakeholders' awareness regarding the cost of services and requires entities to define objectives and goals, which is the first step for proper management. Among the issues relevant to successful implementation of performance measurement systems, the motivation of top managers and public employees to implement and use the system, the commitment of political leaders and the involvement of citizens in the process can be highlighted (Sanger, 2008). However, the introduction of these systems can also have some unintended consequences, such as the generation of extra costs for monitoring (Pollitt et al., 2007), negative effects on the motivation, morale and behavior of public employees (Arnaboldi et al., 2015) or even negative influence on performance (van Thiel and Leeuw, 2002). Thus, caution is necessary.

There is still room for research in successful experiences of performance management systems to evidence how they operate and what the keys for their proper development are. Another controversial issue is the use of performance information in practice (Pollitt, 2006) and specifically its use by managers and stakeholders, where the literature is still scarce, and with contradictory results. For example, Charbonneau and Bellavance (2015) found that the municipal benchmarking regime mandated to the municipalities of Quebec was not used to the desirable level due to management unwillingness toward performance measurement. A more positive view was offered by Johansson and Siverbo (2009) for Swedish local governments, where evaluation involves comparative analysis among municipalities, which increases the usability of information. Saliterer and Korac (2013) analyzed the use of performance information by politicians and public managers in small- and medium-size Austrian local governments, evidencing that they use performance information more for accountability purposes rather than for internal management. The authors highlight that organizational culture is an important factor for the use of information by politicians and public managers. Furthermore, a managerial style that favors implementation can enhance the use of information by chief officials, although there is no clear evidence of the claim that the management style has an effect on the use of information for internal management purposes by mayors.

Sanger (2008) points out that success depends on the organizations themselves, on “the demand side”. Any effective use of performance measures by management requires strong and committed leadership, both from top-down and bottom-up perspectives. Personal attitudes, such as leadership motivation, commitment and personal skills of the top local politicians and managers (de Lancer and Holzer, 2001; Moynihan and Pandey, 2010), as well as the organizational culture (Moynihan and Pandey, 2010) are explanatory factors of the use of performance information.

The contribution by Rajala and Sinervo in this special issue, entitled The beauty of constructive culture: planting the seeds for widespread performance information use among councillors, addresses these parameters through a case study of a local government in Finland. Firstly, the authors summarize the literature on the factors affecting the use of performance information, identifying five broader categories: environmental factors, organizational factors, information, information providers and information channels. Secondly, they present a positive case that shows how politicians use performance information when they discuss the performance of the local government in a complex political environment. The results highlight that a dialog culture, constructive political climate, trusted information sources and high-quality accessible information can explain the successful use of performance information by politicians.

Public financial management research has taken advantage of the different research methodologies of social sciences in the exploration of reforms and changes implemented in organizations, testing theories and propositions and analyzing research questions. As van Thiel (2014) points out, public management research has some features that must be taken into account when these methods are applied. Literature on management and accounting research methods reveals that surveys and archival or desk research (including descriptive and normativity studies or statistical analysis of secondary data) are the most applied, while field and case research, simulations and experiments, are less exploited. In each of these methods different approaches can be used to collect evidence and data (van Thiel, 2014), such as observation, questionnaire, interview, content-analysis (the most frequently adopted), meta-analysis or secondary data (covering both information disclosed by organizations or published data).

In this special issue, different methodologies have been used. The paper by Haustein, Lorson, Oulasvirta and Sinervo adopts an exploratory design, where data have been collected through questionnaires. In order to measure the maturity of the accounting system of the Swiss cantons, the paper of Soguel and Luta recurs to a combination of data sources: data about the implementation of the accounting have been collected via a questionnaire, while the design of the criteria for measuring the maturity level of Swiss cantons' accounting standards has been developed with the support of experts through interviews. Rajala and Sinervo analyze the use of performance information by politicians through a case study of a local government in Finland, where evidence has been collected through observations retrieved from the recordings of budget meetings combined with semi-structured interviews with local politicians. Finally, the paper of Johnsen contains a statistical analysis of data related to the organizational structure of audit and audit costs obtained through a questionnaire addressed to the municipalities in Norway, combined with secondary data.

The papers included in this special issue analyze the factors and interactions that can contribute to successful stories. Drawing inferences requires studying the process of change, the overall results and the outcome of the cases. Similar analyses can be applied to other organizations and levels of government or to different public management settings and contexts. This type of studies calls for research designs and methods that treat the possibility of approaching the cases in-depth and collecting different sources and types of information. Even if there is not a single method of research that can serve this purpose, and probably the combination of different methods could work, the case study method seems particularly useful (McNabb, 2010). In fact, the case study is particularly appropriate when research questions include the how and why, as this type of questions requires a longitudinal analysis rather than the mere analysis of frequency or incidence (Yin, 2009). Consequently, the use of the case study method for the analysis of the implementation of new tools and changes in public financial management can offer two important benefits: to take into account the context and permit flexibility in data gathering processes.

Public financial management reforms have been spread around the world in the last three decades, and different tools have been implemented in public administrations aiming at improving management and accountability in order to increase the efficiency of public services and the effectiveness of public policies. The reforms started under the NPM doctrine, but they have now been adapted to changing social and economic contexts. From this perspective, changes and reforms are still ongoing and public administrations are continuously innovating, introducing new tools and processes. The reforms and innovations cover several areas, such as accrual accounting and harmonization of accounting standards, performance measurement and management accounting.

The literature evidences positive outcomes from public financial management reforms in most economies, while some developing countries have experienced delays and cannot therefore offer clear evidence of a successful implementation of public management reforms – unlike the pioneer Anglo-Saxon countries. The relevance of contextual factors in the outcome of the reforms, both from a broad and from a micro perspective has been also pointed out. From a broad perspective, evidence indicates that the reforms need political and management support and commitment, training and professional skills, organizational changes, a strategic plan for development, control mechanisms and accurate performance measurement. Further research is necessary to understand the processes and variables that influence the achievements of expected results, as well as their unexpected consequences.

A particular reform spread around the world has been accrual accounting which in some cases is still in progress. Although there is a current debate about the outcomes of the reforms and the use of information, the literature shows that accrual accounting implementation has to go hand in hand with preparation actions targeting preparers of financial statements, managers, politicians, policy-makers and other stakeholders, including citizens. Another important issue is that a cultural change needs to be embedded in the decision-making processes. Future research can inform the conditions and factors that can actually transform accrual accounting systems into a successful tool for decision-making and transparency. This strand of research becomes even more relevant especially for Europe, under the prospect of harmonized accrual accounting standards meant to be used by the European member states.

Studies about the use of performance information have been also carried out in several countries, albeit coming up with contradictory results. Among the dimensions that can influence performance information use, environmental factors, organizational factors and information-related factors have been highlighted.

The four articles hosted in this special issue share interesting success stories and can be used as a basis for lessons to be learned in seemingly different areas. From a closer look, however, these at-first-sight heterogeneous topics all fall under the umbrella of public financial management reforms that can easily accommodate innovations in the audit market, the adoption process of accrual accounting standards, the usefulness of financial information for decision-making as well as the use of performance information for management in different countries and administrative systems. The methods used for obtaining empirical evidence also vary. Surveys, interviews, observations and secondary data have been properly employed to serve the purpose of these studies.

It is interesting that none of the articles in the special issue has touched upon new reporting formats, such as sustainability, integrated and popular reports. Nonetheless, this is an area of research that requires attention. We need success stories in this domain as well. We hope that more insights on these topics will become available as on the one hand, these new reporting formats gradually mature and become more commonly encountered, and on the other hand, scholars devote time in studying them in depth. Research in these evolving topics deserves full attention by scholars.

Some other gaps still remain, especially in public sector management accounting, where research is somehow scant. The case study method can help in better understanding the process that leads to the outcome of a particular reform, permitting in parallel the consideration of contextual factors. Case study research can be performed at all governmental and organizational levels: central, regional and local governments, health-care institutions, higher education and cultural organizations. In all of these settings, changes and reforms are nearly continuous and require reflections, systematization and suggestions by academics.

The core message sent by this special issue is that research about successful and unsuccessful experiences is important. It is important in an effort to understand the challenges faced by reforms and innovations, the substance of the actual achievements as well as the main contributing factors to the outcomes to draw useful lessons for professionals, governments, organizations or even countries.