Standard Setters Boost Performance Reporting Practices
Many citizens want to know what sort of progress their government is making on issues they care about: Is the community getting safer? Are the air and water getting cleaner? How well are the schools educating their children? Whatever the issues that concern them, they often have trouble cutting through the jargon and data tables that are a hallmark of many reports. It is with this in mind that the Governmental Accounting Standards Board (GASB) voted in April 2007 to add a project to its current agenda that could result in suggested guidelines for governments to help them effectively communicate their accomplishments to the public.
The GASB project is known as Service Efforts and Accomplishments (SEA) Reporting and has been a research project at GASB practically since the organization started in 1984. Now, the Board is positioning itself to act. Meanwhile, in Canada, the Public Sector Accounting Board (PSAB) has already acted by approving a "Statement of Recommended Practice" for this purpose.
"Suggested Criteria" for Performance Reporting Based on GASB Research
The SEA Reporting project is intended to help governments report to the public the measures they develop and use to gauge the outcomes they achieve in pursuit of their public policy goals. GASB’s SEA research produced a special report on "suggested criteria" for performance reporting in 2003, and a guide for users of performance reports in 2005. GASB's suggested criteria are not prescriptive. Neither these criteria suggested by GASB researchers nor the eventual guidance issued by the board will indicate what performance measures should be reported. Instead, the criteria are meant to help governments report compelling performance information citizens can trust in a user-friendly way. Criteria include:
- Giving citizens information about the reliability of the data, and
- Reporting measures of results that are relevant to the major goals and objectives of the government.
Several suggested criteria particularly support Effective Community Governance, including:
- Identifying who is involved in setting goals and objectives, including the extent of citizen involvement;
- Including information on citizen perceptions and satisfaction; and
- Providing multiple levels of reporting and multiple communication media to make it easier for citizens to find the information they want on the issues and services that most concern them.
"Helping governments effectively communicate what they believe are their most important accomplishments to constituents has been the focus of the GASB's research on SEA reporting," said Robert Attmore, GASB chairman.
In Canada, the PSAB Has Already Acted
While the GASB is only just moving from research to an active board project, in Canada, the Public Sector Accounting Board already issued a "Statement of Recommended Practice" (SORP) called SORP-2, Public Performance Reporting, approved by the board in June 2006. The SORP provides recommended practices for reporting performance information in a public performance report and is, like the GASB's suggested criteria, neither prescriptive nor a template. The SORP recommends, for example, that public performance reports:
- Provide information that appears reliable and valid;
- Describe the organization's strategic direction in the report;
- Compare actual to planned results and explain variances; and
- Describe lessons learned and key factors that influence performance.
In May 2007 the PSAB issued a Guide to Preparing Public Performance Reports [PDF] to help governments in Canada follow these practices. The guide introduces each recommended practice as a question and suggests features that would make it clear whether the practice has been applied or not.
AGA Awards Foster the Use of the GASB Suggested Criteria
To encourage U.S. state and local governments to use the GASB suggested criteria, the Association of Government Accountants (AGA) has established a program to help governments strengthen their performance reports and recognize, through a Certificate of Achievement program, the truly outstanding reports. Performance reports are evaluated on how well the government or other organization informs the public about its performance, consistent with the GASB's suggested criteria. Reviewers then award a Certificate of Achievement in SEA Reporting. The Fiscal Year 2006 winners were the Cities of Bellevue (Washington), Palo Alto (California) and Portland (Oregon); King County (Washington) Metro; King County Department for Natural Resources & Parks; and the Oregon Department of Transportation. As interest in the performance reporting grows, expect fiercer competition for the award in years to come.
A newer, related AGA program, the Citizen-Centric Government Reporting Initiative, is aimed at helping governments produce brief, attractive, easy-to-understand reports on government finances and service performance. In a pilot citizen-centric project, Portland, Oregon, became the first major metropolitan city in the U.S. to create a four-page summary of city finances and service performance, issued in May 2007 as the Auditor's Report to Residents [PDF].