Better Accounting Can Get Us Through the Pandemic
A more complete view of a country’s fiscal health can help governments build public trust, generate revenues and even save lives.
Jacinda Ardern and her team were set up to succeed.
Photographer: Phil Walter/Getty Images
The Covid-19 pandemic has revealed just how much governments matter — and that competent management can be the difference between life and death. Good leadership requires good information to support smart, timely decisions. Further, democracy itself relies on information that is understood and trusted by its citizens. High-quality accounting is a vital source of that information.
In the fight against the coronavirus pandemic, while most governments debate how much debt is sustainable and what fiscal measures should be used to measure it, countries like New Zealand are deploying the fiscal measures that make sense on the basis of a proven technology: accrual-based accounting. This method underpins financial decision-making and reporting in the private sector — and has contributed to the wealth many enjoy today.