Clear as Mud

Looks like there was good reason so many finance ministers said no to Summary Accounting.

This story started decades ago as successive Provincial Auditors pressured successive finance ministers and administrations to embrace what is known as Summary Accounting, arguing it would help citizens understand how government was managing our money. Now that we finally adopted the concept, it may be clearer to accountants but for the rest of us, it is anything but enlightening.

A prime example of the lacking clarity played out in the last week as the provincial government and the farm group APAS were engaged in a spat over comments regarding the latest fiscal update.

Summary Accounting includes monies accumulated through government authority but not actually available to the government to use on day-to-day expenditures….such as money collected from farm producers for crop insurance or from employers through Workers’ Comp. They are insurance pools, not general revenue…but this accounting process labels them as government money.

But this fight – where neither side is wrong – shows Summary Accounting to be an idea that is new but far from helpful and anything but transparent.