top of page
Asian Institute of Research, Journal Publication, Journal Academics, Education Journal, Asian Institute
Asian Institute of Research, Journal Publication, Journal Academics, Education Journal, Asian Institute

Economics and Business

Quarterly Reviews

ISSN 2775-9237 (Online)

asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, managemet journal
crossref
doi
open access

Published: 22 December 2020

The Ramifications of the Treasury Single Account, the Ifmis Platform, and Government Cash Management in Developing Economies in the Wake of the Covid-19 Pandemic: Ghana’s Empirical Example

Richmond Sam Quarm, Rosemond Sam-Quarm, Richmond Sam-Quarm

University of Education (Ghana), Ghana Audit Service (Ghana), mPharma Ghana Ltd (Ghana)

asian institute research, jeb, journal of economics and business, economics journal, accunting journal, business journal, management journal

Download Full-Text Pdf

doi

10.31014/aior.1992.03.04.311

Pages: 1654-1672

Keywords: Treasury Single Account (TSA), Public Financial Management (PFM) System, Modern Money Theory, Ministry, Department, and Agencies (MDAs), Metropolitan, Municipal, and District Assemblies (MMDAs), Covered Entities, Appropriation Act, Consolidated Fund, Zero-Balance Accounts (ZBAs), Integrated Financial Management Information System (IFMIS), Ghana Integrated Financial Management System (GIFMIS), Bank of Ghana (BoG)

Abstract

In recent years, the combined effects of inflation, recession, high-interest rates, new investment media and technological advances in information processing have made “Cash Management” an increasingly important and complex subject (IMF, 2001; Ter-Minassian and Parente, 1995). At times, the desire and effort to squeeze out the most from every dollar and to minimise idle cash balances has become an obsession with many organisations and countries. Therefore, effective and efficient Cash Management has become a “sine qua non” for the success of any business organisation (Horcher, 2006a; White, 2006). And Countries, “as Corporate Entities”, are no exceptions to this basic fundamental business principle (Wood & Sangster, 2012). The Theoretical Framework of this study was underpinned by the Stakeholder Theory (Freeman, 1984), the Financial Management Theory (Hayes and Nolan, 1974; Kingston, 1973), and the Modern Money Theory (Friedman, 1964; Keynes, 1930; Mitchell-Innes, 1914). We conducted a cross-sectional research through non-probability and purposive sampling with 200 respondents. Our face-to-face interviews, structured closed-ended and open-ended Questionnaires which were administered online through email application via Google Forms (as a result of the novel, dreaded, and disruptive Covid-19 pandemic), coupled with PETS (Khan and Pessoa, 2010; Reinikka and Svennson, 2006) resulted in startling revelations. Our major finding was that a government lacking an efficient and effective control over its cash resources will definitely pay for its institutional deficiencies in multiple ways (Ahmed, 2016).

References

  1. Ahmed, A. I., (2016). Treasury Single Account (TSA) as an Instrument of Financial Prudence and Management: Prospects and Problems. Research Journal of Finance and Accounting: http:// www.iiste.org. ISSN 2222-1697 (Paper) ISSN 2222-2847 (Online). Vol.7, No.4, 2016

  2. Akande, I. (2015). Buhari orders Federal Ministries, Departments, and Agencies to open Treasury Single Account. Press Release, August 9

  3. Bank of Ghana. (2016). Bank of Ghana Bulletin, 3(2), 2016. Accra.

  4. Bower, J. L. (1970). Managing the Resource Allocation Process: A Study of Corporate Planning and Investment. Division of Research, Harvard Graduate School of Business Administration, Boston, Mass.

  5. Carleton, W. T. (1970). An Analytical Model for Long Range Financial Planning. Journal of Finance, 25 (2), pp 291-315

  6. Central Bank of Nigeria. (2015). Revised Guidelines for compliance with Treasury Single Account by Banks in Nigeria.

  7. Central Bank of Nigeria. (2014). Communiqué No. 94 of the Monetary Policy Committee. March, 24-25, p 1-37.

  8. Chohan, U. W. (2020). Modern Monetary Theory (MMT). A General Introduction. CASS Working Papers on Economics & National Affairs. Social Science Research.Network SSRN

  9. Deloitte. (2012). Integrated reporting: The new big picture. Deloitte Insights.

  10. Dener, C. (2007). Treasury Single Account Practices in ECA, mimeo

  11. Denzin, N. K. (2017). The research act: A theoretical introduction to sociological methods.New York, NY. Routledge.

  12. Economist Intelligence Unit (EIU). (2005). Assessing Payments Systems in Latin America. Economist

  13. Edwards, S. (2019). Modern Monetary Theory: Cautionary Tales from Latin America. Cato Journal 39 (3), 529. doi: 10.36009/CJ:39:3:3

  14. Ekubiat, J. U., and Ime, F. E. (2016). The Adoption of Treasury Single Account (TSA) by State Governments of Nigeria: Benefits, Challenges, and Prospects. Journal of Finance and Accounting 4(3), p. 126-130 http://www.sciencepublishinggroup.com/j/j

  15. Financial Administration Act. (2003). Act 654, Assembly Press, Accra.

  16. Fiscal Responsibility Act. (2018). Assembly Press, Accra

  17. Fitzsimons, V., G. (2009). A troubled relationship: corruption and reform of the public sector in development. Journal of Management Development, 28(6), 513-521. DOI: 10.1108/02621710910959675

  18. Freeman, R. E. (1984). Strategic management: A stakeholder approach. Boston, MA: Pitman.

  19. Friedman, M., & Schwartz, A. J. (1964). Has the government any role in money? Journal of Monetary Economics, 17(1), 37-62

  20. Garbade, K., Partlan, J. C., and Santoro, P. J. (2004). Recent Innovations in Treasury Cash Management, Current Issues in Economics and Finance. 10(11)

  21. Hayes, R. H., and Nolan, R. I., (1974). What Kind of Corporate Modelling Functions Best? Harvard Business Review, 5(6), pp 102-112

  22. Hendriks, C., J. (2013). Integrated Financial Management Information Systems: guidelines for effective implementation by the public sector of South Africa: original research, South African Journal of Information Management, 15(1), 1-9. doi: 10,4102/sajim.v14i1.529

  23. Hill, C. W., and Jones, G. R. (2012). Strategic management theory: An integrated approach. 10 Ed.). South-Western: Cengage Learning.

  24. Hobbes, T. (1985). Leviathan. London. Penguin.

  25. Horcher, K. A. (2006a). Essentials of Managing Cash. John Wiley & Sons, Inc.

  26. Horcher, K. A. (2006b). Essentials of Managing Treasury. John Wiley & Sons, Inc.

  27. Howlett, M., and Ramesh, M. (2003). Studying public policy: Policy cycles and policy subsystems. Ontario, Oxford University Press.

  28. Ibietan, J. (2013). Corruption and Public Accountability in the Nigerian Public Sector: Interrogating the Omission. European Journal of Business and Management, 5(15), 1-48. Retrieved from: http://www.iiste.org/Journals/index.php/EJBM/article/view/6201

  29. IMF. (2020. International Monetary Fund, Fiscal Monitor Publication, Washington, DC.

  30. IMF. (2007). Manual on Fiscal Transparency (Washington).

  31. IMF. (2001). Government Finance Statistics Manual (Washington).

  32. Iroegbu, C. (2015). Treasury Single Account will block leakages. Vanguard, August, 24. P 38

  33. Khan, A., and Pessoa, M. (2010). Conceptual Design: A Critical Element of Government Financial Management Information System Project Technical Notes and Manuals (Washington: International Monetary Fund).

  34. Kinston, D. L. (1973). Concepts of Financial Models. IBM Systems Journal, 12 (2) pp 113-125

  35. Keynes, J. M. (1936). General Theory of Employment, Interest, and Income. New York.

  36. Keynes, J. M. (1930). Treatise on Money. p 4, 6. New York.

  37. Krugman, P. R., and Wells, R. (2018). Economics (5 Ed). ISBN-1-319-0-660-7

  38. Krugman, P. R. (2007). The Conscience of a Liberal. ISBN-0-393-06069-1

  39. Larson, M. C. (2007). Local Government Cash Management, Chapter 2 in Local PublicFinancial Management, ed. by Anwar Shah, World Bank

  40. Lekubu, B., K. (2013). Issues of Corruption in South Africa’s Municipalities. Conference Proceedings, South African Association of Public Administration and Management (SAAPAM). Cape Town, South Africa.

  41. Lienert, I. (2009). Modernizing Cash Management, Technical Notes and Manuals, Fiscal Affairs Department, Washington, International Monetary Fund.

  42. Lindblom, C. E., and Woodhouse, E. J. (1993). The policy-making process. Upper Saddle River. NJ: Prentice Hall.

  43. Mansfield, E. (1997). Microeconomics: theories and applications (9 Ed). New York

  44. Mitchell-Innes, A. (1914). The Credit Theory of Money. The Banking Law Journal, 31

  45. Obinna, C. (2015). Banks Face Liquidity Strain as FG Fully Endorses Treasury Single Account. Thisday Monday, 11(8), pp 52.

  46. Oguntodu, J. A., Alalade, Y. S. A., Adekunle, Y. A., and Adagbie, F. F. (2015). Assessment of Treasury Single Account and Nigeria’s Economy Between 1999 and 2015. Journal of Accounting and Financial Mismanagement. ISSN 2504-8856. Vol. 2, No. 6, 2016 www.iiardpub.org

  47. Olken, B., A., and Pande, R. ((2012). Corruption in Developing Countries. Annual Review of Economics, 4(1), 479-509. DOI: 10.1146/annurev-economics-080511-110917

  48. Onwuka, C., C., Okoh, C., I., and Eme, O., I. (2009). Corruption in Nigeria: Nature, Forms, and Challenges before Anti-Corruption Agencies. Interdisciplinary Journal of Contemporary Research in Business, 1(8), 114-132.

  49. Paris Declaration. (2005). Public Financial Management Reforms. Paris.

  50. Pattanayak, S. and Cooper, J. (2011). Chart of Accounts: A Critical Element of the Public Financial Management Framework Technical Notes and Manuals (Washington: International Monetary Fund).

  51. Pattanayak, S., and Fainboim, I. (2010). Treasury Single Account: Concept, Design and Implementation Issues IMF working paper 10/143 (Washington: International Monetary Fund). (http://www.imf.org/external/pubs/cat/longres.cfm?sk=23927.0).

  52. Public Financial Management Act (2016). Act 921, Assembly Press, Accra.

  53. Quentin, S. (1978). The Foundations of Modern Political Thought: The Age of the ReformationCenbridge.

  54. Reinikka, R., and Svennson, J. (2006). Using micro-surveys to measure and explain corruption. World Development, 34(2), 359-370. doi:10.1016/j.worlddev.2005.03.009

  55. Reinikka, R., and Svennson, J. (2001). Explaining leakage of public funds. WIDER Discussion Papers/World Institute for Development Economics (UNU-WIDER) (No. 2001/147).Washington, DC: The World Bank.

  56. Samuelson, P. (1992). Economics (11 Ed). McGraw Hill, New York.

  57. Schmitz, S. W., and Wood, G. E. (2006). Institutional Change in the Payments Systems and Monetary Policy—An Introduction in Institutional Change in the Payment System and Monetary Policy ed. by Stefan W. Schmitz and Geoffrey E. Wood (Routledge).

  58. Suchman, M. C. (1995). Managing legitimacy: Strategic and institutional approaches. Academy of Management Review, 20(3), 571-610

  59. Ter-Minassian, T., and Parente, P. (1995). Setting Up a Treasury in Economies in Transition IMF Working Paper 95/16, International Monetary Fund.

  60. Trumpeter, G., M., Carpenter, T., D., Desai, N., Jones, K., L., and Riley Jr, R., A. (2012). A synthesis of fraud-related research. Auditing: A Journal of Practice & Theory, 32(1), 287-321. doi: http://dx.doi.org/10.2308/ajpt-50360

  61. White, L. H. (2006). Payments System Innovations in the United States since 1945 and their Implications for Monetary Policy Chapter 1 in Institutional Change in the Payment System and Monetary Policy ed. by Stefan W. Schmitz and Geoffrey E. Wood (Routledge).

  62. Williams, M. (2010). Government Cash Management: Its Interaction with Other Financial Policies. Technical Notes and Manuals (Washington: International Monetary Fund).

  63. Wood, F., and Sangster, A. (2012). Business Accounting 1 (12 Ed). Pearson Education Limited.

  64. Yusuf, I. A., and Chiejina, N. (2015). Anti-Graft War: One Economy, One Account. Sunday Nation. 8 (16), pp 9-10 & 71.

  65. Zhang, K. (2012). Increasing Citizen Demand for Good Government in Kenya. Retrieved from: http://cega.berkeley.edu/assets/cega_events/4/Zhang-

bottom of page