The Challenges of Public Expenditure Management in Case of MOFEC
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Date
2018-01
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Addis Ababa University
Abstract
The public investment requirement of Ethiopia is increasing rapidly while there
are challenges that undermine public sector performance toward achieving the PEM
objectives: The critical problems with public expenditure management include lack of
accountability and transparency in budget allocation and execution, weak internal
control and monitoring in making continuous identification of problems and taking
corrective actions when actual result deviate from budgeted. this study aimed to identify
and analyze the practical challenges of expenditure management in both recurrent and
capital budgets of MoFEC during the GTP period. The study employed descriptive
research type approach using both primary and secondary data to answer the research
questions. The collected data was analyzed using descriptive statistics. The study found
out that MoFEC pursued the program budget procedure for allocating the annual
expenditure budget for different programs and directorates. This study also identified
that there is overspending and under spending of budget because of weak employee
motivation, high turnover, lack of leadership commitment and lack of management
alignment. Regarding the effectiveness of monitoring and controlling of expenditure
budget, the finding indicated that: Financial reports are not presented in time, internal
audit lacks sufficient auditors, the internal auditors are not free of interference & there is
no performance audit. The researcher recommends that greater emphasis should be
given to the budget allocation process, MoFEC should identify the causes of under
spending and overspending, due attention should be given to the enforcement of financial
rules and regulations, strengthen the skills & knowledge of employees, should apply
performance audit.
Description
A Project Work Submitted to Department of Accounting and
Finance School of Graduate Studies, Addis Ababa University
in Partial fulfillment of the Requirement for the Degree of
Master of Arts in Accounting and Auditing.
Keywords
Expenditure Management, MOFEC, Public Expenditure