Accountability and the accounting regime in the public sector. Some messages from the NHS

In the UK, the government is keen to introduce private sector procedures into the public sector. The latest stage of this process has been to suggest the adoption of accruals accounting by those parts of the public sector where it is not already operated. This approach to accounting was introduced into the NHS as part of the reforms which implemented a quasi-market to match the demands of purchasers of health care with its providers. Outlines the assumptions which underlie accruals accounting and considers whether the environment created for NHS Trusts is sufficiently like that of the private sector to justify its use. Shows that the initial ideas of the extent to which Trusts could mimic private sector organizations have not been fulfilled in practice, and concludes that it is not possible to justify the use of accruals accounting in the public sector simply on the grounds that as it is the technique used in the private sector it must be superior to the available alternatives.