International Accounting Standards, Budgeting and Controlling in Private and Public Sector

The purpose of this article is to present the ability of convergence in budgeting and control mechanisms between Private and Public Sectors, based on the standardization of financial events in accordance with International Accounting Standards (IAS). The necessity arises from the trend –expressed as New Public Management (NPM) theory – of adopting in Public Sector entities, management procedures that are followed in the Private Sector. The research concludes that the common structure of financial statements under IAS/IFRS and IPSAS allows the convergence of budgeting and control mechanisms between Public and Private Sectors. In the herein presented article, the budgeting and controlling models applied in the Private Sector entities have been applied in the Public Sector organizations considering the different directions of the mechanisms that generate these models. The research enhances the accountability and decision-making in the Public Sector, while contributing to further discussions about the effectiveness of the application of Private-sector techniques in Public entities.     Keywords: Audit; Accounting, IAS/IFRS/IPSAS, Financial Control