The state’s current financial statements and fiscal controls are not completely effective in their purpose of aiding the Legislature and the Governor to employ and be accountable for the state’s limited resources. Current state financial reports contain dissimilar and incomplete information which must be reviewed piecemeal. The state’s fiscal control system places too much emphasis on detailed control of expenditures and overlooks other methods of more effective control and direction of the state’s financial resources.
The Department of Finance and Administration’s statewide automated accounting system (SAAS) has specific benefits, but the system has not reached its full potential and has not been a high state priority.
The dominant influence over the state’s fiscal controls is the budgeting system. The current budgeting system contributes to the following weaknesses: control by line-item expenditures (salaries, travel, etc.) rather than more effective controls by agencies’ activities (the services and results delivered with the funds provided); focus on State Treasury accounts (source of resources) rather than the more appropriate focus on generally accepted accounting principles funds (use of resources); and, the lack of determined fiscal priorities and evaluation of agencies’ performance toward objectives.
For a paper copy of this report, contact PEER by telephone at 601-359-1226 or by e-mail at reports@peer.ms.gov.