Richard Allen is an economist and public finance expert. He is currently working as a consultant with the World Bank. Richard was a senior official of the U.K. Ministry of Finance (H.M. Treasury) until 1995. Subsequently, he worked with the OECD in Paris, the Asian Development Bank, the World Bank, and the IMF's Fiscal Affairs Department. Richard is the co-editor of a standard reference book on Managing Public Expenditure: a Reference Book for Transition Countries, OECD, 2001—and several other books and articles on public financial management. He has advised governments in more than 50 countries on strengthening their budget systems and public finances. Richard Hemming is an economist and fiscal policy expert with wide-ranging industrial and developing country experience. He is currently Visiting Professor at the Duke Center for International Development, and a consultant for the World Bank. He worked for 24 years in the IMF, and was Deputy Director of the Fiscal Affairs Department until August 2008. Prior to joining the IMF, Richard worked at the OECD and, before that, was a researcher at the Institute for Fiscal Studies in London, and a university lecturer in the U.K. and Australia. He has published widely on tax, social security, public expenditure and other fiscal issues. Barry Potter is an economist and public finance expert with wide ranging experience in the U.K. government, consulting and the IMF. He was a senior official in the U.K. Cabinet Office and H.M. Treasury in the 1980s, and Private Secretary to the British Prime Minister (Mrs. Thatcher) from 1990-1992. Subsequently, Barry worked in the Fiscal Affairs Department of the IMF, where he was Division Chief for Public Financial Management, later becoming Director of the Fund's Office of Budget and Planning in 2001, and the IMF's Special Representative to the United Nations in 2007. He is the author (with Jack Diamond) of Guidelines for Public Expenditure Management, International Monetary Fund, 1999, and several other publications.

The Handbook is a welcome addition to the literature on public finance, not least because it draws on multiple disciplines in the social sciences to provide a rigorous and up-to-date analysis of all facets of this important subject. As such it will surely prove to be an invaluable resource for both academics and practitioners of public finance.' EMMANUEL TUMUSIIME-MUTEBILE, Governor of the Bank of Uganda 'This Handbook brings together an extraordinary array of public financial management experts and their collective experience to provide a comprehensive repository of cutting-edge knowledge. It is a must read for students and practitioners especially after the global financial and Eurozone crises have rudely awakened the world to the importance of the linkages between public financial and macro-fiscal management and their influence on constructing rules and institutions that can be implemented in specific political economy contexts.' SANJAY PRADHAN, Vice President, World Bank Institute This extremely comprehensive and well-researched volume covers topics of tremendously broad and practical interest, written by many of the world's leading experts on these subjects. I know of no other collection that comes anywhere close to addressing the whole of international financial management, from initial budget planning through adoption, execution, and evaluation. This book represents an invaluable contribution to the field, and will benefit students and government officials alike. PHILIP JOYCE, University of Maryland School of Public Policy and Editor, Public Budgeting & Finance The field of Public Financial Management has grown in sophistication and complexity over recent decades. This volume brings some of the most important topics together in thought-provoking ways. It blends technical, political and managerial perspectives in a manner that fosters honest discussion about the subject. The message it sends is clear. There is a lot to discuss, and there are many perspectives. MATT ANDREWS, Harvard Kennedy School 'By providing a fresh perspective not only on the bread and butter of public financial management, but also on innovative themes, the Handbook is a valuable and comprehensive guide to the field, and sure to become a first reference for the practitioner and student.' NEIL COLE, Collaborative African Budget Reform Initiative, CABRI 'This is a virtual encyclopedia of public financial management, covering all aspects of the budget cycle. I am confident the volume will become a standard reference in this critically important field.' JON BLONDAL, Organization for Economic Cooperation and Development, OECD 'Improving our understanding of public financial management is crucial as nations seek to correct fiscal imbalances stemming from the global economic and financial crisis. An important contribution of this Handbook is in emphasizing the importance of collaborative approaches to reform, bringing together knowledge from economics, public finance, political science, law, organizational development, computer science and human resource management.' CLAY WESTCOTT, Senior Editor, International Public Management Review 'This is an important Handbook that provides a very practical 'how to' guide to all aspects of public financial management that are now taken to constitute best practice. It should be of interest to practitioners in governments and policy-related institutes around the world. The volume also contains new perspectives on the political economy of institutional change. Some of the chapters would thus be of interest to researchers working in the relatively new area of institutional change and governance, or why certain prescriptions or best practices so often fail, despite the high quality advice that is now available.' EHTISHAM AHMAD, London School of Economics and Political Science and University of Bonn 'Public financial management reform takes time, is complex and has to consider the local environment, including key political economy factors. This volume, written and edited by some of the world's leading experts on the subject, will be indispensible for all those involved with such challenges.' ANDY WYNNE, Editor, International Journal of Governmental Financial Management

• IntroductionPART I: THE INSTITUTIONAL AND LEGAL FRAMEWORK The Macroeconomic Framework for Managing Public Finances in a Global EnvironmentFiscal Rules and Public Financial ManagementThe Legal Framework for Public Finances and Budget SystemsPolitical Economy Aspects of Managing Public FinancesRole, Responsibilities and Structure of Central Finance AgenciesRole of the Legislature in Budget ProcessesStrengthening Performance in Public Financial ManagementPART II: ALLOCATION OF RESOURCES The Coverage and Classification of the BudgetPolicy Formulation and the Budget ProcessMedium-term Fiscal and Expenditure FrameworksManaging for Results and Performance Budgeting Fiscal Federalism and Intergovernmental Financial RelationsPART III: MANAGING BUDGET EXECUTIONThe Budget Execution Cycle Public ProcurementManaging Government PayrollThe Treasury Function and Treasury Single AccountsInternal Control and Internal AuditManaging Extra-budgetary FundsPART IV: MANAGING GOVERNMENT REVENUESTax Design from a Fiscal Management PerspectiveRevenue Forecasting Efficient Revenue Administration Customs Administration User Charges and EarmarkingManaging Natural Resource Revenues Managing External Aid PART V: LIABILITY AND ASSET MANAGEMENTGovernment Balance SheetsPublic Investment Management and PPPsManaging Fiscal RisksSovereign Wealth FundsLong-term Obligations and Generational AccountingCash Management and Debt ManagementManaging State-owned Enterprises PART VII: ACCOUNTING, REPORTING AND OVERSIGHT OF PUBLIC FINANCESStrengthening Fiscal Transparency Government Accounting Standards and Policies Government Financial Reporting Standards and Practices Financial Management Information Systems External Audit Role of Independent Fiscal AgenciesAbout the Editors and ContributorsGlossary ReferencesIndex

Richard Allen is an economist and public finance expert. He is currently working as a consultant with the World Bank. Richard was a senior official of the U.K. Ministry of Finance (H.M. Treasury) until 1995. Subsequently, he worked with the OECD in Paris, the Asian Development Bank, the World Bank, and the IMF's Fiscal Affairs Department. Richard is the co-editor of a standard reference book on Managing Public Expenditure: a Reference Book for Transition Countries, OECD, 2001—and several other books and articles on public financial management. He has advised governments in more than 50 countries on strengthening their budget systems and public finances. Richard Hemming is an economist and fiscal policy expert with wide-ranging industrial and developing country experience. He is currently Visiting Professor at the Duke Center for International Development, and a consultant for the World Bank. He worked for 24 years in the IMF, and was Deputy Director of the Fiscal Affairs Department until August 2008. Prior to joining the IMF, Richard worked at the OECD and, before that, was a researcher at the Institute for Fiscal Studies in London, and a university lecturer in the U.K. and Australia. He has published widely on tax, social security, public expenditure and other fiscal issues. Barry Potter is an economist and public finance expert with wide ranging experience in the U.K. government, consulting and the IMF. He was a senior official in the U.K. Cabinet Office and H.M. Treasury in the 1980s, and Private Secretary to the British Prime Minister (Mrs. Thatcher) from 1990-1992. Subsequently, Barry worked in the Fiscal Affairs Department of the IMF, where he was Division Chief for Public Financial Management, later becoming Director of the Fund's Office of Budget and Planning in 2001, and the IMF's Special Representative to the United Nations in 2007. He is the author (with Jack Diamond) of Guidelines for Public Expenditure Management, International Monetary Fund, 1999, and several other publications.

The Handbook is a welcome addition to the literature on public finance, not least because it draws on multiple disciplines in the social sciences to provide a rigorous and up-to-date analysis of all facets of this important subject. As such it will surely prove to be an invaluable resource for both academics and practitioners of public finance.' EMMANUEL TUMUSIIME-MUTEBILE, Governor of the Bank of Uganda 'This Handbook brings together an extraordinary array of public financial management experts and their collective experience to provide a comprehensive repository of cutting-edge knowledge. It is a must read for students and practitioners especially after the global financial and Eurozone crises have rudely awakened the world to the importance of the linkages between public financial and macro-fiscal management and their influence on constructing rules and institutions that can be implemented in specific political economy contexts.' SANJAY PRADHAN, Vice President, World Bank Institute This extremely comprehensive and well-researched volume covers topics of tremendously broad and practical interest, written by many of the world's leading experts on these subjects. I know of no other collection that comes anywhere close to addressing the whole of international financial management, from initial budget planning through adoption, execution, and evaluation. This book represents an invaluable contribution to the field, and will benefit students and government officials alike. PHILIP JOYCE, University of Maryland School of Public Policy and Editor, Public Budgeting & Finance The field of Public Financial Management has grown in sophistication and complexity over recent decades. This volume brings some of the most important topics together in thought-provoking ways. It blends technical, political and managerial perspectives in a manner that fosters honest discussion about the subject. The message it sends is clear. There is a lot to discuss, and there are many perspectives. MATT ANDREWS, Harvard Kennedy School 'By providing a fresh perspective not only on the bread and butter of public financial management, but also on innovative themes, the Handbook is a valuable and comprehensive guide to the field, and sure to become a first reference for the practitioner and student.' NEIL COLE, Collaborative African Budget Reform Initiative, CABRI 'This is a virtual encyclopedia of public financial management, covering all aspects of the budget cycle. I am confident the volume will become a standard reference in this critically important field.' JON BLONDAL, Organization for Economic Cooperation and Development, OECD 'Improving our understanding of public financial management is crucial as nations seek to correct fiscal imbalances stemming from the global economic and financial crisis. An important contribution of this Handbook is in emphasizing the importance of collaborative approaches to reform, bringing together knowledge from economics, public finance, political science, law, organizational development, computer science and human resource management.' CLAY WESTCOTT, Senior Editor, International Public Management Review 'This is an important Handbook that provides a very practical 'how to' guide to all aspects of public financial management that are now taken to constitute best practice. It should be of interest to practitioners in governments and policy-related institutes around the world. The volume also contains new perspectives on the political economy of institutional change. Some of the chapters would thus be of interest to researchers working in the relatively new area of institutional change and governance, or why certain prescriptions or best practices so often fail, despite the high quality advice that is now available.' EHTISHAM AHMAD, London School of Economics and Political Science and University of Bonn 'Public financial management reform takes time, is complex and has to consider the local environment, including key political economy factors. This volume, written and edited by some of the world's leading experts on the subject, will be indispensible for all those involved with such challenges.' ANDY WYNNE, Editor, International Journal of Governmental Financial Management

• IntroductionPART I: THE INSTITUTIONAL AND LEGAL FRAMEWORK The Macroeconomic Framework for Managing Public Finances in a Global EnvironmentFiscal Rules and Public Financial ManagementThe Legal Framework for Public Finances and Budget SystemsPolitical Economy Aspects of Managing Public FinancesRole, Responsibilities and Structure of Central Finance AgenciesRole of the Legislature in Budget ProcessesStrengthening Performance in Public Financial ManagementPART II: ALLOCATION OF RESOURCES The Coverage and Classification of the BudgetPolicy Formulation and the Budget ProcessMedium-term Fiscal and Expenditure FrameworksManaging for Results and Performance Budgeting Fiscal Federalism and Intergovernmental Financial RelationsPART III: MANAGING BUDGET EXECUTIONThe Budget Execution Cycle Public ProcurementManaging Government PayrollThe Treasury Function and Treasury Single AccountsInternal Control and Internal AuditManaging Extra-budgetary FundsPART IV: MANAGING GOVERNMENT REVENUESTax Design from a Fiscal Management PerspectiveRevenue Forecasting Efficient Revenue Administration Customs Administration User Charges and EarmarkingManaging Natural Resource Revenues Managing External Aid PART V: LIABILITY AND ASSET MANAGEMENTGovernment Balance SheetsPublic Investment Management and PPPsManaging Fiscal RisksSovereign Wealth FundsLong-term Obligations and Generational AccountingCash Management and Debt ManagementManaging State-owned Enterprises PART VII: ACCOUNTING, REPORTING AND OVERSIGHT OF PUBLIC FINANCESStrengthening Fiscal Transparency Government Accounting Standards and Policies Government Financial Reporting Standards and Practices Financial Management Information Systems External Audit Role of Independent Fiscal AgenciesAbout the Editors and ContributorsGlossary ReferencesIndex

Richard Allen is an economist and public finance expert. He is currently working as a consultant with the World Bank. Richard was a senior official of the U.K. Ministry of Finance (H.M. Treasury) until 1995. Subsequently, he worked with the OECD in Paris, the Asian Development Bank, the World Bank, and the IMF's Fiscal Affairs Department. Richard is the co-editor of a standard reference book on Managing Public Expenditure: a Reference Book for Transition Countries, OECD, 2001—and several other books and articles on public financial management. He has advised governments in more than 50 countries on strengthening their budget systems and public finances. Richard Hemming is an economist and fiscal policy expert with wide-ranging industrial and developing country experience. He is currently Visiting Professor at the Duke Center for International Development, and a consultant for the World Bank. He worked for 24 years in the IMF, and was Deputy Director of the Fiscal Affairs Department until August 2008. Prior to joining the IMF, Richard worked at the OECD and, before that, was a researcher at the Institute for Fiscal Studies in London, and a university lecturer in the U.K. and Australia. He has published widely on tax, social security, public expenditure and other fiscal issues. Barry Potter is an economist and public finance expert with wide ranging experience in the U.K. government, consulting and the IMF. He was a senior official in the U.K. Cabinet Office and H.M. Treasury in the 1980s, and Private Secretary to the British Prime Minister (Mrs. Thatcher) from 1990-1992. Subsequently, Barry worked in the Fiscal Affairs Department of the IMF, where he was Division Chief for Public Financial Management, later becoming Director of the Fund's Office of Budget and Planning in 2001, and the IMF's Special Representative to the United Nations in 2007. He is the author (with Jack Diamond) of Guidelines for Public Expenditure Management, International Monetary Fund, 1999, and several other publications.

The Handbook is a welcome addition to the literature on public finance, not least because it draws on multiple disciplines in the social sciences to provide a rigorous and up-to-date analysis of all facets of this important subject. As such it will surely prove to be an invaluable resource for both academics and practitioners of public finance.' EMMANUEL TUMUSIIME-MUTEBILE, Governor of the Bank of Uganda 'This Handbook brings together an extraordinary array of public financial management experts and their collective experience to provide a comprehensive repository of cutting-edge knowledge. It is a must read for students and practitioners especially after the global financial and Eurozone crises have rudely awakened the world to the importance of the linkages between public financial and macro-fiscal management and their influence on constructing rules and institutions that can be implemented in specific political economy contexts.' SANJAY PRADHAN, Vice President, World Bank Institute This extremely comprehensive and well-researched volume covers topics of tremendously broad and practical interest, written by many of the world's leading experts on these subjects. I know of no other collection that comes anywhere close to addressing the whole of international financial management, from initial budget planning through adoption, execution, and evaluation. This book represents an invaluable contribution to the field, and will benefit students and government officials alike. PHILIP JOYCE, University of Maryland School of Public Policy and Editor, Public Budgeting & Finance The field of Public Financial Management has grown in sophistication and complexity over recent decades. This volume brings some of the most important topics together in thought-provoking ways. It blends technical, political and managerial perspectives in a manner that fosters honest discussion about the subject. The message it sends is clear. There is a lot to discuss, and there are many perspectives. MATT ANDREWS, Harvard Kennedy School 'By providing a fresh perspective not only on the bread and butter of public financial management, but also on innovative themes, the Handbook is a valuable and comprehensive guide to the field, and sure to become a first reference for the practitioner and student.' NEIL COLE, Collaborative African Budget Reform Initiative, CABRI 'This is a virtual encyclopedia of public financial management, covering all aspects of the budget cycle. I am confident the volume will become a standard reference in this critically important field.' JON BLONDAL, Organization for Economic Cooperation and Development, OECD 'Improving our understanding of public financial management is crucial as nations seek to correct fiscal imbalances stemming from the global economic and financial crisis. An important contribution of this Handbook is in emphasizing the importance of collaborative approaches to reform, bringing together knowledge from economics, public finance, political science, law, organizational development, computer science and human resource management.' CLAY WESTCOTT, Senior Editor, International Public Management Review 'This is an important Handbook that provides a very practical 'how to' guide to all aspects of public financial management that are now taken to constitute best practice. It should be of interest to practitioners in governments and policy-related institutes around the world. The volume also contains new perspectives on the political economy of institutional change. Some of the chapters would thus be of interest to researchers working in the relatively new area of institutional change and governance, or why certain prescriptions or best practices so often fail, despite the high quality advice that is now available.' EHTISHAM AHMAD, London School of Economics and Political Science and University of Bonn 'Public financial management reform takes time, is complex and has to consider the local environment, including key political economy factors. This volume, written and edited by some of the world's leading experts on the subject, will be indispensible for all those involved with such challenges.' ANDY WYNNE, Editor, International Journal of Governmental Financial Management

• IntroductionPART I: THE INSTITUTIONAL AND LEGAL FRAMEWORK The Macroeconomic Framework for Managing Public Finances in a Global EnvironmentFiscal Rules and Public Financial ManagementThe Legal Framework for Public Finances and Budget SystemsPolitical Economy Aspects of Managing Public FinancesRole, Responsibilities and Structure of Central Finance AgenciesRole of the Legislature in Budget ProcessesStrengthening Performance in Public Financial ManagementPART II: ALLOCATION OF RESOURCES The Coverage and Classification of the BudgetPolicy Formulation and the Budget ProcessMedium-term Fiscal and Expenditure FrameworksManaging for Results and Performance Budgeting Fiscal Federalism and Intergovernmental Financial RelationsPART III: MANAGING BUDGET EXECUTIONThe Budget Execution Cycle Public ProcurementManaging Government PayrollThe Treasury Function and Treasury Single AccountsInternal Control and Internal AuditManaging Extra-budgetary FundsPART IV: MANAGING GOVERNMENT REVENUESTax Design from a Fiscal Management PerspectiveRevenue Forecasting Efficient Revenue Administration Customs Administration User Charges and EarmarkingManaging Natural Resource Revenues Managing External Aid PART V: LIABILITY AND ASSET MANAGEMENTGovernment Balance SheetsPublic Investment Management and PPPsManaging Fiscal RisksSovereign Wealth FundsLong-term Obligations and Generational AccountingCash Management and Debt ManagementManaging State-owned Enterprises PART VII: ACCOUNTING, REPORTING AND OVERSIGHT OF PUBLIC FINANCESStrengthening Fiscal Transparency Government Accounting Standards and Policies Government Financial Reporting Standards and Practices Financial Management Information Systems External Audit Role of Independent Fiscal AgenciesAbout the Editors and ContributorsGlossary ReferencesIndex