Transforming the finance function for service performance a - PowerPoint Presentation

Slide1

Transforming the finance function for service performance and accountability

John Matheson CBEPresident, CIPFA May 2016Slide2

About CIPFA

The global professional accountancy body for people in public finance Only professional accountancy body focused on public servicesPartner with government bodies and professional accountancy organisations to improve Public Financial Management (PFM) and Governance Slide3

Some global highlightsSlide4

Outline

Forces for change in the finance functionThe roles of the public service finance functionInnovatorBusiness PartnerStewardStrategistThe finance function contribution to a ‘Whole Systems Approach for PFM’A tool for assessing financial performance

The role of the CFO

SummarySlide5

Forces for change in the finance function – external forces

Economic and fiscal retrenchmentDemographic trendsCost pressuresStructural turbulencePartnership workingIncreased personalisation of servicesWorking with customers and citizensGreater transparency and accountabilitySlide6

Forces for change in the finance function - internal

Increased constraints on public expenditureAn emphasis on developing new skillsManaging costs not budgetsTransformation and radical thinkingRestructuringSlide7

The roles of the public service finance function

InnovatorBusiness partnerStewardStrategist Slide8

The roles of the public service finance function

RoleInnovatorBusiness partnerStewardStrategist

Critical area

Change agent

Managing demand

Risk management

Clarity of vision

Cross public service opportunities

Funding futures

Financial standing and resilience

Delivery vehicle

Analysis of public vale

Future orientated decision support

Internal control

Experts and specialists

Supporting transformation

Strategy and resource planning

Monitor

Long-term view

Stakeholder relationship

Commercialisation

Assurance

Big

d

ata

Value for money

Capabilities

Technical, professional and relationship skills; leadership and vision; talent managementSlide9

Innovator

Change agent Cross public service opportunitiesAnalysis of public valueSupporting transformationStakeholder relationshipsSlide10

Business partner

What is it?Direct involvement in core management processes such as: - resource planning, strategic, long, medium and short termforecasting, modelling and scenario buildingcharging and pricing strategiesmonitoring resource use and budget executionevidenced based policyleadership and efficiency techniques Slide11

Business partner – adding value

Managing demandFunding futuresFuture orientated decision supportStrategy and resource planningCommercialismValue for money Slide12

Steward

The public interestGovernance and scrutinyRisk managementFinancial standing and resilience Internal controlMonitoringAssurance Slide13

Strategist

Clarity of visionDelivery vehicle Experts and specialist Long-term viewImpact of technology Big dataSlide14

cipfa.org

PFM professionals are atthe heart of change…bet

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ng of resources

stronger accountability

more efficient use of resources

greater comparability

improved transparency

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erySlide15

Strong PFM as a

corporate responsibilityIs financial management where we want it to be?Identifies priority areas for improvementAllows tracking over timeCan be used to benchmark between organisationsCan test organisational leaders skills in financial managementwww.cipfa.org/services/advisory-and-transformation/financial-management-model

Strengthening

finance:

CIPFA FM Model

How good is PFM in your organisation?Slide16

Role of CFO

Statement Slide17

The CFO in a public service organisations:

is a

key member of the Leadership Team

, helping it to develop and implement strategy and to resource and deliver the organisation’s strategic objectives sustainably and in the public interest;

must be

actively involved in

, and able to bring influence to bear on,

all material business decisions

to ensure immediate and longer term implications, opportunities and risks are fully considered, and alignment with the organisation’s overall financial strategy; and

must

lead the promotion and delivery

by the

whole organisation

of

good

financial management

so that public money is safeguarded at all times and used appropriately, economically, efficiently and effectively.

To deliver these responsibilities the Chief Financial Officer:

must lead and direct a finance function that is resourced to be fit for purpose; and

must be professionally qualified and suitably experienced.

Role of CFO Slide18

Capacity Development

Professional training

CIPFA has a global track record of strengthening

PFM

PFM

projects

Standards / best practiceSlide19

We have a lot of guidance to help!Explaining

WSA key elements:Role of CFO in public service organisationsStepping Stones to AccrualFM ModelCode of Practice on Managing the Risk of FraudRole of the Head of Internal AuditEmerging Stronger

Available

via

the CIPFA

website

www.cipfa.org

Complementary guidance:

CIPFA/IFAC

International Framework: Good Governance in the Public Sector

Public Sector Internal Audit StandardsSlide20

In summary Finance has a key and an increasingly important role to play in any organisationFinance is uniquely placed to offer insights to help decision making and so improve quality service deliveryFinance helps decision makers understand the financial implications of strategic and policy options, balancing medium- and long-term horizons with short term operational requirements