PART I – DEFINITION OF A USER
[Noun] “a person who uses or operates something.”
[Law] “the continued use or enjoyment of a right.”
There is an idea that the financial statements are prepared for the accountants. While the financial statements are prepared by accountants, they are not prepared for accountants.
The financial statements are prepared for those people that have an interest in a particular entity. People usually have an interest in an entity because they provided them with money (or other resources) and want to know if that money, or other returns like interest or dividends, will be repaid.
In the public sector, government and its entities receive money from taxpayers, ratepayers, lenders, donors and other governments. There is a wide group of users interested in government’s financial statements. Government provides the infrastructure necessary for basic goods and services in a modern society – water, electricity, sanitation, healthcare, education, security and more. Because of the range of people who give money to government and the number of people who rely on government’s services, there are many who are interested in government’s financial statements.
So, if the financial statements are prepared for specific people to use, and those people don’t use the financial statements, they are worthless! This is why it is so important for us at the ASB to ensure that the information in the financial statements can be used.
Reflecting on the definition of a “user”, it is a person that operates something, and for us, users ‘operate’ the financial statements. Most importantly though, the legal definition of a user means there is right that is enjoyed. As the ASB we support users’ rights to transparent, credible information about government and its finances. This information enables citizens to ensure (a) there is an equitable allocation of resources across the country, and (b) government delivers on its obligations in law.
PART II – DEFINITION OF A CITIZEN
[Noun] A person who belongs to a particular country, state, or commonwealth and has legally recognised rights and duties as a member of that entity.
Being a citizen of South Africa means we have rights and duties. At the ASB, we want to help citizens with the rights, i.e. citizens get what they need, but they can also use what they get. We also want to help citizens fulfil their duties, we are proud to launch our “Citizens Guide – Understanding Financial Statements” .
In this initiative, citizens are those people who represent citizens in oversight structures such as Parliament, Provincial Legislatures, and Municipal Councils. We hope to provide citizens with an understanding of:
- The purpose of financial statements.
- The role of financial statements in the accountability chain and how they link to the strategy, plan, budget and performance information.
- What the various components and line items in the financial statements mean.
Most importantly, tips are provided to help citizens hold officials accountable and make financial, policy and other decisions.
The financial statements can be a key tool when participating in government’s democratic processes when voting nationally, provincially and at a municipal level. Share this material with your family, community, colleagues – and let’s get everyone motivated to do their duty!
Like the financial statements, we hope this material is both used and useful to users. We welcome suggestions for improvement and encourage you to send us feedback on info@asb.co.za.
Happy reading 🕶️