Public Sector Governance and Accountability Series: Budgeting and ...

10
Automating Public Financial
Management in
Developing Countries
stephen b. peterson
I
n recent years, integrated financial management information
systems (IFMISs) have become core components of financial
reforms in developing countries. This chapter sets out the functions
of those systems and how to manage them, with particular reference
to the choices that developing countries face as they seek to introduce
improved financial management. Because IFMISs require a
relatively complex information technology (IT) platform, the chapter
also discusses at some length the questions that surround the
decisions that governments must make when procuring an IFMIS—
above all, whether to purchase off-the-shelf (OTS) systems and
customize them or to develop their own tailored systems. The subject
is important because of the apparent general consensus that IFMISs
have not met the high expectations that seem to have been attached
to them. 1
Moreover, a second dimension needs to be addressed: the same
literature that analyzes the failure of IFMISs argues that IT systems not
only should provide a technology platform to manage transactions
and the budgetary process, but also should go further and drive
budgetary reform. In the process, the demands of IFMISs (especially
OTS) force governments to adapt their systems to meet those
demands. Governments in this situation, therefore, make reforms
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