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Public‐Private Partnerships: Form Over Substance?
Author(s) -
WALKER R. G.
Publication year - 2003
Publication title -
australian accounting review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.551
H-Index - 36
eISSN - 1835-2561
pISSN - 1035-6908
DOI - 10.1111/j.1835-2561.2003.tb00401.x
Subject(s) - incentive , government (linguistics) , substance over form , asset (computer security) , business , accounting , finance , debt , order (exchange) , balance sheet , balance (ability) , face (sociological concept) , economics , accounting information system , financial accounting , accounting standard , market economy , medicine , social science , linguistics , philosophy , computer security , sociology , computer science , physical medicine and rehabilitation
Public‐private partnerships have been devised to avoid treating financing arrangements as government “debt”. Governments face incentives to avoid treating these arrangements as giving rise to liabilities. Both the Australian and UK standards boards have avoided a “substance over form” approach in order to accept that PPPs may be kept off‐balance‐sheet. The analysis supporting their conclusions was based on consideration of whether PPPs led to the acquisition of an asset, using the analogy of accounting for finance leases, rather than addressing whether the substance of commercial arrangements means that contractual commitments may evolve into liabilities.