Fiscal Responsibility Act 2007 Critical Analysis

The fiscal instrument is the budget, an annual statement from the government dealing with its income and expenditure plan for the next financial year. Fiscal Policy is an effective tool which can target specific sectors of the economy such as individual industries, unlike monetary policy which affects the economy as a whole; this is why the government implements a policy mix.

The United States deficit, surplus, and debt will always have an impact on taxpayers. In the state of high deficit the government seeks ways to cut and save money for debt payment. The government does this by pulling funding from programs that have little government impact. Increasing taxes also supplies the government with extra income. In addition to the reduction or elimination of certain tax credits, the government analyzes school funding for cost effectiveness. Each step the government takes has a trickling effect on taxpayer’s dollar.

Public Finance is the role of government in the economy. Transparency and accountability in government financial management is crucial. The reading, “Understanding New York City’s Budget” references that due to government spending of taxpayer money to operate various services, several checks and balances such as Audits, City Council Oversight, Mayor’s Management Report (MMR), and Program Evaluation were put in place for accountability. The adherence to policy, procedures, rules, regulations and laws are important when compliance and integrity is the goal.

By adding the auditing process to line-item budgeting, government management focuses on expenditures, thus creating a type of accountability that confronts corruption, helps discourage public employees deviating from strict instructions, and enhances tighter control over the employees’ behavior. For these reasons, most governments utilize some form of line-item budgeting at some level within their organization” (Smith & Lynch, 2004).

Fiscal Policy can be explained in many ways, for example. Fiscal policy is the use of the government budget to affect an economy. When the government decides on the taxes that it collects, the transfer payments it gives out, or the goods and services that it purchases, it is engaging in fiscal policy. The primary economic impact of any change in the government budget is felt by particular groups—a tax cut for families with children, for example, raises the disposable income of such families. Discussions of fiscal policy, however, usually focus on the effect of changes in the government budget on the overall economy—on such macroeconomic variables as GNP and unemployment and inflation.

In the article, “The Economics of Major League Baseball Free Agency: Start It Earlier To Achieve Fiscal Sanity” (2014), Reuter, T. explains why signing athletes to mega-contracts is an albatross waiting to happen and other cautionary tales relating to the baseball free agent market. Reuter, asserts that the current Major League Baseball (MLB) labor agreement is out of date and is in need of a major overhaul. His viewpoint on this issue is that baseball is a young man’s game and it would be smart for Major League Baseball to acknowledge that fact and start free agency earlier in their careers.

The federal budget is designed every year by undergoing an arduous process to be ratified as a law. Under the regulations of the Budget and Accounting Act of 1921, the president first sends a federal budget request to the United States Congress reflecting the needs of federal agencies to work properly in the coming year. A debate in Congress ensues in response to the President’s budget request and eventually a budget resolution is put together by committees from both parties in the House of Representatives in the Senate which is then turned into actual spending bills called “appropriations bills”. A unique conference committee comes together to settle appropriations disputes between the House of Representatives and the Senate, potentially leading to the president’s signing of a veto of the proposed budget into law, which the president (by law) is

All the people in the United States are effected by the fiscal policies. Team C will address the how and why the U.S. budget deficits, budget surpluses and debt effect different individuals and institutions. There are a wide array of individuals effected by fiscal policy, which include tax payers, future Social Security and Medicaid users will be effected. The unemployed individuals and University of Phoenix students will be effected by fiscal policy. The U.S. financial reputation , an exporter, and importer, and effects of the GDP will also be covered about the effects of the U.S fiscal policy.

The author discuss the different acts and how budget officer worked around that time. that is soon There have been changes in Congress that affected the work of the federal agency. Practioners many years ago, we're aware of the budgeting issues. They are dealing with issues today that was a lot different from the past. Kilman claims that budget officers has become old extinct species such as “dinosaurs. Budget officers implemented strategies to help maintain a budget and to mishap technical that could result in problems later. Legislation changed in budget process has made it more difficult and heavier caseloads. There are now strict budget ceilings that have effect on policy choices. There are many arguments that explain why skilled budget officers are more important than ever in policymakers. Kilman compares old ancient officers to budget officers now. He acknowledged the change in budget process. Budget officers perspective is different than before. They are active and well alive. They explain the nature of the old-time budget officers. It is not your typical kind found in agencies. There are many differences and legislative changes have made it more difficult with heavy workloads. In many different levels of a budget officer in past still have same standard as today. The roles and time that being put into the job is different from past. It had become very difficult to argue the status is elevated or diminished. They explained some of the budget reforms enacted by Congress and the change in itself. Work and responsibilities for budget officers have increased. Budget officers roles and responsibilities have changed but not as drastically from our past work. They still carry out the traditional expectations and programs for the federal

Fiscal policy is a macroeconomic management tool that involves the use of the Commonwealth Government’s Budget In order to achieve the government’s economic objectives of. The budget is the tool of the government for the exercise of fiscal policy, it shows the government’s planned revenue for the next financial year. By varying the amount of government spending and revenue, the government can alter the level of aggregate demand, which in turn will influence economic growth, environmental sustainability, distribution of income and wealth, internal stability (inflation and unemployment) and external stability (current account deficit, foreign liabilities and the exchange

The United States has gone through economic successes and turmoil since its independence in 1776. Some of these peaks and troughs were quite severe, but the economy tends to self-correct itself. Prior to the Great Depression, the United States had a laissez-faire approach to economic matters, including on how to balance the budget. However, once the Great Depression started, economists decided the government needed to be involved in the U.S.’s economic affairs as the unemployment rate reached 25%. The first fiscal policy to be instituted was The New Deal by President Franklin D. Roosevelt, but the results were lower than hoped due to the start of the Great Depression. The New Deal was to provide relief, recovery, and reform to the nation,

Giving the responsibilities of creating and executing the budget to department heads or at least a committee of qualified staff members is a educated move because they have the best understanding of the day-to-day operations and needs of their departments. If any problems did arise within the budget of any department, then the power would shift up to the director and the board members. They would be responsible for raising additional money to fill any “income gaps” they find reasonable (Lord 161).

All organizations strive to streamline operations, which in turn should lead to saving money. Fighting the wasting of resources should be a top priority for any government entity and particularly for supervisors, managers, and executives. In the public sector this is particularly true because the citizens in effect supply the resources wasted. The public trust should not be abused by careless or needless spending. However, because of the bureaucratic nature of any government agency, some waste cannot readily be avoided. The laws and regulations that have been duly enacted to secure justified expenditures in and of themselves can cause waste.

3. How does the opportunity cost of a government purchase vary depending on whether the market for

BEING A RESEARCH PROJECT SUBMITTED TO THE DEPARTMENT OF ACCOUNTING, FACULTY OF MANAGEMENT SCIENCES, UNIVERSITY OF ABUJA, ABUJA, NIGERIA