Changes in the Public Accounts Committee of a Less Developed Democratic Country: A Field Study

• Date: 01 February 2016
• DOI: http://doi.org/10.1111/faam.12082
• Published date: 01 February 2016
• Author: Sajjad Hossain Khan,Zahirul Hoque

Financial Accountability & Management, 32(1), February 2016, 0267-4424

Changes in the Public Accounts

Committee of a Less Developed

Democratic Country: A Field Study

SAJJAD HOSSAIN KHAN AND ZAHIRUL HOQUE∗

Abstract: This paper complements prior studies on the public accounts committ-

ees (PACs) by considering the notions of ‘agency’ and ‘structure’ of institutional

theory in tandem in understanding the changes in structures and activities of the

PAC of a less-developed democratic country – Bangladesh. While prior studies

examined ‘external’ institutional pressures on the development and operation of

the PAC in various settings, the role of internal and external institutional agents

in this context has not been their primary focus. Our empirical evidence from

a qualitative field study indicates that over the past two decades, Bangladesh’s

PAC underwent significant changes to its internal governance structures and

administrative processes. While these changes were indirectly driven by pressures

from international donor agencies, PAC members and the national audit office played

a key role as institutional agents in initiating and institutionalising the changes in

PAC governance and operation.

Keywords: public accounts committee, institutional theory, less-developed country,

Bangladesh

∗Sajjad Hossain Khan is a lecturer and course coordinator in Accounting at Charles

Sturt University Study Centre in Melbourne, Australia and Zahirul Hoque is Head of the

Department of Accounting and Professor of Management Accounting/Public Sector at La

Trobe Business School, La Trobe University, Melbourne, Australia. He is also the Executive

Director of the La Trobe University Centre for Public Sector Governance, Accountability and

Performance. The first-named author gratefully acknowledges the financial support provided

for this study by La Trobe University, Australia and the University of Dhaka, Bangladesh.

The authors owe a debt of gratitude to Professor Kamran Ahmed for his support during this

research study. The paper also benefitted from comments of the participants at the 2012

European Annual Congress in Ljubljana.

Address for correspondence: Zahirul Hoque, Department of Accounting, La Trobe Business

School, La Trobe University, Melbourne, Victoria, 3086, Australia.

e-mail: z.hoque@latrobe.edu.au

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PUBLIC ACCOUNTS COMMITTEE OF BANGLADESH 81

INTRODUCTION

Over the past two decades, there has been a shift of paradigm in public-sector

management and accounting worldwide, with increasing emphasis on private-

sector type governance modes, accountability1and performance measurement

for government entities (Hood, 1995; Lapsley, 2008; and Watson, 2004). Good

governance with its principal attributes of accountability and transparency is

receiving increasing attention from policy makers, legislators, funding agencies,

and other stakeholders across nations regardless of the level of development

in their public sectors (Groot and Budding, 2008; and Lapsley, 2008). One of

the important institutions involved in this governance process is the Public

Accounts Committee (PAC). It is one organisational form of the parliamentary

infrastructure through which parliament ensures the accountability of the

government and its agencies that deliver services to the greater community

(McGee, 2002; and Wehner, 2003). A study group of the Commonwealth

Parliamentary Association2in 2002 suggests that the PAC is an essential

component of a democratic accountability.

In recent times, there has been considerable research in exploring the

structural/legal aspects of the PAC in various settings suggesting that PACs

often choose to adopt particular governance modes and accountability practices

to meet the demands of external constituents such as government regulatory

bodies and ‘external’ resource providers (Degeling, et al., 1996; Jacobs and

Jones, 2009; Jacobs et al., 2007a; Jones, 2006 and 2007; Jones and Jacobs, 2006;

and Power, 1997). These studies have mainly concentrated on a democratic

environment, particularly in developed nations. Yet we still lack evidence

on how PACs operate in less-developed environments. The literature has

identified marked differences in socio-economic and political environments

between developed and less-developed democratic countries (Gilman, 2003;

Hoque and Hopper, 1994; Leys, 1996; and Uddin and Hopper, 2001). In general,

a developed country possesses a good level of economic activity, a generally

organised government, and is wealthy. On the other hand, a less-developed

country lacks good economic resources and infrastructures, has a low level of

economic diversification, low standards of living, high population growth, high

dependency on foreign assistance, political instability, corruption, etc. Clearly,

under-developed socio-economic, political and legal institutions have significant

influence on the operations of a PAC. The power of civil and military bureaucracy

over political institutions is significant in leading to recommendations not being

implemented by ministries in less-developed economies.

This paper contributes to the public sector literature in the following

manner. First, it highlights how the PAC’s governance modes and accountability

processes operate in a less-developed democratic country such as Bangladesh.

Second, the findings reveal how a PAC in a less-developed country imported

PAC features from its external environment and gradually formalised these

into institutionalised structures and processes. Third, the study points to the

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