Postgraduate Certificate in Public Financial Management (Distance Learning)

Welcome to the Financial Reporting module. Accounting is a vital yet complex task for any organisation. Businesses and public organisations need to keep accurate records of their income and spending. This information is needed both for internal decision-making and to demonstrate accountability to their stakeholders. This module is designed to give students sufficient knowledge of financial reporting practices, in both the private and public sectors, to use the information produced and to contribute to debates on the development of reporting policy. The module concentrates on financial reporting using the International Financial Reporting Standards (IFRS) and International Public Sector Accounting Standards (IPSAS). These standards have now been adopted in many countries; other countries are in the process of adoption or have implemented similar systems.

Learning outcomes

When you have completed your study of this module, you will be able to:

• discuss the international conceptual frameworks for financial reporting in the public and private sectors
• discuss the development and global adoption of the International Public Sector Accounting Standards (IPSAS) and the International Financial Reporting Standards (IFRS)
• explain and contrast the differences in external reporting on a cash and accruals basis
• discuss the accounting treatment for specific assets and liabilities in accordance with IPSAS and IFRS
• discuss the process of consolidating financial statements and identify relevant accounting standards
• discuss the application of governance principles and compare with national governance guidance.

Tuition and assessment

Students are individually assigned an academic tutor for the duration of the module, with whom you can discuss academic queries at regular intervals during the study session.

You are required to complete two Assignments for this module, which will be marked by your tutor. Assignments are each worth 15% of your total mark. You will be expected to submit your first assignment by the Tuesday of Week 6, and the second assignment at the end of the module, on the Tuesday after Week 10. Assignments are submitted and feedback given online. In addition, queries and problems can be answered through the Virtual Learning Environment.

You will also sit a three-hour examination on a specified date in September/October, worth 70% of your total mark. An up-to-date timetable of examinations is published on the website in July each year.

Study resources

• Study guide: The module study guide is carefully structured to provide the main teaching, defining and exploring the main concepts and issues, locating these within current debate and introducing and linking the assigned readings.
• Key texts: 
  • Elliott B & J Elliott (2019) Financial Accounting and Reporting. 19th Edition. Pearson.
  • Müller-Marqués Berger T & EY (2018) IPSAS Explained: A Summary of International Public Sector Accounting Standards. 3rd Edition. John Wiley & Sons.
• Readings: Throughout the module you will be directed to study a selection of readings, including journal articles, book extracts and case studies that are of particular relevance and interest to the topics covered in the module.
• Virtual learning environment: You will have access to the VLE, a web-accessed study centre. Via the VLE, you can communicate with your assigned academic tutor, administrators and other students on the module using discussion forums. The VLE also provides access to the module Study Guide and assignments, as well as a selection of electronic journals available on the University of London Online Library.

Study calendar 2022/23

Study calendars are subject to change.

Module overview

Unit 1 Context of Financial Reporting

• 1.1 Introduction
• 1.2 Private Versus Public Sectors
• 1.3 Rationale for Financial Reporting Standards
• 1.4 International Conceptual Framework – Public Sector
• 1.5 International Conceptual Framework – Private Sector
• 1.6 Conclusion

Unit 2 Accounting Concepts 1

• 2.1 Financial Standards: IFRS versus IPSAS
• 2.2 Cash- Versus Accruals-Based Accounting
• 2.3 Cash Versus Accruals and Accounting Standards
• 2.4 Case Study
• 2.5 Feedback on Case Study
• 2.6 Conclusion

Unit 3 Accounting Concepts 2

• 3.1 Income, Capital and Value
• 3.2 The Accountant’s View
• 3.3 The Economist’s View
• 3.4 Accounting for Changes in Price Levels
• 3.5 Case Study
• 3.6 Feedback on Case Study
• 3.7 Conclusion

Unit 4 Accounting for Assets

• 4.1 Current Assets
• 4.2 Non-Current Assets
• 4.3 Valuing Assets in Agriculture
• 4.4 Case Study
• 4.5 Feedback on Case Study
• 4.6 Conclusion

Unit 5 Accounting for Liabilities

• 5.1 Current and Non-Current Liabilities
• 5.2 Provisions and Contingent Liabilities
• 5.3 Financial Instruments
• 5.4 Case Studies
• 5.5 Feedback on Case Studies
• 5.6 Conclusion

Unit 6 Leases and Partnerships

• 6.1 Leases
• 6.2 What are Public Private Partnerships?
• 6.3 Use of PPP
• 6.4 Accounting for PPP
• 6.5 Case Study
• 6.6 Feedback on Case Study
• 6.7 Conclusion

Unit 7 Group Accounts

• 7.1 Group Accounts
• 7.2 The Consolidation Process
• 7.3 Users and Uses of Consolidated Financial Statements
• 7.4 Case Studies
• 7.5 Feedback on Case Studies
• 7.6 Conclusion

Unit 8 Governance

• 8.1 Definitions
• 8.2 Governance Failures
• 8.3 Good Governance in the Public Sector
• 8.4 Good Governance in the Private Sector
• 8.5 International Comparisons and National Perspectives
• 8.6 Conclusion
• 8.7 The Examination

Module samples

• M492 Module Introduction (PDF)
• M492 Specimen Examination (PDF)
• M492 Unit 1 (PDF)

Disclaimer

Important notice regarding changes to programmes and modules

This module, Macroeconomic Policy and Financial Markets, is specially constructed for postgraduates studying finance and related subjects. The module is designed to increase the depth of your understanding whether or not you have studied economics or macroeconomics previously. Although it does not require previous study of macroeconomics, if you have studied macroeconomics at undergraduate level, this module adds to your knowledge because, unlike other modules, we focus on the relation financial markets have to macroeconomics.

Our intention is that after successfully completing the module, students from varied backgrounds will understand the key elements of macroeconomics and their connection with financial markets. We place the subject in a real-world context, aiming to show how theoretical and empirical knowledge of macroeconomics and financial markets provides ways to analyse the salient problems faced by modern macroeconomic policy makers.

Learning outcomes

When you have completed your study of this module, you will be able to:

• outline and discuss the connection between financial markets, real saving by households, and real investment by firms
• analyse how monetary policy can affect real macroeconomic activity through its interaction with financial markets
• explain the relation between financial markets and governments' fiscal policies
• discuss the effect that expectations of future inflation and interest rates can have on macroeconomic policy and financial markets
• analyse the connection between foreign exchange markets, imports and exports
• examine the possibility of instability arising from interaction between international capital flows and financial markets
• evaluate theories in the light of empirical evidence
• use theory and evidence to analyse actual problems facing macroeconomic policy makers.

Tuition and assessment

Students are individually assigned an academic tutor for the duration of the module, with whom you can discuss academic queries at regular intervals during the study session.

You are required to complete two Assignments for this module, which will be marked by your tutor. Assignments are each worth 15% of your total mark. You will be expected to submit your first assignment by the Tuesday of Week 6, and the second assignment at the end of the module, on the Tuesday after Week 10. Assignments are submitted and feedback given online. In addition, queries and problems can be answered through the Virtual Learning Environment.

You will also sit a three-hour examination on a specified date in September/October, worth 70% of your total mark. An up-to-date timetable of examinations is published on the website in July each year.

Study resources

• Study guide: The module study guide is carefully structured to provide the main teaching, defining and exploring the main concepts and issues, locating these within current debate and introducing and linking the assigned readings.
• Key texts: Miles, D, A Scott & F Breedon (2012) Macroeconomics: Understanding the Global Economy, 3^rd Edition, Wiley.
• Readings: Throughout the module you will be directed to study a selection of readings, including journal articles, book extracts and case studies that are of particular relevance and interest to the topics covered in the module.
• Video: You will also have access to video content on the VLE, in which leading policy-makers talk to CeFiMS about their experiences. All the decision makers and advisers in the video have dealt with difficult macroeconomic problems in a range of countries and they explain how they approached the problem and considered alternative policies.
  They include:
  • Paul Volcker, looking back on his experience as Chairman of the Federal Reserve
  • Sir Alan Budd, as Economic Adviser in the British Treasury (Ministry of Finance)
  • Guillermo Ortiz, as the Governor of Mexico's central bank
  • Professor Lord Richard Layard, as advisor to the Russian government
  • Benno Ndulu, of the World Bank
  • Professor Rudiger Dornbusch, on experience of Latin American macroeconomic policy
  • Professor Sakakibura, on Japan's recent policy problems
    The interviews were recorded by CeFiMS for the International Monetary Fund and designed for officials studying macroeconomics with the IMF Institute. They are reproduced here with kind permission of the IMF. They show case studies intended to enable students to link their study of principles to actual macroeconomic policy making in the complex real world.
• Virtual learning environment: You will have access to the VLE, web-accessed study centre. Via the VLE, you can communicate with your assigned academic tutor, administrators and other students on the module using discussion forums. The VLE also provides access to the module Study Guide and assignments, as well as a selection of electronic journals available on the University of London Online Library.

Study calendar 2022/23

Study calendars are subject to change.

Module overview

Unit 1 Macroeconomics and the World of Finance

• 1.1 Introduction
• 1.2 Getting Macroeconomics in Perspective
• 1.3 Long-Run and Short-Run Macroeconomics
• 1.4 Aggregate Demand and National Income Accounts
• 1.5 Alternative Windows on Macroeconomics
• 1.6 Macroeconomics and Financial Markets
• 1.7 Macroeconomics and Finance in Subsequent Units

Unit 2 Saving and Finance

• 2.1 Introduction: Real and Financial Saving
• 2.2 Life Cycle Theory of Saving
• 2.3 Flow of Savings to Financial Markets – Demographic Fundamentals
• 2.4 Impact of Financial Markets on Saving – Interest Rate Effect
• 2.5 Impact of Financial Markets on Saving – Wealth Effect

Unit 3 Investment and Financial Markets

• 3.1 Capital Accumulation
• 3.2 Interest Rates and Investment – the Basic Model
• 3.3 Beyond the Basic Model
• 3.4 Investment and the Stock Market
• 3.5 Financing Hierarchy and the Role of Internal Funds
• 3.6 Conclusion – Investment and Monetary Policy

Unit 4 Monetary Policy and the Central Bank

• 4.1 Central Banks and Macroeconomic Policy – Inflation Targeting
• 4.2 Policy's Intermediate Targets – Money Supply and Interest Rate
• 4.3 Taylor Rules
• 4.4 Transmission Mechanisms of Monetary Policy
• 4.5 Monetary Policy in Context

Unit 5 Fiscal Policy and Government Finances

• 5.1 Effects of Fiscal Policy – Aggregate Demand and Financial Markets
• 5.2 Fiscal Policy and Monetary Policy
• 5.3 Fiscal Policy and the Sustainability of Debt Financing
• 5.4 Fiscal Policy in Perspective

Unit 6 Expectations, Inflation, and Interest Rates

• 6.1 Markets Reflect the Expected Future Today
• 6.2 Macroeconomic Expectations and Financial Markets
• 6.3 Inflation Expectations and the Inflation Output Trade Off

Unit 7 Foreign Exchange Markets and Foreign Trade

• 7.1 Foreign Exchange Markets and the Economy
• 7.2 Case Study – China's Macroeconomic Policy Choices
• 7.3 Exchange Rates, Inflation and Aggregate Demand
• 7.4 Exchange Rates and Monetary Policy

Unit 8 International Capital Flows and Financial Markets

• 8.1 International Capital Flows – Balance and Shocks
• 8.2 Interest Rates, Expectations and Currency Crises
• 8.3 Currency Crises and Exchange Rate Systems
• 8.4 Is There a Case for Controls on International Capital Flows?

Module samples

• M425 Module Introduction (PDF)
• M425 Specimen Examination (PDF)
• M425 Unit 1 (PDF)

Disclaimer

Important notice regarding changes to programmes and modules

Welcome to the module Public Financial Management: Audit and Compliance. Audit is an evolving function in the public sector. It has evolved from simply checking that money has been spent in the ways that governments intended and ensuring that none was stolen or misappropriated. Now it is also concerned with evaluating whether the application of funds represents good value for the taxpayer and, more recently, to evaluating whether government policies have been effective. The early functions of audit (i.e. the detection of fraud and technical errors in accounting) still remain but have now been overlain with new, more evaluative, functions.

The purpose of this module is to give you an understanding of the different roles and purposes of audit and to enable you plan and commission audits. In addition, it will enable you to carry out some of the functions of the auditor. This is an ambitious aim, and the module ranges over the spectrum of audit activities, drawing examples from detecting fraud to evaluating the success of policies.

Learning outcomes

When you have completed the study of this module and its readings you will be able to:

• explain the public finance control function as an activity that involves different actors in the constitutional system
• explain the different rationales with which the different control actors operate in a democratic state
• make comparisons between the different control subsystems
• explain and compare the different forms of audit reporting
• examine the International Public Sector Internal Audit Standards applicable and effective from 1 April 2013 and other internal audit guidelines
• outline the advantages of cybernetic control theory
• carry out a systems-based approach to audit
• use compliance and substantive testing
• explain the various sampling techniques and demonstrate how to use IT to test the whole population
• discuss the concept of performance audit, and what it consists of
• differentiate the role of performance audit from evaluation activity
• define the concepts of economy, efficiency and effectiveness, and evaluate the performance of a public programme or organisation through these elements
• use audit criteria to determine the economy, efficiency and effectiveness of a public programme or organisation
• value the importance of performance audit in the contemporary public administration
• discern the fuzzy delineation between political and external control when it comes to performance audit
• distinguish the two main functions of performance audit: accountability and organisational learning
• assess the performance of a performance auditor
• situate the function of fraud combat within the broader architecture of budgetary control
• discuss how a fraud investigation is carried out, including the legal framework and evidence collection
• explain the main types of classical and contemporary fraud which exist in all countries, developed or developing.

Study resources

• Study guide: The module study guide is carefully structured to provide the main teaching, defining and exploring the main concepts and issues, locating these within current debate and introducing and linking the assigned readings.
• Key texts: Davies M & J Aston (2011) Auditing Fundamental. Prentice Hall.
• Readings: Throughout the module you will be directed to study a selection of readings, including journal articles, book extracts and case studies that are of particular relevance and interest to the topics covered in the module.
• Virtual learning environment: You will have access to the VLE, a web-accessed study centre. Via the VLE, you can communicate with your assigned academic tutor, administrators and other students on the module using discussion forums. The VLE also provides access to the module Study Guide and assignments, as well as a selection of electronic journals available on the University of London Online Library.

Study calendar 2022/23

Study calendars are subject to change.

Module overview

Unit 1 Public Sector Auditing

• 1.1 Introduction to Auditing
• 1.2 Accountability in the Public Sector
• 1.3 External Audit in the Public Sector
• 1.4 Internal Audit in the Public Sector
• 1.5 Political Power and Control
• 1.6 The Control of Public Spending in the Genesis of Constitutionalism
• 1.7 The Purposes of Budgetary Control
• 1.8 Conclusion

Unit 2 The Public Finance Control System

• 2.1 The Control Pyramid
• 2.2 Internal Control
• 2.3 External Control
• 2.4 Jurisdictional Control
• 2.5 Political Control
• 2.6 Social Control
• 2.7 Conclusion

Unit 3 External Audit and Reporting

• 3.1 The Role of External Audit?
• 3.2 Reporting on Finanical Statements
• 3.3 Probity Audit
• 3.4 Verification Audit
• 3.5 Supreme Audit Institutions
• 3.6 Conclusion

Unit 4 Internal Audit and Control

• 4.1 What is Internal Audit?
• 4.2 Internal Audit and Internal Control
• 4.3 Ethical Issues and the Internal Auditor
• 4.4 Public Sector Internal Audit Standards
• 4.5 Internal Control
• 4.6 Cybernetic Control Theory
• 4.7 Conclusion

Unit 5 Risk Assessment and a Systems-Based Approach

• 5.1 Introduction to Risk
• 5.2 Policy and Risk
• 5.3 Risk Management
• 5.4 Systems-Based Auditing
• 5.5 System Documentation
• 5.6 Sampling
• 5.7 An IT Approach to Sampling
• 5.8 Conclusion

Unit 6 Performance Audit I

• 6.1 Introduction to the Concept of Performance Audit
• 6.2 Auditing Performance: Economy, Efficiency and Effectiveness
• 6.3 Performance Audit Criteria
• 6.4 Conclusion

Unit 7 Preformance Audit II

• 7.1 Performance Audit in Contemporary Public Administration
• 7.2 The Political Dimension of Performance Control
• 7.3 Performance Audit, Between Accountability and Learning
• 7.4 Performance Audit in the Age of Multi-Level Governance
• 7.5 Implications of the Elaboration of the Audit Agenda
• 7.6 The Learning Component of Performance Audit
• 7.7 Evaluating the Performance of a Good Performance Audit
• 7.8 Conclusion

Unit 8 Fraud

• 8.1 The Problem of Fraud
• 8.2 Fraud and Irregularity
• 8.3 Corruption and Risk in Public Procurement
• 8.4 Preventing Fraud through Internal Control: COSO
• 8.5 Conclusion

Tuition and assessment

Students are individually assigned an academic tutor for the duration of the module, with whom you can discuss academic queries at regular intervals during the study session.

You are required to complete two Assignments for this module, which will be marked by your tutor. Assignments are each worth 15% of your total mark. You will be expected to submit your first assignment by the Tuesday of Week 6, and the second assignment at the end of the module, on the Tuesday after Week 10. Assignments are submitted and feedback given online. In addition, queries and problems can be answered through the Virtual Learning Environment.

You will also sit a three-hour examination on a specified date in September/October, worth 70% of your total mark. An up-to-date timetable of examinations is published on the website in July each year.

Module samples

• M472 Module Introduction (PDF)
• M472 Specimen Examination (PDF)
• M472 Unit 1 (PDF)

Disclaimer

Important notice regarding changes to programmes and modules

Welcome to Public Financial Management: Planning and Performance. We hope that you will find the module stimulating and useful. Even if you do not have a background in public finance we think you will be able to learn a lot and do well in the assessment for this module. There is technical material and language that may seem to outsiders to be jargon, but we aim to explain the reasoning behind all new terms as we introduce them and to avoid unnecessarily technical language.

It is an interesting time to be studying public finance for several reasons. First, there are changes in the way that the public sector ‘does its business’. Bureaucracies with strict hierarchies of public employees carrying out their duties according to a fixed set of rules are giving way, or have already given way, to different ways of working. In some cases there have been programmes of decentralisation and delegation of authority so that managers and professionals at relatively junior levels now have to take decisions based on the best information, including financial information, available to them.

In professions across the public sector – whether medical, educational, legal, engineering or custodial – people are making choices about investments, about how to achieve efficiency, how to stay within budget and how to improve performance. Whether reluctantly or willingly, people are having to understand costs, budgets, financial statements about cash flows and expenditures, even when they are not in accountancy.

In other cases, services are increasingly contracted out to commercial companies, to NGOs or to communities rather than being provided directly by public employees. These arrangements require a different set of disciplines – of monitoring other people’s performance, of assessing value for money of contracts rather than employees’ performance.

A second reason why public finance is interesting now is that in many countries what people are being held to account for is also changing. It is often not sufficient to have accounts that show that money has been spent as governments intended – politicians and the public want to know how well it has been spent, whether it has been used efficiently and whether it has achieved the purposes for which it was allocated. This widening of accountability, combined with the delegation of accountability lower down in the organisations, has placed a burden on accounting systems and on the managers and professionals who have to understand and operate them. Computer systems make financial management easier but managers need to understand the concepts underlying the numbers and the consequences of the financial information that is provided.

Learning outcomes

When you have completed this module, you will be able to:

• explain how public budgeting fits into the macroeconomic framework
• apply ideas about accountability to the production of various forms of account for public services and public money
• discuss how changes in public management require different forms of public accounting
• read a budget and a set of national accounts and explain the differences between budgets and accounts in different jurisdictions
• explain costs and different ways of measuring them and how costs are used in budgets
• discuss the budget process at national and sub-national levels and the techniques appropriate at different levels
• apply budgetary control methods
• use financial management to enhance the performance of public organisations
• discuss how public financial management interfaces with politics and political choices.

Tuition and assessment

Students are individually assigned an academic tutor for the duration of the module, with whom you can discuss academic queries at regular intervals during the study session.

You are required to complete two Assignments for this module, which will be marked by your tutor. Assignments are each worth 15% of your total mark. You will be expected to submit your first assignment by the Tuesday of Week 6, and the second assignment at the end of the module, on the Tuesday after Week 10. Assignments are submitted and feedback given online. In addition, queries and problems can be answered through the Virtual Learning Environment.

You will also sit a three-hour examination on a specified date in September/October, worth 70% of your total mark. An up-to-date timetable of examinations is published on the website in July each year.

Study resources

• Study guide: The module study guide is carefully structured to provide the main teaching, defining and exploring the main concepts and issues, locating these within current debate and introducing and linking the assigned readings.
• Key texts: Allen R, R Hemming and BH Potter (Eds) (2013) International Handbook of Public Financial Management. Basingstoke, UK and New York, Palgrave Macmillan.
• Readings: Throughout the module you will be directed to study a selection of readings, including journal articles, book extracts and case studies that are of particular relevance and interest to the topics covered in the module.
• Virtual learning environment: You will have access to the VLE, a web-accessed learning environment. Via the VLE, you can communicate with your assigned academic tutor, administrators and other students on the module using discussion forums. The VLE also provides access to the module Study Guide and assignments, as well as a selection of electronic journals available on the University of London Online Library.

Study calendar 2022/23

Study calendars are subject to change.

Module overview

Unit 1 The Context of Financial Management

• 1.1 Introduction
• 1.2 What is a Budget?
• 1.3 The Macroeconomic Framework
• 1.4 The Legal Framework
• 1.5 Accountability
• 1.6 Conclusion

Unit 2 Budget Coverage, Classification and Structure

• 2.1 Introduction
• 2.2 Coverage of the Budget
• 2.3 Classification of the Budget
• 2.4 Budget Composition
• 2.5 The Line Item System vs Programme Systems

Unit 3 Costs

• 3.1 Some Definitions of Cost
• 3.2 Costing Systems
• 3.3 Cost-Volume-Profit Model
• 3.4 Absorption or Full Cost Recovery
• 3.5 Activity Based Costing (ABC)
• 3.6 Managing Costs
• 3.7 Price-Based Costing
• 3.8 Relevant Costs

Unit 4 Accounting and Budgeting: National Level

• 4.1 Approaches to Public Accounting and Budgeting
• 4.2 Cash Accounting vs Accruals Accounting
• 4.3 The Macroeconomic, Fiscal Framework and the Medium-Term Expenditure Framework
• 4.4 Policy Formulation and the Budget Process
• 4.5 Budget Timetable

Unit 5 Accounting and Budgeting: Sub-National Level

• 5.1 Translating the national budget into operational budgets
• 5.2 Structure, Performance, Discretion, Block Grants and Contracts
• 5.3 Fund Accounting
• 5.4 Resource Accounting and Budgeting
• 5.5 Which Techniques at Which Stage?
• 5.6 Budget Timetable at Sub-National Level
• 5.7 Case Study South Africa Basic Education
• 5.8 Accounting for Services Provided by Third Parties

Unit 6 Budget Execution

• 6.1 Introduction: Budgetary Control
• 6.2 Controlling Operations
• 6.3 Taking Action
• 6.4 Risk of Policy Failure
• 6.5 Case Study

Unit 7 Budgeting and Performance

• 7.1 Introduction: Accruals Accounting and Output and Outcome Budgeting
• 7.2 Defining and Measuring Non-Financial Items, Especially Outputs and Outcomes
• 7.3 Case Study 1: Output and Outcome Definitions
• 7.4 Case Study 2: Performance Budgeting in France
• 7.5 Case Study 3: Performance Budgeting in Poland
• 7.6 Performance Budgeting in Asia
• 7.7 Case Study: Education Funding in South Africa
• 7.8 Conclusions: Will Performance Management and Budgeting Ever Be Fully Implemented?

Unit 8 Budgeting and Democracy

• 8.1 Introduction
• 8.2 National Legislatures and the Budget Process
• 8.3 Case Study: Canada
• 8.4 Participatory Budgeting
• 8.5 Case Study: Australia
• 8.6 Conclusions on Budgeting and Democracy
• 8.7 Is There a Single Best Method of Financial Management?

Module samples

• M401 Module Introduction (PDF)
• M401 Specimen Examination (PDF)
• M401 Unit 1 (PDF)

Disclaimer

Important notice regarding changes to programmes and modules

This module aims to introduce you to the theory and practice of public finance, with special reference to how governments raise and use revenues. It is concerned with taxation, borrowing and aid. There are economic principles that bear on the issues of financing public expenditure and these are covered in the module. At the same time, however, we recognise that decisions on taxation, borrowing and aid are not taken solely with reference to economics but also to politics, and the module raises relevant political and social issues too. While the module has some emphasis on taxation in poorer countries, they are not its exclusive concern.

Learning outcomes

When you have completed your study of this course you will be able to:

• outline and discuss the main sources of government revenue
• explain the main criteria for assessing types of taxation
• analyse the main trends in taxation especially as between advanced and developing countries
• evaluate the main recommendations and analytical methods of the theory of optimal taxation that underpins modern tax reform
• gauge the degree of inequality and evaluate policies to reduce inequality
• outline the economic arguments for and against environmental taxes
• assess the impact of taxes on people’s consumption behaviours
• evaluate the causes of weak tax administration in developing countries and recommended appropriate policies to improve tax administration
• judge the use of Value Added Taxes in the context of developing countries
• discuss the causes and effects of tax competition between countries
• evaluate the effects of natural resource abundance on countries
• explain the economic case for fiscal decentralisation
• explain the characteristics of local taxes and some of the problems of tax collection at local level
• define the issues in how fiscal policy can be used to stabilise economies
• outline the different effects and policy implications of internal and external debt
• explain how governments can create the illusion of fiscal adjustment by financial engineering
• assess the success of aid giving as a method of supplementing government revenues in poorer countries and analyse its effects on government spending, tax raising and borrowing.

Tuition and assessment

Students are individually assigned an academic tutor for the duration of the module, with whom you can discuss academic queries at regular intervals during the study session.

You are required to complete two Assignments for this module, which will be marked by your tutor. Assignments are each worth 15% of your total mark. You will be expected to submit your first assignment by the Tuesday of Week 6, and the second assignment at the end of the module, on the Tuesday after Week 10. Assignments are submitted and feedback given online. In addition, queries and problems can be answered through the Virtual Learning Environment.

You will also sit a three-hour examination on a specified date in September/October, worth 70% of your total mark. An up-to-date timetable of examinations is published on the website in July each year.

Study resources

• Study guide: The module study guide is carefully structured to provide the main teaching, defining and exploring the main concepts and issues, locating these within current debate and introducing and linking the assigned readings.
• Readings: Throughout the module you will be directed to study a selection of readings, including journal articles, book extracts and case studies that are of particular relevance and interest to the topics covered in the module.
  • "classics" in the study of public finance
  • operational and policy documents that illustrate how the public finance practitioner uses the tools of public finance in real world policy contexts
  • case studies and research papers that examine the impact of various public finance policies and initiatives in a variety of country and policy contexts.
• Virtual learning environment: You will have access to the VLE, a web-accessed study centre. Via the VLE, you can communicate with your assigned academic tutor, administrators and other students on the module using discussion forums. The VLE also provides access to the module Study Guide and assignments, as well as a selection of electronic journals available on the University of London Online Library.

Study calendar 2022/23

Study calendars are subject to change.

Module overview

Unit 1 Introduction to Taxation

• 1.1 Introduction
• 1.2 Criteria for Assessing Types of Taxes
• 1.3 Types of Tax
• 1.4 Trends in Taxation
• 1.5 Tax Policy and Tax Administration
• 1.6 Conclusion

Unit 2 The Economic Theory of Taxation

• 2.1 Introduction
• 2.2 Economic Efficiency
• 2.3 Income Tax versus Sales Tax
• 2.4 Taxes on the Supply of Labour
• 2.5 Equity and Efficiency
• 2.6 Optimal Taxation
• 2.7 Implications for Tax Policy
• 2.8 Summary and Conclusions

Unit 3 Public Policy and Taxation

• 3.1 Introduction
• 3.2 Inequality
• 3.3 Environmental Taxes
• 3.4 Behaviour and Taxes: Tobacco and Alcohol (Sin) Taxes
• 3.5 Summary and Conclusions

Unit 4 Tax Policy Issues in Developing Countries

• 4.1 Introduction
• 4.2 Tax Policies in Developing Countries
• 4.3 Tax Administration in Developing Countries
• 4.4 Value Added Tax (VAT)
• 4.5 Summary and Conclusions

Unit 5 Tax Policy Issues

• 5.1 Introduction
• 5.2 Tax Competition
• 5.3 The Internationalisation of Tax Policy – Base Erosion and Profit Shifting (BEPS)
• 5.4 Natural Resources ‘Curse’?
• 5.5 Flat Taxes
• 5.6 Summary and Conclusions

Unit 6 Sub National government Revenues

• 6.1 Introduction
• 6.2 The Economic Case for Fiscal Decentralisation
• 6.3 SNG Tax Revenues
• 6.4 Intergovernmental Grants and Transfers
• 6.5 Sub-National Government Borrowing
• 6.6 The Impact of Fiscal Decentralisation
• 6.7 Summary and Conclusions

Unit 7 Budget Deficits and National Debts

• 7.1 Introduction
• 7.2 Deficit Definitions
• 7.3 Why do Governments Run Deficits?
• 7.4 Why Do Deficits Matter?
• 7.5 Does Government Debt Matter?
• 7.6 Austerity Policies
• 7.7 Fiscal Policy in Developing Countries
• 7.8 Fiscal Adjustment and Fiscal Illusions
• 7.9 Summary and Review

Unit 8 Foreign Aid and Debt Relief

• 8.1 Introduction
• 8.2 What is Foreign Aid? (ODA)
• 8.3 Donors of Foreign Aid
• 8.4 Allocation of Foreign Aid
• 8.5 Budget Support
• 8.6 Aid and Tax Effort in Recipient Countries
• 8.7 Aid Volatility
• 8.8 Debt Relief
• 8.9 Summary and Conclusions

Module samples

• M405 Module Introduction (PDF)
• M405 Specimen Examination (PDF)
• M405 Unit 1 (PDF)

Disclaimer

Important notice regarding changes to programmes and modules

Welcome to this module looking at The International Monetary Fund and Economic Policy. The module covers an extensive range of issues and, in the next eight weeks, you will study a wide spectrum of topics associated with the relationship between the IMF and macroeconomic stabilisation. Because the subject matter is vast, I have tried to focus on some of the key themes and provide some indications as to where this subject matter can be studied in greater detail if or when you have time to do so.

Learning outcomes

When you have completed this module, you will be able to do the following:

• identify who pursues stabilisation policies, and why
• distinguish between countries that seek to stabilise on their own, and those that seek help in doing so
• outline and discuss the role, function and operations of the IMF and its approach to stabilisation
• discuss the influence of the financial sector in precipitating instability
• explain the prevalent stabilisation theories and assess their appropriateness in differing circumstances
• identify and discuss the major criticisms and controversies that the IMF's approach has elicited
• explain the particular problems and prescribed remedies for low-income countries seeking to stabilise their economies.

Tuition and assessment

Students are individually assigned an academic tutor for the duration of the module, with whom you can discuss academic queries at regular intervals during the study session.

You are required to complete two Assignments for this module, which will be marked by your tutor. Assignments are each worth 15% of your total mark. You will be expected to submit your first assignment by the Tuesday of Week 6, and the second assignment at the end of the module, on the Tuesday after Week 10. Assignments are submitted and feedback given online. In addition, queries and problems can be answered through the Virtual Learning Environment.

You will also sit a three-hour examination on a specified date in September/October, worth 70% of your total mark. An up-to-date timetable of examinations is published on the website in July each year.

Study resources

• Study guide: The module study guide is carefully structured to provide the main teaching, defining and exploring the main concepts and issues, locating these within current debate and introducing and linking the assigned readings.
• Readings: Throughout the module you will be directed to study a selection of readings, including journal articles, book extracts and case studies that are of particular relevance and interest to the topics covered in the module.
• Virtual learning environment: You will have access to the VLE, which is a web-accessed study centre. Via the VLE, you can communicate with your assigned academic tutor, administrators and other students on the module using discussion forums. The VLE also provides access to the module Study Guide and assignments, as well as a selection of electronic journals available on the University of London Online Library.

Study calendar 2022/23

Study calendars are subject to change.

Module overview

Unit 1 Macroeconomic Stabilisation and the Role of the IMF

• 1.1 Introduction
• 1.2 The Character of the International Monetary Fund
• 1.3 The Articles of Agreement
• 1.4 Three Key Functions Performed by the IMF
• 1.5 Organisational Structure of the IMF
• 1.6 The Executive Board, Constituency System and Advisory Organs
• 1.7 The Departmental Structure of the IMF
• 1.8 The Process Followed in Negotiating a Financing Arrangement with the IMF
• 1.9 Types of IMF Lending
• 1.10 Types of IMF Conditionality
• 1.11 Conclusion

Unit 2 The IMF's Approach to Stabilisation

• 2.1 Introduction
• 2.2 Trends in the Use of IMF-Supported Stabilisation Programmes
• 2.3 Special Drawing Rights (SDRs)
• 2.4 A Model to the Rescue? Mundell-Fleming
• 2.5 Scenarios Using the IS-LM-BP Schedules
• 2.6 The Theoretical Framework For IMF Stabilisation Policies
• 2.7 The Financial Programming Approach – Four Key Identities
• 2.8 Moving from Identities to Behavioural Assumptions
• 2.9 Key Questions and Issues – Jamaica 2010
• 2.10 Conclusion

Unit 3 Alternative Approaches to Stabilisation

• 3.1 Introduction
• 3.2 Key Shortcomings and Criticisms of the IMF Financial Programming Approach
• 3.3 Further Issues in Evaluating the Financial Programming Approach
• 3.4 How Can the IMF Programming Approach Be Improved?

Unit 4 Stabilisation and the Financial Sector

• 4.1 Introduction
• 4.2 Capital Flows and Stabilisation Policy
• 4.3 The Emerging Market Crisis
• 4.4 The Global Financial and Economic Crisis
• 4.5 Conclusion

Unit 5 Stabilisation Policy and Financial Sector – Institutional Responses to Recent Crises

• 5.1 Introduction
• 5.2 Financial Sector Crises – the Role and Responses of the IMF
• 5.3 Developing International Standards and Codes
• 5.4 The IMF's Role in Crisis Prevention and Resolution
• 5.5 Financial Crises – Other International Responses
• 5.6 Conclusion

Unit 6 Stabilisation and the Financial Sector – Some Challenges and Controversies

• 6.1 Introduction
• 6.2 Capital Account Liberalisation
• 6.3 Capital Controls
• 6.4 Criticisms of IMF Stabilisation Policies
• 6.5 Criticisms of the IMF's Response During the EME Crisis
• 6.6 Criticisms of IMF Policy During the Global Financial Crisis
• 6.7 Conclusion

Unit 7 Stabilisation and Low-Income Countries

• 7.1 Introduction
• 7.2 IMF Concessional Lending to Low-Income Countries
• 7.3 The Economic Development Document
• 7.4 Debt Relief
• 7.5 Emergency Lending
• 7.6 IMF Technical Assistance (TA)

Unit 8 Challenges for Low-Income Countries

• 8.1 Introduction
• 8.2 Quotas and Voting Shares of Low-Income Countries
• 8.3 Access Limits
• 8.4 Additional Challenges for Developing Countries
• 8.5 Social Safety Nets
• 8.6 Conclusion

Module samples

• M413 Module Introduction (PDF)
• M413 Specimen Examination (PDF)
• M413 Unit 1 (PDF)

Disclaimer

Important notice regarding changes to programmes and modules