School board directors’ information needs and financial reporting’s role

Abstract

Purpose

The purpose of this paper is to examine whether Washington State school district financial reporting and budget reporting meet the information needs of school board directors charged with governance.

Design/methodology/approach

Washington State school board directors were surveyed and asked to rank information items’ usefulness in carrying out their governance role. School district annual reports, budgets and websites were examined to determine whether the identified information was reported and easily transparent to those charged with governance and the public.

Findings

Directors rank information on strategic oversight, budget planning and student outcomes as more useful, consistent with the strategic role of new public management. Follow-on analysis of district annual financial reports, budgets and websites reveal that the availability of the information ranked useful by directors is limited. The findings suggest an information gap exists between directors’ information needs and school district reporting. Annual reports and budgets, when provided, often provide typical financial statements and variance data, respectively, rather than reporting on mission-aligned performance measures. The main consequence of the information gap may be compromised decision-making effectiveness.

Originality/value

By directly asking those charged with governance what information they identify as useful and then examining whether the information is reported in the annual report, budget or website, the study links user information needs to information transparency.

Citation

Chen, H. and Smith, S.H. (2019), "School board directors’ information needs and financial reporting’s role", Journal of Public Budgeting, Accounting & Financial Management, Vol. 31 No. 4, pp. 578-595. https://doi.org/10.1108/JPBAFM-09-2018-0097