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Burgess Manuscript
Hundreds of Issues
From the book 'Hundreds of Issues that Impact Relief and Development'
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Section BBB
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Issue
Balance Sheet
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Basic observation
A balance sheet, together with profit and loss account and cash flow statement comprises a basic financial statement set.
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Prevailing response
Balance sheet accounting does not exist in the cash basis accounting used by most governments and the relief and development sector. As a result, it is very difficult to get useful financial information about relief and development performance.
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A better response
The balance sheet is a very powerful tool for the measurement of relief and development performance, just as it is vital in the financial analysis of corporate performance. Balance sheet concepts can be used as a major metric for the accounting of relief and development performance at various levels from the family and community to organizations, sectors and nations.
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Issue
Banking
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Basic observation
Banking services are critical in the economy and have been from early times. Money, in particular, facilitates economic transactions.
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Prevailing response
The banking and financial services sector has not been a priority in the relief and development sector. There has been development neglect and private market driven services have largely withdrawn from most of the poor communities. Meanwhile, major international banks do service the elite and the corporate community and facilitate the movement of large amounts of money with little constraint, oversight or transparency. The banking sector has become very profitable while its level of service to all but its richest clients has deteriorated.
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A better response
Banking services need to be everywhere. Transaction costs need to be low enough so that affordable pricing is profitable. This is possible with modern ICT based financial systems. The banking and financial sector needs external public accounting and analysis so that its value chains are better understood, and there may be a need to introduce regulatory controls to limit banking institutions from profiting at the expense of the clients and the public.
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Issue
Big “pharma”
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Basic observation
The pharmaceutical industry has scientific strength, but the business model that has evolved seems to favor stockholders over society.
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Prevailing response
There are a lot of critics of the “big pharma” corporations because of the appearance of putting profit ahead of people. There is a huge polarization between the critics and the corporations, and very little appreciation of the totality of the issues.
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A better response
Better knowledge about the investments being made by “big pharma” in research, and the costs that have to be incurred to bring a product to market would result in more appreciation for the corporate position on pricing ... but also the corporations need to be held accountable for their lack of interest in using their available knowledge to solve major health problems in developing countries.
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Issue
Bill of Rights
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Basic observation
In a modern civilized society, people can reasonably expect that a set of “rights” exist and will be respected.
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Prevailing response
Too often, however, “rights” are limited to an elite group of people rather than ALL people. Instead of resulting in a better world, the result is exactly the reverse.
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A better response
Rights are talked about as applying to all people, and this needs more and more to be made a reality. Information systems should be mobilized to make this a reality. The government and leadership in countries where peoples' rights have been seriously abused should be sanctioned in an effective way, such as be losing all international recognition and having national sovereignty suspended.
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Issue
Bio-diversity
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Basic observation
The planet is a complex ecological system, and its biology is amazingly diverse.
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Prevailing response
Leadership has bio-diversity low in its priorities. Yet loss of habitat and the encroachment of development means species are disappearing at an increasingly rapid rate.
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A better response
Development needs to be accelerated but in ways that also help maintain bio-diversity. Community level development may be a way to encourage socio-economic progress and implement programs to protect bio-diversity, as for example, thorough eco-tourism.
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Issue
Book-keeping
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Basic observation
Book-keeping is the basis of good accounting, but is usually relegated to a back room with little attention from the organization's leadership.
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Prevailing response
Book keeping is not highly regarded nore understood by experts in the relief and development sector. The failure of World Bank experts to appreciate the critical work done by accounting clerks and book-keepers helped to make corruption endemic in many poor countries. High level discussions about planning, financial management, computerization, etc. completely missed the critical support needs.
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A better response
Leadership needs to make a big deal about the quality of book keeping and ensure that it is done well. Good accounting is the best line of defense against financial mis-management in all its forms. Getting record keeping done on time with all transactions recorded correctly is the best way to solve the problems of bribery and corruption and will also produce better management information.
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Issue
Bribery
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Basic observation
Bribery is the practice of paying for favors or influence. The recipient is often an official with some ability to speed up the process or otherwise be helpful. It is practiced at both the petty level where amounts are small, and on a grand scale where the amounts are very large.
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Prevailing response
The issue of bribery and corruption has been identified for years. Until the late 1980s, the issue was not admitted at all by the major actors in the relief and development sector. At the World Bank, in the 1980s, it was impossible to talk or write about corruption. “Officially” ... bribery and corruption did not exist. It was only later, around 1990 that the World Bank and others started to talk about the problem.
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A better response
But the relief and development sector needs to go a long way further. It is not sufficient just to talk about bribery and corruption. There have to be strong actions to make bribery and corruption and unacceptably expensive alternative to fair and honest political and business transactions. For this to happen there needs to be strong efforts in both the accounting and in the legal enforcement areas.
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Issue
Budget (in private business or an NGO)
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Basic observation
The budget as more a piece of the planning system.
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Prevailing response
In the corporate world the budget is part of a process that helps to optimize profit performance. In the NGO community the budget is the funding available for a relief and development intervention and frequently driven by donor limits.
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A better response
The budget can be a very powerful tool for performance in any organization, but only when it is designed for planning and subsequent measurement and feedback and includes both the income, revenue or benefits as well is simply the costs.
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Issue
Budget (in government)
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Basic observation
The budget in government is the authorization by the legislature to spend funds. It is a result of a process of planning and negotiation that culminates in a legislative act.
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Prevailing response
The ORDA community and its development experts have paid little attention to the “budget” situation in poor countries where the resource flows are insufficient for the country's government to function
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A better response
The budget of a poor “south” country should be a key information element for development analysis, and easily accessible. Government level programs should all be consistent and compatible with the budget.
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Issue
Business abuse
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Basic observation
Abuse in the business world is not new, it has existed in one form or another for a very long time. It is a product of greed and human nature.
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Prevailing response
It is possible that business abuse has increased in scale during the past fifty years. In part this is because the scale of economic activity has increased, but it is also a result of singular attention to “numbers” without paying adequate attention to the underlying ethics of the organization.
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A better response
Business leadership sets the tone, and where it is clear that ethics in the organization are secondary to making the numbers, abuse will flourish. Good leadership and good accounting are strong antidotes to business abuse. Also real transparency serves as a catalyst for sound corporate behavior.
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Issue
Business education
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Basic observation
Business education has grown over the past several decades. As a result more business managers understand the financial dimension of business than in past years.
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Prevailing response
A business education in conjunction with a technical or professional training is very valuable. A business education that is not grounded in other specialties is limited, and business education without ethics is potentially dangerous.
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A better response
A business education can be very powerful in conjunction with other disciplines such as engineering, accounting or law. It is also of reat value when aligned with strong ethical values. But business education should go beyond the corporate result and also address the social issues and the value dimensions of social investment.
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From 'HUNDREDS OF ISSUES THAT IMPACT RELIEF AND DEVELOPMENT'
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