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Introduction
Innovations in public sector management now travel rapidly around the world. Over the last two decades, most western countries and many developing ones have seen substantial changes in their public sectors. While the western states have better embraced these changes and reaped the benefits due to the well internalization of the features of modern administrative system and the support of parallel development of rational thinking, other countries have encountered hurdles in their endeavor due to the weaknesses of the administrative systems, the lack of acceptable norms of behavior, and the disconnection between the modern administrative principles and the prevailing values of the society ([42] World Bank, 1999; [25], [44] Kiggundu, 2002, 1998; [40] UN/DESA, 1997). Despite the enormous contributions of the old administrative model, since 1970, it has come under severe criticism for various reasons. By end of the 1980s, a new model of public sector management (new public management - NPM) has emerged in most developed and some of developing nations ([35] Pollitt, 1993). Many scholars and even international organizations have shared and raised similar concerns about growing size and capability of the public sector. The fiscal crises of governments, the inferior and inefficient methods of service provision, the changes in public expectations, the lack of accountability, and corruption have contributed to the emergence of NPM model. The new model promises better government, devolution of authority, empowerment, client focus and better mechanisms of public accountability ([34] Pollitt, 2001; [37] Sarker, 2006).
One consequence of this change has been an increased concern with reporting and accountability. [22] Hood (1995) and [4] Behn (2001) argued that NPM should include accountability for results and performance as well as compliance with financial rules and procedures. Government departments and agencies should be held accountable for outputs and outcomes achieved rather than only attempt to avoid errors by following rules, procedures, and standards. By changing the budget format to include outputs, and even outcomes, as well as the monetary figures, the accountability of public sector organizations will be strengthened. This has become known as "performance auditing."
Performance auditing was developed in industrial countries with representative systems of government and a high level of public accountability, but it has been adopted by many other countries with rather different economic and...