The GASB's Mission and Performance Measurement.

The Government Finance Officers Association (GFOA) is proud of the leadership role it played in helping to establish the Governmental Accounting Standards Board (GASB). As an organization we remain firmly committed to the GASB's role as the authoritative accounting and financial reporting standard-setting body for state and local governments. GFOA is equally proud of its longstanding efforts to encourage governments to use performance measurements to improve how they provide services and allocate resources. Most recently, GFOA adopted a comprehensive strategy to promote performance measurement in the public sector.

GFOA can boast many members from jurisdictions, including my own, Portland, Oregon, that have actual, "on-the-ground," experience in performance measurement. This shared experience of governments across the country has amply demonstrated the crucial importance of performance measurement for budgeting, management, and service planning. Thus, for more than a decade, GFOA's members, under the leadership of the Executive Board and standing committees, have demonstrated in action an abiding commitment to improving performance measurement.

Accordingly, there can be no questioning GFOA's commitment to promoting performance measurement in the public sector. Nor are we alone in our support for performance measurement. The National Advisory Council on State and Local Budgeting (NACSLB) recognized performance measurement as an essential element of good budgeting practice. Likewise, the International City/County Management Association has undertaken its own performance measurement project.

The GASB also has demonstrated a serious interest in performance measurement, which it prefers to describe as service efforts and accomplishments (SEA) reporting. The GASB passed formal resolutions encouraging governments to experiment with SEA reporting in both 1985 and 1989. It also issued a series of nine research reports collectively entitled Service Efforts and Accomplishments Reporting: Its Time Has Come. Most important, in 1994, the GASB issued Concepts Statement No. 2, Service Efforts and Accomplishments Reporting, which committed the board in principle to incorporating performance measurement as part of general purpose external financial reporting.

Normally, GFOA seeks out opportunities to work with other groups to pursue common goals. In this particular case, however, GFOA has no choice but to oppose the GASB's involvement with performance measurement. Nor is GFOA alone in this regard. The seven largest governmental public-interest groups took a similar position in a letter dated February 1, 2000. Why then do governments oppose the GASB's SEA project despite their own commitment to performance measurement?

To be effective, performance measurement must be thoroughly integrated into a government's budgetary process. This natural relationship between performance measurement and budgeting was underscored in the NACSLB's Recommended Budget Practices and can be briefly summarized as follows.

* A government uses strategic planning to identify its broad organizational objectives, which it then translates into specific goals and objectives.