Page 31 - CMA Journal (July-August 2025)

Focus Section

Public Finance Management

Through Data Analytics

“Nothing is easier than public money. It does not appear to belong to anybody. The temptation is overwhelming
to bestow it on somebody,” -- Calvin Coolidge, 30th President of the USA

Overview 2) Transparency
deficit and corrup-
Public Financial Management (PFM) refers to the
tion in execution:
effective utilization of public funds for the welfare of
The second chall-
society. It is the government's responsibility to ensure the
enge is the trans-
provision of essential services such as healthcare,
parency deficit and
education, infrastructure, food, and shelter to its citizens.
corruption in
Efficient distribution of resources and the safeguarding execution. There is
of economic stability are key objectives of any a high risk that
government. Such resource allocation affects the public resources
economy and society in both the short term and over the may be diverted for
medium to long term. political gains, Said Faheem Jaffer, FCMA
ultimately under-
PFM encompasses the processes of revenue generation, Manager, Accounts Payable &
mining public trust
budgeting, expenditure, and the development of related ERP Financial Transformation,
and discouraging
fiscal policies, laws, and rules to support these Dubai Government Entity;
foreign aid and
responsibilities. Chairman, R&P Committee
grants. Internation-
of UAE Branch Council
PFM is a crucial pillar for a country’s growth and al Monetary Fund
long-term sustainability, requiring strong controls and (IMF) technical reports emphasize the need for coun-
transparency. Without a sustainable approach, the risk of tries like Pakistan to strengthen fiscal control mecha-
systemic failure becomes significant. However, certain nisms, particularly to improve budget credibility and
challenges require absolute visibility and focused execution (International Monetary Fund. (2020).
attention. Let’s explore these challenges and examine (Pakistan: 2020 Article IV Consultation—Press Release).
how data analytics can help mitigate them.
Challenges

1) Revenue forecasting & collection: The first
challenge is revenue forecasting and collection. The
World Bank highlights that many developing
countries, including Pakistan, face significant
challenges in accurately forecasting and efficiently
collecting public revenues. Issues such as tax evasion
fueled by the informal economy, unreliable data, and
manual processes increase the risk of errors and fraud.

ICMA’s Chartered Management Accountant, Jul-Aug 2025 29