Екатерина Харькова
Relevance of Public-Private Partnerships for consulting services
Financing Private sector sources of funding are usually a feature of PPPs. This reflects the fact that, by providing the finance, the private sector is able to optimise the mix of initial and through-life spending and will also engage in rigorous risk management procedures. An important step is to define risk sharing as well as types and level of risk. Further, the available capital structure, risk structure, and optimal funding structure must be considered.
Accounting & Reporting The long–term contractual nature of the business relationship leads to difficult financial issues, related to taxation, cash flow budgeting and disclosure rules. The number of entities with an interest in the outcome puts a premium on accountability in the broadest sense. Neither traditional models of public sector accountability nor those developed for private sector entities are adequate. An extra approach is required which takes into account the complexity of the risk–sharing mechanisms and identifies clearly the rights and responsibilities of the various partners clearly. It is also important to investigate whether there is any comprehensive fiscal accounting and reporting standard developed specifically for PPPs.