Non‐profit Performance Indicators in the Public Sector

This paper examines the scope for validly using non‐profit performance indicators in the public sector and identifies several decision‐relevant roles for such indicators in the process of policy optimisation. It argues that many of the desirable qualitative characteristics of financial accounting data identified in the FASB's conceptual framework project are both relevant, and in need of strengthening, when the profit concept is extended to a more general performance concept which also includes benefits to consumers of the output of the public sector. The need for such strengthening is examined in both nationalised industries and the non‐trading public sector.