Possibilities of using in Poland the foreign models of predicting the fiscal distress in local government units

The aim of the paper is to analyze the usefulness of foreign models of assessing financial condition for predicting financial distress in local governments and to verify whether they may be applied to Polish local government units. The selection of models and indicators was based on a review of foreign literature. Next, a quantitative survey was conducted to verify the assessments resulting from the theoretical analysis of the examined models. The studied group comprised municipalities with populations under 100,000 and the research covered the years 2010-2016. The study uses data from budget reports and consolidated balance sheets of local government units.emisia@sgh.waw.plCollegium of Management and Finance, Warsaw School of EconomicsBrown K.W., 1993, The 10-point test of financial condition: toward an easy-to-use assessment tool for smaller cities, “Government Finance Review”, no. 9(6).Carmeli A., 2003, Introduction: Fiscal and Financial Crises of Local Governments, “International Journal of Public Administration”, no. 26(13), DOI: 10.1081/PAD-120024404.Dylewski M., Filipiak B., Gorzałczyńska-Koczkodaj M., 2010, Metody analityczne w działalności jednostek podsektora samorządowego, Difin, Warszawa.Filipiak B., Dylewski M., Gorzałczyńska-Koczkodaj M., 2011, Analiza finansowa budżetów jednostek samorządu terytorialnego, Municipium SA, Warszawa.García-Sánchez I-M., Cuadrado-Ballesteros B., Frías-Aceituno J-V., Mordan N., 2012, A New Predictor of Local Financial Distress, “International Journal of Public Administration”, no. 35(11), DOI: 10.1080/01900692.2012.679173.Gorina E., Maher C., Joffe M., 2017, Local Fiscal Distress: Measurement and Prediction, “Public Budgeting & Finance”, DOI: 10.1111/pbaf.12165.Honadle B.W., Costa J.M., Cigler B.A., 2004, Fiscal Health for Local Governments. An Introduction to Concepts, Practical Analysis, and Strategies, Elsevier Academic Press, San Diego, CA.Jacob B., Hendrick R., 2013, Assessing the Financial Condition of Local Governments, [in:] Handbook of Local Government Fiscal Health, Levine H., Scorsone E.A., Justice J.B. (eds), Jones & Bartlett Learning.Jones S., Walker R.G., 2007, Explanators of local government distress, “Abacus”, no. 43(3), DOI: 10.1111/j.1467-6281.2007.00238.x.Kloha P., Weissert C.S., Kleine R., 2005, Developing and testing a composite model to predict local fiscal distress, “Public Administration Review”, no. 65(3), DOI: 10.1111/j.1540-6210.2005.00456.x.Maher C.S., Nollenberger K., 2009, Revisiting Kenneth Brown’s “10-Point Test”, “Government Finance Review”, October.Marlowe J., 2015, The Governing Guide to Financial Literacy, vol. 2, Managing Your Jurisdiction’s Financial Health, The Governing Institute, Washington D.C.Metodyka kompleksowej oceny gospodarki finansowej jednostki samorządu terytorialnego, 2009, Filipiak B. (red.), Difin, Warszawa.Shamsub H., Akoto J.B., 2004, State And Local Fiscal Structures And Fiscal Stress, “Journal of Public Budgeting, Accounting & Financial Management”, no. 16(1), DOI: 10.1108/JPBAFM-16-01-2004-B003.Stone S.B., Singla A., Comeaux J., Kirschner Ch., 2015, A Comparison of Financial Indicators: The Case of Detroit, “Public Budgeting & Finance”, no. 35(4), DOI: 10.1111/pbaf.12079.Trussel J.M., Patrick P.A., 2009, A Predictive Model Of Fiscal Distress In Local Governments, “Journal of Public Budgeting, Accounting & Financial Management”, no. 21(4), DOI: 10.1108/JPBAFM-21-04-2009-B004.Ustawa z dnia 27 sierpnia 2009 r. o finansach publicznych, Dz. U. z 2017 r. poz. 2077 ze zm.Ustawa z dnia 29 września 1994 r. o rachunkowości, Dz. U. z 2018 r. poz. 395.www 1, http://www.finanse.mf.gov.pl/documents/766655/6146149/I-II+_Wsk+2014-2016 _opis.pdf [date of entry: 15.02.2018].www 2, http://www.mf.gov.pl/ministerstwo-finansow/dzialalnosc/finanse-publiczne/budzety-jednostek-samorzadu-terytorialnego/sprawozdania-finansowe [date of entry: 10.02.2018].www 3, http://www.osc.state.ny.us/localgov/fiscalmonitoring/index.htm [date of entry: 12.02.2018].www 4, https://www.mf.gov.pl/ministerstwo-finansow/dzialalnosc/finanse-publiczne/budzety-jednostek-samorzadu-terytorialnego/sprawozdania-budzetowe [date of entry: 10.02.2018].Zafra-Gomez J.S., López-Hernández A.M., Hernández-Bastida A., 2009, Developing an alert system for local governments in financial crisis, “Public Money & Management”, no. 29(3), DOI: 10.1080/09540960902891731.3(93)11512