What is the primary financial control device used in government?

The appropriated budget with an accompanying system of budgetary accounting stands as the primary financial control device used in government due to its foundational role in planning, controlling, and monitoring public funds. This budget establishes the legal framework for government spending and aligns financial resources with policy goals and priorities set by elected officials.

In a governmental context, the appropriated budget serves several critical functions. It outlines how much money can be spent in a fiscal year for various departments and programs, thereby supporting accountability and transparency. By delineating specific allocations, it provides a mechanism for enforcing financial discipline, ensuring that funds are used only for their intended purposes.

The accompanying system of budgetary accounting complements this by tracking financial activity and performance against the budget. This system allows for monitoring actual expenditures versus budgeted amounts, enabling governments to adjust and make informed decisions in response to financial realities.

Although components such as a cash flow statement, financial reporting systems, and annual audit reports are important for overall financial management and oversight, they do not serve the same primary role in controlling government finances as the appropriated budget does. The budget directly relates to legislative authority and prioritization of resources, making it central to fiscal policy and governance in the public sector.