The changes been brought about by public sector reforms influenced inter alia financial arrangements to ensure efficient and effective service delivery and consequently good governance practices. One are specifically earmarked is the introduction and the application of new accounting practices. Government departments on the national and provincial sphere in South Africa provide various services through the utilization of resources at their disposal. Currently government expenditure are allocated and assigned to departments and not to the services that are provided by government departments. The cost effectiveness of these services cannot be assessed, controlled and managed under the current accounting structures that are focused on departmental budgetary control. During the latter part of 2006 an empirical study was undertaken with a questionnaire been developed and distributed among Chief Financial Officers (CFOs) and senior finance