Extended New Treasury Single Account: New Tool for Government Cash Management in Turkey

Abstract

Treasury Single Account (TSA), which is a cash pooling system that enables public cash resources to be managed centrally and efficiently, is essential for equalizing cash flows in terms of time and place. In this way, TSA system in Turkey was initially established in 1972; however, the TSA was greatly different from that of other countries in many aspects, especially its coverage was narrow. Since its establishment, the structure of TSA has been revised many times in order to converge to international good practices; however, these revisions have been done for its operational structure rather than its scope. With the latest amendment in Law No. 4749, New Extended Treasury Single Account (New TSA) system, which enables almost all public resources to be managed by single hand without disturbing the administrative and financial autonomy of public administrations, was established in 2018. By Law, the President of the Republic of Turkey has the authority to extend the scope of TSA. Within the limits of the powers conferred by the Law, the President of the Republic issued Presidential Decree on the scope of new TSA, on August 8, 2018. In this study, the historical development of Turkish TSA is represented. Thereafter, the main motivation of the establishment of the New Extensive TSA and its structure is discussed. This study aims to clarify the structure of the New TSA by considering its theoretical, operational structure, banking architecture, accounting structure, and IT infrastructures and to highlight its likely contributions to public financial management in Turkey.