Determinants of irregularities in municipal public management: the case of municipalities in the state of São Paulo

The municipal external control exercised by the Courts of Accounts reveals the irregularities found in the accounts of municipal governments through the disclosure of audit reports. They have been empirically analyzed from the point of view of their classification in terms of severity, but few studies aim to identify the factors that influence such failures. Having verified this gap, the main objective of this study is to identify factors that may influence lapses in municipal public management pointed out by the audit of the Court of Accounts. This article contributes to further research on this topic and to improving management in municipalities. This is an exploratory analysis based on econometric models for panel data. The sample includes 179 municipalities in Sao Paulo, with data for 2011, 2013, 2015, 2017, and 2019. The results suggest that the recommendations and determinations of the Court of Accounts and gaps in internal controls influence irregularities in small, medium, and large municipalities. The volume of legal and constitutional transfers received influences small and medium-sized municipalities, while the municipal gross domestic product (GDP) influences medium-sized municipalities.