New budget balancing, electronic invoicing, split payments, code of public contracts: the bookkeeping of Italian public bodies has been revolutionised over the past years by a number of thorough reforms. One of the most radical ones has been the harmonisation of balance sheets, introduced in 2011.

It has not been easy to adapt to the new requirements. In order to comply with the new accounting systems (whose implementation is somewhat complex), many mayors had to conduct a real inspection into their municipal accounts, sorting out assets and liabilities and writing off bad debts, streamlining payments and making collection more efficient. Smaller municipalities were the ones that suffered major issues, for they had less human resources and tools at their disposal: out of 150 municipalities that failed to comply with the stability pact in 2015, a good 103 had less than 5,000 inhabitants.

And how have the others fared, on average? What effects has the reform produced? Here is a first evaluation of the new regulation's impact on municipal balance sheets.