Interoperability of financial management systems in local governments and opportunities for digital transformation

Abstract Two digital transformation agendas have been implemented in parallel in Brazil, one for disseminating interoperable financial management systems and the other focused on services for citizens, called “digital government.” Although these agendas are interconnected, their joint impact is rarely discussed. This article addresses the adoption agenda for financial management systems in local governments and the potential implications for the digital government agenda. We analyzed the automation, interoperability, and integration of commercial software contracted by 150 municipalities based on the perception of accountants who use these systems. The results indicate a greater development of the core accounting module and less integration and interoperability with non-core modules of the government’s system. Based on a matrix of integration of financial management systems modules and interoperability with digital government systems, we analyzed different scenarios for the digital transformation of local governments.