Empirical Analysis of Engineering‑Accounting Integration Model for Reducing Cost‑Related Financial Losses in Infrastructure Delivery Phase

Abstract

Hidden costs and financial losses during the infrastructure delivery phase constitute core drivers of public capital waste and inefficient investment, whereas the traditional separate governance mode for engineering and finance presents prominent governance deficiencies. Based on the engineering‑finance linkage governance theory, this paper adopts cross‑border panel data of 106 large‑scale public infrastructure projects in Australia, North America and the European Union from 2012 to 2022 (Ortiz, S.S., Kang, K., Hubbard, B. & Besiktepe, D., 2023). Two‑way fixed‑effect panel regression and the PSM‑DID model are employed to systematically identify the governance effect, mechanism and boundary conditions of the engineering‑accounting integration model on cost‑related financial losses in the infrastructure delivery phase, which are further verified via mediating‑effect test, heterogeneity analysis and multi‑dimensional robustness tests. The empirical results show that the engineering‑accounting integration model significantly reduces the ratio of cost‑related financial losses in the delivery phase by 8.9 percentage points (p<0.001). Mechanism tests indicate that this governance effect is achieved mainly through two pathways: restraining unidentified implicit liabilities (mediating contribution = 42.1 %) and curbing unreasonable completion claim expenditures (mediating contribution = 36.4 %). The two pathways jointly explain 78.5 % of the total effect. Heterogeneity analysis demonstrates that projects funded by federal finance and projects with high design‑change frequency obtain stronger governance effects, with financial‑loss reductions of 11.2 % and 10.1 % respectively. This study unpacks the mechanism black box of infrastructure financial governance, and provides quantitative evidence and practical references for delivery‑risk management of federal infrastructure projects under the framework of the U.S. Bipartisan Infrastructure Law.