The public sector is defined as privately-owned accounting procedures applied in the practice of public organizations. According to ancient books published by Western Europe, the public sector is synonymous with government accounting. Some are calling it the same with public financial accounting. All these designations have the same meaning.
Accrual Base applied in New Zealand led to understanding the impact of changes in the public sector. Change is located on the side of sense to say that the public sector is accounting of public funds.
The cornerstone of the Public Sector Accounting
Public sector accounting is based on public sector financial accounting standards (SAKSP). Expected to notice SAKSP the administrative information provided gives the completeness of the data so that it can improve the quality and validity of the report in particular government organizations.
Moreover, the impact of their SAKSP is an attempt to menyenpurnakan report financial activities so that there is an increase in financial and economic performance. Thus it can be taken a step and the right decisions regarding production plans further.
How to Develop Financial Accounting In Public Sector
To produce financial accounting in the public sector are accurate and contain important information completeness, the treasurer or accountant should follow the preparation steps. The preparation steps include studying the problem in the first stage and examine it carefully, making observations focus and form analysis as basic assumptions, create and deploy memorandum discussion on the authorities, held a public discussion.
Then look at the results of public discussion and memorandum discussion, then consider the results of the analysis carefully and wisely, set the initial draft has been prepared based on the results of previous observations, if any written opinion then the next step is to consider the contents of these opinions, then decide, and finally issued a statement that used as SAKSP.
Financial Accounting Application In Public Sector
Indonesia has been practicing financial accounting in the public sector. For example in the organization of state enterprises, precisely Public Telecommunications Company. The company has used financial accounting in the public sector well since 1989. Although he had ‘colonized’ by the bureaucrats as too easily be used as a ‘political mine’, but the Public Telecommunications Company has proven the success of the administration.
Adoption of Public Sector Accounting Techniques
From the public sector, generated some financial accounting techniques that can be applied, among others, budget accounting, commitments, funds, cash and accrual. Five techniques are mutually beneficial and does not intersect the working principle. In budget accounting, the aim is to suppress the role of the budget cycle planning, control, and accountability. Thus the expected conveniences can prepare reports.
Accounting commitments can be used simultaneously on a cash accounting and accrual accounting. Accounting commitment is very important for shareholders because it deals with the principle of the time the transaction took place. Fund accounting is used when providing the funds or shareholders have limited fund from which seeks to resources available to support the most important activities.
Cash accounting has the advantage of transparency of administrative activities prepared by the treasurer or accountant. Shortage of cash accounting is somewhat overstated the available balance which lead to waste on a company or organization. Accrual accounting is used more often than cash accounting for more accurate results so that decision-making more efficient.
With the accounting is expected to form the administration of information and communication for several periods in a company or organization.
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