The Use of Accrual Accounting in New Zealand’s Central Government: Second Thoughts

Sesuai dengan Undang-Undang nomor 1 tahun 2004 tentang keuangan Negara dan Undang-Undang nomor 1 tahun 2004 tentang Perbendaharaan Negara serta Peraturan Pemerintah nomor 10 tahun 2010 tentang Standar akuntansi Pemerintahan, Pemerintah Pusat diharuskan membuat laporan keuangan berdasarkan basis akuntansi akrual mulai tahun 2015.Tulisan ini bertujuan menguraikan tentang tantangan yang harus dihadapi oleh pemerintah pusat untuk berpindah dari sistem yang sekarang digunakan yaitu Half AccrualAccounting ke sistem yang baru yaitu Full Accrual Accounting. Metode analisa yang digunakan dalam kajian ini adalah analisis statistika deskriptif. Paper ini akan memberikan gambaran singkat tentang apa yang telah dilaksanakan oleh Pemerintah Pusat di dalam menjalankan mandat dari Undang-Undang terkait Pengelolaan Keuangan Negara di era reformasi. Pemerintah pusat menghadapi tantangan saat harus meninggalkan sistem yang saat ini dipergunakan dengan pendekatan Half accounting Accrual dengan disupport oleh Aplikasi Saiba menuju sistem baru yang Full Accrual Accounting yang disupport oleh Aplikasi Sakti. Pertama, tantangan regulasi; Kedua, tantangan Sistem Informasi dan Teknologi; Ketiga, tantangan Sumber Daya Manusia; Keempat, tantangan resiko implementasi sistem baru dalam konteks pengelolaan keuangan negara; dan terakhir; Kelima, tantangan perubahan bisnis proses. Pemerintah pusat sesungguhnya belum sepenuhnya menjalankan mandat undangundang dalam menjalankan sistem akuntansi dan pelaporan keuangan karena belum menerapkan Full Accrual Accounting System. Kajian ini memberikan rekomendasi pemerintah untuk bisa bermigrasi dengan aman menuju sistem baru yang akuntabel dan reliabel In accordance with Act No. 1 of 2004 concerning State Finance and Act No. 1 of 2004 concerning State Treasury and Government Regulation No. 10 of 2010 concerning Government Accounting Standards, the Central Government is required to make financial reports based on accrual accounting starting in 2015. This writing aimed to describe the challenges that must be faced by the central government to move from the system currently in use, namely Half Accrual Accounting to the new system, namely Full Accrual Accounting. The analytical method used in this study was descriptive statistical analysis. This paper provided a brief overview of what has been done by the Central Government in carrying out the mandate of the Laws relating to Management of State Finance in the reform era. The central government faced challenges when it comes to leaving the system that is currently being used with the Accrual Half accounting approach, supported by the Saiba Application to the new system namely Full Accrual Accounting supported by the Sakti Application. First, regulatory challenges; Second, the challenges of Information Systems and Technology; Third, the challenges of Human Resources; Fourth, the risk challenges of implementing a new system in the context of state financial management; and last; Fifth, the challenge of changing business processes. The central government actually had not fully implemented the legal mandate in carrying out the accounting and financial reporting system because it had not implemented a Full Accrual Accounting System. This study suggested the government to be able to migrate safely towards a new accountable and reliable system.

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ACCRUAL ACCOUNTING & FINANCIAL REPORTING IN THE PUBLIC SECTOR TO ENHANCE ACCOUNTABILITY AND TRANSPARENCY (REFRAMING IMPLEMENTATION IN INDONESIA)

EKUITAS (Jurnal Ekonomi dan Keuangan) ◽

10.24034/j25485024.y2010.v14.i1.198 ◽

2018 ◽

Vol 14 (1) ◽

Author(s):

Nanang Shonhadji

Keyword(s):

Public Sector ◽

Local Government ◽

Financial Reporting ◽

Public Management ◽

Central Government ◽

Budget Balance ◽

Accrual Accounting ◽

Financial Flows ◽

Harmonization Process ◽

Fiscal Balance

Implementation modified cash basis at public sector in Indonesia have adopted to implement accrual accounting and financial reporting as the basis for their reformed accounting policy. Public administration in Indonesia has changed dramatically since 1999. The country has gone through one of the fastest and most comprehensive devolution reforms ever seen. Managerial and financial responsibilities have been decentralized from central government, mostly to local government at the district level. Under accrual accounting, government reports financial flows in terms of an operating statement equivalent to a business profit and loss statement. If the budget operating balance is zero, then this year's operating expenses are being fully covered by this year's revenue. Expenses are not the same as outlays so expenses measure this year's costs of production, whereas outlays does not. Prior to the introduction of accrual accounting, the Indonesian government have fiscal policy indicator which underlying cash balance. It was the cash budget balance which the local government. With the arrival of accrual accounting, however, the cash budget balance has been supplanted in this context. This helps us to compare the cash budget balance with fiscal balance. This phenomenon has been widely debated in public management circles, and within the academic literature. Many of these debates however, have been arid and narrowly technically focused. This paper reviews the harmonization process of Indonesian local public sector accounting suppose some main adjustments regarding and prepared exposures draft to harmonize this problem

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ACCRUAL ACCOUNTING & FINANCIAL REPORTING IN THE PUBLIC SECTOR TO ENHANCE ACCOUNTABILITY AND TRANSPARENCY (REFRAMING IMPLEMENTATION IN INDONESIA)

EKUITAS (Jurnal Ekonomi dan Keuangan) ◽

10.24034/j25485024.y2010.v14.i1.2110 ◽

2017 ◽

Vol 14 (1) ◽

pp. 22

Author(s):

Nanang Shonhadji

Keyword(s):

Public Sector ◽

Local Government ◽

Financial Reporting ◽

Public Management ◽

Central Government ◽

Budget Balance ◽

Accrual Accounting ◽

Financial Flows ◽

Harmonization Process ◽

Fiscal Balance

Implementation modified cash basis at public sector in Indonesia have adopted to implement accrual accounting and financial reporting as the basis for their reformed accounting policy. Public administration in Indonesia has changed dramatically since 1999. The country has gone through one of the fastest and most comprehensive devolution reforms ever seen. Managerial and financial responsibilities have been decentralized from central government, mostly to local government at the district level. Under accrual accounting, government reports financial flows in terms of an operating statement equivalent to a business profit and loss statement. If the budget operating balance is zero, then this year's operating expenses are being fully covered by this year's revenue. Expenses are not the same as outlays so expenses measure this year's costs of production, whereas outlays does not. Prior to the introduction of accrual accounting, the Indonesian government have fiscal policy indicator which underlying cash balance. It was the cash budget balance which the local government. With the arrival of accrual accounting, however, the cash budget balance has been supplanted in this context. This helps us to compare the cash budget balance with fiscal balance. This phenomenon has been widely debated in public management circles, and within the academic literature. Many of these debates however, have been arid and narrowly technically focused. This paper reviews the harmonization process of Indonesian local public sector accounting suppose some main adjustments regarding and prepared exposures draft to harmonize this problem

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Ten Demi-Culverins for Aldeburgh: Whitehall, the Dunkirkers, and a Suffolk Fishing Community, 1625–1630

Journal of British Studies ◽

10.1017/jbr.2019.1 ◽

2019 ◽

Vol 58 (2) ◽

pp. 315-337 ◽

Cited By ~ 1

Author(s):

Thomas Cogswell

Keyword(s):

North Sea ◽

East Coast ◽

Central Government ◽

Fishing Community ◽

Close Attention ◽

The North ◽

The North Sea ◽

The Impact

AbstractHistorians have not paid close attention to the activities of freebooters operating out of Dunkirk in the late 1620s. This essay corrects that omission by first studying the threat from Dunkirk to England's east coast and then addressing how the central government, counties, and coastal towns responded. A surprisingly rich vein of manuscript material from Great Yarmouth and particularly from the Suffolk fishing community of Aldeburgh informs this case study of the impact of this conflict around the North Sea.

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Understanding the impact of mandatory accrual accounting on management practices: interpretation of Japanese local governments’ behavior

International Review of Administrative Sciences ◽

10.1177/0020852321988956 ◽

2021 ◽

pp. 002085232198895

Author(s):

Makoto Kuroki ◽

Keiko Ishikawa ◽

Kiyoshi Yamamoto

Keyword(s):

Internal Control ◽

Local Governments ◽

Public Management ◽

Management Practices ◽

New Public Management ◽

Central Government ◽

Institutional Pressures ◽

Accrual Accounting ◽

Logistic Analysis ◽

The Impact

Accompanying the spread of “new public management” since the 1980s, accrual accounting and results-based management has become a global standard. However, whether accrual accounting results in successful outcomes and which drivers lead to the intended impacts of the reform have been contested. Given the mixed arguments in the literature, we set out two research questions: (1) “Have public sector organizations realized any positive impacts on management practices by adopting mandatory accrual accounting?”; and (2) “What are the primary drivers of such impacts?” To answer these questions, we examine the impact on management practices by analyzing a survey to ascertain how financial department officers in Japanese local governments perceive the benefits of adopting mandatory accrual accounting on management practices. The results indicate that they have so far not recognized the intended benefits, though they had expected higher benefits in internal control. Then, we use technical-rational, socio-political, and institutional isomorphic perspectives in a comprehensive approach to understand the impacts on management practices. The logistic analysis shows that financial managers in local governments that do not have a majority party in the assembly, but consist of several parties in power, as well as in those with greater financial dependence on the central government, perceive higher benefits. Further, we find that financial managers that imitate other local governments as a form of mimetic pressure perceive fewer benefits. The results show that some technical-rational tools, socio-political conditions, and institutional pressures change the perceived benefits for public managers of adopting mandatory accrual accounting. Points for practitioners We find that some technical-rational, socio-political, and institutional factors explain the intended internal benefits of the mandatory adoption of accrual accounting. In practice, financial managers in local government feel the merits of accrual accounting in less autonomy in not only politics, but also finance, and few mimetic conditions. It might be understood that difficult situations would drive practitioners to use mandatory information.

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The Role of Accounting Information System Afflication In Reliability Financial Reporting

Ilomata International Journal of Tax and Accounting ◽

10.52728/ijtc.v2i1.208 ◽

2021 ◽

Vol 2 (1) ◽

pp. 97-112

Author(s):

Lesi Hertati ◽

Otniel Safkaur ◽

Dwi Yanti ◽

Irlan Fery ◽

Peny Cahaya Azwardi

Keyword(s):

Information System ◽

Information Systems ◽

Financial Reporting ◽

Central Government ◽

Accounting Information ◽

Sampling Technique ◽

City Governments ◽

Accounting Information System ◽

Accounting Information Systems ◽

Verification Methods

The manifestation of regional financial autonomy can be seen in the regional financial accounting information system as a good government system characterized by increasingly low problems so that the information generated by the central government and regional governments in Indonesia is a form of quality financial reporting and effective application of accounting systems by various government agencies in Indonesia. Indonesia. This study aims to find out how the successful application of accounting information systems on financial reporting performance was produced. This study uses causality and population verification methods in this study are the district and city governments in the provinces of Papua and West Papua. The sampling technique uses a census so that all members of the population become research samples. The results of this study show empirical evidence that the successful application of accounting information systems and financial reporting performance is transparent and accountable.

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The role of the Troika on the Greek central government accounting reforms

International Journal of Public Sector Management ◽

10.1108/ijpsm-06-2016-0101 ◽

2018 ◽

Vol 31 (3) ◽

pp. 316-330 ◽

Cited By ~ 2

Author(s):

Sandra Cohen ◽

Sotirios Karatzimas

Keyword(s):

Financial Reporting ◽

Financial Management ◽

Central Government ◽

Case Study Research ◽

Extreme Case ◽

Resource Dependency ◽

Reform Process ◽

Content Type

Purpose The purpose of this paper is to explore the role of the Troika’s advent played in the progress of the budgeting and the financial reporting systems reform at the Greek central government level. Design/methodology/approach The approach of an extreme country case study is adopted. The data used in the paper have been identified through document analysis performed on the relevant documents produced by the Troika, the Greek Ministry of Finance, and other relevant sources. The reform process is seen through the lens of the neo-institutional theory and the resource dependency theory. Findings Although both reforms targeted the introduction of best international practices – particularly useful in periods of financial distress and scarce resources – the advent of the Troika affected their progress and changed the priorities. As a result, the reform was redirected toward strengthening the cash budgeting system. Research limitations/implications The study is subject to the limitations of an extreme case study research. Practical implications This is a case where resource dependency changes political priorities and directions and affects the evolvement of state budget and accounting reforms under way. Originality/value The role of external fund providers in public sector financial management reform priority-setting, in the case of a developed Eurozone country, is analyzed. The study contributes to the research agenda on accounting practices in times of austerity.

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Fund accounting and government-wide financial reporting during the Pre-IPSAS implementation era from a Nigerian experience

Journal of Public Budgeting Accounting & Financial Management ◽

10.1108/jpbafm-01-2019-0017 ◽

2020 ◽

Vol 32 (3) ◽

pp. 339-358

Author(s):

Christopher Enyioma Alozie

Keyword(s):

Information Asymmetry ◽

Financial Reporting ◽

Financial Statements ◽

Accounting System ◽

Accrual Accounting ◽

Public Funds ◽

Content Type ◽

Financial Position ◽

Fund Accounting ◽

Fund Balances

PurposeThis paper assessed accuracy level in accounting for government funds in Nigeria's federal treasury and their faithful presentation in government financial reporting. It aimed to determine whether the reported annual balances in Nigeria's financial reporting were reliable or otherwise. Data used in analysis were obtained from secondary sources from federal treasury.Design/methodology/approachEx-post “facto” analysis method was adopted in the study involving the use of statistical techniques of absolute or aggregate mean percentage error derived from differences between recomputed and published fund balances and was employed. This was augmented with interactive review meetings of the initial case research report with the management of Nigeria's audit agency.FindingsResults distilled from the consolidated revenue fund (CRF), development fund and public debt show that recomputed values were greater than the fund balances in the gazetted financial statements. Results for contingency fund (CTF), federation account fund (FAF), special trust fund (STF) and sundry deposit fund yield equal figures and accurate. The paper concludes that there were serial understatements of the core public fund balances in the financial statements over the years. This trend of reporting incorrect in three core public funds in financial statements rendered Nigeria's financial position unreliable in the affected years for decisions. It also facilitated frauds, mismanagement of funds and corrupt practices.Research limitations/implicationsThe scope of the research is restricted to assessment of degree of accuracy in fund accounting, faithful representation of the respective fund balance in the liabilities side of FGN balance sheet and the reliability of the financial position. But, it did not consider or cover the implementation of International Public Sector Accounting Standards (IPSASs) in federal treasury since FGN had not issued any full IPSAS–oriented financial statements as on 2015.Practical implicationsIdentification of deficiencies in fund account balances, structural defects in fund accounting and acts of understatement of carrying balances in CRF and capital development fund (CDF) implies that the aggregate core fund liabilities reported in financial statement of government entities without corresponding assets do not actually reflect a true and fair financial position in some countries. It reveals remarkable degree of financial information asymmetry in government financial reporting. Illusionary fund accounting has direct linkage to poor fiscal governance in many sovereign with associated sub-optimal delivery of public goods and service level distress syndrome in many economies; lead to poverty, unemployment, crisis and macroeconomic disturbances.Social implicationsThe study contributes to the development of fund accounting system; strengthening government financial reporting architecture and practices. It provides framework for tracking financial information asymmetry in government financial reporting and mismanagement of public funds. It provides platform to effect necessary adjustment (correction) during the “first time 3-year adoption” adjustment window in Nigeria. Flowing from the findings, it advocates for institutionalization of government fund accounting standards and provides evidence for migration to accrual accounting system in countries that have not already implemented it. Evaluation system developed herein will improve fund management in federal treasury and contribute to efficient public financial management, good governance and enhance development of public accounting practice.Originality/valueThis exploratory empirical research is the one to ever evaluate accuracy level of fund accounting in sovereign entities and faithful representation in government's financial position prior to implementation of accrual accounting and financial reporting. The study established substantial level of illusionary accounting for public funds and information asymmetry in published government's financial reporting. It is necessary to rectify these discrepancies in fund accounting and financial reporting prior to and or during the first three years of the IPSAS transition implementation programme. These research deliverables provide adopters with relevant data for adjustment accounting during the transition period in strengthening public financial reporting in order to realize the benefit of full IPSAS accrual accounting.

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Losing control: the gap in multi-level government reporting

Journal of Public Budgeting Accounting & Financial Management ◽

10.1108/jpbafm-10-2018-0110 ◽

2019 ◽

Vol 31 (2) ◽

pp. 264-284 ◽

Cited By ~ 2

Author(s):

Josette Caruana ◽

Kimberly Zammit

Keyword(s):

Local Government ◽

Financial Reporting ◽

Fiscal Federalism ◽

Central Government ◽

Structured Interviews ◽

Government Officials ◽

Financial Reports ◽

Content Type ◽

Budget Execution

PurposeThe purpose of this paper is to analyse the relationship between control by the Maltese Central Government on Local Government and the format and basis of budgetary and financial reporting used. The study analyses the role of reporting in agency and fiscal federalism theories.Design/methodology/approachSemi-structured interviews were carried out with the controller (Central Government officials and the National Audit Office), while a survey was carried out with the controlled (Maltese Local Councils).FindingsThe type of reporting used by Maltese Local Councils may be undermining the control that Central Government seeks to exercise on overspending and debt levels. The Local Councils’ financial statements report accrual deficits and increasing liabilities. This overspending appears to slip through Parliamentary scrutiny because the latter approves cash allocations to Local Councils; the financial reports submitted to Parliament do not highlight overspending in cash terms; and the cash budget execution report that should be prepared by Local Councils is not given due importance.Originality/valueCentral Government should be consistent in its policy towards Local Government, which may require more elaborate reporting. This study highlights the importance of aligning the reporting required (top-down) and the reporting presented (bottom-up) – otherwise, control is at stake.

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Investigation of the institutional and decision-usefulness factors in the implementation of accrual accounting reforms in the public sector of Tanzania

Journal of Accounting in Emerging Economies ◽

10.1108/jaee-01-2018-0005 ◽

2019 ◽

Vol 9 (3) ◽

pp. 335-365 ◽

Cited By ~ 2

Author(s):

Latifa Hamisi Mbelwa ◽

Pawan Adhikari ◽

Khandakar Shahadat

Keyword(s):

Central Government ◽

Research Strategies ◽

Cross Sectional Survey ◽

Accrual Accounting ◽

Cross Sectional ◽

Content Type ◽

Decision Usefulness ◽

Effective Implementation ◽

The Government ◽

Organisational Level

Purpose The purpose of this paper is to investigate the factors that have resulted in the effective implementation of accrual accounting reforms in the Central Government of Tanzania. Design/methodology/approach The paper relies on the ideas of institutional theory and some aspects of decision-usefulness so as to delineate the external pressures enforcing the Government of Tanzania to embrace accrual accounting and the factors complicating its implementation at organisational level (within government entities). The authors draw on quantitative techniques and the explanatory and cross-sectional survey research strategies and methods for data analysis. Findings Our findings suggest that the coercive pressures from donors and auditors along with the normative pressures surfaced by the training of employees generate a significant impact on designing the effective administrative model of accrual accounting. In a lesser extent, pressures from the National Board of Accountants and Auditors and cultural factors are positively correlated to the implementation of accrual accounting in the Tanzanian context. Of the factors the authors examined, the management changes are proved to be least effective. Unawareness of the key stakeholders has caused weak political and regulatory commitments. Accrual accounting implementation is further exacerbated by inadequate technical and personnel competence. Ultimately, the implementation of the accrual accounting has increased significant managerial accountability though a major segment of such behaviour is unexplained by the factors the authors employed in the study. Practical implications The effective implementation of accrual accounting relies on improvements in cultural and human-related issues. What is important to understand is that accrual accounting is more of a management reform incorporating changes in broader aspects of institutional and accountability mechanisms, rather than just an adoption of particular accounting technologies. Without such broader changes, accrual accounting reforms can be detrimental providing the technocrats and government officials with a space for manipulating financial information, Tanzania serving as an example. Originality/value The study highlights the case of an emerging economy in which accrual accounting is actually in effect and has impacted on managerial accountability, but is struggling to engender intended results and outcomes at organisational level.

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