GOVERNMENT

FINANCIAL
REPORT
Difference Organization Government & Business

DIFFERENCE GOVERNMENT BUSINESS

• Ownership • External • InternalsAnd/external

• Viewpoint • From Public Interest • From Private Interest

• Legitimacy Source • Citizens / Society in • Capital Owners

General /Shareholders

• Orientation • Public Service • Profit

• Influence • Values ​and Political • Especially from
Environment Systems Consumer
• Theories • Characteristic Local • Characteristic Universal
• Service Provided • Regulated By • Regulated by Market
Government Mechanisms
 Governance And Agency Problem

• Is the process of managing various fields of life (social, economic,

political, etc.) in a country by involving various interested parties, as
well as the use of resources (natural, financial, and human) in a way
that is in accordance with the principles of fairness, efficiency,
transparency and accountability.
• Agency Problems atGovernment
– Politicians vs People;
– Politicians vs Government;
– Government vs People
– The disharmony between the interests of the
people and the interests of the government
and politicians, even though they are the
highest interest holders.
State Finance Reform

UU 17/2003 State finances

• General arrangements regarding state finances

UU 1/2004 State Treasury

• Financial system, payment procedures, accountability

UU 15/2004 Audit of State Finance Management and

Accountability by BPK based on SAP

• Financial audits, performance checks and checks for

specific purposes
STATE FINANCE ACT

• State finances are all rights and obligations of the state

that can be valued in money, as well as everything either
in the form of money or in the form of goods that can be
owned by the state in connection with the implementation
of these rights and obligations.

• State finances are managed in an orderly manner, in

compliance with laws and regulations, efficiently,
economically, effectively, transparently and responsibly by
taking into account the sense of justice and propriety.

5
STATE FINANCE ACT

• The President submits a draft law on accountability for the

implementation of the APBN to the DPR in the form of a
financial report that has been audited by the Supreme Audit
Agency, no later than 6 (six) months after the end of the
fiscal year.
• The financial report referred to at least includes:
– Statement of Budget Realizations
– Balance Sheet
– Statement of Cash Flows, and Notes to Financial Statements, which
are attached with the financial statements of state companies and
other entity.

6
STATE FINANCE ACT

• State rights and obligations in terms of state

finances.
• Power over State Financial Managers
– delegated to the Minister of Finance,
– delegated to Ministers/Heads of institutions
– submitted to the governor/regent/mayor, The budget and
procedures, both for APBN and APBD
• Relations between the Central Bank, Regional
Government, Central Government, other
Institutions/Governments.

7
STATE FINANCE ACT

• The form and content of the accountability report on the

implementation of the APBN/APBD is prepared and
presented in accordance with government accounting
standards.
• Government accounting standards are prepared by an
independent standards committee and are stipulated by
Government Regulation after receiving prior consideration
from the Supreme Audit Agency.
• Provisions regarding the recognition and measurement of
income and expenditure on an accrual basis. As long as the
accrual-based recognition and measurement of income and
expenditure has not been implemented, cash-based
recognition and measurement is used
8
STATE TREASURE ACT

• The State Treasury is the management and accountability of state

finances, including segregated investments and assets, which are
stipulated in the APBN and APBD.
• State treasury official
– Budget User
– State/Regional General Treasurer
– Receiving/Dispensing Treasurer
• Implementation of income and spending / area
• Implementation of state/regional revenues and expenditures
• Money management
• Management of receivables and debts

9
STATE TREASURE ACT

• Investment management
• Management of state/regional property
• Prohibition of confiscation of state and regional money
and goods
• APBN/APBD Administration and Accountability
• Government inter-control
• Misuse of money and the state
• Public agency financial management

10
STATE FINANCIAL AUDIT ACT

• Audit of state finances includes examination of state financial management and

examination of state financial responsibility.
• The BPK conducts audits on the management and accountability of state
finances.
• Audits consist of financial audits, performance audits, and audits with a specific
purpose.
• The audit is carried out based on Audit standards.
• Audit standards are prepared by BPK, after consultation with the Government.
• Contents of the law
– Audit scope
– Audit implementation
– Audit results and follow-up
– Procurement of State Compensation
– Criminal provisions

11
Government Accounting Standard

• Standard used For compile report finance:

– State Government –including LK Ministry/Institutions
– Local Government -Province, Regency, City
– Public Service Agency
• In the form of Government Regulation - PP No. 71 of 2010 and
Regulation of the Minister of Finance (PMK) for additions and revisions
• The standards are developed on government accounting practices and
apply internationally and the laws and regulations that apply in Indonesia.
• International standard reference for public sector accounting using the
International Public Sector Accounting Standard (IPSAS)
• For nThe standards prepared by the Government Accounting Committee
(KSAP) then set by Government Regulation
• on-government public sector entities (foundations, social institutions) use
PSAK 45 Accounting for Non-Profit Organizations

12
 LEGAL BASIS
• State/regional income is the right of the central/regional
government which is recognized as an addition to net
Psl 17 worth
UU17/2003 • State/regional spending is the obligation of the
central/regional government which is recognized as a
deduction from net worth

• Provisions regarding the recognition and measurement of

Psl 36 ayat
accrual-based income and expenditure are implemented
(1) UU no later than 5 (five) years
17/2003

• Provisions regarding the recognition and measurement of

Psl 70 ayat accrual-based income and expenditure shall be
(2) UU 1/2004 implemented no later than the 2008 fiscal year

13
 GOVERNMENT ACCOUNTING STANDARDS (PP
Number 71 of 2010)

SAP are the accounting principles applied in preparing

and presenting government financial reports

PREPARED BY KSAP AND APPLICABLE TO

THE CENTRAL GOVERNMENT AND LOCAL
GOVERNMENTS
INDONESIAN GOVERNMENT ACCOUNTING STANDARDS COMMITTEE
(KSAP)

Indonesian Government Main strategies and

Accounting Standards references in standard Due Process
Committee (KSAP) development

• Organization • Main Strategies • Topic Identification

• Independent Committee,
mandated by Law,
established by
Presidential Decree
• Member
• Representatives from
Ministry of Finance, • Main References
Ministry of Home Affairs,
government internal
auditors, other line
ministries, local
governments, accounting
profession institutions
(IAI) and academicians
• Follow best international • Research
accounting practices • Discussion of preliminary
• Consider existing draft
conditions and needs in • Decision making by the
Indonesia, Committee
• Transition periods/stages • Exposure Draft
• Limited hearings & public
hearings
• International Public • Discussion of comments
Sector Accounting from hearings
Standards • Request for Supreme Audit
• Indonesian Financial Institution (BPK) comments
Accounting Standards • Discussion of Supreme
• Financial Accounting
Audit comments
Standards Board • Finalization of the
standards
• Standards promulgation &
socialization.

15
STRUCTURE OF GOVERNMENT ACCOUNTING
STANDARDS

Accompanied by Other
Publications
CONCEPTUAL
FRAMEWORK

Interpretasi PSAP (IPSAP)

SAP
STATEMENT • IPSAP intended to further explain a
particular topic in order to avoid user
misinterpretation PSAP.

GOVERNMENT
ACCOUNTING Technical Bulletin
STANDARDS • The Technical Bulletin is a
direction/guideline for implementing
PSAP as well as IPSAP.
 ACCRUAL BASIS CONCEPTS

BASE CONCEPTION CONFESSION

ACCRUAL The accrual basis is an accounting  Revenue is
BASIS basis in which economic recorded when
transactions or accounting events the rights have
are recognized, recorded, and been obtained
presented in the financial (earned)
statements at the time the  Expenses are
transaction occurs, regardless of recorded when
when cash is received or paid. liabilities are
incurred or
resources are
consumed
 Indonesian Government Accounting Standard

PSAP
Conceptual Framework
PSAP 01 Presentation of Financial Statements
PSAP 02 Statement of Budget Realizations
PSAP 03 Statement of Cash Flows
PSAP 04 Notes to the Financial Statements
PSAP 05 Accounting for Inventories
PSAP 06 Akuntansi Investasi
PSAP 07 Accounting for Fixed Assets
PSAP 08 Accounting for Construction in Progress
PSAP 09 Accounting for Liabilities
PSAP 10 Correction of Errors, Changes in Accounting Policies, and Extraordinary Events
PSAP 11 Consolidation of Financial Statements
PSAP 12 Statement of Operations
PSAP 13 Accounting for Public Service Agencies PMK 217/2015
PSAP 06 Accounting for Investment (Revisedi 2016) – PMK 223/2016
PSAP 14 Accounting for Intangible Asset - PMK 90/2019
 Interpretation of Indonesian Government Accounting
Standard

Interpretation PSAP
Interpretation No 1 Transaction in foreign currencies
Interpretation No 2 Recognition of revenue received in State/Regional General Cash Accounts
Interpretation No 3 Recognition of financing transactions received in/disbursed by State/Regional General Cash
Accounts
Interpretation No 3 Changes in Accounting Policies and Correction of errors without restatement
Technical Bulletin Indonesian Government Accounting Standard

No Bultek Tahun Keterangan

01 Bultek 15 Accounting for Fixed Assets 2014 Replace Bultek 09
02 Bultek 16 Accounting for Receivable 2014 Replace Bultek 16
03 Bultek 17 Accounting for Intangible Assets 2014 Replace Bultek 11
04 Bultek 18 Accounting for Accrual Depreciation 2014 Replace Bultek 05
05 Bultek 19 Accounting for Social Assistance 2015 Replace Bultek 10
06
No
Bultek 20 Accounting for Loss and Indemnification 2015 New Bultek
07 Bultek 21 Accounting for Transfers to Regional 2015 New Bultek
Governments
08 Bultek 22 Accounting for Liabilities 2015 New Bultek
09 Bultek 23 Accounting for Non Tax Revenue 2016 New Bultek (Apply 2017)
10 Bultek 24 Accounting for Tax Revenue 2016 New Bultek (Apply 2017)
ADOPTION, CONVERGENCE OR ADAPTATION OF
IPSAS

1. One crucial issue in development of IGAS is decision on adoption, convergence or

adaptation of IPSAS

a. Adoption implies that national rules are set aside and replaced by the
international accounting standards requirement. Adoption means IPSAS are
implemented in the same manner as issued by the IPSASB (full compliant ).

b. Convergence means a gradual process of the country’s Accounting Standard

Board to develop IPSAS-compatible accounting standards by working together
with IPSASB. Compliance is partial and a country may deviate to a certain
extent from the IPSAS.

c. Adaptation implies that IPSAS are adapted to national context when

appropriate.

2. Indonesia choose adaptation strategy.

COMPARISON OF IPSAS & PSAP
REGULATIONS PP 71/2010
GOVERNMENT ACCOUNTING STANDARDS

APPENDIX I • Accrual Base SAP » Appendix I

ACCRUAL • Valid from the set date and can be
BASIS applied immediately
PP71/2010 • Contains the Government Accounting
Conceptual Framework and 12 PSAP
• Valid no later than FY 2015

PP 71
Become

2010
• SAP Cash Towards Accrual » Appendix II
(PP 24/2005)
APPENDIX II • Applicable during the transition period for
CTA BASE(Cash entities that are not yet ready to
Towards Accrual) implement SAP
PP24/2005 • Contains the Governmental Accounting
Conceptual Framework and 11 PSAP
• Not Valid From FY 2015

23
GOVERNMENT FINANCIAL REPORT

Financial Report according to Accrual

SAP
• Statement of Operations
• Balance Sheet
• Statement of Changes in Equity
• Statement of Cash Flows
• Notes to the Financial Statements
• Statement of Budget Realizations
• Statement of Changes in Accumulated Budget
Surplus Balance

24
ACCRUAL BASIS CONCEPTION AND
BENEFITS
• Base accruals an accounting basis in which economic transactions
or accounting events are recognized,recorded, presented in the
financial statements when they occur, regardless of when cash is
received or paid.

• Revenue is recognized when the rights have been granted obtained

(earned) and expenses (spending) are recognized when liabilities
are incurred or resources are consumed

• Base cash is the basis of accounting that recognizes the effect of

transactions and other events when cash or cash equivalents is
received or paid which is used for the recognition of revenues,
expenditures and financing.
• Statement of financial position (balance sheet)
• can’t presented in full  Only Cash Account

25
 BUDGET CONCEPTIONS AND ACCOUNTING

LO is prepared to complement the accrual-based reporting and

accounting cycle so that the preparation of LO, Report on changes in
equity and Balance Sheet have an accountable relationship

CASH BUDGET
BASE
Statement of Statement of
Budget SILPA/SIKPA
Realizations SAL

ACCOUNTANCY
ACCRUAL
BASIS Surplus/ Statement
Statement of Balance
of Changes Equity
Operations
Defisit Sheet
in Equity

26
 Statement of Changes in Accumulated
Budget Surplus Balance

• Statement of Changes in Accumulated Budget Surplus

Balance is Report on Changes in Budget Balance is a
component of financial statements that presents the
following items in comparison with the previous period:
– Accumulated Budget Surplus Beginning Balance,
– The use of Accumulated Budget Surplus Balance,
– Surpluss/Deficit Financing Budget Current Year
– Correct Error Bookkeeping in Previous Year,
– Accumulated Budget Surplus Ending Balance.
PROVINCIAL GOVERNMENT/ DISTRICT / CITY
Statement of Changes in Accumulated Budget Surplus Balance
BY 31 DECEMBER 20X1 AND 20X0 (In rupiah)

NO DESCRIPTION 20X1 20X0

1 Beginning Budget Surpluss Balance XXX XXX

2 Use of SAL as Current Year Financing Receipt (XXX) (XXX)

3 Subtotals (1 - 2) XXX XXX

4 Surpluss/Deficit Budget Financing (SiLPA/SiKPA) XXX XXX
5 Subtotals (3 + 4) XXX XXX
6 Correction of Previous Year Bookkeeping Errors XXX XXX
7 Etc XXX XXX
8 Ending Budget Surpluss Balance (5 + 6 + 7) XXX XXX

28
28
 STATEMENT OF OPERATIONS

• Statement of Operations provide information about whole activity

operational finance entity reporting Which reflected in
– Income from operational activity
– Expense from operational activity
– Surplus/Deficit from Non-Operating Activities, if any
– Extraordinary post, if there is one
– Surplus/deficit

29
STRUCTURE AND CONTENTS
STATEMENT OF OPERATION

– Present various elements

• income-LO,
• expense
• surplus/deficit from operations,
• surplus/deficit from non-operational activities,
• surplus/deficit before extraordinary items,
• extraordinary post,
• surplus/deficit-LO,

– In the Operational Report are added headings, titles and

other sub-amounts if required by the Statement of
Governmental Accounting Standards, or if such presentation
is required to present the Operational Report fairly

30
 STATEMENT OF OPERATIONS

• The interrelationship of financial statements considering the dual basis

of budgeting and reporting.
• Linkage of financial reports, especially Statement of Operations , with
performance reports
• Statement of Operations are prepared to complement accrual-based
reporting and accounting cycles so that:
– Statement of Operations, Statements of Changes in Equity and Balance
Sheets have linkages that can be accounted for
– Budget accountability reports can be distinguished from financial
performance reports
– It can be known the operational performance of the government for a certain
reporting period
– Statement of Operations has predictive value because the information can
be used to predict the Statement of Operations revenue that will be received
to fund government activities in the coming period

31
INFORMATION IN THE NOTES TO THE FINANCIAL STATEMENTS

• Reporting entities present LO-revenue classified by source of

revenue.
• Further details of sources of income are presented in the Notes to
the Financial Statements.
• The reporting entity presents expenses classified according to the
classification of types of expenses
• Expenses based on organizational classification and other
classifications required according to applicable laws and
regulations are presented in the Notes to the Financial Statements.

32
CENTRAL GOVERNMENT
OPERATIONAL REPORT
FOR THE YEAR ENDED
BY 31 DECEMBER 20X1 AND 20X0 (In rupiah)

33
33
CENTRAL GOVERNMENT
OPERATIONAL REPORT
FOR THE YEAR ENDED
BY 31 DECEMBER 20X1 AND 20X0 (In rupiah)

34
34
 STATEMENT OF CHANGES IN EQUITY

• LPE is component report finance Which serve at leastposts:

– initial equity,
– surplus/deficit-LO in the current period;
– corrections that directly increase/decrease equity,
– ending equity

Equity is only one component, not divided into Current Fund Equity, Invested
Fund Equity, etc.

35
STATE GOVERNMENT
REPORT CHANGES IN EQUITY
FOR THE YEAR ENDED
BY 31 DECEMBER 20X1 AND 20X0 (In rupiah)

NO DESCRIPTION 20X1 20X0

1 INITIAL EQUITY XXX XXX

2 SURPLUS/DEFICIT-LO XXX XXX
CUMULATIVE IMPACTS OF POLICY
3 CHANGES/UNDERSTANDING ERRORS:
4 INVENTORY VALUE CORRECTION XXX XXX
5 FIXED ASSET REVALUATION DIFFERENCE XXX XXX
6 ETC XXX XXX
7 FINAL EQUITY XXX XXX

36
36
 TRANSACTIONS IN ACCRUAL SAP

• CASH TRANSACTIONS BUDGET IMPLEMENTATION

ACCRUAL TRANSACTIONS
• Income must still be received
• Prepaid income
• Accrued expenses
• Prepaid expenses
• Depreciation expense

37
ADJUSTMENT OF CASH - ACCRUALS
LRA Income and LO Income Spending and Expenses

LRA LO LRA LO

LO-income Spending
At a time At a time
Income-LRA Expenses

LO's income
Payable
Prepaid Already Income Prepaid Expense
Expenses
Income received the Receivables Expenses Already Paid
(YMHD)
Payment

38
 APPLICATION OF ACCRUALS IN LOCAL
GOVERMENT
REGULATION OF THE MINISTER OF HOME AFFAIRS OF THE
REPUBLIC OF INDONESIA NUMBER 64/2013 IMPLEMENTATION OF
ACCRUAL-BASED GOVERNMENT ACCOUNTING STANDARDS IN
LOCAL GOVERNMENTS

• Objective Guidelines for local governments in • General Provisions

implementing accrual-based SAP. • Objective
• Scope local government accounting policies; .
• Scope
SAPD; and BAS.
• Permendagri is equipped with: • Local Government
• Appendix I : Guidelines for draft local Accounting Policy
government accounting policies • Local Government
• Appendix II : Guidelines for draft SAPD Accounting System
• Appendix III : Standard Chart of Accounts • Standard Chart of
• Appendix IV : LRA presentation conversion
Accounts
format
• Other Provisions

39
 FINANCIAL Income-LRA
1 4 7
STATEMENTS Shopping
LRA sal
Transfer
local government
Financing

PP LO-income 2 5
71/2010
Burden LO LPE
Cash & Cash
C
Equivalents
accounts
A
Home Policy
Regulatio Act& receivable L
Supply
n 64/2013 SAPD 3 K
Long term balance
investment sheet
**)
Fixed Assets & 6
Depreciation LACQU
Reserved fund ER

Other Assets
Obligation Transitory
Error Correction Transactions
*)

Consolidation
ReStatement of
Financial Statements

40
 FINANCIAL STATEMENTSSKPD
1 5
Income-LRA
LRA
Spending

LO-Income 2 4
Expenses
LO LPE
C
A
PP Permendag Cash & Cash Equivalents
L
71/2010 ri 64/2013 accounts receivable K
Supply 3
Fixed Assets & balance
Depreciation sheet
Other Assets
Obligation
Error Correction

Consolidation
Local government
report

41
 SAP IMPLEMENTATION (PP 71chapter6):
STANDARDS AND SYSTEMS

(1) The government prepares a Government Accounting System that refers to SAP.
(2) The Government Accounting System at the Central Government is regulated by
a Minister of Finance Regulation which refers to the general guidelines for
Government Accounting Systems.
(3) The Government Accounting System in local governments is regulated by
governor/regent/mayor regulations referring to the general guidelines for
Government Accounting Systems.
(4) The general guidelines for the Government Accounting System as referred to
in paragraph (2) and paragraph (3) are regulated by a Minister of Finance
Regulation after coordinating with the Minister of Home Affairs.
 Regulation–Government Center

GOVERNMENT ACCOUNTING STANDARDS:

• PP 71 of 2010: Government Accounting Standards (appendix I)
• PSAP Bultek:
– Bultek 15: Fixed Assets Accruals
– Bultek 16: Accrual Receivables
– Bultek 17: Intangible Assets Accruals
– Bultek 18: Accrual Depreciation
Upcoming:
– PSAP Public Service Agency
– Bultek NonTaxation Revenue
– Bultek Taxation Revenue

43
PERATURAN TERKAIT IMPLEMENTASI AKUNTANSI DI PEMERINTAH PUSAT

PMK 215 Tahun 2016 mengganti PMK 213 Tahun 2013

• Central Government Accounting System (SAPP)

PMK 214 Tahun 2013

• Standard Chart of Accounts

PMK 215 Tahun 2013

• Journal of Government Accounting

PMK 224 Tahun 2016 pengganti PMK 219 Tahun 2013

• Central Government Accounting Policy

PMK 225 Tahun 2016 pengganti PMK 270 Tahun 2014

• Implementation of Accrual-Based SAP at the Central Government

PMK 222 Tahun 2016 pengganti PMK 177 Tahun 2015

• Guidelines for Preparation of Financial Statements Ministry/Institution

PMK 221 Tahun 2016 pengganti PMK 216 Tahun 2015

• Preparation and Submission of Financial Statements of the State General
Treasurer (BUN)
 FLOW OF PREPARATION OF CENTRAL GOVERNMENT FINANCIAL
REPORTS(LKPP)
MINISTER/LEADERINSTITUTIONS AS BUDGET/GOOD USERS DPR
Agency Accounting System (SAI)
work unit LKKL
LO
BLU work unit Region/ LPE
Eselon 1 K/L balance sheet
Province
LRA
CaLK President
BS/BL
LKPP:
1. LRA
2.LO
CONSOLIDATION 3. LPE
4.balance sheet
5. LAK
KPPN/PKN DJPB Regional Office APK-DJPB 6.LPsal

SPAN
7. CaLK
BUN
Loan
Loan Special
Special
Debt
Debt & Grants
& Grants
Forwarding
Forwarding Transactions
Transactions
LKBUN BPK
Government
Government Transfer
Transfer toto Statement of Cash
Investment Other Bodies flow
Investment Regions
Regions
LRA
LPE
LPSAL
BUN Accounting System balance sheet
THE MINISTER OF FINANCE AS THE GENERAL TREASURER OF THECaLK
STATE
45
 BPK EXAMINATION RESULTS 2008-2015
LOCAL GOVERNMENT
OPINION
LKPD QMS
WTP % WDP % TW % TMP %
2006 3 1% 327 28% 28 6% 105 23% 463
2007 4 1% 283 59% 59 13% 123 26% 469
2008 13 3% 323 67% 31 6% 118 24% 485
2009 15 3% 330 65% 48 10% 111 22% 504
2010 34 7% 343 66% 26 5% 119 23% 524
2011 67 13% 349 67% 8 2% 100 19% 524
2012 120 23% 319 61% 6 1% 79 15% 524
2013 156 30% 311 59% 11 2% 46 9% 524
2014 252 47% 247 46% 5 1% 35 6% 539
2015 312 59% 187 35% 3 1% 30 6% 532

Kriteria Pemberian Opini Laporan Keuangan oleh BPK (UU

15/2004)
Compliance with Government Accounting Standards
Adequacy of Disclosure (adequate disclosure)
Compliance with laws and regulations

Source: IHPS BPK

Internal Control System Effectiveness
 BPK EXAMINATION RESULTS 2008-2015
STATE GOVERNMENT

OPINION
LKPD QMS
WTP % WDP % TW % TMP %
2008 34 41% 31 37% 0 0% 18 22% 83
2009 42 58% 24 33% 0 0% 7 10% 73
2010 50 65% 25 32% 0 0% 2 3% 77
2011 61 76% 17 21% 0 0% 2 3% 80
2012 62 71% 22 25% 0 0% 3 3% 87
2013 65 75% 19 22% 0 0% 3 3% 87
2014 62 71% 18 21% 0 0% 7 8% 87
2015 56 65% 26 30% 0 0% 4 5% 86

Vice President Budiono in the 2014 Accounting National Working Meeting:

“WTP opinion is not the final goal, but only an intermediate goal to achieve good
governance in government financial management.
Source: IHPS BPK
THANK
YOU
48