GOVERNMENT ACCOUNTING STANDARDS (SAP)

IUP. to edit Master 2011 ClickNOVEMBER 18thsubtitle style

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REGULATION AND CONTROL

Business:
Able to modify or withdraw unprofitable goods and services from the marketplace Responds to value of resources provided to type and quality of goods and services provided Profit motive and measurement result in an allocation and regulation of resources vs. goods and services provided

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REGULATION AND CONTROL

G&NP:

Not able to modify or withdraw some unprofitable goods and services from the marketplace

Value of resources provided often not related to type and quality of goods and services provided

Goods and services provided often unique and without charge or at a token charge
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G&NPs DIFFICULTY IN EVALUATING RESULTS

No market supply and demand test for value of services

Indirect relationship between resource providers and service recipients

Absence of profit test

Forced resource contributions (taxation)

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G&NP OPERATIONS AFFECTED BY:

External elements

Federal / state statutes and laws Grant regulations Judicial decisions

Internal elements

Charter, by-laws, ordinances Contractual obligations Trust / donor agreements

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G&NP OPERATIONS REGULATED & CONTROLLED BY:

Organization structure

Governance elected, line of authority

Personnel policies and procedures

Who hires / fires, compensation

Source of financial resources

Taxes, debt and rate limits

(Continued)

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G&NP OPERATIONS REGULATED & CONTROLLED BY:

Use of financial resources

Restricted, budgeting, purchasing

Accounting and financial reporting

Structure, reporting types, recipients

Auditing

Who, frequency, scope, grants

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ACCOUNTING & FINANCIAL REPORTING OBJECTIVES

Making resource allocation decisions Setting goals and objectives Directing and controlling resources Reporting on resource custodianship Contributing to efficiency and effectiveness
American Accounting Association

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ACCOUNTING & FINANCIAL REPORTING OBJECTIVES

Objectives address needs of external users of financial information

Managers and other internal users have specialized needs for financial information

FASB - Statement of Financial Accounting Concepts No. 4

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ACCOUNTING & FINANCIAL REPORTING OBJECTIVES

For general purpose external financial reporting:

Making resource allocation decisions

Assessing services and ability to continue

Assessing management stewardship responsibilities and performance

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FINANCIAL REPORTING INFORMATION NEEDS

Economic resources, obligations, net resources Effects of transactions / events on resources Performance measurement of resource changes Service efforts and accomplishments Sources of cash flows and liquidity
FASB - Statement of Financial Accounting Concepts No. 4

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ACCOUNTING & FINANCIAL REPORTING CHARACTERISTICS

Remember

Accounting

is a service function and must meet user information needs in a given environment

Accounting control provisions in G&NP environment

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ACCOUNTING & FINANCIAL REPORTING CHARACTERISTICS

Therefore, the two most important legal and administrative controls affecting governmental and nonprofit accounting and financial reporting
Funds and fund accounting Budgets and appropriations

1.

2.

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ACCOUNTING & FINANCIAL REPORTING CHARACTERISTICS

What are key differences of government and nonprofit from business accounting & financial reporting?

Use of fund accounting Use of special accounting for restricted activities Presentation of budgetary comparisons in connection with regular financial reporting
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SAP Introduction

Government Accounting Standards Committee, referred to KSAP Statement of Governmental Accounting Standards Interpretation, referred to IPSAP are clarifications, , explanations and further descriptions of the SAP statement issued by KSAP

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KSAP consist of:

1.

Governmental Accounting Standards Consultative Committee (Consultative Committee) Assigned to provide consultation and / or opinion in the formulation of the concept of the draft Government Regulation on Government Accounting Standards.

2.

Governmental Accounting Standards Working Committee (Working Committee). Assigned to prepare, formulate and arrange the Draft of Government Regulation on Government Accounting Standards

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Strategies and Goals of KSAP

KSAP aims to improve accountability and reliability of government financial management through the preparation and development of governmental accounting standards, including supporting the implementation of the standard

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Governmental Financial Report

Government financial report intended to meet the general purpose financial reporting, but not to meet the specific needs of the user itself. the term "financial statements" includes all the reports and the various explanations that follow.

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Governmental Accounting Standards (SAP)

In accordance with UU no. 17 of 2003 on State Finance, SAP stipulated by Government Regulation, which state and local governments must applied.

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Scope SAP implemented in the government, i.e. central, regional, and organizational units within the central / local, or under the legislation referred to an organizational unit shall present its financial statements. Limitations of the SAP will be stated.

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SAP Preparation Process

1

Identify topics to be developed into a standard Establishment of working group (Working Group) in the KSAP Research by the working group Writing the SAP draft by working group Discussion of the draft by the working committee Draft decision to be published The launch of the SAP draft Limited hearings and public hearings Discussion responses to the SAP draft Finalizing standards

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Determination of the Governmental Accounting Standards

Before applied to be government regulation, KSAP through the government, requesting BPK RI to take the final draft of SAP into consideration. Then Consultative Committee proposes to the President the final draft of SAP to be PP through the Finance Minister.

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Statement of Governmental Accounting Standards (PSAP) PP 24/2005

PSAP 01 Presentation of Financial Statements . PSAP 02 Budget Realizations . PSAP 03 Cash Flows Statements . PSAP 04 Notes to Financial Statements (CALK) . PSAP 05 Accounting for Inventories . PSAP 06 Accounting for Investments . PSAP 07 Accounting for Fixed Assets . PSAP 08 Construction in Progress . PSAP 09 Accounting for Liabilities . 5/2/12

CONSTITUTION
GOVERNMENT
SETTING INFRASTRUCTURE

MANAGEMENT

RESPONSIBILI TY

BPK - RI

CONSIDERATION S OF SAP CONSIDERATION S OF PP SPI

RECEIVING AUDITOR REPORT

RECEIVING TREASURER REPORT

AUDIT

FINANCIAL STATEMENT PERFORMANCE SPECIFICATIO N

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