New and old government accounting system
Providing necessary data in order to analyze cash flows which can emerge in the future. Traditional view suggests that receivables, payables, and assets of the government should be excluded from the scope of government accounting because of the reasons below [ 12 ]: There is no power of disposition on the assets of the government purchasing, renting, etc.
New Zealand broke taboos by granting the financial reporting authority of the government to an independent institution through this application [ 38 ]. Government accounting systems Emergence and development of government accounting date back to the fifteenth century.
A private institution acting independently from the government was authorized to control the prosecution and application of these accounting standards so that the government lost its opportunity to make explanations on behalf of itself.
New and old government accounting system
For long years, government accounting systems have been recorded in a cash basis manner which includes allocations given by the budgets, expenditures from these allocations, total revenue for financing the expenditures, and some other information that may be needed and which principally represents for the record of collection of revenues and payment of expenditures. There can be no disposition on such government properties as ancient arts, palaces, and museums just as on private properties. Patrimuan accounting requires making up a balance sheet. If we do not address to accounting to include general government services, it has a very limited scope, and there will be no account unity in government sector. Definition, scope, and aim of government accounting Government accounting is a process which enables recording, making decision analysis, classification, summarization, notification, and interpretation of government financial knowledge as well as including and reflecting all transactions which include purchasing, transferring, and allocation of government property in general [ 1 ]. Since its scope is limited to cash flows, it does not serve for transparency and accountability purposes [ 23 ]. Traditional view suggests that receivables, payables, and assets of the government should be excluded from the scope of government accounting because of the reasons below [ 12 ]: There is no power of disposition on the assets of the government purchasing, renting, etc. It is not a single basis for performance evaluation in terms of prudence and efficiency or achievement of the targets, either [ 24 ]. Government activities started to change in parallel with the developments in the world, and traditional concept of government experienced a change. Cash book is recorded by the cashier based on the documents of revenues and expenses. Moreover, since accounting records are recognized when the payments are made, not when services and goods are received, this method does not give any information regarding demands arising at the end of the year against a government administration. Government Agencies would include government instrumentalities like bureaus, Congress, Judiciary, constitutional bodies and self contained institutions, among others, which are required to have an accounting division, which are of equal level with that of other agencies that are tasked to do maintenance of accounts and submit financial statements on a regular basis. Schneider accounting system is a more developed cameral system applied in order to remove these lacking parts [ 9 ]. Cash basis accounting is not interested in when services and benefits which are derived from transactions have emerged. However, it does not remove the liability of the government.
It is possible to suggest the lacking parts of cash basis government accounting system [ 25 ]. Supporters of this system suggest that it easily determines the impacts of financial transactions on economy. Accrual customized government accounting In accrual customized government accounting, transactions are recorded when an economic value is created, changed, exchanged, transferred, or eliminated regardless of time of cash flows.
Opinions of supporters and non-supporters of cash basis government accounting system can be summarized as follows [ 14 ]: Cash basis government accounting system is the simplest method which is used for monitoring government accounts.
Financial reports lose budget revenues and expenses, cash inputs and outputs, and opening and closing cash assets in such an accounting system [ 21 ].
Features of government accounting
Collection of this data is only possible by collecting more detailed statistical data. Revenue account indicates revenue transactions which accrued throughout the fiscal year regardless of their being collected in cash and which are required to be recorded as revenues in accordance with the principles of accounting which are universally accepted, while expense account indicates sum of expenses which accrued throughout the fiscal year regardless of their being collected in cash. Just like SNA93, ESA95 also enables uniformity in concepts and classifications of such various economic and social statistics as employment statistics, production statistics, and foreign trade statistics. In this regard, we firstly examined countries which had important developments in shifting to accrual basis accounting system as it threw light upon the developments in the world and which made the first applications of this system. However, government departments in New Zealand shifted to accrual basis in the issues of budgeting and accounting in , and New Zealand became the first country to produce government accounts in accrual basis in Cameral accounting system is divided into two as old cameral accounting system and new cameral accounting system with regard to historical development of accounting systems. When there is an entitlement of using the sources, which are expected to provide benefit to the organization in the future, accrual basis government accounting system regards them as an asset and records them. Recording and monitoring the studies and activities of the governments regarding financial and economic policies, government accounting is the most important element of the principle of financial transparency and financial accountability in this regard. Approaches and modifications which were developed because of the obligation of this implementation in some countries using accrual basis government accounting system are as follows [ 31 ]: Approach which supports that assets and liabilities are recorded in accrual basis while revenues are recorded in cash basis because of difficulty in calculating the amount of collection. This system cannot sufficiently help financial transparency because it does not produce detailed and accurate financial data on the issues which are required to be within the knowledge of government.
Not producing information on service costs: Service cost information, pricing policy and control, and performance evaluation are beneficial and necessary instruments for decision-making process and government contract policies. Cameral accounting system is divided into two as old cameral accounting system and new cameral accounting system with regard to historical development of accounting systems.
based on 69 review