Government Accounting

One which encompasses the process of analyzing, recording, classifying, summarizing and
communicating all transactions involving the receipt and disposition of government fund and property
and interpreting the results thereof.

Objectives of Government Accounting

To produce information concerning past operations and present conditions

To provide a basis for guidance for future operations

To provide for control of the acts of public bodies and offices in the receipt, disposition and utilization of
funds and property

To report on the financial position and the results of operations of government agencies for the
information and guidance of all persons concerned

Public Sector Accounting Standards Board

Assists the commission in formulating and implementing the Philippine Public Sector Accounting
Standards (PPSAS) where PPSAS applies, in which case the Philippine Financial Reporting Standards
(PFRS) and relevant standards issued by the Financial Reporting Standards Council, Board of
Accountancy and Professional Regulation Commission shall apply.

Coverage of PPSAS

National Government Agencies (NGAs)

Local Government Unit (LGUs)

Government Owned and controlled corporations (GOCCs) not considered as Government Business
Enterprise (GBEs)

Government Business Enterprise

1. An entity with the power to contract in its own name

2. Has been assigned the financial and operational authority to carry on a business
3. Sells goods and services, in the normal course of business, to other entities for profit or full cost
recovery
4. Not reliant on the continuing government funding to be a going concern
5. Controlled by a public sector entity
Accounting Responsibility

Emanates from the constitution, laws, policies, rules and regulations

The constitution mandates the keeping of the general accounts of the government, promulgation of
accounting rules, and the submission of reports covering the financial condition and the operation of the
government

Government offices charged with accounting responsibility

Commission on Audit (COA)

Department of Budget and management (DBM)

Bureau of Treasury (BTr)

Government Agencies discharging the functions of government to enable it to attain its commitments to
the Filipino people

Commission on Audit (COA)

Keeps the general accounts of the government

Promulgate accounting rules and regulations

Submits annual report of the government, its subdivisions, agencies and instrumentalities, including
GOCC to the President and Congress

Has the exclusive authority, subject to limitation in this Article, to define the scope of its audit and
examination

Promulgate accounting rules and regulations

Department of Budget and Management

Responsible for the formulation and implementation of the National Budget with the goal of attaining
our national socio-economic plans and objective

Bureau of Treasury

Receive and keep national funds, manage and control the disbursements thereof

Maintain accounts of financial transactions of all national government offices, agencies and
instrumentalities
National Government Agencies

Departments, bureaus, offices and other instrumentalities of the National Government, including the
Congress, the Judiciary, the constitutional bodies, state colleges and universities, and other self-
contained institutions and hospitals are required by law to have accounting
units/divisions/departments.

Basic Accounting and Budget Reporting Principles

Generally accepted government accounting principles in accordance with PPSAS and pertinent laws,
rules and regulations.

Accrual basis of accounting in accordance with PPSAS

Transactions and other events are recognized when they occur and not when the cash or its equivalent
is received or paid

Budget Basis for Presentation of budget information in the financial statements in accordance with
PPSAS

Presentation of Budget Information in the Financial statements requires a comparison of budget

amounts and the actual amounts arising from the execution of the budget to be included in the financial
statements of entities that are required to make publicly available their approved budgets.

Revised Chart of accounts as prescribed by the Commission on Audit

The Commission is encouraged to adopt relevant International accounting standards

Double Entry Bookkeeping

It is a system of bookkeeping where every journal entry to account requires a corresponding and
opposite entry to a different account

Financial Accounting Based on accounting and Budgetary Records

The objectives of general purpose financial reporting in the public sector should be able to provide
information useful for decision making, and to demonstrate the accountability of the entity for the
resources entrusted to it

Fund Cluster Accounting

Refers to an accounting entity for recording expenditures and revenues associated with a very specific
activity for which accounting records are maintained and periodic financial reports are prepared