Mini Project Presentation

Public Sector Accounting

PREPARED BY:

ALI BIN A.RAHIM

ABDUL RAHMAN BIN IZAM

(AC089489)

ABDUL HAFIZ BIN ABDUL HISHAM

(AC089497)

MUHAMMAD HAFIFI BIN ABDUL MANAP

MUHD SOLIHIN BIN MAHMUD

PREPARE FOR

MISS AZLEEN BIN ILIAS

SECTION: 1AM

(AC089503)

(AC088240)
(AC086471)

Fundamental of
accounting system
Accounting is a federal matter and therefore the states would need to comply with directions from
the central government in all accounting matters.
The Accountant General (AG) is the principal accountant in the government and head of the accounts
division. principal functions are to safeguard, account for and be the custodian for all federal
government collections of revenue, loans and trust funds and prepared financial statement.

TYPE OF ACCOUNTING SYSTEM

Cash and Accrual Basic
Since government accounts are kept on a cash basis, separate trust funds for
them were set up in the federal accounts to account for their receipts and
payments. However, their financial statements on commercial lines are tabled
separately in Parliament.

ACCOUNTING STANDARDS
The responsibility for financial and accounting
procedure vests with the Minister of Finance. It is
the duty of the Treasury and its principal
accounting officer, the Accountant General (AG),
to issue instructions and directions on accounting
matters and procedures, monitor that a proper
system of accounts is established and ensure that
procedures comply with generally accepted
accounting principles and standards.

PRODUCTION OF THE ACCOUNTS

Section 16 of the Financial Procedure Act requires that
the annual financial statements be prepared as soon as
practicable after the end of every year for the purpose
of audit, but no date is mentioned in this law for the
submission of the accounts.

Fund Accounting

Types of fund accounting

1)Consolidated Revenue Account
2)Consolidated Trust Account
3)Consolidated Loan Account

1)Consolidated RevenueAccount

Consolidated Revenue Account in which account shall be kept of all moneys

in the Fund.

Consolidated Revenue Account section 7(a)

Consolidated Revenue Account

Federal government revenue

Tax

revenue

Non-Tax

revenue

Miscellaneous
Revenue

Receipts

from Federal Territories

Expenditure Control

Three types of expenditure

Charged Expenditure is expenditure that is directly charged to the Consolidated

Fund

Operating Expenditure are expenditure to finance the daily programmes and

activities of a ministry, department or agency

Development Expenditure is the capital expenditure either for a short or medium

term which entails long term returns

2) Consolidated loan account

Consolidated Loan Account in which account shall be kept of all moneys

received by way of loan upon the public credit of the Federation or of the
State, as the case may be.

Consolidated Loan Account section 7(b)

Consolidated loan account

Why should consolidate loans?

Loan consolidation can greatly simplify loan repayment by centralizing the loans to
one bill and can lower monthly payments by giving up to 30 years to repay the
loans

Types of loans can be consolidated

Direct Subsidized Loans

Direct Unsubsidized Loans

Subsidized Federal Stafford Loans

Unsubsidized Federal Stafford Loans

Direct PLUS Loans

PLUS loans from the Federal Family Education Loan (FFEL) Program

Supplemental Loans for Students (SLS)

Federal Perkins Loans

Federal Nursing Loans

Health Education Assistance Loans

some existing consolidation loans

Syndicated loan

Bond issues

A syndicated loan is one that is provided by a group of lenders and is

structured, arranged, and administered by one or several commercial or
investment banks known as arrangers

Bonds are issued by public authorities, credit institutions, companies

and supranational institutions in the primary markets

Floating rate

floating rate loan (or a variable or adjustable rate loan) refers to a loan
with a floating interest rate

3) Consolidated trust account

Consolidated Trust Account in which account shall be kept of all moneys

received subject to a trust and to be applied in accordance with the terms
of the trust.

Consolidated Trust Account section 7(c)

Consolidated trust account

Development Fund

Housing Loan Fund

This fund is set up in accordance with the development fund 1965 for
the economic development of the nations

The government housing loan fund scheme is financed by the housing

loan fund in accordance with the provision of the housing loan fund act
No.4 of 1975 (revised 2004).

Miscellaneous Government Trust Fund

The miscellaneous government trust fund are classified into 5

categories, namely the clearance account, trading account, loan
account, contingencies fund and miscellaneous fund.

Public Trust Funds

Section 9 of the financial procedure act 1957 (revise 1972) established

this fund to account for trust monies entrusted to federal government
and special trust and act other than financial procedure act
1957(revised 1972) for monies received for specific purpose.

Deposits

Deposits consist of money received by the federal government for a

specific purpose under any law or contractual agreement and are
refundable when the specific purpose has been achieved.

Definition of financial reporting

-Government duties to be publicly a Financial reporting is a set of documents prepared

usually by Government agencies at the end of an accounting period. It generally

contains summary of accounting data for that period,1 with background notes, forms,

and other information. The Governmental Accounting Standards Board (GASB) , 1984
has appropriately identified financial report is not end in itself but is intended to provide
information useful for many purpose. Financial reporting help fulfill accountable.

Legal requirement and procedure

Section 16 (1) of the Financial Procedures Act 1957 states that, the financial authority shall for the purpose of
Section 9 of the Audit Act 1957, after the end of every financial year prepare in respect of the year the
following

A Statement of Consolidated Revenue Account

A Statement of Consolidated Loan Account

A Statement of Consolidated Trust Account

A Statement of Assets & Liabilities of the Federation or States at the end of a financial year

Objective of financial reporting

Compliance and stewardship

Basis of Planning

Performance and Evaluation

Quality of Services

Statement of Achievement

Fact and Figure

Statement of memorandum Account

Asset

Recoverable loans

Investment

Subcription to internasional organization

Statutory deposit

Liabilities

Public debt

Guarantees

Notes payable

Unclaimed securities

Central depository account

Statement of financial position

shows the amount of cash and investment for the accounts of the
Consolidated Fund which consist of Public Money and Consolidated Fund.

Public money is money that has been collected by the state. It consist Cash
and Investment.

Consolidated Fund, it consist of Consolidated Revenue Account, Consolidated

Loan Account and the third is Consolidated Trust fund.

Statement of cash receipt

In the statement of cash receipt, it is include revenue, loan, external assistance,

capital receipts and trust receipts,

Statement of financial performance.

The statement of financial performance of the federal government include

revenue, revenue surplus, overall surplus of deficit.

Notes to the financial statement

It consist of 12 items, there are:

- Accounting Policies And Practices

- Presentation Of The Federal Government Financial Statements
- Cash
- Investment
- Consolidated Revenue Account
- Consolidated Loan Account

- Consolidated Trust Account

- Memorandum Of Assets
- Memorandum Of Liabilities
- Contingent Liabilities
- Account Receivables
- Advances To Contractors

Requirement of Financial Reporting

Basic principle

Credibility.

Fair Presentation

Value Added

Consistency and Uniformity

Annual Financial Statements

Financial Disclosures

Reporting Entity

Full Reporting Capacity

Budgetary Reporting

Statistical reporting

Contents of Financial Reporting Standards

General Principles
Financial Reporting
Defining the financial reporting entity
Comprehensive Annual Financial Report
Additional financial reporting considerations
Notes to financial statements
Budgetary reporting
Cash flows statements
Segment information
Reporting entity and component unit presentation and
disclosures
Supplemental and special purpose reporting
Statistical Section
Interim financial reporting

Relevant statutes/act

Federal constitution

Financial procedure act 1957

Audit act 1957

IPSAS