Public vs.

Private Accounting[edit]
There is an important difference between private sector accounting and
governmental accounting. The main reasons for this difference is the environment of
the accounting system. In the government environment, public sector entities have
different goals, as opposed to the private sector entities' one main goal of gaining
profit. Also, in government accounting, the entity has the responsibility of fiscal
accountability which is demonstration of compliance in the use of resources in a
budgetary context. In the private sector, the budget is a tool in financial planning and
it isn't mandatory to comply with it.
Government accounting refers to the field of accounting that specifically finds
application in the public sector or government. A special field of accounting exists
because:- - The objectives to which accounting reports to differ significantly from
that for which generally accepted accounting practice has been developed for in the
private (business) sector; & - The usage of the results of accounting processes of
government differs significantly from the use thereof in the private sector.
An exception exists on the above-mentioned differences in the case of public utility
businesses (for example Electricity Services) that may be intended to produce a net
income or profit, but a significant debate exists over whether there should be such
an exception. Nationalisation includes, amongst others, the argument that entities
should be either private or public, and that the objectives of public entities should
differ significantly from that of private entities. In other words, is the generation and
reticulation of electricity with the objective to generate a profit in the public interest or
not? And if it is the best way, shouldnt it then