Name: Rayhan Zuhra Rinaldi

NIM: 1610532051

Governmental Accounting

1. Discuss the difference between government organizations and private

sector organization.

The government organization is public-organization which established with a purpose

to serve the public, or we called as public service. The main purpose for government
organization is to give the services like making ID Card in Dinas Kependudukan dan
Pencatatan Sipil (Disdukcapil), making Driving License or SIM, making birth certificate, or
something like that. It is not fully profit oriented, because there is a commitment for a country
to give the service to its citizens.

The private organization is organization owned by private or a group of people which

established with the main purpose is to seek the profit of that organization. This organization
are run in several categories, and sometimes they also run in same context of government
organization. For example, we study in a university that are government-owned organization,
or state university. In other side, there are Universitas Bung Hatta, Universitas Baiturrahmah
as the private organization, which are give us more cost to pay. In Andalas University we
already subsidized by government, so we do not necessary to pay the tuition fee as the real
calculation.

One of the main characteristic to distinguish government organization and private

organization is profit. The way of organizing the government organization are different with
private organization, because:

1. Basically, the policies of the management of leader in government organization are based
on they desire to being chosen in the next period. In other side, the private organization, the
policies are based on “going concern” or they existence of the organization.
2. Government organization are open and democratic, and then, usually the government
organization are slow to make a decision. In other side, the private organization are refers to
the market, so they make decision like the market moves.
 3. Government organization receive the funds from the tax – payers and from treasury fund
in majority. In private organization receive the funds based from the customers who use they
services.
In government organization, to authorize or to establish the new organization, government
organization must have some procedure like legality, permission, and something like that. The
private organization also have the same procedures, but the procedures not complex as the
government organization.

Example of Government Organizations:

1. Regional Development Bank
This bank are owned by government. We know Bank Nagari, Bank DKI, and Bank
Kalbar, and other regional development bank that are the name are refers to its province.
Each province usually have different regional development bank. Regional development
bank can provides us services that are same with the private banks.
2. Dinas Pekerjaan Umum
This public works service department are the department that are have a role to plan
the development and maintaining road, bridge, and other construction that are owned by
government. This department also have a role to developing the territory, urban structure,
and land use. Maintaining heavy equipment also the role of public works service.

Example of Private Organization:

1. Private Banks
Many examples from private banks, such as BCA, Mandiri, CIMB Niaga banks etc.
This bank provides services to the public in the financial sector. Starting from borrowing
money, savings, mortgage deposits and others. Private banks offers more services than
regional development bank. But the private banks have higher interest if we compared to
regional development banks.
 Summary for Distinguish Government Organization and Private Organization:

Aspect Private Organization Government Organization

Purpose -Profit oriented -Nonprofit
-Provides goods and -Public service oriented
services comercially
Source of funds -Equity -Tax
-Retained Earnings -Retribution
-Issuing shares -Gift
-Selling Asset
Owner Shareholders and investors Citizen and parlementary
Budget Characteristics Organizational business Governmental structure
structure
Organizational Structure -Close to the public -Open to the public
-Secret documents -Public documents
(confidential
Accounting Standards Standar Akuntansi Standar Akuntansi
Keuangan (IFRS) Pemerintahan (SAP)
2. Describe the role of professional accountant in the government
organizations.

Professional accountant are related to local autonomous. The authorization that are
given by center government to local government are have impact to organize the public sector
that are managed by local autonomous. Public Sector Accounting are the chain process that are
similar with the accounting in general. But, the demands of transparency to the public are
emphasized in the pupose of the reports. The financial reports must be accessible to the people,
in order to know how the government utilize the funds that are come from the people.

Although there is a local autonomous, center government must know all of the revenues
and the expenses of local finance, and also have responsibility to the people. Then, public sector
must preparing the financial report to the people easily and clearly. Shortly, local autonomous
give more simplicity for public sector to deliver its financial reports to the people. There are
the function of public sector accountants:

1. To serve the information for the decision maker for the economic activities which is
important and also support the information about how they allocate resources that is limited,
like human resources, materials, and something like that.

2. To evaluate the services that are performed by government and then evaluate how was the
service performed, are the service are effectively and efficiently run.

3. Provide useful information that are usable to the person who are have concern to the
economic development, and others.

For the example, accountants are work in BPK (Badan Pemeriksa Keuangan), BPKP
(Badan Pengawasan dan Keuangan Pembangunan), or any accountants who works in
governmental institutions like in Kementerian Keuangan, any department like in Dinas
Pekerjaan Umum, Dinas Kependudukan dan Pencatatan Sipil, and other else. And also, the
accountant in public sector also works as the lecturer. A lecturer conduct research and
development of accounting, and have a role to educate and to teach the others.
References:

1. Rowan, Jones. 2010. Public Sector Accounting 6e. Hampshire: Pearson Education Limited.
2. Ass'ad Aldiwa. 2014. Komparasi Organisasi Sektor Publik vs Sektor Swasta di
http://www.academia.edu (diakses 29 Agustus)