GOVERNMENT

ACCOUNTING AND
AUDITING

Reporters:
Dexter C. Lactuan
Annalee R. Lactuan
 What is Accounting

 Accounting is an effective tool of management

in evaluating the performance of the different
agencies of government.
What is Government Accounting

 refers to the process of recording and the

management of all financial transactions
incurred by the government which includes its
income and expenditures.
What is Government Accounting
 is maintained according to
the government rules and regulation.

 helps to provide financial information and data

for budget preparation.
Main Objective of Government
Accounting
 To produce relevant financial information
about past and present transactions of
government.

 To serve as the control mechanism for the

receipt, disposition and utilization of
government funds and properties.
Main Objective of Government
Accounting
 To serve as basis for decision making for the
future.

 To come up with financial reports pertaining to

the results of operations of various
government agencies that are for
dissemination to the public.
 NGAs

 New Government Accounting System

Simplified set of accounting concepts,
guidelines and procedures design to ensure
correct, complete and timely recording of
government financial transactions, and
productions of accurate and relevant
financial reports.
 The shift to NGAS was made in
responds to the following needs:
 Adoption of an accounting system that is in
conformity with the International
Accounting Standards.

 Computerization of the accounting systems

to generate reports that will be easy to
understand by the general public
 The shift to NGAS was made in
responds to the following needs:

 Preparation of regular and routinary

financial reports.

 The use of the generated financial reports

as tools of management in decision making.
What are the Basis of Accounting

 Cash Basis

 Accrual Basis
 Cash Accounting

 Traditional method of accounting simply

sought to control and track the passage of
cash funds voted by legislatures as the
funds were allocated to and spent by
agencies.
 Accrual Accounting

 Allows for true measures of income and

expenditures whether or not cash payments
associated with the earnings or debts have
actually taken place.
TYPES OF GOVERNMENTAL
FUNDS
 General Funds

 Special Revenue Funds

 Debt Service Funds

 Capital Project Funds

 Permanent Funds
 GENERAL FUNDS
 Routine operations
 Not accounted for elsewhere

 SPECIAL REVENUE
 Expenditures restricted to a purpose
 Specific revenue sources
Restricted activities such as
maintenance of public
parks
 CAPITAL PROJECT FUNDS
Account for the acquisition
or construction of major
capital facilities or
improvements that benefit
the public.

 DEBT SERVICE FUNDS

 Accumulation of resources for, and
payment of principal and interest on long-
term general obligation debt.
 Permanent Funds

 To account for resources legally restricted

such that only earnings maybe use for
government programs.
 On Accounting Responsibility
 The fiscal responsibility emanates from the
constitution and its governing laws, rules and
promulgation.

 The mandate as prescribed under the said

constitution of the Philippines calls for the keeping
of the general accounts.

 The government officer that are mandated to

discharge the above stated accounting
responsibilities are the COA, DBM and BTR.
 WHAT IS AN AUDIT

 Any independent examination

 any objective assessment of
anything
 public management is verified and controlled
 activity and economy are analyzed
 work around efficiency and transparency
 always acting in accordance with the relevant
legal provisions applicable to the specific
case.
Characteristic of Government
Audit
 Performs evaluations, studies, reviews and
investigations of public activity
 It is an objective audit, conducted and
directed by an impartial auditor.
 Evaluates the operations that have been
carried out (it is an ex post analysis). Likewise,
it compares with the standards of
performance, quality or with generally
accepted provisions and principles.
 The government audit concludes with a verbal
and other written report.
 Objectives of the Government
Audit
 Promote improvements and constructive
reforms, based on critical and objective
criteria.
 Determine and inform the regulations and
authorized legal programs.
 Find out if human, material and economic
resources are used efficiently.
 Communicate to the rest of organisms and
entities about everything that has been
discovered and is meaningful for them.
 Financial Audit
 Operational Audit
 Compliance Audit
 Subtypes of Financial Audit

 Audit of financial statements

 Audit of financial matters

 Types of Auditors

 Internal Auditor

 Independent Auditor
The end