Group 1

 Ades Kurnia
 Safira Yafiq Khairani

Introduction of Public Sector Accounting

A. The Definition and Objectives of Public Sector Accounting.

Public Sector Accounting is a process for collecting, recording, classifying, analyzing and
reporting financial transactions for a public organization that provides financial information for
parties who need it to be used when making a decision.

According to the American Accounting Association, the primary purpose of public sector
accounting is to provide financial management information and reports. Furthermore, this
report will be used for management control and accountability.

Management Control
The first objective of public sector accounting is management control. As management control,
accounting for the public sector will provide the information public institutions need in
managing it appropriately and efficiently. This accounting will also provide information on the
use of resources that have been budgeted for in public institutions.

Accountability
The purpose of accounting for the public sector, in turn, relates to accountability. So, accounting
for the public sector will provide important information needed by managers of public
institutions. This information will later be used by managers as an accountability report for all
areas under their authority.

Not only that, this information is also used as an accountability report to the public for the
performance of government agencies. So, the public can see transparency about what the use of
public budgets by government agencies is like.

B. The Characteristics of Public Sector Accounting

Accounting for the public sector has different characteristics from accounting used by
the private sector. The main difference can be seen from the institutions or agencies that use
the two accounting sciences. Accounting for the public sector is commonly used by local and
central government agencies.

The characteristics of public sector accounting focus on two things. First, accounting for
the public sector focuses on the nature of institutions. Thus, the characteristic of this accounting
is the specialty of non-profit organizations that are not profitable. For example, such as
government agencies.
 Second, accounting for the public sector focuses on institutional goals. As the name
implies, accounting for the public sector only provides service information to the public. This
public service is carried out to improve the welfare of the community.

C. The Scope of Public Sector Organizations.

The scope of public sector accounting includes government agencies (central

government, local government, and government work units), volunteer organizations, hospitals,
colleges and universities, foundations, non-governmental organizations, religious organizations,
political organizations, and so on.

D. The History and development of Public Sector Accounting.

The history of public sector organizations have started thousands of years ago. In fact, in
his book, Vernon Kam (1989) illustrates the existence of public sector accounting practices since
thousands of years BC.
This practice results from various interactions between members of the community and
various social forces. The social forces of society, which are generally in the form of government

- these public sector organizations, are classified into:

 The spirit of capitalization (capitalistic spirit)
 Political and economic events (economic and political events)
 technology innovation.

Historical evidence indicates that the practice of recording systems dates back to
ancient Egypt. A ministerial organization was established for the purpose of administering
reports for the prime minister. The ministers practice monthly reports related to the results of
tax collection. At that time, the Egyptian government was composed of districts led by a
governor who was in charge of keeping records of the wealth of each district as a basis for tax
collection.
Subsequently, in the Babylonian era, the practice of recording was carried out in various
activities to generate income and production.
In Greek times, the ruling government shared the income received fairly. Phartenon, is
the designation for the ministerial organization in charge. They have developed various methods
of recording valuables.
In the Roman era, accounting practices to support the tax mechanism were carried out
by all officials, both in governorates and the empire.
In the mid-late 14th century, the practice of recording financial transactions in Genoa
was in the form of evidence of financial transactions between the ruling government and the
people. Furthermore, the process of recording develops in the process of trade between
countries

E. The Public Sector Accountant Profession

 Graduates of the Public Sector Accounting study program will be directed to have a
career in the public sector, namely in government offices as PNS and Non-PNS. The professions
undertaken by graduates of Public Sector Accounting are, of course, public sector accounting
staff, Public Sector Auditors, Government procurement management of goods / services, and
Tax Staff of the Public Sector Accounting Department. However, it is also not limited for
graduates to cross into the private sector, because basically the graduates of this study program
have competencies in accounting which will also be needed in the private sector. Here the
example of the proffesion :

 Financial Examiner
 Tax Officer / Tax Preparation Officer
 Auditor
 Public Accountant
 Tax Inspectors and Collectors, and Revenue Agents
 Accountant
 Financial Analyst