UNIVERSITY OF GHANA

(All rights reserved)

BSc. ADMINISTRATION
SECOND SEMESTER, 2020/2021

DEPARTMENT OF ACCOUNTING
ACCT 402: PUBLIC SECTOR ACCOUNTING (3 Credits)

INSTRUCTIONS:
ATTEMPT ALL QUESTIONS

Q.1
The following is a summarized list of the receipts and payments extracted from the ledger of the
Consolidated Fund account of the Central Government of Ghana for the year ended 31
December, 2020:

GHc'000
Cash payment to support the aged 3,450
Foreign travelling cost 1,250
Corporate Income tax 6,450
Loans and advances granted during the year 8,560
UN Peace keeping Expenses 1,410
Refund of medical expenses of paupers 1,960
Transfer to the Road Fund 1,320
Borrowing from the domestic commercial banks 3,280
Medical support for pregnant women 1,280
Training and capacity building 1,730
Value added taxes 10,870
Domestic debt interest paid 1,340
Other expenses 1,790
Subsidies on utilities 1,280
Other bilateral grants 1,380
National award and celebrations 1,120
Recoveries of opening Taxes Receivables 1,230
Net Treasury Operations 1,740
Repayment of domestic borrowing during the year 1,810
Repayment of external borrowing during the year 1,640
Transfer to District Assembly Common Fund (DACF) 1,590
Seminar and workshops 1,820
Recoveries of loans and advances 820

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 External borrowing during the year 14,270
External debt interest paid 1,570
Grant received in support of school feeding programme 2,680
Subsidies on fuel 1,980
Infrastructure works in progress 2,170
Repairs and maintenance 1,230
Fines, Penalties and forfeiture 5,120
Transfer to GET Fund 1,650
Administrative cost 860
Fees and charges for services rendered 3,140
Non-established post salaries 2,840
Financial investment during the year 2,340
Established post salaries 6,110
Custom and Excise duties 6,790
Purchase of property plant and equipment 1,680
13% SSF contribution 1,260
Rent tax 3,960
Staff allowances 2,050
Transfer to other statutory funds 1,110
Proceeds from disposal of PPE 2,910
State Protocol Expenses 720
Infrastructure works completed 6,170
Trust funds 1,780
Income tax (PAYE) 8,360
Capital project grants received 1,270
Dividends and other investment income 1,240

The following additional information is made available:

1. The Government of Ghana applies the full accrual basis International Public Sector
Accounting Standards (IPSAS) as the basis for preparing its financial statements.

2. The approved budget for the 2020 fiscal year excluding that of capital expenditure and
investments is as follows:

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 Original
Supplementary
Budget
Budget

GHc’000 GHc ’000

Direct taxes 8,000 5,000
Indirect taxes 11,000 6,000
Non-tax revenue 9,000 2000
Grants 8,000 2,000 Consumptio
n Compensation of employees 8,000 3,000 of Fixed
Goods and Service cost 6,000 Capital
3,000
3,500
Public debt interest 2,000 1,000
-
Subsidies 2,000 2,000
Transfers 6,000 2,000
3. Bala
Social benefits 2,000 1,000 nces
Other expenses 2,000 1,000
extracted from the ledger of the Consolidated Fund as at 1/01/20 consisted of:
GHc'
000
Consumption of Fixed Capital:
PPE 2,590
Infrastructure completed 1980
PPE 12,310
Infrastructure completed 4,320
Trust Funds 3,210
Inventories 1,980
Loans and advances 7,640
Domestic Debt 9,870
Financial Investments 4,560
External Debt 7,630
Taxes Receivable 2,480
Payables 1,430
Cash and cash equivalent 2,890
Accumulated fund 8,750
Infrastructure in progress 6,740
Treasury bills issued 3,480
Revaluation Reserve 3,980

6. Inventories included in use of goods and services available at the end of the year was as
follows:
Inventories for use Inventories for sale

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 GHc’000 GHc’000
Historical Cost 2,000 2,500
Replacement Cost 1,000 800
Net Realizable Value 900 1,000

4. The probability of receipt of the outstanding opening Taxes Receivables as at 15 th

February 2021 was only 5% as the entity from which government expects to collect the
tax from had been declared insolvent. In December 2020 Investments with a carrying
amount of GHc1,110,000 was liquidated for GHc1,020,000.

5. The capital project grant was received from the Government of Japan in November 2020.
The Government of Ghana reasonably expects to comply with the grant agreement. The
Government of Ghana is unlikely to comply with some of the conditions for grants
amounting to GHc450,000 of the other bilateral grants. The Government of Ghana has
already complied with grant condition in respect of a bilateral grant from the South Korea
amounting to GHc1,890,000. This grant is highly probable to be received in the first
month after the financial year end.

7. Domestic debt interest and external debt interest amounting to GHc1,210,000 and
GHc540,000 respectively was due but not paid due to the financial constraints during the
year.

8. It is the policy of government to provide for consumption of fixed assets on all non-
financial assets acquired during the year and those already existing using the straight line
method at the following rates:
Property, Plant and Equipment 25%
Infrastructure asset completed 20%

No depreciation is charged on assets sold during the year.

9. Salaries and other emoluments outstanding during the year amounted to GHc1,270,000
while that of use of goods and services amounted GHc760,000. Additionally,
GHc3,030,000 of rent paid during the year relate to 2021. GHc570,000 relating to other
expenses was outstanding as at 31st December, 2020.

10. As at 31st December, 2020, corporate tax assessments amounting to GHc4,500,000 was
still outstanding to be paid by corporate entities to government, whilst the total amount
owed to government as at 31st December, 2020 in respect of taxes on goods and services
stood at GHc3,880,000. It is estimated that, only 90% of the outstanding taxes to
government may be recovered.

11. The Government of Ghana applies the revaluation model for its non-current assets
(existing prior to the adoption) in line with IPSAS 17: Property, Plant and Equipment. In

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 this respect, a Professional Valuer was engaged who produced the following values as at
31st December, 2020: Property, Plant and Equipment GHc14,560,000; Infrastructural
assets completed GHc24,960,000 and Infrastructural assets in progress GHc18,210,000.
GHc5,740,000 of Infrastructure in progress was completed and transferred to
Infrastructure at 31st December, 2020. Prior to the revaluation exercise, Property, Plant
and Equipment with a cost of GHc1,040,000 and accumulated Depreciation of
GHc330,000 was sold. All additions to non-current assets were done before 31 st
December, 2020.

You are required to:

Prepare the following financial statements in accordance with the PFM laws of Ghana, the Chart
of Accounts of government and relevant accrual basis IPSAS:
a) Statement of Financial Performance of the Consolidated Fund for the year ended 31
December 2020; 25 marks
b) Statement of Financial Position of the Consolidated Fund as at the year ended 31
December 2020;
25 marks
c) Statement of Changes in Net Assets and Equity for the year ended 31 st December, 2020;
5 marks
d) Separate Statement of Budget Comparison with Actuals in accordance with IPSAS 24;
and 20 marks
e) Show detailed workings for all derived answers 25 marks
Total Marks: 100%

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