TOPIC 6

ACCOUNTING FOR
RECEIPTS AND PAYMENT

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 GOVERNMENT ACCOUNTING
MACHINERY

 Relates to governance structure for financial

management of the country’s public sector.
 Comprises of institutions and agencies, personnel, and
systems and procedures.

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 COMPONENTS OF GOVERNMENT
ACCOUNTING MACHINERY
• INSTITUTIONS AND AGENCIES
• MOF
• TREASURY
• ACCOUNTANT GENERAL DEPARTMENT
• SELF ACCOUNTING DEPARTMENT
• RESPONSIBILITY CENTRE

• PERSONNEL
• ACCOUNTANT GENERAL
• CONTROLLING OFFICER
• ACCOUNTING OFFICER

• SYSTEMS AND PROCEDURES

• FEDERAL CONSTITUTION, FP ACT 1957, AUDIT ACT 1957, GOVERNMENT
ACCOUNTING STANDARD, TREASURY INSTRUCTIONS, TREASURY CIRCULARS,
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ACCOUNTANT GENERAL CIRCULARS, STATE GOVERNMENT CIRCULARS

 BASIS OF PUBLIC SECTOR
ACCOUNTING
• CASH BASIS ACCOUNTING
• NO PUBLIC MONEY SHOULD BE SPENT IN WAYS AND AMOUNTS THAT
WERE NOT SPECIFIED IN ANNUAL GOV BUDGET.
• ONLY SHOW SOURCES OF CASH RECEIPTS, ALLOCATION OF CASH
EXPENDITURE AND BALANCES AT THE TIME CASH IS EXCHANGED.
• MODIFIED CASH BASIS ACCOUNTING
• HYBRID OF CASH AND ACCRUAL BASIS.
• REVENUES RECOGNIZED WHEN CASH RECEIVED, EXPENDITURE
RECOGNIZED WHEN IT IS INCURRED.
• MODIFIED ACCRUAL BASIS ACCOUNTING
• REVENUES RECOGNIZED EITHERVWHEN IT IS RECEIVED IN CASH OR
WHEN COLLECTION OF THE AMOUNT CAN BE REASONABLY ESTIMATED
TO BE RECEIVED IN NEAR FUTURE. EXPENDITURE RECOGNIZED WHEN
GOODS OR SERVICES ARE RECEIVED.
• ACCRUAL BASIS ACCOUNTING
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• REVENUE AND EXPENSES RECOGNIZED IN ACCOUNTING PERIOD WHICH
THEY EARNED OR INCURRED.
ACCOUNTING OPERATIONS

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PROCEDURE FOR RECORDING VOTE
BOOK
• 12 TYPES OF TRANSACTIONS TO BE RECORDED IN THE VOTE
BOOK:
• ALLOCATION WARRANT RECEIVED
• ADDITIONAL ALLOCATION RECEIVED
• REDUCED ALLOCATION
• SUB-ALLOCATION WARRANT
• TRANSFER ALLOCATION (VIREMENT IN AND OUT)
• INCUR LIABILITY
• CANCELLATION OF LIABILITY
• RECORD EXPENDITURE
• CREDIT EXPENDITURE
• ADJUSTMENT ENTRY
• CLOSING ENTRY
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• LIABILITY BROUGHT FORWARD
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