Current Status of Accounting Basis in the Government of Nepal

Transcription

1 Current Status of Accounting Basis in the Government of Nepal Sundar Shrestha Deputy Director of Studies NASC

2 Presentation Outline Introduction Purpose and Research questions Research Methods Assumptions and Limitation Findings Conclusion and recommendation

3 Introduction Accounting Basis: Cash Basis, Accrual Basis, Hybrid Basis Successful implementation of accrual accounting system in NASC revealed that accrual accounting is more appropriate reporting system. Thus, I was also interested to identify the status of accounting basis in the GoN.

4 Purpose and Research Questions The central purpose of this study is to explore the current status of accounting basis in government organizations. How government organizations are maintaining accounting basis? How is the gap between cash basis accounting and accrual accounting?

5 Research Methods Approach: Qualitative Design: Descriptive and Explorative Nature and Sources of Data: Primary and Secondary Sampling: Ministries, Central Level Offices, Operating Level offices and office of Chartered Accountants (Ministry of Physical Infrastructures & Transport, Ministry of Urban Development, Ministry of Health, Office of the Auditor General, Financial Comptroller General Office, Revenue Tribunal, PEFA, Secretariat, Office of the District Treasury and Dev. Associate and Charter Accountants. Data Collection Tools and Techniques: In-depth interview Data Analysis Techniques: Transcribed, theme generate, meaning generation

6 Assumption and Limitation Limited to Kathmandu based offices: central offices and operating Based on practices of government accounting system.

7 Findings Traditional Cash Basis (Policy Conference Questionnaires.docx ) GAAP Procedures of transactions Capital Expenditure Non Cash Transaction Credit Transaction Advance Financial Statement NPSAS Cash

8 Why accrual Accounting system NPSAS itself is not accounting system it is reporting system based on cash basis accounting of GoN has been adopting. It provides accurate financial information to the decision makers for the decision making. Accrual accounting can provide the detail financial Picture about the organizations to all stake holders.

9 Why accrual Accounting system NPSAS accrual or equivalent accounting system is compatible with international accounting standard. Preparing integrated financial statement the government agencies will provide the assurance to the stake holders in accounting and reporting system.

10 Who should play What Role Government: Government of Nepal will play the vital role in financial statement and financial reporting system. ICAN/ASB: ICAN/ASB can develop the accounting standard, prepare chart of Accounts and introduce the accounting codes, Advocacy of training, and capacity development. FCGO: FCGO makes legal provision, accounting format revision and implementation of these format, Software development, accounting training to the accounting staff and define accounting policy. OAG: Office of the Auditor General will provide feedback for using of the government format, which is approved, if necessary.

11 Who should play What Role Line Ministries: Line Ministries have own role for conducting training and implementation the system and to provide the guidelines to the departments and operating level offices. Public Service Commission (PSC): Public Service Commission has to prepare the curriculum of examination so that subject s related people can be selected not only but also revise the selection of criteria. As a result, accounting can be easily handled without training at first.

12 Who should play What Role Ministry of Finance will provide the fund for training, infrastructure, IT and overall implementation of accrual accounting. The office of the Prime Minister and council Ministers (OPMCM) provides assurance of policy commitment and coordination among the ministries or central level offices of the government of Nepal. Commission, Constitution Body. Parliament, Cabinet: Commission, Constitution Body. Parliament, Cabinet with their respective roles from legislature works to execution and oversight

13 Conclusion and Recommendation Government has adopted NPSAS cash and it is a transitional period of accrual accounting. Government Should be implemented accrual accounting. It will be compatible of international accounting Standard and it provides clear financial picture. First of all, government has no clear cut policy of adopting the accrual accounting system. Major challenges are in human resource. There is no competent staff of fully handling the accrual system.

14 Conclusion and Recommendation Before implementation the AB system we need infrastructure but we do not have appropriate infrastructures. We do not have well record management systems. No intuitional memory in an office. Lack of technical assistance. Government has not done the valuation of assets. Syllabus of examination should be revised by PSC so that right candidate will be selected

15 Thank You