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Government Accounting Developments: The Indonesian Experience
Hekinus Manao,
Ministry of Finance Indonesia; The University of Indonesia
ABSTRACT: Until recently modern accounting has been a foreign language among government agencies in Indonesia. This paper explains the types of financial recording activities which were carried out on a fragmented, single-entry and cash-based bookkeeping system. The case for government accounting reform was intensified by the economy collapse in the late 1990s. But, among the several critical issues faced was related to the choice between cash basis and accrual basis. To avoid possible infliction on the new accounting implementation, an innovated scheme has been adopted by introducing a “cash towards accrual” accounting basis. The new approach maintains both revenue-expenditure account ledgers and balance-sheet account ledgers, wherefrom a comprehensive set of financial statements can be produced. Although the new government accounting system has not yet been subjected to academic tests, it has been successfully generated the comprehensive financial reports of the government of Indonesia.
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