Introduction
Government accounting refers to the branch of accounting which is used in government organizations. It is a process of identifying, collecting, recording ,summarizing the financial activities (government revenue and expenses) and communicating the financial results. The main objective of this accounting system is to reveal the position of public funds and properties. It is different from commercial accounting which is used by the business firms to determine the profit or loss and the financial position of the firm.
Features Of Government Accounting
Some of the main features of government accounting can be pointed out as follows:
1. Government Revenue And Expenses
Government accounting deals with government revenue and expenses. It collects, records, summarizes and communicates the financial transactions incurred by the government organizations.
2. No Profit Or Loss
Government accounting does not reveal profit or loss of the government institutions but it shows the position of public properties and funds.
3. Cash Basis System
It follows cash basis accounting system rather than accrual basis system. It means accounting records are made when actual payments are received or paid.
4. Follows GAAP
Government accounting must follow generally accepted accounting principles (GAAP) and maintained under given rules and procedures.
5. Based On Budget
Another features of government accounting is that it is based on the annual budget of the government. It helps to track and monitor government revenues and expenditures.
6. Single Entry System
It is non commercial in nature, so it follows single entry system to record the financial transactions in the government offices,
Also Read: Objectives of government accounting
7. Auditing
Accounting records, financial statements and books of accounts are audited by the concerned department of the government.
8. Complex System
It is more complex than commercial accounting because of the large volume of transactions and varieties of financial items.
