Question 1:
a) Describe fully the given financial accounting methods:
• Cash accounting
• Accrual accounting
• Fund accounting
• Budgetary Accounting
b) Describe in brief the two advantages and two drawbacks of cash accounting.
c) Identify and describe, with one illustration, the five key elements of the accural accounting.
d) Explain how the given transactions are reported by using cash and accrual accounting.
• Purchase of services on credit
• Acquisition of assets
• Consumption of asset through use
Question 2: There are some distinctive characteristics of government’s operating environment that affect the type of accounting it uses.
Required:
a) Identify and explain four characteristics which are unique to government.
b) Describe the given three dimensions of Government accounting:
• Managerial
• Compliance
• Civil society
Question 3: With the view to modernize its accounting system Government is considering adopting International Public Sector Accounting Standards (IPSAS) so as to maximize the reliability and helpfulness of reported financial information.
Required:
a) What are IPSAS and describe four main drivers for changing to IPSAS.
b) In brief describe six benefits government can derive from adopting IPSAS.
i) Government is presently using the Treasury Accounting System (TAS) to account for all financial transactions.
Describe what TAS is and in brief describe the different Modules used to process the financial transactions of the government.
ii) Government has recently set up a new Chart of Accounts to record its financial transactions. Identify and in brief describe two segments of the Chart of Account with one illustration of its application.