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What Is Public Sector Accounting and List five sources of revenue for the central/federal government

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What Is Public Sector Accounting?

Public Sector Accounting is the process of recording the financial transactions concerning the receipts and payments of government funds, systematically, as well as their analysis and interpretation to guide governments and their agents in various financial decisions. OR

Public sector accounting refers to the principles, standards, and processes of financial reporting and management that are used by government entities, such as federal, state, and local governments, public schools, and other public institutions.

The main objective of public sector accounting is to provide accountability and transparency to the public and ensure that public funds are being used efficiently and effectively to serve the needs of the community.

Public sector accounting is governed by international accounting standards, such as the International Public Sector Accounting Standards (IPSAS), which are designed to promote consistency and comparability of financial reporting across the public sector.

What are types of public sector accounting?

There are two main types of public sector accounting:

1. Fund accounting: This type of accounting is used to track and manage specific funds, such as grants or revenue from specific sources, and ensure that the funds are being used for their intended purposes.

2.Governmental accounting: This type of accounting is used to provide a comprehensive view of the financial position and operations of the government as a whole.

It includes the preparation of financial statements that show the government’s assets, liabilities, revenues, and expenditures, and provides information on the government’s financial performance and the use of public resources.

Both types of public sector accounting are important for ensuring transparency, accountability, and effective financial management in the public sector.

List five sources of revenue for the central/federal government

The five main sources of revenue for the central/federal government are:

  1. Grants from central government.
  2. Statutory Allocation e.g. Nigeria from the Federation Account.
  3. Rates/levies: There are rates people pay to maintain, sustain and expand social services.
  4. State allocation: In Nigeria, at least 10% of internally generated revenue of the State Government.
  5. Investment in business yields to the local government.
  6. Fees from liquor licenses, registrations, markets, motor parks, etc.
  7. Court fines: (Share of court fines in Nigeria).

OR

1. Taxation: This includes income tax, corporate tax, value-added tax (VAT), and other taxes.

2. Customs duties: These are taxes imposed on goods imported into a country.

3. Excise duties: These are taxes imposed on specific goods, such as alcohol and tobacco.

4. Non-tax revenue: This includes fees, charges, and other revenues earned by the government through the provision of services or the sale of goods.

5. Grants and transfers: This includes funding received from other levels of government, international organizations, and private entities

Get More here: WAEC GCE Financial Accounting 2023 Questions And Answers

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