Public sector accounting system to be adopted by 2011

http://www.thejakartapost.com/news/2010/11/03/public-sector-accounting-system-be-adopted-2011.html

Summary
Andreas Bergmann, Chairman of the International Public Sector Accounting Standards (IPSAS) said to The Jakarta Post of after the four-day IPSAS board meeting, “Countries around the world should adopt a conceptual framework on public sector accounting by 2011 to allow more transparent and reliable public sector accounting on a global scale.” A meeting was held on November 2, 2010, its goal was to create the outlines for public sector accounting standards. The objective of The Public Sector of Accounting Standards is to meet the needs of users of financial statements by providing the information needed for accountability and decision making. Indonesia has made the exclusive decision of adapting to accrual accounting by 2015 on November 1, 2010. According to Andreas Bergmann, in the past, accrual accounting was uncommon for the public sector, but now many countries are planning to switch to it because of its extensive advantages. He also said that reliable information provided by accrual accounting would assist “crisis management”. For now, only five countries actualized the full accrual accounting standard: Australia, Iceland, New Zealand, Switzerland and the United Kingdom.

Connection
In our financial accounting textbook, it talks about the accrual accounting method briefly on page 80. As stated in the textbook, transactions are recorded when it happens. The article talks about the near development of accrual accounting. Although it may take a while for the country to fully adapt to it, the government is going to have a five-year transition period to phase out “cash-in and cash-out bookkeeping” according to Andreas Bergmann. It would also be easier for people to analyze the financial statements if it is kept up to date at all times.This article also connects to the importance of timeliness and reliability.

Reflection
Accrual basis accounting is a great example of an accounting method that keeps financial accounting up to date. It is most commonly used with keeping up with income and expenses. Unlike most standard accounting, accrual basis accounting requires accountants to post as income and expenses occur, rather than postponing until a later date. Accrual basis accounting can also make it possible to take a snapshot of the financial health of a company at any given time. You can pull it out anytime you want. With this information, it is extremely helpful when it comes to making short term goals for the company, applying for a business loan, or making plans for a long term project.

Thousands of Kentucky Companies in Danger of Missing Annual Report Deadline

http://www.chevychaser.com/Articles-c-2010-10-12-95554.113117_Thousands_of__Ky_Companies_in_Danger_of_Missing_Annual_Report_Deadline.html

 Summary            

Tens of thousands of companies doing business in Kentucky face a threatening deadline either to file their annual reports to the Office of the Secretary of State or disappear. This includes all corporations that have been registered with the state such as the following: Limited Liability Companies (LLCs), Professional Services Corporations (PSCs), Partnerships, Limited Liability Partnerships (LLPs), Business Trusts. Any of these companies that have failed to file their annual report by June 30 of this year are now listed as “bad standing”.  Failing to file their annual report by October 31, 2010 11:59 p.m. ET will consequently considered as “entity being administratively dissolved or being revoked” according to Secretary of State, Trey Grayson. He is currently encouraging businesses to save time and file online.  In a matter of minutes, they can make any necessary changes, view your information, and then file it. This new service allows accountants to access either offline or on the web.

Connection

This article informs us the new way Kentucky accountants are able to hand in their annual reports. In addition to the book, we also learn what happens to companies if they fail to submit their annual reports. An annual report is a document that is prepared and published by a corporation within the year. It includes the business’ annual financial statements. Allowing accountants to update information quickly, accurately, and frequently, timeliness would be achieved easily. As mentioned in our textbook, timeliness is important because the old information loses its relevance to users. Reliable information is essential for decision making.

Reflection

With this newly improved method, people can access a business’ financial information effortlessly. Important people such as owners or very event filled people can look it up online anytime, at home, or in their offices under their own convenience.  One of the intentions for this is to reduce the processing time in the office and can help save taxpayer money. Also, businesses can access these forms at the beginning of the year, they no longer have to wait until they had received a mail from the Office of the Secretary of State. Instead of mailing sheets and sheets of paper, this is also a good way for saving paper. Saving thousands sheet of paper every year is, in truth be told, a good start for being environmentally friendly.