ACCOUNTING FOR NON-FINANCIAL ASSETS IN THE MANAGEMENT OF PUBLIC SECTOR ENTITIES

Abstract

Research on the accounting of non-financial assets of public sector institutions in public financial management has found that governance is carried out through the implementation of public policies by institutions. It has been found that not all institutions implement the same public policies in the same way, but all public institutions are divided into appropriate segments and have appropriate functional characteristics to implement a particular public policy. The main lines of government policy affecting the relationship between public financial management and non-financial asset accounting have been identified. Non-financial assets have been found to provide economic benefits to public institutions as a result of their possession or use for a certain period of time, thus facilitating and providing some appropriate management of non-financial assets. Key components of public policy have been identified and defined that they have a direct impact on the availability and movement of non-financial assets of institutions. It is the effective fiscal and tax policy of an institution that determines the provision of non-financial assets to institutions, as well as funding for their improvement and repair. The application of the policy-targeting approach, strategic planning and elements of public procurement affect the qualitative upgrading of non-financial assets according to the needs of the institution. In addition, appropriate decisions on public financial management are made on the basis of accounting data and financial statements. Public finances are managed on the basis of consolidated information on the activities of institutions, organized on the basis of accounting data. Consequently, public financial management is linked to the accounting treatment of non-financial assets that bring economic benefits to the owners of those assets. Public finances are managed on the basis of consolidated information on the activities of institutions, organized on the basis of accounting data. And macro-indicators are aggregated on the basis of the System of National Accounts, which also promotes transparency and reliability of non-financial asset accounting information for different users of information for effective management decisions.