Year-End Procedures in Public Accounting

Ahmet AY

Abstract


ABSTRACT

Year-End Procedures in Public Accounting

Public accounting is a specialization that fulfills the function of recording and reporting on public institutions. The purpose of public accounting is to account for and report on efficiency and effectiveness analyses of the activities and revenues and expenses of the administrations and institutions within the scope of the general government by measuring the costs of the services rendered by the government in accordance with the accounting and international reporting standards.

In the public accounting system, Cash-Based, Accrual Based, Adjusted Cash Based, Accrual Based and Adjusted Accrual Based methods are used

Cash-Based Public accounting; in cash based public accounting financial transactions is recognized when cash is received or paid.

Accrual Based Public accounting; in the Accrual based registration system, financial transactions are recorded in order to disclosure the allocation when the commitment is fulfilled. 

Adjusted Cash Based Public accounting; in this accounting system, financial transactions are recorded when they are received or paid as cash regardless of considering the periods in which they are related and their results are obtained similarly in cash basis accounting. In this system transactions related to tangible assets, liabilities, commitments, guarantees and debt management are out of accounting.

Accrual Based Public Accounting; The structure of accountability has shifted from a narrow view of compliance with spending limits to a view that encompasses responsibility for products, the effectiveness and consequences of activities, the exact cost of operations, long term liabilities and financial situation in general. On an accrual basis, transactions are recorded when they are emerged neither received nor paid.

Adjusted Accrual Based Public accounting; Transactions and events on an accrual basis are recorded when an economic value is created, exchanged, transferred or destroyed, regardless of when cash flows occur.

In this study, the transactions that can be done at the end of the period are discussed in terms of public accounting. At the end of the term, according to the accounting records in the public accounting system, general trial balance is prepared, the current value of economic assets is determined by carrying out physical inventory, and differences are found between general trial balance and physical inventory if there are. Necessary regulatory accounting records are made according to the reasons about differences and book inventory transactions are made. Accounting records and inventory results are balanced and adjusted trial balance is prepared. Accounts are closed and financial statements are prepared.


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