Você está na página 1de 8



College of Business, Hospitality and Tourism Studies

School Of Accounting

ACC606 Public Sector Accounting

Final Examination: Trimester 3, 2013



Read the following instructions before writing


Time Allowed: 3 hours with additional 10 minutes reading time.


All answers are to be written in the SPECIAL Answer Booklet.


Write your ID Number on all the pages in your Special Answer Booklet that you use.



Section A: Theoretical Questions

Five Questions. All compulsory


Section B: Essay

Two Questions. Choose only one


Section C: Short Case Studies

Two Cases. Both compulsory


Section D: Solving Cases

Two Cases. Both compulsory





SECTION A (25 marks)

Public Sector Accounting Theory

Attempt all questions. (5 marks eacb)

1. The Fiji government has adopted a three

stage approach towards reforms?

List and explain these three stages.

(5 marks)
2. "Objective of General Purpose Financial Reporting states that general purpose financial
reports are prepared to provide users with information about the reporting entity which is
useful for making and evaluating decisions about the allocation of scarce resources."

With reference to this statement, explain what is meant by "Reporting Entity" and how
it is relevant in thepuhlic sector.
(5 marks)

3. Govenunent Accounting Standards Board (GASB) has said that there are at least five
environmental differences between the public sector and private sector.

List and explain any three of these five differences.

(5 marks)

4. Differentiate between Payback method and Net Present value method for budget estimate
exercise in Fiji.
(S marks)

5. Fiji Government has decided to outsource the implementation of identified projects and
delivery of selected services to private and non-state actors. Early this year, Higgins Fiji was
contracted by the Fijian government to provide road maintenance in the Western Division of

In outsourcing operations, what is Fiji government trying to do?

(5 marks)



(15 marks)

Essay - Attempt only one question

Question: 1
International financial organisations have become an important aspect of the institutional
environment of Fijian society, and encourage in Fiji, as they have elsewhere (Hoque & Hopper,
1994, 1997), the implementation of private sector concepts in public sector organisations. The
prescriptions by the international fmancial agencies to overcome poor economic performance
were predictably deregulation, corporatization and privatization of state assets.

You are required to write an essay on the implication of the above statement with reference
to Water Authority of Fiji or any relevant organisation.
(15 marks)

Question: 2
The Confederation of Asian and Pacific Accountants (CAP A) is a Regional Organisation
representin.g national professional accounting organisations (P AOs) in Asia Pacific.
Over 1 million accountants are represented by these PAOs. The Confederation of Asian and
Pacific Accountants (CAPA) fully supports and encourages the convergence towards
International Public Sector Accounting Standards (IPSAS) by all member countries in the
Asia/Pacific region to assist in the improvement of public sector financial- management

You are required to write an essay on CAPA's goals and objectives in respect to
convergence towards IPSAS and how its goals and objectives associated with public sector
financial management in Fiji.
(15 marks)



(20 marks)

Attempt all questions.

Case: 1 [10 marks]
Refer to the Article 1 given below and answer the questions thatfollow:

Article 1: President appoints AG, Nasik Swami [Sunday - August 25,2013] - EXTRACT
THE office of the Auditor General established under the States Services Decree 2009 continues
in existence, states the new 2013 Constitution.
The Constitution states that the appointment of the Auditor-General is made by the President on
the advice of the Constitutional Offices Commission, following consultation with the Minister
for Finance. It states the President may, on the advice of the Constitutional Offices Commission,
appoint a person to act as Auditor-General during any period the office of the Auditor-General is
vacant or when the Auditor-General is absent from duty or from Fiji or is, for any reason, unable
to perform the functions of his office.
"At least once in every year, the Auditor-General shall inspect, audit and report to Parliament on
the public accounts of the state, the control of public money and public property of the State and
all transactions with or concerning the public money or public property of the State," the
Constitution states. ...........
Source: The Fiji Times Online, http://www.jijitimes.comlstory.aspx?id=243637

Based on Article 1 answer the/oLLowing questions:

1. Explain the purpose of public sector audit. Why is this relevant to emerging economics
like Fiji Islands?
(3 marks)
2. Provide your inferences on the establishment of the office of the Auditor-General and the
reasons why our new constitution demands for its continuance? What purpose does an
audit report serve as an output of audit by such office?
(4 marks)
3. Explain the need for the following as per the new constitution:
"At least once in every year, the Auditor-General shall inspect, audit and report to
Parliament on the public accounts of the state, the control of public money and public
property of the State and all transactions with or concerning the public money or public
property of the State".
(3 marks)

Case: 2 [10 marks]

Refer to the Article 2 given below and answer the questions thatfollow:

Article 2: PM talks ethics, Margaret Wise [Saturday, June 11,2011] - EXTRACT

GOVERNMENT is committed to ensuring that high standards are maintained in the accounting

cadre, says Prime Minister Commodore Frank Bainimarama.

"It requires actual adherence to transparency; it requires engagement with Government; it

requires adherence to and the enforcement of standards; and it requires loyalty and commitment

to the society in which you render your professional services," he said.

Commodore Bainimarama then questioned why the Fiji Institute of Congress did not "see fit" to

invite the Fiji Independent Commission against Corruption at its three-day annual meeting in


"While you have a session this (yesterday) afternoon on Governance and Corruption FIA has not

seen it fit to invite FICAC. Instead you have the presence of the local Chapter of Transparency

International which in recent times has taken a political approach."

"Indeed I wonder ifFIA has ever invited FICAC to any of your previous congress or seminars."

Source: The Fiji Times Online, http://wwwIzjitimes.com/story.aspx?id=172058

Based on Article 2, answer the following questions:
1. Why is business ethics so important to accountants, professionals, government officers
and especially to public accountants?
(3 marks)
2. What were the issues raised by the PM? What is FICAC's role in Fiji public sector? You
can provide examples and discuss with real-life facts.
(5 marks)

3. How does congress such as one mentioned above promote ethics for the accounting
profession as a whole?
(2 marks)

SECTION D (40 marks)

Solving Case Studies - Attempt all questions.
Case: 1 [20 marks]

Below in an excerpt from the Fiji Institute of Accountants (FIA) submission towards the national

budget of Fij i for the fiscal year 2014.




Public Sector Reform

Continue to implement public sector reform measures to deliver efficient and

effective services.

Enforce accountability in the public service.

Review disciplinary procedures for civil serv<lots to expedite the process.


Government Services
Accelerate E-Governance initiatives.
Overhaul as a matter of priority:

Registrar of Companies

Titles Office

Department of Town and Country Planning

laws of fiji - update all legislation with all amendments to-date. Public should

have easy access through internet to all laws of fiji with historical updates and


Source: FIA Submission to MinistJy ofFinance, August 2013, p. 15

You are required to answer the following with reference to the above excerpt:
1. The above suggested reforms were provided by FIA to the government in their
submissions back in year 2011 as well as the sanle for the year 2012. State two (2)
reasons why FIA would make such submissions.
(5 marks)
2. Should FIA be playing an active role in respect to public sector accounting reforms in
terms of providing more detailed suggestions in comparison with those above? Explain
your answer with two (2) examples.
(5 marks)
3. How, in your view, can the public sector reforms bring efficiency and effectiveness to the
government services? Justify your answer with two (2) examples.
(5 marks)
4. How would accountability be achieved through the audit report 111 respect to public
service and/or government service? Provide two (2) justifications.
(5 marks)

Case: 2 [20 marks]
The following are the assets and liabilities of Samabula Sports Club at 30th June 2011 :
Cash at bank
Subs due
Sports equipment
Stock of stationery
Sports pavilion .



Subs in advance


Accumulated funds

An analysis of the treasurer's cash book reveals the following information in respect of the year
ended 30th June 2012.
Current year
Previous year
Next year
Sale of dance tickets
Sale of furniture (Cost $100)



Wages - caretaker
Purchase of sports equipment
Affiliation fees
Match expenses
Hire of hall for dance
Hire of band
Refreshments at dance
Purchase of investment


Additional Information:
a. Stock of stationery at 30th June 2012 $50
b. Repairs to pavilion invoiced but not paid $78
c. Hire of band unpaid at balance day $ 36
d. Depreciation on pavilion to be provided at 10% per annum on cost
e. Subscription in arrears $26

You are required to prepare the following:

1. SUbscriptions account
(4 marks)
2. Income and Expenditure Account

(8 marks)
3. Balance Sheet as at 30th June 2012
(8 marks)

End of Examination