Cash Versus Accrual Accounting in Public Sector

Abstract:     
In public sector the cash basis of accounting has been traditionally used, but in the last period there have been discussions over the benefits of a change to the accrual basis. There are a lot of important supporters of cash basis like IFAC,who issued 21 IPSAS, based on IAS/IFRS, EU commission and IMF.

Many organizations like SIGMA and the DFID which work in transitional and developing countries, question the priority, for these countries at least, of moving from the cash to the accrual basis of accounting.

So, the move to the accrual basis for public sector financial reporting has not gained universal acceptance. In Europe, there are a lot of countries who refuse to make the exchange, or who have increased doubts.

In this confuse international context Romania starting with 2006 implement the accrual accounting for public sector.

In our article we intend to analyze the evolution of movement from cash to accrual accounting in public sector, the factors who influenced the movement in the case of Romanian accounting public sector and to respond at the follows questions:
- It is better or not for romanian public sector accounting to make the movement from cash to accrual accounting?
- Romania had or not the chance to choose the system?

Number of Pages in PDF File: 13

Keywords: cash accounting, accrual accounting, public sector

JEL Classification: M41, M40, P20, H80, O52

Accepted Paper Series