The New Government Accounting System (Issues in Public Audit)

1791 Words Oct 4th, 2010 8 Pages
The New Government Accounting System: Issues in Public Audit 1 Introduction Historically, the growth of government auditing and accounting in the Philippines was greatly influenced by the administrative practices in the United States, so much so that during the time that the General Accounting Office in the United States was responsible for the government’s accounting, that concept was similarly introduced in the Philippines. Unfortunately, by the time the practice was abandoned in the United States in favor of a better system, the Philippines has then become independent and hence the change was not followed here.2 COA Promulgates New Accounting System Unlike in the United States where accounting standards are formulated by the Federal …show more content…
It has, among others, updated many aspects in public accounting to keep in step with the current development in governance. This writer, however, doubts whether the design, development and installation of the accounting system for agencies of government is a proper function of the Commission on Audit, being at the same time their external auditor. Firstly, it is not among the stated functions of COA under the law; and secondly, it violates the generally accepted government auditing standards. Assuming arguendo that COA has legal basis to undertake such function, yet the New Government Accounting System (NGAS) contains some components that ignore, if not violate certain accounting provisions prescribed by existing laws. In support of this position, this writer offers the following: A. Developing accounting system is not a function of COA. The functions of the Commission on Audit are clearly stated in Section 25 of the Government Auditing Code of the Philippines, and there is nothing in the enumeration about developing accounting systems. Of course the function of COA “to promulgate accounting rules and regulations” appears, as also mentioned in the Constitution6, but such authority is not analogous to the function ‘to formulate accounting system’. There is an accepted distinction between a “system” and a “regulation”. The term “system” is defined as a regularly interacting or
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