Definition of Government Accounting Standards, Principles and Objectives – Do you already know about the definition of government accounting standards? If you don't know it yet, you can refer to the article below for more detailed information.

The purpose of preparing government accounting standards (SAP) is as a reference in preparing financial balances, here is the complete information here.

Government Accounting Standards are standards followed by the government in compiling financial reports issued by Committee Government Accounting Standards (KSAP).

Understand what is meant by government accounting standards and examples of execution that you can learn in this article.

It is common practice in governments to use government financial accounting standards when reporting financial information to related parties.

This method of recording and bookkeeping is necessary to properly track government funds and assets.

If government accounting is not carried out, of course state revenues and expenditures will not be recorded correctly and evenly.

Definition of Government Accounting Standards

State or local government internal budgeting processes require the use of government accounting software to track, classify, and report many financial (public finance) activities.

Definition of Government Accounting

How to manage money and track it helps the government set financial reporting standards for people like the DPR, the public, and the BPK.

He wants to show the public that he is honest by writing down all his transactions in the government's official financial reports.

Government openness is highly expected because it relates to its responsibilities in distributing money and managing all resources, both limited ones such as labor and capital, and unlimited ones such as water and electricity.

Accounting principles are used to prepare and present several forms of government financial reports, such as Central Government Financial Reports (LKPP) and Regional Government Financial Reports (RGFR), under the umbrella of Government Accounting Standards (SAP) (LKPD).

Some examples of fundamental financial reports according to government accounting standards include:

  1. Budget realization report
  2. Balance report
  3. Cash flow statement
  4. Notes to financial statements

Get to know Government Accounting Standards

Government Accounting Standards (SAP) are the accounting rules used in the process of preparing and presenting government financial reports. Reports can be in the form of Central Government Financial Reports (LKPP) and Regional Government Financial Reports (LKPD) (LKPD).

These standards are important for obtaining transparency and accountability in the administration of government accounting and for improving the quality of LKPP and LKPD. As a rule, the SAP takes the form of a statement, including information such as the default title, number and effective date.

In addition, SAP offers a Government Accounting Conceptual Basis, which is the framework for its preparation. According to Government Regulation no. 71 of 2010 (Mentu & Sondakh, 2016), the principles of Government Accounting Standards (SAP) as outlined in Government Regulation No. 1, included in this list:

Government Accounting Standard Principles (SAP)

SAP's eight accounting and financial reporting principles are outlined in Government Regulation no. 71 of 2010.

Government Accounting Standard Principles (SAP)

These principles include the basis of accounting, the concept of historical value, the principle of realization, the principle of substance over formal form, the principle of periodicity, the principle of consistency, the principle of full disclosure and the principle of fair presentation.

To better understand SAP and its ambitions, let's look at the following review.

Accounting Base

Based on the premise of Government Accounting Standards (SAP), the basis of accounting is used in government financial statements in the form of an operational report basis, accruals, for the recognition of revenues, expenses, assets, liabilities and equity.

In the event that laws and regulations require that the accounting basis be provided together with financial statements on a cash basis, the accrual basis for operational reports is an indicator of income that is recognized when the right to earn income has been fulfilled, even if cash has not yet been received in the State/Regional General Treasury Account. or by company.

Historical Value (Historical Cost)

Assets with historical value are assets that are valued based on the amount of cash outflows and cash received. The recorded asset may also be the fair value of the consideration to purchase the asset at the time of acquisition.

Historical values are more reliable than other types of valuation because they are based on facts and easy to check.


Government budgets permit the use of cash-based revenue available for a given accounting period for a variety of purposes.

During this period, it is often used to pay off debts and make purchases. Given that the Budget Reality Report (LRA) is a report that must be prepared, cash basis income must be recognized after being allowed through the budget and after cash has been increased or decreased.

Substance Overcomes Formal Form (Substance over Form)

This concept is information designed to fairly describe transactions and other events that must be provided. Therefore, all forms must be documented and presented in accordance with the content and economic reality, and not just the aspect of formality.

If the contents of the transaction are inconsistent or different from the elements of formality, it must be stated explicitly in the notes to the financial statements.

Periodicity (Periodicity)

The reporting enterprise's accounting operations and financial reporting should be separated into reporting periods to assess performance and establish its resource status. The main term used is annual, but monthly, quarterly, and semester intervals are sometimes required.


Reporting entity consistency can be defined as applying the same accounting treatment to events that can be compared from one period to the next.

This does not rule out the possibility of switching from one accounting technique to another, but it does show that circumstances can replace the current accounting system.

The condition is that the newly applied approach must be able to convey greater information than the previous method. Top notes Financial statements show how any changes to how these methods are used affect the business.

Full Disclosure

Information included in financial reports must be comprehensive for the benefit of end users. Information should also be provided on the front page of the financial statements or in the notes to the financial statements.

Full Disclosure

Fair Presentation

It is critical that those responsible for financial reporting preparation and financial management use sound judgment when faced with an unclear situation.

Uncertainty is identified by reporting its nature by using good judgment in preparing financial reports. Prudence is perhaps one of the smartest things to think about, preventing assets from being overstated in financial accounts and liabilities from being overstated.

Basic accounting is a component in making Government Accounting Standards (SAP) (SAP). Therefore, it is important to know that proper accounting records will facilitate processing and reporting for governmental reasons as well as support SMEs in clearing their company accounts.

The Government Accounting Standards Committee (KSAP) uses Government Accounting Standards (SAP) to prepare financial reports for the government (Simanjuntak, 2005). SAP used the cash-to-accrual basis until 2003 and the cash-to-accrual basis from 2004 to 2014. SAP switched between the two methods in 2013.

This cash-to-accrual basis SAP is a SAP that recognizes income, expenses and financing on a cash basis and recognizes assets, liabilities and equity funds on an accrual basis. Indonesia has been using accrual-based SAP since 2015.

Purpose of Government Accounting Standards

According to Nurlan Darise (2008: 39), "Government accounting standards are used as guidelines in the framework of preparing accountability reports for the implementation of the APBN / APBD in the form of financial reports that at least contain reports on budget realization, cash flow reports, and notes on financial reports."

Purpose of Government Accounting Standards

Indra Bastian (2010: 138) says that one of SAP's goals is to make it easier and more efficient for the government to manage its finances.

Based on the descriptions of the two experts regarding the objectives, it can be concluded that the purpose of SAP is to assist in the preparation of financial reports in the context of accountability for the implementation of the APBN/APBD so that government financial management is more accountable and reliable.


Below we have summarized some frequently asked questions about government accounting standards, as follows:

What is the Importance of Government Accounting Standards?

Government accounting standards also have benefits, namely one of them can be used by financial accountants in government as a guide in the preparation and presentation of government financial reports.


Government Accounting Standards (SAP) are the accounting rules used in preparing and presenting government financial reports. They were developed by the Governmental Accounting Standards Committee (KSAP) under the umbrella of Governmental Accounting Standards (LKPD).

The purpose of SAP development is to serve as a reference in compiling financial accounts. The principles of Government Accounting Standards (SAP) are outlined in Government Regulation no. 71 of 2010. That is the discussion regarding the preparation of accounting strategies in this article, I hope this information is useful.

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