Course Overview

Public Sector Accounting & Auditing

Course Code: BBA-AUD 360
Credit Hours: 3
Semester Offered: Year 3 – Semester 5

Course Description

This course introduces the principles, standards, and practices of public sector accounting and auditing. It examines how governments and public institutions record, manage, and report financial information in line with statutory and international requirements. The course emphasizes the role of accountability, transparency, and good governance in managing public resources. Students will also learn about the framework of public financial management (PFM), government budgeting, auditing standards, and the responsibilities of oversight institutions such as the Auditor General’s office and Public Accounts Committees.

Course Objectives

By the end of the course, students should be able to:

1. Explain the principles and objectives of public sector accounting and auditing.

2. Understand the regulatory and institutional frameworks governing public financial management.

3. Prepare and interpret public sector financial reports in line with IPSAS (International Public Sector Accounting Standards).

4. Apply auditing techniques in evaluating the use of public resources.

5. Assess the role of accountability, ethics, and transparency in public sector governance.

Learning Outcomes

Upon successful completion, students will be able to:

• Record and report financial transactions in the public sector.

• Differentiate between cash basis and accrual basis accounting in government.

• Prepare and analyze government budgets and financial statements.

• Apply audit procedures to evaluate compliance, performance, and financial audits in the public sector.

• Appreciate the challenges of corruption, fraud, and misuse of public funds and propose solutions.

Key Topics

1. Introduction to Public Sector Accounting

   • Nature, objectives, and importance of public sector accounting

   • Differences between public sector and private sector accounting

2. Legal & Regulatory Framework

   • Role of government financial regulations and audit acts

   • Public Finance Acts, Treasury instructions, and oversight bodies

   • IPSAS and other international guidelines

3. Government Budgeting

   • Budget preparation and approval process

   • Types of budgets (performance-based, program-based, incremental, zero-based)

   • Budget execution and control

4. Public Sector Financial Reporting

   • Cash vs. accrual basis in government reporting

   • Preparation of financial statements for ministries, departments, and agencies

   • Consolidated financial reporting

5. Public Sector Auditing

   • Objectives and scope of government audits

   • Compliance audits, financial audits, and performance audits

   • Role of Supreme Audit Institutions (e.g., Auditor General’s Office)

   • Audit of donor-funded projects

6. Accountability & Governance in the Public Sector

   • Transparency and ethical issues in public finance

   • Public procurement and contract management

   • Challenges: corruption, fraud, and misuse of public funds

7. Emerging Issues in Public Sector Accounting & Auditing

   • Digital transformation in government accounting

   • International cooperation in anti-corruption and audit reforms

   • Sustainability and environmental reporting in the public sector

Teaching Methods

• Lectures and class discussions

• Case studies of national audit reports and public financial scandals

• Practical exercises in preparing government accounts

• Guest lectures from public finance and audit professionals

Assessment Methods

• Assignments & Case Studies (20%)

• Midterm Examination (20%)

• Group Presentation (Audit of a Public Institution) (10%)

• Final Examination (50%)

???? Recommended Textbooks & References

1. Jones, R., & Pendlebury, M. – Public Sector Accounting

2. International Federation of Accountants (IFAC) – International Public Sector Accounting Standards (IPSAS)

3. Glynn, J., & Murphy, M. – Public Sector Financial Management

4. INTOSAI (International Organization of Supreme Audit Institutions) – Auditing Standards and Guidelines