GOVERNMENT ACCOUNTING IN MALDIVES

The audit acts of Maldives allows the cash basic IPSAS to be followed, albeit this is not specified in the public finance law (World Bank, 2007). A modified version of cash accounting is in practice in the government of Maldives. The prevailing accounting system is inconsistent with the requirements of both cash and accrual IPSASs in many instances. For instance, as underscored by the cash-basis IPSAS, the financial statements lack disclosures on the impact of events occurring after reporting date, the consolidation of controlled entities, the actual cash balance available for use, the comparative cash information, the authorization date, and the accounting policies and notes. To comply with the accrual basis of IPSASs the financial statements are to be upgraded by including disclosures on assets, liabilities, net equity, revenues, and expenses by major classes, net surplus or deficits, and cash flows indicating operation, investment and financial activities among others. The Ministry of Finance and Treasury (MoFT) has prioritized the development of a code of ethics for public sector accountants and the launch of distance learning accounting education.