Assessing the readiness for the implementation of Generally Recognised Accounting Practice (GRAP) in the Department of Transport and Public Works in the Western Cape

Solomons, Yolanda M. (2012-03)

Thesis (MPA)--Stellenbosch University, 2012.

Thesis

ENGLISH ABSTRACT: IMPLEMENTATION OF GENERALLY RECOGNISED ACCOUNTING PRACTICE (GRAP) IN THE DEPARTMENT OF TRANSPORT AND PUBLIC WORKS IN THE WESTERN CAPE. The research project was undertaken to explore one of the major obstacles in South Africa’s public sector, namely shifting the basis of accounting from modified cash accounting to accrual accounting. Contrary to cash accounting, which recognises expenditure only when cash is paid and income is received, accrual accounting recognises expenditure when the goods and services are received and income is recognised when services are rendered. Given the condition of financial reporting within departments with no accrual accounting compliant systems, no processes and policies in place to comply with accruals and lack of relevant capacity and skills, the purpose of the study was to determine the capability of the department to implement accrual accounting (mainly Generally Recognised Accounting Practice (GRAP)) in the public sector context. What needed to be determined was the readiness of the department for the implementation and the challenges and conditions that hampered the implementation of accrual accounting. The literature review explores the existing information for correlation with the implementation of GRAP and recommendations are made to departments within the public sector to ensure an approach and conversion plan that would be relevant and practical in the current environment and address all challenges and concerns identified within a reasonable time frame. The importance of the research for the public sector resides in the recognition of the need for better understanding of the implementation of accrual accounting, so that significant risks and challenges of the accrual accounting implementation may be determined within departments in the public sector.

AFRIKAANSE OPSOMMING: Hierdie navorsingsprojek is onderneem om die gereedheid van die Departement van Vervoer en Openbare Werke ten opsigte van die implementering van die toevallingsgrondslag van rekeningkunde (GRAP) in die publieke sektor te bepaal. Ondersoek is ingestel na een van die grootste struikelblokke in Suid-Afrika se publieke sektor, naamlik die verskuiwing vanaf die kontantgrondslag van rekeningkunde na die toevallingsgrondslag van rekeningkunde. Ooreenkomstig die kontantgrondslag van rekeningkunde word transaksies en ander gebeure erken wanneer kontant ontvang of betaal word. Volgens die toevallingsgrondslag van rekeningkunde word transaksies en ander gebeure egter erken wanneer dit aangegaan word en nie wanneer kontant ontvang of betaal word nie. Gegewe die toestand van finansiële verslagdoening binne die departemente, met geen voldoening aan toevallingsgrondslagrekeningkundige stelsels nie, geen prosesse en beleide in plek nie en 'n gebrek aan kapasiteit en vaardighede in die publieke sektor, was die doel van die studie om te bepaal tot watter mate die departement oor die vermoë beskik om toevallingsgrondslagrekeningkunde binne die departemente in die publieke sektor te implementeer en om die gereedheid vir die implementering en die uitdagings en struikelblokke wat die implementering kan belemmer, te identifiseer. ‘n Literatuurstudie is onderneem om die beskikbare inligting met die implementering van toevallingsgrondslagrekeningkunde (GRAP) te gekorreleer en aanbevelings word aan die departemente in die publieke sektor gemaak om te verseker dat die benadering en die omskakelingsplan hiervoor die huidige situasie toepaslik en prakties sal aanspreek en alle uitdagings en probleme binne 'n redelike tydperk die hoof sal bied. Vir die publieke sektor is die belangrikheid van die navorsing daarin geleë dat 'n beter begrip van die toepassing van toevallingsgrondslagrekeningkunde in departemente nodig is sodat die beduidende risiko's en uitdagings wat met die implementering van toevallingsgrondslagrekeningkunde binne departemente in die openbare sektor vasgestel kan word.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/20337
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