Accounting is a basic information activity of any organisation, monitoring and assessing the organisation’s financial events. It encompasses accounting information reporting based on bookkeeping, budgeting, accounting supervision, and the accounting analysis of assets, liabilities, revenue and expenditure.
Accounting includes collecting, managing and processing data and compiling information expressed in a monetary unit and relating to the organisation’s past or future operations. Accounting services manage, collect, record and report data, effect payments, carry out accounting supervision and the supervision of account receivables and payments, compile mandatory financial statements, and file original bookkeeping documents.
In Slovenia accounting is regulated in two ways:
1) Article 54 of the Companies Act (ZGD-1) lays down general rules for accounting applying to private companies that are required to keep books of account and compile annual reports based on the Slovene Accounting Standards prepared and adopted by the Slovenian Institute of Auditors following the approval of the Ministry of Finance and the Ministry of the Economy.
2) Article 1 of the Accounting Act (ZR) regulates bookkeeping and the drawing-up of annual reports for the budget, budget users and those legal persons governed by public or private law that do not keep the books of account pursuant to the Companies Act, the Services of General Economic Interest Act or the Societies Act. The drafting of the Accounting Act and all regulations adopted pursuant to it falls within the responsibility of the Ministry of Finance.
In addition to the Accounting Act, accounting is also regulated by the Public Finance Act, which covers this subject in its Chapter 8. The responsibilities of accounting services are set out in Article 91 of the Public Finance Act, unless otherwise provided in another Act.
Public sector accounting
Public sector accounting is accounting in the public sector.
In Slovenia it is regulated by the Public Finances Act, the Accounting Act and secondary legislation based thereon, and in cases not specified in the aforementioned regulations by the Slovene Accounting Standards. The knowledge of public finances and budget law constitutes a framework for the functioning of public accounting. The financial management of public finances involves the bookkeeping of all events in the implementation of the financial plans of the state and municipal budgets and the plans of individual direct and indirect users of the state and municipal budgets. Both Acts and secondary regulations drafted on the basis thereof provide for the connection between the drafting of financial plans and the budget as a whole and the implementation of the budget and recording of all financial events in the books of account when they occur.
The Acts started to apply on 1 January 2000. Their enforcement launched the reform of public finance in Slovenia. The reform was also dictated by the guidelines of international institutions (the International Monetary Fund, Eurostat and others).
In addition to the aforementioned law, accountants in public accounting also comply with the Code of Accounting Principles. The Code includes basic accounting principles, which prescribe that:
- an authentic bookkeeping document must be produced for every financial event that results in a change in revenue and other income, expenditure and other expenses, and assets and their sources,
- a bookkeeping document must be submitted to the accounting service, which must record the event in the book of accounts.
The Accounting Act (ZR) is the basic act governing accounting for the budget, budget users and legal entities under public law and for those legal entities under private law that do not keep the books of account or do not conduct accounting pursuant to the Companies Act, the Services of General Economic Interest Act or the Societies Act.
The Act is divided into 16 chapters covering the following subjects: bookkeeping documents and books of account, revenue and expenses, determining profit and loss, financial statements and annual reports, filing and archiving of bookkeeping documents and books of account, the valuation of financial statement items, financial inventory-taking, writing off intangible and tangible fixed assets, drawing up and submitting annual reports, and accounting supervision.