SNC-AP: what has changed and what to take into account?

[shukla7789]

The Accounting Standardization System for Public Administrations – SNC-AP – is the accounting model to which all entities with public participation must ensure compliance.

In 2015, the foundations for the Public Accounting Reform were laid through Decree-Law No. 192/2015, which established an Accounting Standardization System for Public Administrations – the SNC-AP .

This standardization of the accounting and reporting model of public iran whatsapp number database based on the International Public Accounting Standards implies a profound transformation in the accounting processes of public entities, which leave the accounting systems used until then, starting to use a system common to all entities, regardless of the subsector of activity: the SNC-AP.

What is SNC-AP?
Single accounting framework for all Public Administrations
The Accounting Standardization System for Public Administrations (SNC-AP) establishes a set of 27 Public Accounting Standards (NCP) applicable to Public Administrations.

The SNC-AP put an end to the POCP and sectoral plans
This diploma, prepared by the Accounting Standardization Commission, establishes the bases for the reform of Public Finances, together with other legal instruments approved in the meantime, insofar as it revokes the Official Public Accounting Plan (POCP) and respective sectoral plans:

· Official Accounting Plan of the Ministry of Health | POCMS

· Official Public Accounting Plan for the Education Sector | POC-Education

· Official Accounting Plan for Local Authorities | POCAL

· Official Accounting Plan for Public Institutions of the Solidarity and Social Security System | POCISSSS

Harmonization with international public accounting standards
The SNC-AP is in line with the international public accounting standards issued by the International Public Sector Accounting Standards Board (IPSASB), as well as with the accounting standards used by the European Commission.

4 points of the SNC-AP that you must retain:
1. The SNC-AP includes the budget accounting, financial accounting and management accounting subsystems;

2. Set of 27 Public Accounting Standards;

3. Detailed Chart of Accounts to respond to budget reporting, financial reporting and statistical reporting;

4. Harmonized models for presenting financial statements and budget reporting;

Why this change?
Bringing all Public Administration entities into a unified accounting model is a vital step towards transparency in the management of public funds and a decisive stage towards the much-desired presentation of consolidated State financial statements.

The absence of financial information or, on the other hand, the existence of inappropriate, insufficient or even incomparable financial information inevitably led to an unrealistic view and a lack of true control over the performance of these entities.

The application of a standardized accounting system had the objective, precisely, of promoting harmonization of public accounting models among all entities, leading to transparency and comparability of results across the board.

What has changed with the SNC-AP regulation?
With the entry into force of the SNC-AP, the accounting practice of these entities is now guided by a set of 27 Public Accounting Standards that introduce new concepts and regulate public accounting.

Here are some of the changes:

Implementation of a single accounting framework in Public Administration, which harmonizes accounting;
The quality of budgetary and financial information increases significantly;
The State becomes an Accounting Entity, with the burden of reporting individual and consolidated budgetary and financial statements;
More budgetary and financial performance indicators are produced on management accounting;
The procedures and reliability in consolidating accounts are facilitated.
Public Accounting Standards
The Public Accounting Standards, developed based on the International Public Sector Accounting Standards (IPSAS), establish new rules for the accounting treatment of the following areas:

Report
New model and content for presenting financial, budgetary and management reports.

Non-current assets
Standards relating to non-current assets, such as tangible and intangible assets, leases, investment properties and impairments of cash-generating assets.

Transactions
Rules related to typical transactions of public entities, such as inventories, income from consideration (sales, etc.), financial instruments, provisions and employee benefits.

Consolidation of controlled entities
Rules relating to the consolidation of controlled entities, investments in associates and other investments.

Heritage
Rules on historical heritage, public domain assets and infrastructure, concessions (from the grantor's perspective), income without consideration and impairment of non-cash generating assets.

Financial statements
Financial statements and budget reporting model aimed at harmonizing procedures and future consolidation of public accounts.

Systems robustness and industry experience are vital
Software houses are the main ally of Public Administrations in this transition process and they have the important role of adapting systems to technical and functional requirements, assisting in the implementation of change and ensuring the transfer of technical knowledge to all those who, in the daily performance of their functions, will have to contribute to the implementation of the SNC-AP.