Public Sector Syllabus
The Public Sector Syllabus tests public financial management: budget formulation and execution, government accounting, internal control, procurement and public audit. The focus is stewardship of public funds, legal appropriation and compliance with public financial management rules.
Core rules and concepts
- Appropriation: the annual budget authorises spending. Spending above appropriation requires reappropriation or a supplementary grant.
- Cash vs accrual: cash accounting records when cash is received or paid; accrual recognises assets and liabilities when they arise. Many government budgets remain cash-based.
- Commitment accounting: records obligations such as purchase orders before cash payment, showing available budget more realistically.
- Public audit: the Auditor-General examines regularity, legality and value for money; independence from the executive is essential.
- Procurement: competitive bidding, transparency, bid security and conflict-of-interest declarations protect public money.
Worked example
A department has a supplies budget of Rs 5,000,000. It issues a purchase order for Rs 600,000 in June; goods arrive in July and payment is made in August. Under commitment accounting, Rs 600,000 is committed in June and reduces the available balance. Under cash accounting, only the August payment becomes expenditure. If the financial year closes in June, the commitment may lapse or require carry-forward. First identify the accounting basis, then apply the timing rule.
Traps that cost marks
- Treating a budget release as revenue.
- Confusing appropriation with cash expenditure.
- Recording payment before the commitment or receipt stage.
- Ignoring year-end lapse rules.
- Treating internal audit as a substitute for external public audit.
Exam focus
Name the control, the responsible officer and the evidence document. Public sector answers should show legality, transparency and stewardship, not only arithmetic.