Describe what you understand by the term fund accounting, Financial Accounting

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Question:

(a) ‘Public accounting is often called fund accounting'.

Describe what you understand by the term ‘fund accounting'.

(b) "What's the difference between national defence and pizza?", asked your public finance professor.

Required:

(i) Distinguish between a public good and a private good.

(ii) Describe your understanding of the ‘market failure' phenomenon.

(iii) What is the free-rider problem?

(c) Public accounting is said to "mirror" the budget. Explain.

(d) The role of the Public Expenditure Management System (PEMS) is to allocate and use resources responsively, efficiently and effectively'.

Briefly describe the above statement with particular emphasis on the highlighted terms. Your may illustrate your answer with examples.


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