Innovation of Public Sector Financial Management: Towards Accrual Accounting

Abstract

Accrual-based accounting is an innovation in the financial management of public sector organizations. The application of accrual accounting is seen to have many benefits. Why? Because, the resulting accounting information would be useful in the decision-making process. Application of cash accounting is seen as less able to provide relevant and reliable information as the basis for strategic decision making. Thus, we need innovation in financial management of public sector organizations that can provide more transparent information. This study aims to explain how the innovation of accrual accounting in the financial management of public sector organizations. The approach used in the analysis of this study is qualitative descriptive. The implications of this study are expected to provide an overview of the innovations of accrual accounting in the financial management of public sector organizations that are able to present information that is relevant and reliable.