Preparation Of Public Sector Accounting SS3 Financial Accounting Lesson Note

SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to

1. List and explain the sources of government revenue
2. List and explain the types of government expenditure

INSTRUCTIONAL TECHNIQUES: 

• Identification, 
• explanation, 
• questions and answers, 
• demonstration, 
• videos from source

INSTRUCTIONAL MATERIALS: 

• Videos, 
• loudspeaker, 
• Textbook,
• Pictures

NOTE

SOURCES OF GOVERNMENT REVENUE

I. Direct taxes:

• Personal income tax
• Company income tax
• Petroleum tax
• Capital gain tax

II. Indirect taxes:

• Import duties
• Export duties
• Tariffs
• Export duties

III. Mining:

• Royalties on mineral resources e.g. Tin, gold, etc.
• Revenue from the export of crude oil
• Quarrying licenses
• Mining fees

IV. Fees:

• Court fees
• International passport fees
• Visa fees
• Advertisement fees (Billboard)

V. Earning and sales:

• Federal government investments
• Sales of government properties e.g land, building
• Proceeds from prison farms

VI. Licenses and internal revenue:

• Arms and ammunition license fees
• Registration and licenses fees e.g company registration, club registration fees
• Churches registration fees

VII. Interest and repayment:

• Interest and repayment of loans granted to state government and government workers.
• General loan interest.

VIII.  Rent on government properties:

• Income from rent of government quarters
• Rent of government offices
• Rent of government vehicles
• Federal government land fees.

IX. Armed forces:

• Income from armed forces educational receipts
• Sales of small weapons
• Sales of armored tanks, aircraft

X. Miscellaneous:

Any other income not mentioned above e.g. money recovered from drug pushers etc.

 GOVERNMENT EXPENDITURE

Government expenditure can be classified into two such as:

• Capital Expenditure
• Recurrent Expenditure

 Capital Expenditure: This is the expenditure incurred by the government which adds to the value of fixed assets. Such as purchases of Buildings, plant machinery, motor vehicles, constructions of bridges and roads, constructions of rails, etc.

 Recurrent Expenditure: These are the day-to-day costs of running the activities of an organization of government departments and ministries. These are wages and salaries,Transportation, repairs of motor vehicles, maintenance of buildings, payment for services. Etc

ILLUSTRATION:

The Federal Ministry of Works and Housing incurred the following in 2013.

1. Capital Expenditure
2. Recurrent Expenditure

 SUGGESTED SOLUTION:

 STATEMENT OF CAPITAL EXPENDITURE

STATEMENT OF RECURRENT EXPENDITURE

EVALUATION:

1. Outline the major sources of revenue to:

• Federal government
• State government
• Local government

1. Mention three sources of direct tax
2. Mention two types of Mining as a source of Revenue for the government.

CLASSWORK: As in evaluation

CONCLUSION: The teacher commends the students positively