The MoF aims to improve financial planning in the UAE in accordance with the best international practices.
In line with its efforts to improve financial planning in the country in accordance with the best international practices, the Ministry of Finance (MoF) announced on Saturday the successful launch of the third and final phase of government entities to transition to accrual accounting.
The project overcame all the challenges it faced in 2020 including working remotely due to the COVID-19 pandemic - which had a direct impact on the transition’s plan of action.
Obaid Humaid Al Tayer, Minister of State for Financial Affairs highlighted the importance of launching the final phase of the federal government’s transition to accrual accounting, as it provides an innovative and advanced infrastructure that would enhance the country’s leading position in global competitiveness indices. His Excellency Al Tayer praised the continuous efforts of MoF’s work teams, and lauded the cooperation between the federal entities and the Ministry of Finance.
Al Tayer said: “Despite the exceptional circumstances that the country and the world are witnessing, the Ministry of Finance has demonstrated its flexibility and ability to overcome various challenges, by adopting innovative and creative approaches to develop and implement action plans. The ministry devised practical solutions in the work-from-home phase, and executed a comprehensive plan to continue to work and cooperate with all parties involved in the project. To help complete the project on time, the ministry also allocated a specialised team to provide technical and accounting support to federal entity users, provide advanced technical forms and solutions, and direct them in preparing opening balances and collecting and exchanging information and data.”
The third phase includes the major entities in the federal government, namely: the Ministry of Interior, the Ministry of Education, the Ministry of Health and Prevention, the Ministry of Foreign Affairs and International Cooperation, and others. These entities began applying accrual accounting from Jan.1, 2021, and were able to attain significant achievements in counting and recording most of the assets and liabilities on the new accounting basis as on January 1, 2020. This contributed to the transfer of knowledge and change management in these entities to include accrual basis of accounting in recording their financial operations.
MoF has amended and automated the Federal Financial System and aligned it with the accrual basis principles of the third phase-federal entities. Therefore, the updated Federal Financial System on the accrual basis of accounting was launched to all federal entities - which enables them to record their financial transactions based on the principles and criteria of Federal Government Accrual Accounting Standards (FGAAS). The new system processes the operations of tangible and intangible assets - which includes processing and automating the asset use, and extracting detailed and unified asset reports for the federal government. That, in addition to automating the federal government expenditures and revenues recognition and extracting final reports based on the detailed and cumulative accrual basis at the federal government level.
The federal government’s transition to accrual accounting has attained several achievements, foremost of which is launching accrual accounting in all federal entities; transferring knowledge and developing expertise in the federal government; and adopting the change management and participatory approach. That, in addition to updating and upgrading accrual accounting application guidance; and ensuring the application of the federal government accounting standards.
MoF plays a pioneering role in providing procedures guides and manuals that assist employees in the federal entities to apply accrual accounting. The ministry was keen to update the manuals continuously - in order to ensure that they comply with the international standards for accounting in the public sector and facilitate their use. It also provides these guides and scientific materials within MoF’s Digital Library - which can be accessed by all employees of the financial departments at the federal government at any time and in an easy and safe manner.
Aimed at improving their skills and self-knowledge, the digital library is meant with training; elevating and transfering knowledge to the human resources in federal ministries and entities - in order to achieve a smooth and successful transformation process at federal entities. Furthermore, MoF is keen to maintain the pace of work according to the highest standards, especially while mitigating the repercussions of the COVID-19 pandemic. It launched remote trainings using visual technologies and innovative interactive applications that depend on the active participation system and diverse modern training methods.
The ministry has provided 18 interactive training courses that were attended by more than 2,000 federal government employees, and has made available videos of the recorded workshops through the digital library for reference at any time.
The first group to transition to accrual accounting programme was launched on June 1, 2020, while the second group was launched on Oct.1, 2020. The third and final group was launched on Jan.1, 2021.
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