Draft Proposal for Accounting Rules

Based on the provisions of the Accounting Act, the Companies Act, Slovenian Accounting Standards and other applicable regulations, every legal entity should be required to have a complete set of rules. Such mandatory rules or acts of a company – institute certainly include the Accounting Rules, which every business entity must prepare for itself according to the scope and nature of its operations. It is recommended that every institute, in addition to the common content regulated by such rules, also regulates certain specific features. Therefore, individual articles need to be adapted.

Problem

Based on the provisions of the Accounting Act, the Companies Act, Slovenian Accounting Standards and other applicable regulations, every legal entity should be required to have a complete set of rules.

Solution and Method

Such mandatory rules or acts of a company – institute certainly include the Accounting Rules, which every business entity must prepare for itself according to the scope and nature of its operations. Every business entity must regulate the organisation of accounting in its own acts. These rules regulate that part of accounting whose final stage is the provision of accounting data and information to internal and external users.

They regulate in detail the tasks and organisation of accounting, the method of preparing accounting documents, the types of accounting documents, responsibility for the preparation, movement and control of documents and their storage in accordance with the Accounting Act, accounting standards and tax regulations. Accounting, as a fundamental information activity in the institute, must be extremely carefully organised, as the quality, timeliness and accuracy of information that helps both external and internal users of accounting information in budgeting, monitoring and analysing obligations to sources of funds, revenues, costs and expenses depend on its organisation.

Institutes must observe the Accounting Act and Slovenian Accounting Standards for keeping accounts, which are only a framework that allows several solutions for individual problems in certain areas. The choice between them is made by the institutes themselves, taking into account the founding acts, rules, regulations and provisions. The new standards require institutes to record their choice in an internal regulation or act called the Accounting Rules.

The preparation of accounting rules requires knowledge of various laws and regulations in the field of status law, codes, accounting and the accounting system, bookkeeping, financial operations, public finance, regulations on levies, payment transactions and supervision and auditing. It is therefore important that the rules are prepared by a person with the broadest possible knowledge of accounting. Regardless of whether the institute has its own accounting organised or on the basis of a contract with external providers (e.g. accounting service), it needs accounting rules.

The content and scope of internal regulations in the field of accounting are not strictly defined.

Results

It is recommended that every institute, in addition to the common content regulated by such rules, also regulates certain specific features. Therefore, individual articles need to be adapted. This concerns specific features in the organisation of internal activities, management bodies, responsible persons and similar.

It is necessary to determine how operations are monitored, who is responsible for which activity, decisions, conduct and other matters. The basic dilemma in preparing the rules is whether they will regulate accounting and financial matters in one set of rules or whether separate rules will be prepared for individual areas, for example rules on cash desk operations, rules on financial operations, rules on the movement of accounting documents, rules on inventory, etc. If the institute decides on accounting rules that cover the entire accounting system, they will be very extensive and will lose clarity, and difficulties will arise in correcting and supplementing them due to constant changes.

The good side of this decision is that all the rules that apply in the accounting of a specific institute are written in one place. The content of the rules regulates in detail the operation of the legal entity and specifies the legal provisions, procedures and rules according to which the legal entity operates. Each institute decides on those that best suit its activities.

It is important that the essential provisions are written down and that all those who work in this field know and observe them. It is very important that the institute determines the optimal organisation of accounting, processes the basic provisions on accounting tasks and duties, and adopts the best possible accounting guidelines for those tasks and actions for which the Accounting Act, and especially the Slovenian Accounting Standards, allow or offer several possible solutions. In the accounting rules, it is good to set, among other things, requirements for education, professional qualifications and other conditions for the position of accountant or employee in accounting.

Institutes should place greater emphasis on the training of their accounting staff, as only with a proper understanding of accounting data is it possible to avoid various misunderstandings and errors in performing this very demanding work.