UKRAINE MINISTRY OF FINANCE
Workshop on the Implementation and Links between the System of National
Accounts 2008 and the Government Finance Statistics Manual
20 – 22 November 2013, Istanbul, Turkey
UKRAINE
GOVERNMENT FINANCE
STATISTICS
Larisa Kalinichenko
Head, Government Finance Statistics
Department
UKRAINE MINISTRY OF FINANCE
Institutional Coverage of the General Government Sector in Government Finance Statistics
Central Government
Subsector 1.Central government units financed out of the state budget
Parliament (Verhovna Rada), Presidential Staff, Cabinet of Ministers, ministries, state services, state agencies and inspectorates,
central executive-branch authorities with special status, Constitutional Court, general-jurisdiction courts, territorial state administrative
authorities, budgetary entities subordinate to central authorities and state authorities
Subsector 2. Central government extrabudgetary units
Not applicable.
Subsector 3.Social security funds
3.1
3.2
3.3
3.4
Pension Fund;
Social Occupational Accident and Disease Insurance Fund;
Social Temporary Disability Insurance Fund;
State Mandatory Universal Social Unemployment Insurance Fund.
Local authorities
Subsector 5. Local authorities financed out of local budgets – 12,086 local government authorities, including:
1 Crimea Autonomous Republic ;
24 provinces;
Cities of Kiev and Sevastopol;
177 cities under republic (Crimea Autonomous Republic ) or province jurisdiction;
488 districts;
278 cities under district jurisdiction;
55 formations within cities;
782 settlements;
10279 villages.
Central government data cover all operations of units belonging to Subsectors 1-3.
Data on local authorities cover the operations of Subsector 5 units.
Slide 2
UKRAINE MINISTRY OF FINANCE
Institutional Coverage of Budgetary System According to
Ukraine Budgetary Code
Ukraine Budgetary
System
State social insurance funds
not belonging to Ukraine’s
Budgetary System:
1.Pension Fund
State budget
Local budget
2.Social Occupational Accident
and Disease Insurance Fund
3.Social Temporary Disability
Insurance Fund
Crimea
Autonomous
Republic budget
4.State Mandatory Universal
Social Unemployment
Insurance Fund
District budgets
Province and Kiev
and Sevastopol
city budgets,
Local government
budgets
Budgetary law lacks a definition of the general government sector and public sector
Slide 3
UKRAINE MINISTRY OF FINANCE
!!!!!! Budgetary law governs certain issues pertaining to the state mandatory
universal social and pension insurance funds:



The Ukraine Cabinet of Ministers provides for the submission of draft budgets of the
state mandatory universal social and pension insurance funds for the plan year to the
Ukraine Verkhovna Rada and Ukraine President no later than September 15 of the year
preceding the plan year, with accompanying materials, attached to the draft Ukraine Law
on the State Budget;
The resources of the state mandatory universal social and pension insurance funds are
serviced by authorities of the Ukraine State Treasury Service;
The state mandatory universal social and pension insurance funds submit quarterly
reports to the Ukraine Verkhovna Rada, Ukraine President, Ukraine Cabinet of Ministers,
Accounting Office, Ukraine Ministry of Finance and Ukraine State Treasury Service on
execution of the respective funds’ budgets in accordance with procedures and dates
established by the Ukraine Ministry of Finance.
Slide 4
UKRAINE MINISTRY OF FINANCE
Accounting Method in Ukraine’s Public Sector
Ukraine law does not presently define uniform accounting and reporting methods in the public
sector
Accounting for execution of the state and local budgets is conducted by Ukraine Treasury authorities
using the cash method with elements of the accrual method for certain operations (accounting for the
public debt and liabilities of the administrators of budgetary resources)
Accounting for execution of budgetary entities’ budgets is conducted by the administrators of
budgetary resources using a modified accrual method
Accounting for state mandatory universal social insurance funds is based on a modified accrual
method (uniform accounting methods established by the State Treasury are not used).
Financial and budgetary reports on the execution of budgets are divided into:
financial:
quarterly
annual
budgetary:
monthly
quarterly
annual
Slide 5
UKRAINE MINISTRY OF FINANCE
Reporting Period for Reports

The reporting period for monthly budgetary reports is the period beginning January 1
and ending on the last day of the reporting month

The reporting period for quarterly financial and budgetary reports is the period
beginning January 1 and ending on the last day of the reporting quarter

The reporting period for annual financial and budgetary reports is the budgetary period
constituting one calendar year beginning on January 1 and ending on December 31 of
the same year, unless a different period is defined in instances established by law
Slide 6
UKRAINE MINISTRY OF FINANCE
Chart of Accounts for Execution of State and Local Budgets

The Chart of Accounts for state and local budgets is governed by a legal regulatory act;

Development of the Chart of Accounts took into account the distinctive features of the
execution of state and local budgets, the operation of the unified treasury account, and the
servicing of local budgets through Treasury authorities, in compliance with general accounting
and reporting principles and requirements;

The Chart of Accounts provides for the reflection in accounting of operations associated with
performance of the functions assigned to Treasury authorities, i.e., it makes possible detailed
and complete accounting for all banking and other operations associated with execution of the
budgets;

The Chart of Accounts has been developed to provide for accounting operations entailed in
the execution of the state budget and local budgets operations using the cash method, and for
the preparation of financial reports

The Chart of Accounts employs a decimal method of encoding accounts with a four-digit
number. Under that method, all classes are divided into 10 sections, which are assigned
numbers from 0 to 9. All sections, in turn, are divided into no more than 10 groups, which are
also assigned numbers from 0 to 9. Each group is divided into no more than 10 accounts.
Such an approach meets the requirements of the Ukraine National Bank with regard to the
structure of accounts and number of digits, according to which the number of a balance-sheet
account must have 4 digits while analytical accounts that are used in the Ukraine National
Bank’s electronic payments system must have from 6 to 14 digits.
Slide 7
7
UKRAINE MINISTRY OF FINANCE
Chart of Accounts in Budgetary Entities
Accounting in budgetary entities provides for the reflection of all operations
associated with execution of their budgets. The timely, complete and accurate reflection
on the entities’ balance sheets makes it possible for their officials to take well-founded
managerial decisions, analyze an entity’s (organization’s) work, monitor the use of
budgetary resources for their intended purposes on the basis of an approved budget, and
detect unlawful and unforeseen expenditures
Budget execution accounting in entities and organizations whose principal activities
are financed out of state or local budget resources is based on the Chart of Accounts for
budgetary entities approved in the December 10, 1999, Order No. 114 of the Chief
Administration of the Ukraine State Treasury, registered with the Ukraine Ministry of
Justice on December 20, 1999, No. 890/4183
The Chart of Accounts uses a decimal method of encoding accounts with a threefigure number (first-level subaccount). All accounts are divided into 2 sections. Section І
comprises balance-sheet accounts, which are divided into 8 classes. Section II comprises
off-balance-sheet accounts, which include one class 0, “Off-balance-sheet accounts”
The Chart of Accounts for a state mandatory universal social insurance fund is approved in
a legal regulatory act of that fund.
Slide 8
UKRAINE MINISTRY OF FINANCE
Further Plans for Improving Accounting and Reporting

Development and implementation of a uniform Chart of Accounts and national accounting
standards for public-sector entities using the accrual method (development has been completed
of 19 national accounting standards in the Ukraine general government sector based on the
International Public Sector Accounting Standards (IPASA). Implementation is slated for approximately
2015).

Establishment of uniform rules for preparing budgetary and financial reports in accordance
with national standards developed on the basis of the International Public Sector Accounting
Standards
Slide 9
UKRAINE MINISTRY OF FINANCE
Budgetary Classification
Pursuant to the Budgetary Code, the Ukraine Budgetary Classification includes:
classification of budget revenue,
classification of budget expenditures,
classification of lending,
classification of debt;
classification of budget deficit financing.
Classification of budget expenditure and lending are subdivided into:
(1) functional, (2) agency, (3) economic, (4) programmatic.
Slide 10
Budgetary Classification
Budget
expenditures and
lending
Budget revenue
Taxes
Functional
Tax
Debt
Agency
Transfers
Other nontax revenue
By type of debt
instrument
Capital
Income from property
and business activity
Administrative fees and
payments, income from
noncommercial
economic activity
By type of
creditor
Current
Economic
Revenue
from capital
operations
Sections,
subsections,
area groups
Fees
Other mandatory
payments
Nontax
Budget financing
Programmatic
Lending
List of main
administrators of
budgetary
resources
By type of
creditor
targeted-program
method
By type of debt
instrument
Internal and
external
Slide 11
Budgetary Classification
Budget revenue
Internal taxes on goods
and services
GFS 2001 code 114
Taxes on income, profits,
and capital gains
GFS 2001 code 111
Taxes on international trade and external
transactions
GFS 2001 code 115
Tax
Property taxes
GFS 2001
code 113
Nontax
Fees for special use of natural resources
GFS 2001 codes 113,114
Other nontax revenue
GFS 2001 codes 141,142,143,145
Revenue from property and business
activity
GFS 2001 code 141
Administrative fees and payments, income
from noncommercial economic activity
GFS 2001 codes 115,142
Revenue
from capital
operations
Transfers
Other taxes and fees
GFS 2001 code 116
Revenue from sale of fixed
assets
GFS 2001 codes 311,313
Transfers from foreign countries and
international organizations
GFS 2001 code 132
Budgetary units’ own
revenue
GFS 2001 code 142
Revenue from sale of public
inventories
GFS 2001 code 312
Revenue from sale of land
and intangible assets
GFS 2001 code 314
Transfers from general government units
(from other budgets, subsidies and
subventions)
GFS 2001 code 133
Slide 12
UKRAINE MINISTRY OF FINANCE
Budgetary Classification of Expenditures (functional)
Item
Code
GFS
Code
0100
General public functions
701
0170
Debt service
7017
0180
Interbudgetary transfers
7018
0200
Defense
702
0300
Public order, safety and the judicial branch
703
0400
Economic affairs
704
0500
Environmental protection
705
0600
Housing and community amenities
706
0700
Health
707
0800
Spiritual and physical development
708
0900
Education
709
1000
Social protection and social security
710
Slide 13
UKRAINE MINISTRY OF FINANCE
Budgetary Classification of Expenditures (economic)
Item
Code
2000
Current expenditures
GFS Code
х
2100 Employee compensation and wage accruals
21
2200
22
Use of goods and services
2400 Debt service
2600 Transfers
24
25,26
2700 Social security
27
2800
28
Other current expenditures
3000 Capital expenditures
х
3100 Acquisition of fixed assets
311
3150 Creation of public inventories and reserves
312
3160 Acquisition of land and intangible assets
313,314
3200 Capital transfers
25,26,28
Slide 14
Budgetary Classification of Financing
By Type of Debt Instrument
Budget financing
Financing through debt
instruments
Borrowing
External
Retirement
Internal
Revenue from
privatization of public
property
Change in deposits and securities used for
liquidity management
Financing through active
operations
Change in cash
Financing with funds in Unified Treasury
Account
Slide 15
Budgetary Classification of Financing by Type of Creditor
Budget financing
Internal financing
External financing
Financing with resources of state funds
Loans from international organizations
Financing with bank loans
Loans from foreign government authorities
Other internal financing
Loans from foreign commercial banks
Revenue from privatization
Financing with funds balances in
accounts of budgetary entities and
budgets
Loans not elsewhere classified
Change in deposits and securities used
for liquidity management
Change in deposits and securities used for
liquidity management
Adjustments
Adjustments
Slide 16
Budgetary Classification of Debt by Type of Debt Instrument
Debt
Internal
Debt on long-term instruments
External
Debt on long-term instruments
Debt on medium-term instruments
Debt on medium-term instruments
Debt on short-term instruments and
bills
Debt on short-term instruments and
bills
Debt on other external instruments
Debt on other internal instruments
Adjustments connected with changes
in deposits and securities, and with
appraisal differences
Adjustments connected with changes
in deposits and securities, and with
appraisal differences
Slide 17
Budgetary Classification of Debt by Type of Creditor
Debt
Internal
Debt on loans obtained from budgets
at various levels and state funds
Debt to banking institutions
Debt to other government units
Internal debt not elsewhere classified
Adjustments connected with changes in
deposits and securities, and with
appraisal differences
External
Debt on loans obtained from international
financial organizations
Debt on loans obtained from foreign
government authorities
Debt on loans obtained from foreign
commercial banks
Debt on loans not elsewhere classified
Adjustments connected with changes in
deposits and securities, and with appraisal
differences
Slide 18
UKRAINE MINISTRY OF FINANCE
Further Plans for Improving Budgetary Classification:
Reflecting in the classification “below the line” transactions involving the acquisition and sale of
nonfinancial assets and the attraction and retirement of loans, i.e., as financing transactions
Reflecting “below the line” transactions involving the transfer of funds for increasing public participation in
nonfinancial and financial corporations, i.e. as financing transactions
Separating subsidy and current transfer items and bringing them into conformity with the requirements of
SNA 2008
Slide 19