Record-Keeping of Wages and Salaries in Ukrainian Budgetary Institutions: Renewed Methodological and Methodical Positions

Abstract

The continuing change in the legal framework for adapting national legislation to internationalstandards and introducing innovations in record-keeping of salaries and wagesin budgetary institutions has implications for record-keeping methods and methodologies. Record-keeping of salaries and wages in the Ukrainian public sector is subject to reform, whichraises importance of the issues of innovation in record-keeping of salaries and wages, to ensureharmonization of Ukrainian practices with respective international standards. The articleaims to analyze innovations in record-keeping of salaries and wages in Ukrainian budgetaryinstitutions, with making up recommendations on regulatory improvements, to allow for reliableand complete information about calculations of wages and salaries in the public sector.The study shows substantial gap between classifications of payment categories in National Standard of Accounting in Public Sector (NSAPS) 132 “Employee benefits” and International Standard of Accounting in Public Sector (LSAPS) 25 “Employee benefits”. Asignificant disadvantage of NSAPS 132 “Employee benefits” is absence of a definition of“employee benefits ”, which interpretation is given by the authors.To improve record-keeping of salaries and wages, the account 65 “Calculation of wages ” should be renamed as “Calculation of wages and employee benefits”, with addingsub-accounts 6520 “Benefits to employees dismissed due to retirement age” and 6521“Benefits to employees dismissed by decision ofpublic sector entity” to the account 65, tohave regular information about benefits to dismissed employees.In addition, the need to cohere the structure of account 65 “Calculation of wages andemployee benefits” with the classification of benefits used in NSAPS 132 “Employee benefits” is demonstrated, to ensure conformity of the benefits categoriesfixed in NSAPS 132 “Employee benefits ” and the synthetic accounting data.The proposals to improve the synthetic account of wages and salaries calculationsare made to ensure transparency in the record-keeping process, improve the informationalcontent of record-keeping and harmonize it with international practices.