Budgeting Based Performance in Indonesia

Basically, performance accountability is the obligation of an embodiment of the organizers of government to account (success / failure) execution of the mission of the organization in achieving its objectives and targets periodically measured by a set of performance indicators.

The accountability system has at least four phases, namely:

1. The preparation or planning of a strategic plan

2. Performance measurement

3. Reporting performance

4. Utilization of information for continuous performance improvement

Annual performance plan is a further elaboration process and covers the period from the annual strategic plan, which has been prepared. Therefore, the elaboration of the strategic objectives, policies, programs and activities to be implemented by government agencies should be formulated in a performance plan document that contains information about:

a. Target to be achieved at a certain period

b. Group performance indicators are expected from an activity

c. The expected level of performance can be achieved at a certain period

d. Indicators of success or level of expected performance is

e. Plan the acquisition of data sources expected performance indicators

Performance plan has been prepared as a basis for government agencies to develop and apply performance-based budgeting. The budget system is a budgeting system that would link the performance of government work units with a budget allocation that will be implemented. It also guided by a framework that includes several budgeting periods (the so-called Medium Term Budgeting) in accordance with the principles of sustainable financing.

In the public sector, budgeting is a process of allocating financial resources limited state (revenue and deficit financing) to be used as spending on each unit - a unit of government. In general, the functions of budgeting are:

a. Financial control of the input

b. Management of ongoing activities

c. Planning 

d. Determination of priorities

e. Accountability

While the functions of government budget in the environment has an influence on accounting and financial reporting, because:

1. The budget is a statement of public policy

2. The budget is the fiscal targets that describe the balance between expenditure, revenue and  financing

3. The budget becomes the basis of control that has legal consequences

4. Budgets provide the basis of government performance assessment

5. The results of the implementation of the budget set forth in the government's financial report as a statement of government accountable to the public