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NATIONAL ACCOUNTING ACT

Act No. 8636, Oct. 17, 2007

Amended by Act No. 8852, Feb. 29, 2008

Act No. 9279, Dec. 31, 2008

Act No. 10289, May 17, 2010

Act No. 11690, Mar. 23, 2013

Act No. 11885, Jul. 16, 2013

Act No. 12844, Nov. 19, 2014

Act No. 14463, Dec. 27, 2016

Act No. 14839, Jul. 26, 2017

Act No. 15285, Dec. 26, 2017

CHAPTER I GENERAL PROVISIONS
 Article 1 (Purpose)
The purpose of this Act is to transparently carry out national accounting and generate and supply useful and appropriate information on finance by prescribing basic matters on national accounting and others related thereto.
 Article 2 (Definitions)
For the purposes of this Act:
1. The term "head of a central government office" means any of the following persons:
(a) The head of a central administration agency established pursuant to the Constitution of the Republic of Korea, the Government Organization Act, or other Acts;
(b) The Secretary General of the National Assembly, the Minister of the National Court Administration, and the Secretary General of the Department of Court Administration of the Constitutional Court, and the Secretary General of the National Election Commission;
2. The term "fund management entity" means a person who is responsible for the management and operation of a fund (referring to any fund defined in subparagraph 2 of Article 2; hereafter the same shall apply in this subparagraph) pursuant to an Act (excluding persons entrusted with the management or operation of a fund);
3. Deleted. <by Act No. 9279, Dec. 31, 2008>
 Article 3 (Scope of Application)
This Act shall apply to the following accounts and funds:
1. General accounts and special accounts under Article 4 of the National Finance Act;
2. Funds established pursuant to Article 5 (1) of the National Finance Act (hereinafter referred to as "funds").
 Article 4 (Principles of National Accounting)
National accounting shall be carried out in compliance with the following principles:
1. National accounting shall be carried out fairly in accordance with objective data and evidence so that it can be reliable;
2. National accounting shall be carried out simply and clearly and supply adequate information so as to make it possible to easily grasp details and results of financial activities;
3. Deleted. <by Act No. 9279, Dec. 31, 2008>
 Article 5 (Fiscal Year)
The fiscal year of national accounting shall begin on January 1 each year and end on December 31.
 Article 6 (Allocation of Administrative Affairs of National Accounting)
(1) The Minister of Strategy and Finance shall have overall control over administrative affairs of national accounting, and the head of each central government office and each fund management entity shall be responsible for administrative affairs of accounts under the jurisdiction of each of them. <Amended by Act No. 8852, Feb. 29, 2008>
(2) The head of each central government office shall, when he/she intends to enact, amend, or repeal any statute governing the administrative affairs under paragraph (1), consult with the Minister of Strategy and Finance and the Board of Audit and Inspection of Korea. <Amended by Act No. 8852, Feb. 29, 2008>
 Article 7 (Appointment of Officer Responsible for Accounting)
(1) The head of each government office shall appoint an officer responsible for accounting to have the officer carry out all affairs of accounting under the jurisdiction of the government office.
(2) Each officer responsible for accounting shall undertake the following matters:
1. Matters concerning accounting, such as internal control under Article 24;
2. Matters concerning accounting and settlement and analysis of accounts;
3. Guidance for, and supervision of, public officials in charge of the affairs under subparagraph 1 or 2;
4. Other matters specified by Presidential Decree in conjunction with the performance of accounting works.
(3) The appointment of an officer responsible for accounting may be substituted by the designation of a position already existing in a central government office by the head of the central government office.
 Article 8 (Establishment of Deliberative Committee on National Accounting System)
(1) A deliberative committee on the national accounting system (hereafter referred to as the "Committee" in this Article) shall be established within the Ministry of Strategy and Finance in order to have the Committee deliberate on the following matters in conjunction with the performance of national accounting works:
1. The national accounting system and the operation thereof;
2. Enactment, amendment, and repeal of statutes governing national accounting practice and the settlement of accounts;
3. Interconnection of accounting systems between the State, local governments, and public institutions (referring to public institutions designated and publicly notified pursuant to Articles 4 through 6 of the Act on the Management of Public Institutions);
4. Other matters specified by Presidential Decree with regard to the operation of the national accounting system.
(2) The Committee shall be comprised of not more than 15 members, including one Chairperson.
(3) The Vice Minister of Strategy and Finance designated by the Minister of Strategy and Finance shall take the chair of the Committee, and other members shall be persons appointed or commissioned by the Minister of Strategy and Finance from among public officials of Grade III of relevant agencies, such as the Board of Audit and Inspection of Korea and the Ministry of the Interior and Safety, or public officials in general service who are members of the Senior Executive Service and persons who have vast knowledge and experience in accounting. <Amended by Act No. 11690, Mar. 23, 2013; Act No. 12844, Nov. 19, 2014; Act No. 14839, Jul. 26, 2017>
(4) Other matters necessary for the organization and operation of the Committee shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 9279, Dec. 31, 2008]
 Article 9 Deleted. <by Act No. 9279, Dec. 31, 2008>
 Article 10 (Relations to other Acts)
This Act shall take precedence over other Acts in application to the accounting of general accounts, special accounts, and funds and the settlement of accounts.
[This Article Wholly Amended by Act No. 9279, Dec. 31, 2008]
CHAPTER II STANDARDS FOR ACCOUNTING
 Article 11 (Standards for National Accounting)
(1) Standards necessary for accounting economic transactions arising from financial activities of the State by the double-entry bookkeeping method on an accrual basis (hereinafter referred to as "national accounting standards") shall be prescribed by Ordinance of the Ministry of Strategy and Finance. <Amended by Act No. 9279, Dec. 31, 2008>
(2) National accounting standards shall be formulated to ensure objectivity and uniformity so as to accomplish appropriateness in accounting and clearly state the financial position and details of financial management.
(3) Deleted. <by Act No. 9279, Dec. 31, 2008>
(4) The Minister of Strategy and Finance may entrust a specialized institution or organization with affairs of national accounting standards, as prescribed by Presidential Decree. <Amended by Act No. 8852, Feb. 29, 2008>
 Article 12 Deleted. <by Act No. 9279, Dec. 31, 2008>
CHAPTER III SETTLEMENT OF ACCOUNTS
 Article 13 (Process of Settlement of Accounts)
(1) The head of each central government office shall prepare a report of settlement of accounts, integrating all general accounts, special accounts, and funds under his/her jurisdiction, (hereinafter referred to as "central government office's report of settlement of accounts") for each fiscal year pursuant to Articles 14, 15 and 15-2.
(2) A fund management entity shall, if it is not the head of a central government office, prepare a report of settlement of accounts for the fund (hereinafter referred to as "fund's report of settlement of accounts") for each fiscal year pursuant to Article 14, 15 and 15-2 (excluding provisions governing settlement of revenue and expenditure) and submit it to the head of the competent central government office. In such cases, a fund falling within the criteria prescribed by Presidential decree, taking into consideration the size of the fund in operation, shall attach an auditor's report prepared by an accounting firm under Article 23 of the Certified Public Accountant Act to the fund's report of settlement of accounts.
(3) The Minister of Strategy and Finance shall prepare a report of settlement of accounts for the State (hereinafter referred to as "the State's report of settlement of accounts") by integrating each central government office's reports of settlement of accounts for each fiscal year and present it to the President for approval after it is deliberated by the State Council.
(4) Necessary matters concerning the method of, and the procedure for, accounting audit under the latter part of paragraph (2) shall be prescribed by Presidential Decree.
[This Article Wholly Amended by Act No. 9279, Dec. 31, 2008]
 Article 14 (Composition of Report of Settlement of Accounts)
Each report of settlement of accounts is comprised of the following documents:
1. Outlines of settlement of accounts;
2. Settlement of revenue and expenditure (including settlement of revenue and expenditure of a fund in cases of a central government office's or the State's report of settlement of accounts, and referring to settlement of revenue and expenditure of a fund in cases of a fund's report of settlement of accounts);
3. Financial statements:
(a) Statement of financial position;
(b) Statement of financial management;
(c) Statement of changes in net assets;
4. Performance report.
[This Article Wholly Amended by Act No. 9279, Dec. 31, 2008]
 Article 15 (Preparation of Report of Settlement of Accounts)
(1) Outlines of settlement of accounts under subparagraph 1 of Article 14 shall be prepared to make it possible to plainly grasp results of execution of budget and a fund, details of financial management, and financial position by summarizing details of settlement of accounts.
(2) The settlement of revenue and expenditure under subparagraph 2 of Article 14 shall be prepared by aggregating results of execution according to the same classification as that of the budget of revenue and expenditure or the fund management plan. In such cases, more specific matters concerning preparation shall be prescribed by Presidential Decree.
(3) Financial statements under subparagraph 3 of Article 14 shall be prepared in accordance with national accounting standards.
(4) Performance reports under subparagraph 4 of Article 14 shall be prepared by comparing goals of performance stated in the relevant performance plan under Article 8 of the National Finance Act with results of performance of the plan.
[This Article Wholly Amended by Act No. 9279, Dec. 31, 2008]
 Article 15-2 (Supplementary Documents for Report on Settlement of Accounts)
(1) The settlement of revenue and expenditure under subparagraph 2 of Article 14 (excluding a fund's settlement of revenue and expenditure) shall be accompanied by the following documents: <Amended by Act No. 11885, Jul. 16, 2013; Act No. 14463, Dec. 27, 2016; Act No. 15285, Dec. 26, 2017>
1. Statement of settlement of continuing expenditure;
1-2. Statement of settlement of revenue and expenditure account by business;
2. Statement of execution of projects with a lump-sum apportionment;
3. Statement of expenditure of revenue substitute expenses;
4. Statement of carryovers;
5. Statement of execution of specified carryover funds;
6. Statement of management of revolving funds in special accounts for governmental enterprises;
7. Gender-sensitive settlement of accounts;
8. Statement of expenditure of reserve funds;
8-2. Statement of execution of each project subject to the control of total project costs under Article 50 of the National Finance Act;
9. Statement of investments in kind under Article 53 (2) of the National Finance Act;
10. Statement of issuance of treasury bills under Article 32 (1) of the Management of the National Funds Act and management of temporary borrowings from the Bank of Korea;
11. Statement of appropriation of the surplus in tax accounts for the previous year under Article 90 of the National Finance Act;
12. Other documents specified by Presidential Decree.
(2) Each fund's settlement of revenue and expenditure shall be accompanied by the following documents: <Amended by Act No. 10289, May 17, 2010>
1. Statement of results of procurement of financial resources;
2. Gender-sensitive fund settlement of accounts;
3. Other documents specified by Presidential Decree.
(3) The settlement of revenue and expenditure in the State's report of settlement of accounts shall be accompanied by the following documents in addition to the documents under paragraphs (1) and (2):
1. Statement of integrated treasury revenue and expenditure;
2. Statement of management of funds in integrated accounts and expenditure of profits.
(4) Financial statements under subparagraph 3 of Article 14 shall be accompanied by the following documents:
1. Report on management of national debts;
2. Report on present credit amount under Article 36 of the State Credit Management Act;
3. Other documents specified by Presidential Decree.
(5) More specific details concerning preparation of gender-sensitive settlement of accounts under paragraph (1) 7 and gender-sensitive fund settlement of accounts under paragraph (2) 2 shall be prescribed by Presidential Decree.<Amended by Act No. 10289, may 17, 2010>
[This Article Newly Inserted by Act No. 9279, Dec. 31, 2008]
 Article 16 (Preparation of Statement of Spending of Reserve Funds)
(1) The head of each central government office shall prepare a statement of the expenditure from reserve funds.
(2) The Minister of Strategy and Finance shall prepare a comprehensive statement of expenditure from reserve funds by integrating statements of spending of reserve funds under paragraph (1).
[This Article Wholly Amended by Act No. 9279, Dec. 31, 2008]
 Articles 17 through 23 Deleted. <by Act No. 9279, Dec. 31, 2008>
CHAPTER IV SUPPLEMENTARY PROVISIONS
 Article 24 (Internal Control)
(1) In order to evaluate the appropriateness of accounting practices and the reliability of reports of settlement of accounts, the head of each central government office shall authorize the office responsible for accounting to conduct internal control, such as control and supervision of such affairs. <Amended by Act No. 9279, Dec. 31, 2008>
(2) The head of each central government office shall establish the procedure and method necessary for internal controls under paragraph (1).
(3) Fundamental matters concerning the procedure and method under paragraph (2) shall be determined by the Minister of Strategy and Finance, subject to consultation with the Board of Audit and Inspection of Korea. <Amended by Act No. 8852, Feb. 29, 2008>
 Article 25 (Keeping Account Books)
The head of each central government office and each fund management entity shall keep account books respectively, as prescribed by Presidential Decree, and keep and maintain records of necessary matters.
 Article 26 (Supervision over Accounting and Preparation of Reports of Settlement of Accounts)
(1) The Minister of Strategy and Finance shall, if necessary for appropriate management of national accounting work, assign public officials under his/her control to conduct field guidance and survey on accounting and preparation of reports of settlement of accounts, as prescribed by Presidential Decree.
(2) The Minister of Strategy and Finance may prepare guidelines for settlement of accounts and notify the head of each central government office of the guidelines so that they can prepare reports of settlement of accounts appropriately.
(3) The Minister of Strategy and Finance may demand heads of appropriate central government offices to furnish data necessary for the preparation of the State's report on settlement of accounts.
[This Article Wholly Amended by Act No. 9279, Dec. 31, 2008]
 Article 27 (Education of Public Officials Involved in Accounting)
The Minister of Strategy and Finance may conduct educational programs for public officials in charge of accounting, as prescribed by Presidential Decree, in order to improve their expertise for carrying out national accounting. <Amended by Act No. 8852, Feb. 29, 2008>
 Article 28 (Responsibilities of Public Officials Involved in Accounting)
Responsibilities of public officials in charge of accounting shall be provided for by other Acts.
ADDENDA
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2009: Provided, That Article 2 of the Addenda shall enter into force on the date of its promulgation.
Article 2 (Establishment of Working Committee for Improvement of National Accounting System)
(1) A working committee for the improvement of the national accounting system (hereafter referred to as the "Working Committee" in this Article) shall be established and operated in order to establish the accounting system in a double-entry bookkeeping method on an accrual basis as early as possible, which shall be introduced by enforcement of this Act, and enforce the new national accounting system.
(2) The Working Committee shall be comprised of the following members:
1. One Vice Minister of Strategy and Finance designated by the Minister of Strategy and Finance;
2. One public official designated by the Chairperson of the Board of Audit and Inspection of Korea from among public officials of Grade III of the Board of Audit and Inspection of Korea or public officials who are members of the Board of Audit and Inspection's Senior Executive Service;
3. One public official designated by the Minister of Planning and Budget from among public officials of Grade III of the Ministry of Planning and Budget or public officials who are members of the Senior Executive Service;
4. One public official designated by the Minister of Government Administration and Home Affairs from among public officials of Grade III of the Ministry of Government Administration and Home Affairs or public officials who are members of the Senior Executive Service;
5. One certified public accountant commissioned by the Minister of Strategy and Finance from among those recommended by accounting-related organizations;
6. One person commissioned by the Minister of Strategy and Finance from among those who have ever taken charge of accounting in the Government or a public institution for at least ten years;
7. Not more than six persons commissioned by the Minister of Strategy and Finance from among those who major in accounting or finance in a college and who have worked for a college or an officially recognized research institute as an adjunct professor or with a higher or equivalent position for at least ten years.
(3) The following persons shall serve as Joint Chairpersons of the Working Committee:
1. The person under paragraph (2) 1;
2. One person elected by and from among members under paragraph (2) 5 through 7.
(4) Each Chairperson shall represent the Working Committee and have overall control over affairs of the Committee, such as the convocation of meetings of the Committee.
(5) The Working Committee may operate a working-level task force team comprised of employees in charge of accounting under the control of the head of a central government office or a fund management entity in order to efficiently promote its affairs.
(6) Heads of central government offices and fund management entities shall provide data relevant to accounting under the jurisdiction of each of them and present their opinions on accounting to the Working Committee and the working-level task force team to have such data and opinions reflected in the national accounting system.
(7) The Government may subsidize expenses necessary for efficiently carrying out affairs of the Working Committee within the extent of budget.
(8) Necessary matters concerning the operation and affairs of the Working Committee shall be determined by the Chairpersons, subject to resolution by the Working Committee.
(9) The Working Committee shall exist until December 31, 2008.
Article 3 (Applicability to Preparation and Submission of Financial Reports)
The preparation and submission of financial reports under this Act shall be applicable to the settlement of accounts for fiscal year 2009 and each year thereafter.
Article 4 Omitted.
ADDENDA <Act No. 8852, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)
Articles 2 through 7 Omitted.
ADDENDA <Act No. 9279, Dec. 31, 2008>
(1) (Enforcement Date) This Act shall enter into force on January 1, 2009.
(2) (Applicability to Preparation of Reports of Settlement of Accounts) The amended provisions of Articles 13 through 15 and 15-2 shall be applicable to the settlement of accounts for fiscal year 2009 and each year thereafter: Provided, That the amended provisions of Article 15-2 (1) 7 and (5) shall be applicable to the settlement of accounts for fiscal year 2010 and each year thereafter.
ADDENDA <Act No. 10289, May 17>
(1) (Enforcement Date) This Act shall enter into force on the date of its promulgation.
(2) (Applicability to Attachment of Gender-sensitive Fund Settlement of Accounts) The amended provisions of Article 15-2 (2) and (5) shall apply beginning with gender-sensitive fund settlement of accounts for fiscal year 2011.
ADDENDA <Act No. 11690, Mar. 23, 2013>
Article 1 (Enforcement Date)
(1) This Act shall enter into force on the date of its promulgation.
(2) Omitted.
Articles 2 through 7 Omitted.
ADDENDUM <Act No. 11885, Jul. 16, 2013>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 12844, Nov. 19, 2014>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided, That amendments to Acts, which were promulgated before the enforcement of this Act but the date on which it enters into force has not yet arrived, among Acts amended by Article 6 of the Addenda, shall enter into force on the enforcement date of the respective Act.
Articles 2 through 7 Omitted.
ADDENDA <Act No. 14463, Dec. 27, 2016>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2017.
Article 2 (Applicability to Accompaniment of Supplementary Documents of Report on Settlement of Accounts)
The amended provisions of Article 15-2 (1) 1-2 shall apply, beginning with the settlement of revenue and expenditure account for fiscal year 2017.
ADDENDA <Act No. 14839, Jul. 26, 2017>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation: Provided, That amendments to the Acts which were promulgated before this Act enters into force but the enforcement dates of which have not yet arrived, among the Acts amended by Article 5 of the Addenda, shall enter into force on the enforcement dates of the respective Acts.
Articles 2 through 6 Omitted.
ADDENDA <Act No. 15285, Dec. 26, 2017>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2018.
Article 2 (Applicability to Accompaniment of Statement of Execution of Each Project Subject to Control of Total Project Costs)
The amended provisions of Article 15-2 (1) 8-2 shall apply, beginning with the settlement of revenue and expenditure account for the fiscal year 2018.