Private Kindergarten Accounting SystemIssues and Improvement
Asian Tax Journal Vol. 22 No. 5 (2021), pp. 51-72
Abstract
Currently, private kindergartens are subject to the 「Rules on Financial Accounting of Private Schools」 because kindergartens are established and operated for childhood education in accordance with Article 11. of the Framework Act on Education and Article 2, No. 2 of the Childhood Education Act. Although it may be legally justified, there are difficulties in practical application of this rule in private kindergartens. For example, despite the fact that the majority of educational institutions are corporations, they are intended to be applied to private kindergartens, and even after the Kindergarten Act is revised, the terminology is still lacking and is not reflected in the national accounting system(edufine). Accordingly, this study suggests the following policies. First, as the 「Private Schools Act」, 「Private School Institutions Financial Accounting Rules」 previously applied to corporate private kindergartens, the legal basis for private kindergarten accounting to be applied to individual private kindergarten accounting is unclear. The private kindergarten accounting is managed in accordance with the “Rules” and the financial affairs manual for private kindergartens of the metropolitan/provincial offices of education. Therefore, it is necessary to reorganize the legal system to provide a legal basis for kindergarten accounting for private private kindergartens. Second, even if a private kindergarten is a private institution by law, it is operated by individuals and its scale is incomparably small. As a device that can do this, it seems necessary to activate the account of provisions and reserves. Allowing provision such as reserves for facility maintenance or depreciation for buildings or facilities is also a basis for taking responsibility for the quality of safety facilities or education. Third, this study allows the establishment of reserves and provisions under the current law, but it has to be accumulated according to the supervision and permission of the head of the provincial and provincial office of education, and its use is also limited even if it is intended for the purpose of accumulating and apportioning kindergarten facilities in the future. To realistically improve the situation and at the same time, we propose to introduce accounting education and certification system for private kindergartens for the smooth operation of K－edufine. In order to improve the transparency of the accounting system of non－profit corporations and private kindergartens, which are attracting public attention, it is urgently required to promote an accounting certification system and accounting education course at a renowned professional institution. This study identifies the causes of issues in the application of financial accounting rules for private institutions based on the type of establishment of kindergartens from a macro perspective, and examines differences in perceptions of subsidies and subsidies between the government and private kindergartens due to differences in form and substance, it is differentiated from previous studies in that it proposes policies and systems for the stable settlement of K－edufine.
Keywords
- private kindergarten accounting
- non－profit accounting
- edufine
- accounting system
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