Role of government in a mixed economy, Accounting Basics

Government: In a mixed economy this is seems to be the duty of the Government to direct the operation of the economic system in that a way which it subseries the general good. Controls and regulations on the operations of private sector enterprises are the hallmark of mixed economy. Several government agencies collect information about various aspects of the activities of business organizations. Several of this information is an express output of the accounting system, for illustration, levels of outputs, profits, costs, investments and taxes etc. All such information is very significant in evolving policies for managing the economy. The task of the Government in managing the industrial economy of the country is assisted if accounting information is presented, as much as possible, in a uniform manner. This is clear here, if accounting information is distorted because of manipulations and window-dressing in the presentation of annual accounts, this will have sick effects upon the measures the government aims to take and the policies this wishes to adopt.

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