Page 43 - SUSTAINABILITY ISSUES & COVID-19

It related to recognition, measurement, and presentation of the state-owned asset revaluation and it makes the
state-owned asset revaluation still leaving problems. A great solution could be the development of a new standard
specifically for the revaluation of the state-owned asset. This standard can also include other things of interest related
to the revaluation of the state-owned asset, such as efforts to optimize the use of assets across generations.

According to GAS, a review of the benefits of depreciable assets is implemented periodically. If there is a huge
difference from the previous estimate, then an adjustment is made to the useful life that will affect the current and
future depreciation. When depreciation was implemented for the first time in 2013 in the context of accrual accounting,
a useful life table was created to calculate the depreciation value. Since the application of accrual-based accounting,
the state-owned asset has never reviewed the useful life. In the state-owned asset reassessment report, additional
useful life is only given to state-owned assets whose useful life has expired but is still in good condition and can be
used. This becomes strange when a state-owned asset that still has useful life is not given a useful life then experiences
an increase in fair value which immediately experiences a large depreciation.

The inconsistent treatment in providing a useful life is not following GAS Number 10. If there is a change in the
conditions used as the basis for the estimated useful life or there is new information or an increase in experience
in making estimates or other things develop, then a revision of the estimate can be made. The state-owned asset
revaluation should have been a condition to cause a revision of estimates.

This means that the government is allowed to make a policy for changing estimates in terms of changes in useful life,
however, the policy must be consistent so that the depreciation expense incurred is an actual condition and is reflected
in the operating statement presented in the financial statements. Improvements were made by making amendments
to PMK 118 of 2017 through the issuance of PMinistry of Finance Regulation number 107 of 2019 and granting new
useful lives not only to BMN that had expired but also to the state-owned asset that received a fair value revaluation
and were given an additional useful life.

The lack of asset revaluation arrangements has made the Ministry of Finance consult with the Audit Board and Public
Sector Accounting Standards Committee in formulating the state-owned asset revaluation policy so as not to conflict
with the applicable GAS. However, this did not make the state-owned asset revaluation free from problems. As much as
possible, the Ministry of Finance has carried out input from various parties by issuing Presidential Regulation number
75 of 2017.

From the explanation above, it can be learned that GAS should regulate the revaluation of the state-owned asset
in more detail so that the Ministry of Finance is not confused in making and implementing the revaluation policy.
This is following the research by Deaconu & Nistor (2014), where asset valuation is done correctly will guarantee the
credibility of accounting information that can support decision making by interested parties. It must be supported by
more detailed accounting standards in terms of concepts and types of value, each with more technical guidance than
is currently available. The lack of detail regarding the valuation methodology, which was subsequently not found in the
professional guidance provided, resulted in inadequate financial reporting support in government institutions.

4.3. Evaluation of the 2017-2018 BMN Revaluation Implementation.
The implementation of the state-owned asset revaluation begins with carrying out an inventory of the state-owned asset
in the ministry/government agency. The results of the inventory are used by the DG-SAM as a basis for revaluation. After
the revaluation is implemented, the results of the revaluation are presented in the government financial statements.
Government Regulation Number 27 of 2014 regulates the management of the state-owned asset and local-owned asset.
According to the Government Regulation, the parties who can carry out an inventory are Property Users and Property
Managers. the state-owned asset and local-owned asset inventories must be carried out every five years by the Goods
User of Proxy. Meanwhile, Inventory of state-owned asset and local-owned asset in the form of land and/or buildings
is carried out by the Property Manager who controls the state-owned asset and local-owned asset at least once every
five years. Ministry of Finance Regulation Number 118 of 2017 that is a guideline in carrying out the revaluation of the
state-owned asset defines inventory as an activity of data collection, recording, and reporting of data collection results
on State Property. The inventory activities are the initial activity carried out in carrying out the revaluation of the state-

42 International Conference on Sustainability
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