Primary Purpose and Characteristics of Government Business

Based on the author of an accounting book (Antonio J. Dayag) and the decree that I have read, government business has a primary purpose to render service to the public as distinguished from the usual profit motive of the private business.

On the other hand, government business has also characteristics identified as follows:

As to purpose: The primary purpose of the government business is to render service to the public at the lowest cost possible as distinguished from the usual profit motive of the private business.

As to ownership: There are no defined individual ownership interests in the government business that can be acquired, sold, transferred or redeemed in the commercial perception. Even though every citizen is said to have a share in the assets of the government, no one may dispose of his share and realize profit or income from it.

As to management: Managers of private businesses have relatively few internal limitations unlike the officers and administrators of the government business who are governed by specific laws and regulations.

As to income: Private business obtain its income from charges made for services rendered or products (useful or valuable) sold while the government derives most of its income from the collection of taxes and fees.