Binding agreements are agreements confirmed by government entities that have financial implications. Binding agreements include:

• lease agreements

• operational agreements

• service agreements

• grant agreements

• cooperation agreements

Heads of government entities are responsible for registering information about agreements in the Financial Management Authority’s contract management system.

Information in the contract management system is used for:

• the government procurement dashboard

• monitoring the implementation of the Budget Act

• preparing supplementary disclosures in the State Accounts

Inventory refers to goods or materials that organizations hold for sale or for use in their operations.

Inventory is recorded as an asset in the balance sheet, specifically under: 

• current assets (because it is expected to be converted into cash relatively quickly).

Inventory affects the income statement:

• An increase in inventory → less sold → lower costs for the period

• A decrease in inventory → more sold → higher costs for the period