Implementing the Account Code Updates (A.1 and A.2) for Village Financial Administration

The Ministry of Home Affairs (Kemendagri) has officially released a critical adjustment regarding the accounting matrix for village financial governance. This systemic update is formally enacted through the Surat Edaran (SE) Menteri Dalam Negeri Nomor 100.3.2.3/4716/SJ. The core mandate of this circular is the instruction to integrate Account Codes A.1 and A.2 directly into the village financial administration system, which remains entirely anchored to Permendagri Nomor 20 Tahun 2018.

This executive intervention is highly calculated. The central government is moving to ensure that national strategic programs descending to the village level—alongside mandatory social protection rights for the local apparatus—possess legally recognized budgetary “rooms” or ledgers. By activating these new account codes, every rupiah deployed for these specific mandates can be recorded legally, auditable, and transparently within the active Anggaran Pendapatan dan Belanja Desa (APB Desa).

I. Strategic Urgency Behind the SE Mendagri Update

Since its promulgation, Permendagri 20/2018 has effectively regulated village expenditure classifications—spanning from broad developmental fields down to granular expenditure objects. However, as local public administration evolves, urgent field requirements have emerged that were not accommodated within the legacy account code matrix.

To close these structural loopholes, SE Mendagri Nomor 100.3.2.3/4716/SJ was issued to accommodate three immediate priorities:

• National Strategic Program Support: Establishing legal budgeting pathways to accelerate the physical construction of storefronts, warehousing facilities, and operational gear for the Koperasi Desa Merah Putih, executing direct presidential directives.
• Social Security Guarantees for the BPD: Providing explicit legal footing for the village to finance iuran BPJS (Health and Employment Insurance premiums) for all members of the Village Consultative Body (BPD).
• Protection for Local Construction Workers: Mandating and locking the allocation of employment insurance premiums for local laborers and artisans engaged in village-scale physical infrastructure projects.

II. Detailed Matrix of the New Account Codes (A.1 and A.2)

To prevent administrative confusion during the digital input phase into the Siskeudes application, this update inserts two specific code clusters into the struktur APB Desa.

1. List of Activity and Output Account Codes (Group A.1)

This group introduces new nomenclature for village operational and developmental activities:

2. List of Revenue, Expenditure, and Financing Account Codes (Group A.2)

Additions within this group are strictly focused on securing the financial allocations for mandatory social safety nets.

Personnel Expenditure Line (Specifically for BPD Social Security):

• Code 5.1.5.01: Allocation for BPD Members’ Health Insurance.
• Code 5.1.5.02: Allocation for BPD Members’ Employment Insurance.

Capital Expenditure Line (Specifically for Field Workers’ BPJS Employment Insurance):

III. Strategic Actions Required from Regional and Village Governments

Through this circular dated June 17, 2026, the Minister of Home Affairs explicitly commands all Governors, Regents, and Mayors to immediately execute three strategic actions:

1. Massive Socialization: Regional governments must immediately disseminate these code updates to all Village Heads and their apparatus to prevent bottlenecks during budget drafting.
2. Direct Oversight of APB Desa: Local governments are mandated to monitor and ensure these new codes are actively utilized across all phases—from planning and execution to bookkeeping and final accountability reports.
3. Synchronization of Local Regulations: All regional statutory codes, such as Regent Regulations (Perbup) or Mayoral Regulations (Perwali) governing village finance manuals, must be urgently revised to align with this ministerial directive.

Critical Note! This structural code update is highly time-sensitive. Failure to adjust local budgets promptly will result in system rejections during the disbursement synchronization phase on the Siskeudes platform. Village administrations must immediately coordinate with the local Community and Village Empowerment Agency (DPMD) to secure technical patches for the system.

IV. Refreshing the Baseline: Permendagri 20/2018 as the Village Financial Engine

Before diving into the complexities of the new codes, village treasurers and planners must refresh their understanding of the fundamental principles established by Permendagri Nomor 20 Tahun 2018. This regulation, which replaced the revoked Permendagri 113/2014, was intentionally designed to streamline bureaucracy while installing rigid “guardrails” to prevent the misappropriation of village funds.

The 5-Stage Financial Management Cycle

According to Article 1, **Village Finance (Keuangan Desa)** encompasses all rights and obligations of the village that possess monetary value. This ecosystem is managed through a systematic five-stage cycle:

1. Planning (Perencanaan): Drafting the APB Desa blueprint. The budget figures cannot be speculative; they must rigidly align with the approved Annual Village Work Plan (RKP Desa).
2. Execution (Pelaksanaan): The operational phase of cash inflows and outflows. The absolute rule is that all transactions must be routed through a single gateway: the Village Treasury Account (Rekening Kas Desa).
3. Administration (Penatausahaan): The primary duty of the Head of Financial Affairs (Kaur Keuangan). Every disbursed or received rupiah must be meticulously logged into the General Cash Book (BKU) and subsidiary ledgers.
4. Reporting (Pelaporan): The Village Head holds the statutory duty to submit periodic progress reports on the APB Desa execution to the Regent or Mayor.
5. Accountability (Pertanggungjawaban): The submission of a comprehensive year-end audit report, which only gains legal force once ratified as a Village Regulation (Perdes).

A critical parameter to remember: this system operates strictly on a **Cash Basis (Basis Kas)**. This means a transaction is legally recognized and recorded only when the physical cash has verifiably entered or exited the village treasury account.

The 5 Non-Negotiable Core Principles

Village administrators do not possess absolute discretionary power over public funds. Governance is bound by five absolute parameters:

• Transparent: Financial data must be openly accessible to facilitate public oversight.
• Accountable: Every disbursed rupiah must be legally and morally justifiable.
• Participatory: The community must be involved in every stage, from planning deliberations to field execution.
• Orderly (Tertib): Execution must adhere strictly to Standard Operating Procedures (SOPs) and prevailing laws.
• Budgetary Discipline: Expenditure must never exceed revenue. Funds cannot be deployed for ad-hoc activities outside the ratified Budget Implementation Document (DPA).

The Separation of Powers and Responsibilities

To prevent blame-shifting and institutional overlap, the regulation explicitly divides financial responsibilities:

• The Village Head (PKPKD): The supreme authority. The Kades dictates overarching policy and serves as the final signatory authorizing fund disbursement.
• Village Financial Management Executors (PPKD): The apparatus team acting as the operational engine on the ground. Consists of:
  • Village Secretary (Sekdes): The PPKD coordinator. Responsible for verifying all disbursement documents and authenticating receipts before they reach the Kades.
  • Section Heads (Kasi/Kaur): The field executors. They design physical work plans, manage goods procurement, and issue Payment Request Letters (SPP) for their respective sectors.
  • Head of Financial Affairs (Kaur Keuangan): The village treasurer. Holds the keys to the vault, drafts the Cash Budget Plan, settles invoices, collects taxes, and logs every transaction into the BKU.

Conclusion

Permendagri Number 20 of 2018 operates as the foundational “holy grail” that forces village financial management into a professional, transparent framework. The issuance of the SE Mendagri regarding the addition of account codes A.1 and A.2 proves that this regulatory architecture is not static; it is highly responsive to real-world field demands—specifically concerning labor protection and national strategic project execution.

For the village apparatus, mastering the parent regulation while agilely adapting to these administrative patches is crucial. By maintaining disciplined bookkeeping and deploying the correct target codes, the village can rapidly accelerate regional development without the constant fear of legal disputes or damaging audit findings in the future.

Summary of the SE Mendagri Account Code Integration

Visit the Village Regulations page for official access.