The Necessity and Theoretical Issues of Accounting and Internal Audit in Public Educational Institutions

The article substantiates why public educational institutions that combine budget financing with paid educational services need accounting and internal audit that go beyond the traditional separation of funds, and it clarifies the theoretical foundations of both. Drawing on fund accounting theory, management accounting, the new national Budget Accounting Standard No. 19 “Revenue”, IPSAS 47, the COSO framework and the Three Lines Model of the Institute of Internal Auditors, the study shows that budget accounting separates funds but does not generate information on individual service types within a fund. Using the 2021-2025 financial statements of the A. Avloniy National Institute of Pedagogical Excellence and the 2025 results of the internal audit service of the Ministry of Preschool and School Education of Uzbekistan, the article proposes an author’s definition of a paid educational service as a four-element accounting object and an author’s definition of internal audit in a public educational institution, describes the sequence of revenue recognition for paid courses, adapts the Three Lines Model to the ministry’s system and develops a typology of seven risks specific to paid educational services.