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governmental chp 2
Terms in this set (55)
fund financial statements?
government-wide financial statements?
condensed consolidated overview
what marked a major change in governmental financial reporting?
issuance in 1999
ensures that the financial reports of all SLGs contain same types of financial statements & disclosures for the same type of funds & activities
*requires full disclosure
simple to complex requirements.
-may be simple if budgeting on GAAP basis
-more complex if cash or encumbrance budgeting is required
Identifying the ____ ______ is key?
trying to assure comparability among & btw govts.
full disclosure may result in much more info than 'adequate' disclosure required by FASB
most distinctive feature of governmental acct
- proper acct controls
- demonstrating compliance
definition of a fund?
independent acct entity w a self balancing set of accts
** captures all reported attributes of a portion of the govt activities & resources accounted for in that fund
captures all reported attributes for the entire business and all its transacitons
1. proprietary funds
2. governmental funds
3. fiduciary funds
plus nonfund accts
similar to acct for business.
- acct measures net position, changes in net position, & cash flows
measurement focus? (MF) Proprietary Funds
- economic resources
- financial statement recognition of all assets and all liabilities
basis of acct? (BA) Proprietary Funds
- recognize revenues when earned & expenses when incurred
used to acct for sources, uses, & balances of general govt. financial resources
-funds represent segregations of general govt. net financial assets
refers primarily to cash, investments, & receivables
related to the current year and normally paid for available current financial resources
- net financial assets of fund
- difference in financial assets & related liabilites
measurement focus? Governmental Funds
current financial resources
basis of accounting? Governmental Funds
govt funds recognition criteria- revenues?
- earned during or levied for the period
- objectively measured
- collected in period or soon enough thereafter (usually 60 days) to pay liab incurred for expenditures of the period (available)
govt funds recognition criteria- expenditures?
when operating or capital outlay: liabilities to be paid currently from govt funds are incurred.
- when debt service (principal & interest): payments on LT liab are due
Deferred Outflows of Resources?
consumption of net assets by the government that is applicable to a future reporting period
- taxes collected in adv of the period for which they are levied
- taxes levied in current period to finance next period
- revenues deferred due to availability criterion
Deferred Inflows of Resources?
acquisition of net assets by the government that is applicable to a future reporting period
General Capital Assets?
not financial resources available for expenditure, but must maintain accountability
General LT Liabilities?
unmatured principal that doesn't require current appropriation or expenditure of fund financial resources
Examples of General Capital Assets?
- capital assets used in general govt activities
- not assets of any fund but of govt unit as a whole
- inclusion in govt fund financial statements would increase fund balance & could mislead users
Examples of General LT Liabilities?
- secured by the general credit & revenue- raising powers of the govt
- not liabilities of any fund but of general govt as a whole
- inclusion as govt fund liab would be misleading & dysfunctional to current period mgmt control
- accts for assets held by govt in trustee or agency capacity for others
- not used to report assets held for govt own use
measurement focus? Fiduciary Funds
basis of accounting? Fiduciary Funds
categories of governmental funds?
- general fund
- special rev fund
- capital projects fund
- debt services fund
- permanent fund
categories of proprietary funds?
- enterprise funds
- internal service funds
categories of fiduciary funds?
- pension trust funds
- investment funds
- agency funds
- private purpose trust funds
customers are usually then general public (as well as businesses & other entities besides the govt own departments or agencies)
internal service funds?
customers are predominantly other departments of agencies of the govt
used to acct & report all financial resources not accted for & reported in another fund
special revenue funds?
used to acct for the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes
capital project funds?
used to acct for & report financial resources that are restricted, committed, or assigned to expenditure for capital outlays, including acquisition or construction of capital facilities or other capital assets
debt service funds?
used to acct for & report financial resources that are restricted, committed, or assigned to expenditure for principal & interest
used to acct for resources that arent legally restricted to the extent that only earnings, & not principal, may be used for purposes that support the reporting govt programs- for the benefit of the govt or its citizenry
pension trust funds?
established to acct for resources that are required to be held in trust for the members & beneficiaries of defined benefit pension plans, defined contribution plans, other post-employment benefit plans, & other employee benefits
investment trust funds?
used to acct for the external portion of investment pools held by the sponsoring govt
private purpose trust funds?
used to acct for all other trust arrangements under which principal & or income benefit individuals or groups outside the govt.
established to acct for resources held in a purely custodial capacity for others
interfund transactions- reciprocal?
- interfund loans
- interfund services provided and used
interfund transactions- nonreciprocal?
- interfund reimbursements
- interfund transfers
interfund transactions- loans?
- amt provided by 1 fund to another w/ a requirement for repayment
- affects only balance sheet accts
interfund transactions- transfers?
- flows of assets from 1 fund to another w/ no requirement for repayment
- affects balance sheet & operating statement accts
comparative operating statements? proprietary funds
- accrual based
- must distinguish btw operating & non operating revenues & expenses
- separate reporting for capital contributions, special & extraordinary items, & transfers
- changes in net position
comparative operating statements? governmental funds
- modified accrual based
- report revenues by source & expenditures by character
- other financing sources & uses for other resource flows, including transfers
- special & extraordinary items reported separately
- change in fund balance
comparative balance sheets? proprietary funds
- current & noncurrent assets
- deferred outflows of resources
- current & noncurrent liabilities
- deferred inflows of resources
- net postion
comparative balance sheets? governmental funds
- financial assets
- deferred outflows of resources
- related liabilities
- deferred inflows of resources
- fund balance
annual financial reporting?
should be prepared for all govt entities.
1. introductory- little GAAP
2. financial- most GAAP
financial reporting entity consist of?
- primary govt
- organization for which the PG is financially accountable
- other organizations whos omission would cause financial statements to be misleading
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