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FAR > F9 Governmental Accounting: Part 2 > Flashcards

F9 Governmental Accounting: Part 2 Flashcards

1
Q

What is the only GRaSPP that can have a POSITIVE unassigned balance?

A

General Fund.

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2
Q

What are the categories of Fund Balance?

A

NUCAR!

  1. N = Nonspendable = G,S
  2. U = Unassigned = G (+), Others (-)
  3. C = Committed = All but P.
  4. A = Assigned = G,D,C
  5. R = Restricted = All.
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3
Q

What GRaSPP fall into Nonspendable Fund Balance?

A

G,S

  • General Fund
  • Special Revenue Fund
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4
Q

What GRaSPP fall into Unassigned Fund Balance?

A

All!

G (+), Others (-)

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5
Q

What GRaSPP fall into Commited Fund Balance?

A

ALL but Permanent!

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6
Q

What GRaSPP fall into Assigned Fund Balance?

A

G,D,C

  • General Fund
  • Debt Service Fund
  • Capital Projects Fund
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7
Q

What GRaSPP fall into Restricted Fund Balance?

A

ALL!

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8
Q

What are nonspendable fund balances?

A

Current assets that you can’t spend.

Ex: Inventories, PP Expenditures, etc.

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9
Q

What are assigned fund balances?

A

Funds associated with funds that the government has designated, but not formally committed.

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10
Q

What are restricted fund balances?

A

Funds Restricted by external authorities (legislations, grantors, creditors).

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11
Q

What are commited fund balances?

A

Funds associated with assets committed to a formal action of the government’s highest decision-making authority.

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12
Q

What are unassigned fund balances?

A

Whatever is left and that has not been classified as the other fund balances.

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13
Q

What is the JE for an encumbrance?

A

When PO is issued:
Encumbrances
Budgetary Control

When Invoice is received, reverse Encumbrance
Budgetary Control
Encumbrances

Then, record the expense
Expenditure
Vouchers Payable/Cash

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14
Q

What is the JE for an outstanding encumbrance?

A

Reverse Encumbrance
Budgetary Control
Encumbrances

Then, record to Unassigned funds Balance
Unassigned fund balance (surplus)
Fund Balance, Committed

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15
Q

What are the components of reciprocal interfund activity?

A

Loans and Services Provided and Used

  1. Interfund Loans = Loans, but if I can’t get them back, they’re reclassed as transfers. Shown as Due To/Due From, and reported as assets & liabilities.
  2. Interfund Services Provided and Used = Sales and Purchases between funds at market prices. Ex. Water & Sewer.
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16
Q

What are the components of NONreciprocal interfund activity?

A

Transfers and Reimbursements

  1. Interfund Transfers = Displayed as Other Financing Sources. Ex. Payment in lieu of taxes.
  2. Interfund Reimbursements = Payments of one fund on behalf of the other.
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17
Q

What funds report Net Position?

A

Net Position = Equity for IRS-E Funds.

Also, government wide FS

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18
Q

How do you call the equity section for Government funds?

A

Fund Balance (NUCAR)

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19
Q

What are deferred inflows and deferred outflow of resources?

A

When things are recorded before they are measurable and available.

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20
Q

What happens when I have a receivable that is unavailable?

A

I have to record a deferred inflow of resources.

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21
Q

What is the BASE for BAE?

A

Budget Appropriation = Beg Appropriations
(-) Activity = Expenditures
(-) Encumbrances
(=) Available Appropriations = End Appropriations

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22
Q

What are the three categories in which Net Position (equity) must be reported?

A
  1. Net investment in Capital Assets.
  2. Restricted Assets.
  3. Unestricted Assets.
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23
Q

What is the formula for Net Investment in Capital Assets?

A

NBV of FA
(+) NBV of Intangibles
(-) Related Debt
(=) Net Investment in Cap Assets

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24
Q

What is the formula for Total Restricted Net Position?

A 
Restricted Assets
(+) Deferred outflows 
(-) Deferred inflows 
(-) Related Liabilities 
(=) Total Restricted Net Position; always positve! if negative, it reduces Unrestricted Net Position.
25
Q

What is the formula for Unrestricted Assets?

A 
Net Assets 
(+) Deferred outflows, not included in net inv of cap assets, or restricted.  
(+) Deferred inflows, , not included in net inv of cap assets, or restricted. 
(-) Liabilities, not included in net inv of cap assets, or restricted. 
(=) Unrestricted Assets
26
Q

What is the rule and the exception for interfund transfers?

A 
Rule = Interfund transfers are not recorded as revenues or expenditures.
Exception = When there is a transaction between funds that is the same if it would've occured with 3rd parties. i.e. utility bill due from general fund to the enterprise fund, then this generates a expenditure.
27
Q

What is a special revenue fund?

A

A fund that accounts for revenues and expenditures that are legally restricted or commited for specific purposes other than debt service or capital projects.

28
Q

What are the most common special revenue funds?

A
  • Sales tax fund (to operate parks).
  • Specific fees fund (museum admission to operate the museum).
  • Gasoline tax fund (to repair roads).
  • Grant fund (for rehab, or welfare)
29
Q

What are the revenue sources of the General Fund?

A
  1. Taxes (Prop Tax)
  2. Public Safety & Regulation (DPS, Driver’s License, Permits)
  3. Grant revenues (from other govts)
  4. Charges for Services
  5. Other Revenues
30
Q

What are the expenditure types of the General Fund?

A
  1. General Government
  2. Public Safety
  3. Culture and Recreation
31
Q

What are the revenue sources of the Special Revenue Fund?

A

Intergovmt revenue, legally restricted.

  1. Specific Taxes.
  2. Shared Taxes.
  3. Grants, monitoring.
32
Q

What are the expenditure types of the Special Revenue Fund?

A
  1. Current operating expenditures (street maintenance).

2. Capital Outlays (highway construction).

33
Q

What are the revenue sources of the Debt Service Fund?

A

Transfer from other funds, and classified as Other Financing Sources, NOT REVENUE.
Investment Income would be classified as Revenue.

34
Q

What are the expenditure types of the Debt Service Fund?

A
  1. Principal payments

2. Interest payments.

35
Q

What is an special item?

A

Items under control of management that are either unusual or infrequent but not both.

36
Q

What happens when I have an item that is BOTH unusual and infrequent?

A

It is classified as an expenditure, and not as an special item.

37
Q

What are the revenue sources of the Capital Project Fund?

A
  1. Investment Earnings - whatever is not spent, gets invested. Earnings are used according to the law.
  2. Tax Revenue - whenever tax revenue is specially identified for construction.
  3. Capital Grants - recorded as a liability, and earned as they are expended. May be restricted or unrestricted.
  4. General or Special Revenue Fund Transfers
  5. Special Assessments - taxes/fees levied to owners that will directly benefit from project. When the governmental unit is not liable, a custodial fund will be created to account for special assessments.
  6. Bond Issue Proceeds - Other financing sources. No AMTZ on discount/premiums.
    7.
38
Q

What are the expenditure types of the Capital Project Fund?

A 
Just one:  Expenditure - Capital Outlay
Things 2 Know: 
1. Encumbrance accounting is used. 
2. Recorded @: 
- Purchase = Cost
- Construction = Cost to build
- Lease (transfers ownership) = PV lease pmts
- Donated = FV
- Forfeiture = Lower of Acquiring Costs or Market
39
Q

What are the revenue sources of the Permanent Fund?

A

Investment earnings from principals that are legally restricted to generate those earnings and use them to support govmt programs.

40
Q

What are the expenditure types of the Permanent Fund?

A

Operating purpose of the fund. The purpose that the investment earnings were designated to.

41
Q

What are bond anticipation notes?

A

Non-current liabilities, recorded as current liabilities, that the entity does not have the ability to refinance as a non-current liability.

42
Q

How do you record bond proceeds?

A

@ Quoted rate, as Other Financing Sources.

43
Q

How do you record bond issue costs?

A

As Debt Service Expenditures, when they are incurred.

44
Q

How do you report investments in a permanent fund?

A

@ FV

45
Q

What are the 3 criteria that need to be met to make a fund an Enterprise fund?

A
  1. The activity is financed with debt that is secured SOLELY (not partially) by a pledge of net revenue from fees. Basically, I will pay my debt with what I charge to people.
  2. Law and regs require that the operating costs are financed through fees (or at least >50%).
  3. Pricing policy is designed to make money to cover its costs.
46
Q

What is the driver/orientation of proprietary funds?

A

Income determination.

47
Q

What are the amounts that should be included in landfills’ disbrusements?

A
  • Equipment expected to be purchased, or built during operating period and after closure.
  • Cost of cover expected to be applied after closure.
48
Q

What are the revenue sources of the Internal Service Fund?

A
  1. Restricted grant revenues = recognize as spent.
  2. Operating revenues = recognized when earned.
  3. Nonoperating revenues = interest income, etc.
49
Q

What are the expense types of the Internal Service Fund?

A
  1. Operating expenses = related to delivery of services.

2. Nonoperating expenses = interest expense, etc.

50
Q

What are the revenue sources of the Enterprise Fund?

A
  1. Operating revenues = Fees from services sold.

2. Nonoperating revenues = Taxes, fees (non-exchange items), interest income.

51
Q

What are the expense types of the Enterprise Fund?

A
  1. Operating expenses = personal services, utilities, depreciation.
  2. Nonoperating expenses = interest expense, etc.
52
Q

What is the presentation of proprietary funds statement of revenues, expenses, and changed in fund position?

A 
INCASET!
I = Income.
N = Nonoperating income/expense.
C = Contributions.
A = Additions to Endowments.
S = Special items (unusual OR infrequent).
E = Extraordinary items (unusual AND infrequent).
T = Transfers, interfund.
53
Q

What is the tea about landfills?

A

They’re their whole persona!

  • Estimated total current cost of closure and post closure should be disclosed as “to be recognized”,
  • Estimated is adjusted every year, and recognized based on period utilization.
  • At closure, all costs must’ve been recognized.
  • Equipment purchases are not added as assets, but as a reduction of liability.
54
Q

What are contributions to the Internal Service fund?

A

Contributions of capital assets, not cash or funds!

55
Q

What are the characteristics of a fiduciary funds?

A
  1. Assets are not controlled by the government.
  2. Assets are not the government’s own source revenue (recorded as additions).
  3. Assets are not subject to admin involvement by the government.
56
Q

What are the financial statements of the Government Funds?

A
  1. Balance sheet,

2. Statements of Revenues, Expenditures, and Changes in Fund Balance.

57
Q

What are the financial statements of the Proprietary Funds?

A
  1. Statement of Net Position.
  2. Statements of Revenues, Expenses, and Changes in Net Position.
  3. Statement of Cash Flows.
58
Q

What are the financial statements of the Fiduciary Funds?

A
  1. Statement of Fiduciary Net Position.
  2. Statements of Changes in Fiduciary Net Position.
  3. Footnotes.

FAR (12 decks)

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