FAR10 Flashcards
Difference GRaSPP vs SE Cippoe
GRaSPP: BAE-BAE Budget-booked on opposite side Modified accrual No Fixed assets and LTD (expenditures) Focus on current
SE and CIPPOE:
Accrual
Record FA & LTL
Economic Resources measurement focus
Restricted Grand revenue recognized when spend
recognized when spend
Operating revenue recognized when earned
DR Cash (due from other fund) CR Billings to other departments (operating)
Balance sheet Difference Graspp vs SE
GRaSPP: Balance Sheet
- Assets (Current only, no FA)
- Liabilities (No LTD it’s in Statement of Rev, Expenditures and changes in Fund Balance (IS), it in other Financial sources)
- Fund balances (NU CAR)
SE & CIPPOE: Statement of Net Position
-Assets:
Current
Non-current (less AD)
-Liabilities:
Current
Non Current (LTD)
Net position (RUN)
Net investment in capital assets
Unrestricted
Restricted to debt services
SE Proprietary Funds
Internal Service Fund:
Central janitorial departments
Central garages and motor pools
Enterprise Fund:
- Utilities (water, electric)
- Stadium, bond issued paid from tickets proceeds
- Public hospitals
- Public Universities
- Bridge
- Amusement park
- Airport
- Parking lot
Enterprise fund
Revenues:
-Operating
-Non-Operating (Shared Revenues). Collected by one government (taxes) and shared to enterprise fund
Bad Debt Expense is not recognized
Expenses:
Operating
Non-Operating (interest expense)
Extraordinary items only in GASBE
Proprietary funds Statement of revenues, expenses and changes in net position
Income (operating) Non operating income Capital Contributions (Not transfer) Additions to endowments Special items (unusual of infrequent) Extraordinary items Transfers
GRaSP Statement of revenues, expenditures and changes in fund balance
1.Revenues: Taxes Fees Interest 2.Expenditures: Current Capital outlay 3.Excess/Deficiency (Rev-Expend) 4. Other financing sources Transfers Bond proceeds 5. Special Items
Net Change in Fund Balance
Proprietary Cash Flow Statement
- CF from operating activities
- CF from noncapital financing activities
- CF from capital and financing activities
- CF from financing activities
- Reconciliation of Operating income/loss to Net cash provided from Operating Activities
CIPPOE - Fiduciary activities C-Custodial I-Investment fund P-Private purpose POE-Pension & other employee benefits
- Assets controlled by Gov
- Assets are not gov’s own source revenue
- Assets are not subject to admin involvement by gov
Fiduciary funds CIPPOE Fin Statements
BS-Statement of Net position
Assets
Liabilities
Net Position
IS-Statement of change in fiduciary net position
Additions
Deductions
Changes in Net Position
NO Statement of cash flow
Custodial fund Government duties limited to collecting and remitting
Tax collection fund-sales tax, payroll withholding, real estate tax, (tax collected for other government normally held 3 months or less)
Clearance fund
Special assessment
Clearance funds used to accumulate resources with NO MONITORING OR ADMINISTRATIVE INVOLVMWNT
Food stamps, child support, pass through grants
If with MONITORING AND ADMIN INVOVMENT-special revenue fund used
If liable for debt-use capital projects and debt service funds
If not liable AR and Debt Service transactions - in custodial fund
Investment trust fund
Net appreciation/depreciation of FV of Plan Asset, realized/unrealized gains and losses, maintain poll to invest idle cash,, premium/discounts on debt securities NOT AMORTIZED
Private Purpose Trust
Not general public use NOT pension or Investment Escheat property fund Retainage on construction contracts Abandoned deposits
Pension and other employee benefits trust
Service cost (current)
Interest cost
Reduction for return on plan assets
A Prior service cost not AMORTIZED
CIPPOE FS
BS-Statement of fiduciary net position
IS-Statement of changes in fiduciary net position
CAFR requirement
Ten years of economic data
Under GASB 68
The current service costs are expensed with the change in pension liability from modifying actuarial assumptions reflected as deferred outflows on the statement of financial position
Primary Government meet ALL:
Separately
Elected governing body
Legal separate
Fiscally independent
Component unit-blended. ONE is required
Do legal entity test. If entity is not legally separated -it is blended
- The same board as primary government
- Component unit serves primary government exclusively
- Component unit is not a separate legal entity
Discrete presentation
Used when criteria for blended are not met
-Board Not substantially the same
-Not exclusively serve
-IS the legally separate unit
Entity is not financially independent since its budget is approved by the city
Integrated approach required by GASB#34
It includes both government wide and fund FS and reconciliation that integrates these two FS
Which is the measurement focus and basis of accounting for government wide FS?
Focus- Economic resources
Basis of accounting-Accrual
Government wide FS focus on
on Operational Accountability
Fund FS focus on
on Fiscal Accountability
Statistical section of government comprehensive annual financial report distinguished from financial statements
Data covering financial trends-Yes
Fiscal year-Yes
Statistical section includes 10 years of fin and non-fin data
Basic FS of governmental entity
Government wide FS
Fund FS
Notes to FS
Required Reporting
Basic 1-4
- MD&A (Analysis and Performance)
- Gov wide FS (S of net position, S of activities) Incl Internal Service fund
- Fund FS (incl non major Debt service fund)
- Notes to FS
RSI Pensions Budget Infrastructure Other supplemental info (Optional) -Details of non major fund FS ,Variances
Government wide FS
Statement of Net Position (RS) Assets (including Capital A) Deferred Outflows of Resources Liabilities Deferred inflows of resources Net Position R (Restricted) U (Unrestricted) N (Net investment in Capital Asset)
Disclose in Supplemental Info modified approach not to depreciate
Categories of program revenue
Services (charges)
Operating grants
Capital grants
For differences between fund financial statement fund balances and government wide financial statement net position related to measurement focus:
- Add governmental fund balances.
- Add assets used in governmental activities NET of accumulated depreciation.
- Subtract liabilities (long-term) not recorded on the fund financial statements.
- Add/subtract internal service fund net position.
In government wide FS asset capitalized to governmental activity
Lower of cost or market value
Estimated current cost of closure and post closure care should be reported as a reduction of liability
and not reported as asset
Statement of cash flow issued only for Proprietary funds (Enterprise and Internal Service)
NO STATEMENT OF CASH FLOW for GRASPP and Fiduciary funds
FS should be presented by major funds. Major Fund Test:
Major fund rules:
-Fund balance/Equity is not used
=General fund is always major
-Internal Service Fund is not major fund
10% Test:
-Separate columns >10% (less) compare to Governmental or Enterprise
totals
-Total columns >5%(more). Total GRASPP+SE
General fund asset is always Major fund even if it doesn’t meet test %
Proprietary Funds
- Cashflow from Operating Activities: sales, outflows to employees, inflow from interfund reimbursement, PAYMENTS IN LIEU OF TAX
- Cash flow from Non-Capital financing:
issuing debt for non capital purpose, Property Tax not for capital purpose, Operating transfers
3.Capital and Related Financing activities:
issuing debt for capital activities principal paid + interest expense; Capital grants; all about capital assets
4.Investing Activities. Loans to others+Interest income. Equity transactions.
Cash flow Proprietary funds
- Direct method
- Reconcile Operating income
- 4 Categories: Operating, Capital financing, Non-Capital financing, Investing activities (reversed order)
- Interest income-Investing activities
- Interest Expense-financing Capital/Non capital
- Capital asset purchase, Bonds Issued-financing activities
- Include depreciation and change in current assets/liabilities
- Do not include Gains and Losses
Proprietary fund cash flow reconciliation
Operating income
-Increase in Current Assets
+Increase in Current Liabilities (net of change in Debt)
+Depreciation
Under the modified approach to capitalizing infrastructure government apply the following principles to record current year additions
Under modified approach infrastructure expenditures are reported as expenses except for outlays that result in additions or improvements. WHICH WOULD BE CAPITALIZED.
NET POSITION IN GOVERNMENT WIDE FS
FUND BALANCE GOVERNMENT FUNDS
+Capital assets used in governmental activities
-Accumulated depreciation
-Non current debt for governmental activities
+S internal service fund net position
Reconciliation of BS of Governmental Funds to the Statement of Net Position (Governmental wide FS)
Prior Year
JE “deduction”
DR Net position
CR Depreciation
DR Net Position
CR LTD
Total governmental fund balance \+Capital Asset -Accumulated depreciation -Non current liabilities (Principle payment) \+Deferred inflows \+Service fund net position \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Net position from governmental activities
Reconciliation of Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental funds to the Statement of Activities (IS) Find out what was an expense (IS) and what belongs to (BS)
Current Year
DR LTD
CR Principle Payment (expenditures)
DR Deferred outflows
CR Tax Revenue
DR Interest Expense
CR Accrued Interest Payable
Net change in fund balance-Total Gov Fund \+Capital outlay \+Principal payment on debt (GRASPP-Principal and Interest-expensed) in Gov wide we don't expense principle but reduce LTD -Asset NBV disposed (land sold, gain on sale, cost of land sold) -Sources (other financing)-bond proceeds \+Revenues not available yet -Interest expense accrual -Depreciation Expense Consolidation Entry: \+Service (Internal service fund revenue) Inter-fund Transfers
Accumulated Depreciation adjustment
Always gross, do not consider Tax
Major Government Funds
10% of funds in the category + 5% of total fund Balance
County issued bond on premium to finance capital project
Transaction s/b accounted for in capital project fund, debt service fund and as assets and liabilities in gov wide FS
