State And Local Gov Concepts Flashcards
Primary authoritative body for government
Governmental Accounting Standards Board (GASB)
Primary intended users of governmental financial statements
Citizens/taxpayers, school boards, and investors and creditors. Internal users are not considered primary users
2 most important concepts of government financial reporting are:
Accountability
Inter-period equity
Inter-period equity
Having current-year revenues cover current-year expenditures, so that future taxpayers don’t end up paying for benefits provided to current taxpayers.
6 characteristics of effective financial reporting
Understandability Reliability Relevance Timeliness Consistency Comparability
5 elements of the statement of financial position
Assets Liabilities Deferred inflow of resources Deferred outflow of resources Net position (not net assets, not equity)
4 financial reporting implications
Expression of public policy
Expression of financial intent
Form of control
May provide basis for evaluating performance
Measurement focus of accounting for governmental accounting
For government fund accounting
For proprietary fund accounting
For government fund accounting
Modified accrual basis is used, and the measurement focus is the flow of current financial resources. The idea is to show the extent to which financial resources obtained in the period are sufficient to cover claims against financial resources.
Modified accrual accounting
Revenues are recorded when they are measurable and available.
Accrual accounting
Revenues are recorded when measurable and earned- this is a key difference
For proprietary fund accounting
The accrual basis is used and the measurement focus is the flow of economic resources.
3 categories of funds
Governmental funds
Proprietary funds
Fiduciary funds
Governmental funds
These accounts for the sources and balances of general government financial resources, uses modified accrual accounting
Proprietary funds
Accounts for business-type activities, uses accrual accounting
Fiduciary funds
Accounts for resources held by a government as a trustee or agent for the benefit others, uses accrual accounting
Governmental funds
General fund Special revenue funds Capital project funds Debt service funds Permanent funds
General fund
This accounts for everything not required to belong in another type of fund
Special revenue funds
These account for revenue sources that are restricted or committed to be spent for specific purposes other than debt service or capital projects
Capital project funds
Funds that are restricted for construction or acquisition of capital facilities
Debt service funds
Funds restricted or committed for debt service principal and interest expenditures
Proprietary funds
Enterprise funds
Internal service funds
Enterprise funds
Accounts for business type activities that the public is the primary user of
Internal service funds
Business type activities where other government agencies are the primary user
Fiduciary funds
Custodial funds
Pension trust funds
Private purpose trust funds
Investment trust funds
Custodial funds
Assets held briefly then distributed such as special assessments, tax collection, or payroll deductions
Pension trust funds
Assets held in trust to provide employee retirement benefits
Private purpose trust funds
Assets held in trust to benefit individuals
Investment trust funds
Accounts for assets held in trust for other governments
