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
