12/3 Class Chapter 17

Question 1

governmental entities

Answer 1

5. accountability for the flow of financial resources is a chief objective
6. typically required to establish separate funds to carry out various missions; each fund is an independent accounting and fiscal entity
   7.

Question 2

GASB

Answer 2

created in 1984

no authority to establish GAAP for governmental entities

Question 3

GFOA

Answer 3

interpretations of GAAP for governmental entities

Question 4

elements of a statement of financial condition

Answer 4

1. assets - resources with present service capacity that the entity presently controls
2. liabilities - present obligations to sacrifice resources that the entity has little or no discretion to avoid
3. deferred outflow of resources is a consumption of net assets that is applicable to a future reporting period
4. deferred inflow of resources is an acquisition of net assets that is applicable to a future reporting period
5. net position the residual of all other elements presented in a statement of financial condition(owners equity)

Question 5

measurement focus

Answer 5

governmental entities

changes in current financial resources available to provide services to the public in accordance with the budget

Question 6

method of accounting(gov entities)

Answer 6

modified accrual method

Question 7

balance sheet

Answer 7

reports only current assets, current liabilities, and fund balance

Question 8

governmental funds

Answer 8

do not resemble commercial activities

Question 9

proprietary

Answer 9

these activities resemble commercial activities. Can measure profitability or capital maintenance

Question 10

fiduciary

Answer 10

holding and managing assets owned by others(ex: pension assets)

Question 11

fund accounting

Answer 11

accounting for certain activities separately from all other operations

Question 12

fund definition

Answer 12

……

Question 13

general fund

Answer 13

the main and largest fund records most routine transactions

Question 14

governmental funds

Answer 14

have a fund balance(difference between assets and liab)

Question 15

proprietary and fiduciary

Answer 15

net assets(difference between assets and liab)

Question 16

general fund

Answer 16

largest fund, accounts for all financial resources except for those accounted for in another fund

Question 17

special revenue fund

Answer 17

accounts for proceeds of specific revenue sources that are restricted fro specified purposes

Question 18

capital projects fund

Answer 18

accounts for financial resources for the acquisition or construction of major assets

Question 19

debt service fund

Answer 19

accounts for the accumulation of resources for and the payment of general long term debt

Question 20

permanent fund

Answer 20

accounts for resources that are restricted such that only earnings not principal may be used in support of governmental programs

Question 21

proprietary fund types

Answer 21

enterprise funds - accounts for operation of governmental units that charge for services provided to the general public
internal service fund - accounts for the financing of goods or services provided by one department or agency to other departments or agencies of the governmental unit. Services are offered only to governmental agencies.
these use accrual accounting more for profit

Question 22

fiduciary fund types and similar component titles

Answer 22

pension - held in trust for others
investment trust fund - accounts for the external portion of investment pools reported by the sponsoring government
private purpose trust fund - accounts for all other trust arrangement under which the funds are to be used to benefit specific individuals, private organizations, or other governments
agency fund - accounts for assets held by governmental unit in an agency capacity for employees or for other governmental units. Generally short term
they use accrual, net assets

Question 23

governmental funds financial statements

Answer 23

balance sheet
statement of revenues, expenditures and changes in fund balance
use current financial reports

Question 24

government fund

Answer 24

Fund balance:
spendable
nonspendable

Question 25

fiduciary fund

Answer 25

Net Assets: restricted unrestricted

Question 26

he will post his version of chapter 17

Answer 26

look at it

Question 27

example of balance sheet in slides

Answer 27

look at it

Question 28

example of statement of revenues, expenditures and changes in fund balance

Answer 28

measurable and available revenues, you have to know it often called the operating statement of the governmental funds revenues are measurable and available funds focuses on the net change in the fund balance similar to a cash flow statement we don't have to build one, but we have to understand its components

Question 29

modified accrual basis

Answer 29

revenues recognize in the period they are available | expenditures: recognize in the accounting period due

Question 30

recognition of revenue

Answer 30

depends on the category 1. derived tax revenues, resulting from assessments on exchange transactions(sales tax) the asset is recognized when the underlying transaction occurs or resources are received whichever comes first revenue recognition depends on the accounting basis used to measure the transaction 2. imposed nonexchange revenues resulting from assessments on nongovernmental entities, including individuals(property tax) the asset is recognized when the government has an enforceable legal claim to the resources or the resources are received, whichever comes first.

Question 31

adjustment

Answer 31

revenue | allowance account/reserve

Question 32

budgets

Answer 32

we will not be tested on budgets but we should know them

Question 33

encumbrances lapse at year end

Answer 33

know this if i set up an encumbrance at the end of the year, the way it has to happen is that expense has to go through the next year we won't be tested on this

Question 34

consumption method

Answer 34

the preferred method it parallels business practice | the use of inventory is treated as an outflow of resources

Question 35

purchase method

Answer 35

......

Question 36

fixed assets governmental funds

Answer 36

not on the books recognized as an expenditure in the year it was acquired

Question 37

fixed assets proprietary funds

Answer 37

account for acquisition of capital assets in the same manner as commercial entities

Question 38

investments

Answer 38

fair value

Question 39

look at the slide for

Answer 39

entitlement receivables look at the problem on the slides