GOV-Combining statements and individual Fund Statements Flashcards
How are internal service funds treated as major funds reporting requiremnts
Major fund reporting requirements do not apply to internal service funds. Therefore, they are usually combined for financial reporting and presented individually with combining statements.
How are fiduciary funds treated on combining fund statements?
Fiduciary fund information should cover all fiduciary funds of a government with a separate column for each fiduciary fund type: pension trust funds, investment trust funds, private-purpose trust funds, and agency funds. A combining statement including all fiduciary funds would not be used. Further, the agency fund does not report a statement of changes in fiduciary net position. It consists only of assets and liabilities that are reported on the financial statement date in the statement of fiduciary net position.
The combing fund statements are:
A
part of the comprehensive financial report but not part of the basic financial statements.
B.
part of both the comprehensive financial report and basic financial statements.
C.
part of the required supplementary information but not part of management’s discussion and analysis.
D.
part of both the required supplementary information and management’s discussion and analysis.
The basic financial statements required of state and local governments report fund financial statements for governmental and proprietary funds, focusing on major funds with nonmajor fund information aggregated or combined. The details of the aggregation of nonmajor funds are shown in the combining fund statements, which are not considered part of the basic financial statements but that are included in the financial section of comprehensive annual financial report. The financial statements are not reported as notes or required supplementary information.
Note:
Major funds are a part of basic F/S
Non major funds are shown in the combining fund statements and are not part of basic F/S
Civic Town has a number of enterprise funds, some reported as major funds in the basic financial statements and some considered as nonmajor funds, reported in aggregated form. One of these nonmajor funds, the Airport fund, accounts for the operations of a small airport used intermittently by hobbyists. Due the requirements of a grant, Airport fund expenses must be reported in more detail than the other nonmajor enterprise funds with which the Airport fund is aggregated. This information can best be shown in the comprehensive annual financial report by:
A.
including the Airport fund in the combining funds statements of the enterprise funds.
B.
adding information about the Airport fund to the required supplementary information.
C.
including the Airport fund in the combining fund statements of governmental funds.
D.
providing schedules supporting Airport fund information.
The question makes it clear that the expense categories in the combining enterprise funds statements are not detailed enough for the grant reporting. The additional detail is not one of the items required as supplementary information. The Airport fund would not be included in the combining fund statements of governmental funds because it is an enterprise fund. The additional detail should be shown in a schedule in order to show compliance with finance-related legal and contractual provisions.
