Chapter 10 Flashcards
(28 cards)
endowment requires
that the principal is preserved forever
nonexpendable
a donation with a stipulation that only earnings can be used, not the principal or corpus
term endowment
is one that the principal can be expended after a specified period of years
Expendable trust funds
can spend the principal and the interest earnings
Permanent funds
are governmental funds used to account for nonexpendable resources that benefit activities of the government itself
Fiduciary funds are
maintained to account for assets that governments hold as trustees or agents for individuals, private organizations or other governmental units
Basis of accounting for fiduciary funds
full accrual
Basis of accounting for permanent funds
modified accrual
Types of Fiduciary funds
private purpose trust funds
investment trust funds
pension trust funds
Agency funds
private-purpose trust funds
moneis held for the benefit of an entity, government or person outside of the governmental entity.
investment trust funds
pooled investments for smaller governmental entities to take advantage of economies of scale
pension trust funds
defined benefit-pension benefit is formula based
defined contribution-pension benefit is based on investment earnings
Agency funds
the governmental enitity acts as an agent, transacting business on others behalf
Fiduciary funds required Financial Statemtents
Statement of fiduciary net assets
Statement of changes in fiduciary net assets
GASB Standards require note disclosures relating to (pension fund)
plan description and funding policy (including annual cost and components of annual cost)
trends in annual cost and NPO
Additional data that must be provided as part of required supplemental disclosures
annual pension cost
calculated amount of the employers’periodic cost
annual required contributions (arc)
employers required contribution to a defined benefit pension plan, calculated in accordance with certain parameters
actuarial deficiencies (excesses)
difference between teh annual required contributions and the actual contributions
Net Pension Obligation
NPO
NPO
Vumulative difference measured from the effective date of the new statement between;
annual pension cost and employers contributions and any transition pension liabilitye and excluding
short term differences and unpaid contributions that have been converted to pension-related debt
ARC
Annual Required Contribution
Annual Required Contribution is calculated
each period and consists of the following 2 components
- actuarial PV of total projected benefits-normal costs
- amortization of unfunded actuarial accrued liability
Employer pension expenditures/expense may include one or both of the
arc contributions and/or payments of pension-related debt
Internal service funds account for
activities
