GOV-Net position and components

Question 1

I.council actions (not imposed by law) to set aside “reserves” for special purposes.
II.debt covenants requiring resources to be set aside.
III.enabling legislation identifying certain resources to be used for specific purposes.

Restrictions of net position should be displayed on the face of the financial statements for the following:

Answer 1

net position should be reported as restricted if use is constrained either by externally imposed conditions such as from creditors or grantors, or by legislation. The council’s actions do not constitute external constraints or enabling legislation.

Keyword must be constrained by EXTERNAL sources!!

Question 2

Which of the following types of fiduciary funds should not be reported in the statement of changes in fiduciary net position?

Answer 2

Agency funds only report net position, not changes in net position

Question 3

“net investment in capital assets,” at an amount calculated as:

Answer 3

the total of capital assets less depreciation and outstanding mortgages or bonds reduced by any significant unspent proceeds.