What are the three major types of funds in governmental accounting?
Governmental, Proprietary, Fiduciary
Which two accounting bases are used in governmental accounting?
Accrual basis - current economic resources focus (revenues recognized when earned) Modified accrual basis - current financial resources focus (revenues recognized when available and measurable)
What is a budget appropriation?
The highest amount allowed for a particular expenditure under a budget.
What is an encumbrance?
Records purchase and reserves it for the encumbrance.
What is the opening budgetary entry?
Dr Estimated Revenues Control Cr Appropriations Control Dr/Cr Budgetary Fund Balance (plug)
What is the closing budgetary entry?
Dr Appropriations Control Dr/Cr Budgetary Fund Balance (plug) Cr Estimated Revenues Control
What are the types of governmental funds?
General Fund Special Revenue Fund Permanent Fund Capital Projects Fund Debt Service Fund
What is a General Fund?
The operating fund of the governmental unit Records Significant Revenues: Taxes; Tickets; Fines; Licenses Records Significant Expenditures: Police; Education; Fire Dept
What is a Special Revenue Fund?
Restricted for a specific purpose such as street repair.
What is a Permanent Fund?
Legally restricted fund; where only earnings can be used to fund programs. Principal remains intact.
What is a Capital Projects Fund?
Used to acquire and build facilities.
What is a Debt Service Fund?
Handles repayment of long-term debt and related interest.
Which fund statements are issued in Governmental Accounting?
Balance Sheet Statement of Revenues; Expenditures; and Changes in Fund Balance
When is Revenue recorded in Governmental Accounting?
When it is BOTH available and measurable; regardless of when it is spent.
What is Derived Tax Revenue?
Money collected from people doing things: Sales tax (buying cars) or income tax (people working)
What is Imposed Tax Revenue?
Tax assessed just because things exist Example: property tax on a car (even if it's never driven); real estate tax Recorded as a revenue when BUDGETED. Estimated uncollectible property tax revenues don't offset revenues; so don't net them.
What are the types of Proprietary Funds?
Internal Service Funds - to serve the needs of other governmental units (i.e. motor pool) Enterprise Funds - provide goods or services to external users (i.e. post office)
What are the Fund Balance Types?
Restricted - Restricted by Contributor Committed - Restricted by Government Assigned - Intended for a purpose Unassigned - Available to be spent Non-spendable - Not in a spendable state
What are the types of Fiduciary Funds?
Agency Fund - government acts as an agent or custodian Pension Trust Fund - Government is a trustee for a pension plan Investment Trust Fund - Government is a trustee over a series of investments Private Purpose Trust - Trust that benefits various individuals and entities
How are Assets & Liabilities presented on the Statement of Net Position?
Assets (Current & Non-Current) Deferred Outflows of Resources Liabilities (Current & Non-Current) Deferred Inflows of Resources
How are Capital Assets shown on a governmental Statement of Net Assets?
They are shown net of debt Asset Cost - Accumulated Depreciation - Asset Liabilities : Net Assets
How is infrastructure reported on a governmental Statement of Net Assets?
Modified approach: Reported at cost; no accumulated depreciation
How is a Statement of Net Assets divided?
Into Governmental Activities and Business Activities
How are activities presented in a Statement of Activities?
They are divided by function If the activities of a component are distinguishable from the rest of the governmental entity; then discreet presentation is required If the activities of the component cannot be identified and separated from the rest of the governmental activities; then blended presentation is warranted. Component units are reported in the Entity-Wide Financial Statements and not the Fund Financial Statements.
What is the primary objective of governmental accounting?
To provide information that is useful and benefits a wide range of users including: Costs of services provided Sufficiency of revenues to cover costs Financial position of entity
What Financial Statements are required for Defined Benefit Pension plans?
Statement of Fiduciary Net Position and Statement of Changes in Fiduciary Net Position
What are the components of the Statement of Fiduciary Net Position for Defined Benefit Pension Plans?
Assets; Deferred Outfows; Liabilities; Deferred Outflows; Fiduciary Net Position
What are the components of the Statement of Changes in Fiduciary Net Position for Defined Benefit Pension plans?
Additions (Contributions and Net Investment Income) - Deductions (Benefits Payments and Admin Expense) : Net Change in Fiduciary Net Position
What should be included in the Financial Statement notes for Defined Benefit Pension Plans?
Types of Benefits; Plan Member Classes; Board Information; Investment Policies and FV Determination