1 / 19

Chapter 2

Chapter 2. Fund Accounting. Objectives. 1. Learn the funds and category of funds 2. Learn the components of CAFR 3. Review the GASB model . Funds. Funds are fiscal and accounting entities, each is self balancing and separates the different

waldo
Download Presentation

Chapter 2

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Chapter 2 Fund Accounting

  2. Objectives 1. Learn the funds and category of funds 2. Learn the components of CAFR 3. Review the GASB model

  3. Funds Funds arefiscal and accounting entities, each is self balancing and separates the different functions of governments or NFPs. They must adhere to the restrictions imposed by regulators, legislators, or donors. Assets = Liabilities + Fund Balance

  4. Comparisons Governmental Funds Business Financial Resources Economic Resources Modified Accrual & Full Full Accrual Income- measurable Earned and available Expenses- Acquired Incurred

  5. GASB #34 Requirements • Measurement focus on economic resources • Government-wide statements are consolidated statements • Fund statements are combined statements on modified accrual basis

  6. Fund Categories • Governmental funds • General Fund • Special revenue • Capital Projects • Debt Service • Permanent • Proprietary Funds • Enterprise • Internal Service • Fiduciary Funds • Trust • Agency Funds

  7. Governmental Funds Governmental Funds are prepared on a modified accrual basis. This means that recognition of revenue occurs when revenue is measurable and available and costs are recognized when resources are acquired, not when they are consumed.

  8. General Fund • Accounts for all resources • not specific to other funds. • Only one for each governmental • unit

  9. Special Revenue Accounts for revenues restricted to specific purposes like assessments

  10. Capital Projects Accounts for the resources held for the acquisition or construction of major capital projects.

  11. Debt Service Accounts for resources set aside pay interest and principal on long term debt.

  12. Permanent Fund Reports resources that are legally restricted so that only earnings may be used for the purposes of the fund.

  13. Proprietary Funds • These funds use revenue and expense and • accounted for using full accrual methods • Revenues recognized as earned • Expenses recognized as resources consumed • Measurement focus on economic resources

  14. Proprietary Funds • Enterprise funds - accounts for business like activities which sell goods or services to customers • Internal Service Fund - accounts for business like activities which are confined to goods and services within governmental units.

  15. Fiduciary Funds • Trust funds held in trust for parties outside the • governmental unit, such as pension funds, • investment trust funds • Agency funds account only for assets held • temporarily for other parties. • Not on government-wide statements

  16. Fund Fund Measurement BasisType Category Focus Accounting General Gov’t Current Financial Resources Modified Special Rev. Gov’t Current Financial Resources Modified Debt Services Gov’t Current Financial Resources Modified Capital Proj. Gov’t Current Financial Resources Modified Permanent Economic Resources Modified Enterprise Proprietary Economic Resources Full Accrual* Internal Serv. Proprietary Economic Resources Full Accrual* Trust Fiduciary Economic Resources Full Accrual Agency Current Financial Resources Modified * Follows FASB rules

  17. Combining vs. Combined Combining means that all funds of that particular type are displayed and totaled. These totals tie to the column for that fund type on the combined statements in the CAFR where a column shows the total of all of the funds of that type and the account groups. Contrast with consolidated…

  18. Consolidated Consolidated statements, such as appear on the government-wide statements, eliminate interfund transactions. Same concepts as used for consolidated financial statements for corporations.

  19. Review • Know the fund categories and the funds in each category • Know the basis of accounting for the different funds • Know the purpose of each fund

More Related