chapter 19 n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Not-for-Profit Entities PowerPoint Presentation
Download Presentation
Not-for-Profit Entities

Loading in 2 Seconds...

play fullscreen
1 / 82

Not-for-Profit Entities - PowerPoint PPT Presentation


  • 126 Views
  • Uploaded on

Chapter 19. Not-for-Profit Entities. Learning Objective 1. Understand financial reporting rules and make basic journal entries for private, not-for-profit entities. Types of Not-for-Profit Organizations. Colleges and Universities Health Care Organizations

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Not-for-Profit Entities' - malha


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.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
learning objective 1
Learning Objective 1

Understand financial reporting rules and make basic journal entries for private, not-for-profit entities.

types of not for profit organizations
Types of Not-for-Profit Organizations
  • Colleges and Universities
  • Health Care Organizations
  • Voluntary Health and Welfare Organizations
  • Certain (or “all other”) Not-for-profit Organizations
excluded entities
Excluded Entities
  • The following entities are not NPOs because they solely serve the economic interests of their owners, members, participants, or trust beneficiaries:
    • Credit unions and mutual banks
    • Employee benefit and pension plans
    • Mutual insurance companies
    • Farms and rural cooperatives
    • Trusts
characteristics of npos
Characteristics of NPOs
  • No outside ownership interest
  • A mission to provide services
    • To their users, patients, society as a whole, or members
    • But NOT at a profit
  • A dependence on significant levels of contributions
  • A significant level of assets that are restricted as to use because of donor stipulations
  • Tax-exempt status.

IRS Form 990, 990A, or 990PF

dependence on contributions and federal funding
Dependence on Contributions and Federal Funding
  • Not-for-profit religious, charitable, and educational groups receive roughly $40 billion annually in federal government grants.
tax exempt status
Tax-Exempt Status
  • Advantages to Tax-Exempt Status for U.S. Income Tax Reporting Purposes (in most states):
    • No state income tax
    • No local property taxes
    • No sales taxes on purchases
tax exempt status1
Tax-Exempt Status
  • Private NPOs are exempt from U.S. income taxes if the NPO:
    • Serves some common good.
    • Does not make an accounting profit.
    • Does not primarily benefit its own executives.
    • Does not function for political purposes.
tax exempt status2
Tax-Exempt Status
  • IRS Audits of Tax-Exempt Groups:
    • Annually, the IRS audits approximately 11,000 of the 1.2 million tax-exempt groups.
    • The IRS assesses taxes & penalties of over $100 million per year.
    • Such taxes are on business-related income (which is taxable at the highest corporate rate).
differences between npos and businesses
Differences between NPOs and Businesses
  • Revenues and support are often compared to expenses. However, remember that
    • Expenses are incurred to provide services (rather than to generate revenues as in commercial accounting).
    • The purpose of NPOs is not to maximize return on an ownership interest.

ROE = Not Applicable

the reporting model private npos
The Reporting Model: Private NPOs
  • The reporting model
    • Focuses on the flow of all economic resources
    • Uses the accrual basis of accounting
    • Recognizes depreciation expense in the operating statement
  • The use of this reporting modelreveals
    • The improvement or deterioration in the NPO’s financial condition for the period and
    • Is similar to the model used in the commercial sector
who makes the rules for not for profits entities
Who Makes the Rules for Not-for-Profits Entities?

The accounting and financial reporting for governmental not-for-profit entities

GASB

Accounting and financial reporting for nongovernmental not-for-profit entities

FASB

financial reporting for private not for profit entities
Financial Reporting for Private,Not-for-Profit Entities
  • Private, not-for-profit entities must report their net assets in accordance with FAC 6.
  • FAC 6 specifies three mutually exclusive classes of net assets:
    • Unrestricted net assets
    • Temporarily restricted net assets
    • Permanently restricted net assets
financial reporting for private not for profit entities1
Financial Reporting for Private,Not-for-Profit Entities
  • Important FASB Standards
    • SFAS 93 guides depreciation
    • SFAS 116 guides accounting for contributions
    • SFAS 117 establishes financial display requirements
    • SFAS 124 establishes the accounting for investments
    • SFAS 136 guides the accounting for transfers of assets to a not-for-profit organization that raises or holds contributions for others
financial reporting for private not for profit entities2
Financial Reporting for Private,Not-for-Profit Entities
  • Some not-for-profit entities use a fund structure to account for each type of net asset class.
  • Other not-for-profit entities maintain only an accounting record to show the amounts in each net asset class.
    • The specific identification of any restricted asset must be made when the asset comes into the entity, generally by donation or bequest.
financial reporting for private not for profit entities3
Financial Reporting for Private,Not-for-Profit Entities
  • Mergers and acquisitions—Exposure drafts
  • The proposed standards
    • Require the recognition of identifiable assets acquired and liabilities assumed at their fair values at the date of the acquisition
    • Require that intangible assets other than goodwill and goodwill be assigned to reporting units that are acquired
    • Approaches to evaluating goodwill impairment
      • Qualitative Evaluation Method
      • Fair-Value-Based Evaluation
contributions scope of fas 116
Contributions: Scope of FAS 116
  • FAS 116, “Accounting for Contributions” applies to ALL 4 types of Private NPOs.

FASB 116

Health Care Organizations

Colleges and Universities

Voluntary Health and Welfare Organizations

Certain Other NPOs

contributions defined
Contributions: Defined
  • Contribution
    • An unconditional (no strings attached) transfer of
      • Cash or
      • Other Assets
    • In a voluntary, nonreciprocal transfer.
    • By a person or entity acting other than as an owner of the NPO

Examples of Other Assets: Equipment,

vehicles, land, and promises of cash.

contributions promises promises
Contributions: “Promises, Promises”
  • “Unconditional transfers” include “unconditional promises” to give cash or other assets in the future.
  • Promises may be
    • Oral or
    • Written
  • Unconditional promises result in reporting “Contributions Receivable” in the balance sheet (subject to an allowance for uncollectibles).
contributions recognizing unconditional promises
Contributions: Recognizing Unconditional Promises
  • Recognizing unconditional promises in the financial statements requires
    • having sufficient evidence
    • in the form of verifiable documentation
    • that a promise was made
contributions conditional promises to give
Contributions: “Conditional” Promises to Give
  • Conditional promises
    • The conceptual opposite of unconditional promises to give
    • Not contributions (as defined by FAS 116)
    • Depend on the occurrence of a specified future and uncertain event that
      • Must occur to bind the promissor and
      • Thus transform the promise from conditional to unconditional status.
contributions conditional promises that may be deemed unconditional
Contributions: “Conditional” Promises That May Be Deemed “Unconditional”
  • A conditional promise may be deemed unconditional if:
    • “The possibility that the future event will not be met [occur] is remote.”

Event not likely to occur = Conditional

Event likely to occur = Unconditional

contributions conditional use of assets received
Contributions: “Conditional” Use of Assets Received
  • If assets have been received and the retention and use of such assets is conditional upon a future event that is not likely to occur,
    • The offsetting credit is to a Refundable Advance account (a liability)
    • Until the conditional event occurs.
contributions manner of reporting by category
Contributions: Manner of Reporting By Category
  • Contributions are reported in the Statement of Activities (the operating statement)by category
    • Unrestricted
    • Temporarily restricted
    • Permanently restricted
contributions manner of reporting by category1
Contributions: Manner of Reporting By Category
  • Donor-restricted contributions whose conditions are fulfilled in the same period in which the contribution is recognized
    • May be reported in the unrestricted category of the operating statement (O/S) if the entity:
      • Consistently follows this policy and
      • Discloses this policy.

Note: This option negates the need to show transfers between categories in the Operating Statement.

contributions endowments
Contributions: Endowments
  • Endowments
    • A contribution that cannot be spent.
    • The unspendable amount is called the principal—it is invested in perpetuity.
  • Income on Endowments
    • Donor stipulations dictate the reporting classification (unrestricted, temporarily restricted or permanently restricted).
contributions temporary restrictions
Contributions: Temporary Restrictions

Contributed Assets

that are restricted as to either

or

Purpose

Time Period

Temporarily Restricted Assets

are classified as

contributions expirations of restrictions
Contributions: Expirations of Restrictions
  • Manner of Reporting Expirationsof Restrictions:
    • Where: In the statement of activities.
    • How: As a separate line item reclassification as shown below.
    • Temporarily
    • Unrestricted Restricted
  • Expirations of restrictions $77,000 $(77,000)
contributions delayed discussion of additional issues
Contributions: Delayed Discussion of Additional Issues
  • The following issues
    • Are covered after we discuss FAS 117 “Financial Statements of Not-for-Profit Organizations”
    • So that you may more readily see the close interrelation-ship that exists between FAS 116 and FAS 117.
      • Valuation
      • Contributed services
      • Collection items
financial statements scope of fas 117
Financial Statements: Scope of FAS 117
  • FAS 117, “Financial Statements of Not-for-profit Organizations” applies to ALL 4 types of Private NPOs.

FASB 117

Health Care Organizations

Colleges and Universities

Voluntary Health and Welfare Organizations

Certain Other NPOs

financial statements fas 117 the basic requirements
Financial Statements: FAS 117—The Basic Requirements
  • FAS 117 specifies:
    • What financial statements are to be presented.
    • What specific information, as a minimum, is to be shown.
financial statements which financial statements
Financial Statements: Which Financial Statements
  • FAS 117 requires for the NPO as a whole:
    • A Statement of Financial Position
    • A Statement of Activities
    • A Statement of Cash Flows.
  • VH&WOs must also report
    • In a separate statement
    • Expenses by Natural Classification in a matrix format.
financial statements the three classifications of net assets
Financial Statements: The Three Classifications of Net Assets
  • The three mandated classifications of net assets are:
    • Unrestricted.
    • Temporarily restricted.
    • Permanently restricted.
  • Note that these are the same three classifications used for reporting contributions.
contributions additional issues
Contributions: Additional Issues
  • Contributions of monetary and nonmonetary assets are valued at the fair value of the assets received.
  • Determining the fair value may require
    • Obtaining quoted market prices.
    • Using independent appraisals.
    • Using other appropriate methods.
contributions additional issues1
Contributions: Additional Issues
  • Use of Present Value Procedures:
    • Can use for estimated future cash flows on unconditional promises to contribute that are expected to be collected over a period of longer than one year.
    • If used, subsequent recognition of the interest element is reported as contribution income—not as interest income.
contributions additional issues2
Contributions: Additional Issues
  • Contributed Services
    • Recognize as revenues only if:
      • Nonfinancial assets are created or enhanced.
      • Specialized skills are provided by individuals possessing these skills (e.g., carpenters, electricians, plumbers, lawyers, CPAs).
  • Required Disclosures for Contributed Services:
    • A description of the nature and extent
    • The amounts recognized as revenues
    • The programs or activities in which the services were used
contributions additional issues3
Contributions: Additional Issues
  • Contributed Services:
    • Recognizable contributed services are usually recorded as revenues at the fair value of the services contributed.
    • Allowed alternative valuation method for the creation or enhancement of nonfinancial assets:
      • May value at the fair value of
        • the asset created or
        • asset enhancement
contributions additional issues4
Contributions: Additional Issues
  • “Collection items” (the exception):
    • Consist of contributed works of art, historical treasures, and similar assets.
    • Need not be recognized in the financial statements if three conditions are satisfied [how used, how cared for, and use of proceeds upon sale].
    • Cannot be capitalized on a selective or arbitrary basis.
practice quiz question 1
Practice Quiz Question #1

How do not-for-profit entities differ from for-profit businesses:

a. Not for profit entities are prohibited from charging more than cost for goods or services provided while for-profit businesses may include a mark up.

b. Both for-profit businesses and not-for-profit organizations are tax exempt.

c. Not-for-profit entities rely heavily on contributions and grants while for-profit businesses rely on profitable operations for survival.

learning objective 2
Learning Objective 2

Understand financial reporting rules and make basic journal entries for

not-for-profit colleges and universities.

colleges and universities
Colleges and Universities
  • Special conventions of revenue and expenditure recognition
    • Tuition and fee remissions/waivers and uncollectible accounts
      • The full amount of the standard rate for tuition and fees is recognized as revenue
      • Accounting for university-sponsored scholarships, fellowships, tuition and fee remissions or waivers depends on whether the recipient provides any services to the university
colleges and universities1
Colleges and Universities
  • Special conventions of revenue and expenditure recognition
    • Tuition and fee reimbursements for withdrawals from coursework
      • Accounted for as a reduction of revenue
    • Academic terms that span two fiscal periods
      • Accounted for as revenue in the fiscal year in which the term is predominantly conducted, along with all expenses incurred
      • NACUBO recommended the use of the accrual basis of accounting
colleges and universities2
Colleges and Universities
  • Board-designated funds
    • The board may designate unrestricted current fund resources for specific purposes.
    • FASB 117 specifies that these funds may not be reported as restricted net assets because only external, donor-imposed restrictions can result in restricted net assets.
colleges and universities3
Colleges and Universities
  • Public colleges and universities
    • Accounting and reporting is specified by the GASB.
    • GASB 35 requires that they follow the standards for governmental entities as specified in GASB 34.
    • Most public institutions will be special-purpose government entities engaged in only business-type activities.
    • These entities present only the financial statements required for enterprise funds and then are included as component units of the state government.
colleges and universities4
Colleges and Universities
  • Private colleges and universities
    • The FASB specifies the accounting and financial reporting standards.
    • The three financial statements required are:
      • The Statement of Financial Position
      • The Statement of Activities
      • The Statement of Cash Flows
    • They are free to select any account structure that best serves their management and financial reporting needs.
colleges and universities5
Colleges and Universities

Overview of the Accounting and Reporting of Colleges and Universities

colleges and universities6
Colleges and Universities

Overview of the Accounting and Reporting of Colleges and Universities

practice quiz question 2
Practice Quiz Question #2

Which of the following statements accurately describes differences between the accounting public and private universities?

Both public and private universities follow FASB rules.

Both public and private universities follow GASB rules.

Public universities follow GASB rules while private universities follow FASB rules.

Public universities follow FASB rules while private universities follow GASB rules.

learning objective 3
Learning Objective 3

Understand financial reporting rules and make basic journal entries for

not-for-profit health care providers.

health care providers
Health Care Providers
  • Hospital accounting
    • Investor-owned hospitals provide the same types of financial reports as commercial entities.
    • Not-for-profit hospitals present their financial results using a specific format required by the FASB.
    • Governmental hospitals follow the GASB’s accounting and reporting requirements and are considered special-purpose entities engaged in business-type activities.
health care providers1
Health Care Providers
  • Hospital fund structure
    • Although not required to do so, many hospitals have used a fund accounting structure for accounting purposes.
    • Operating activities are carried on in the general fund, and a series of restricted funds can be used to account for assets whose use has been restricted by the donor.
health care providers2
Health Care Providers

Overview of the Hospital Accounting and Reporting

health care providers3
Health Care Providers
  • Financial statements for a not-for-profit hospital
    • Separate, not-for-profit hospitals issue four basic financial statements
      • The Balance Sheet
      • The Statement of Operations
      • The Statement of Changes in Net Assets
      • The Statement of Cash Flows
health care providers4
Health Care Providers
  • Not-for-profit hospital: The Balance Sheet
    • Presents the total assets, liabilities, and net assets of the organization as a whole
  • Major accounts
    • Receivables
    • Investments
      • Initially recorded at cost if purchased or at fair value at the date of receipt if received as a gift
    • Plant assets
      • Property, plant, and equipment reported with any accumulated depreciation
health care providers5
Health Care Providers
  • Not-for-profit hospital: The Balance Sheet
    • Assets whose use is limited
      • Separate disclosure should be made for assets that have restrictions placed on their use
    • Long-term debt
      • The hospital must also account for its long-term debt and pay the principal and interest as it becomes due
    • Net Assets
      • Unrestricted net assets available
      • Temporarily restricted net assets available for use
      • Permanently restricted net assets
health care providers6
Health Care Providers
  • Not-for-profit hospital: The Statement of Operations
    • Also often termed “the statement of activities”
    • Includes the revenues, expenses, gains and losses, and other transactions affecting the unrestricted net assets during the period
    • Only general fund transactions are reported
    • Should report an operating performance indicator
health care providers7
Health Care Providers
  • Not-for-profit hospital: Major accounts in The Statement of Operations
    • Net patient service revenue
    • Contractual adjustments
    • Income from ancillary programs
    • Interfund transfers
    • General fund expenses
    • Donations
health care providers8
Health Care Providers
  • Not-for-profit hospital: The Statement of Changes in Net Assets
    • It presents the changes in all three categories of net assets
      • Unrestricted
      • Temporarily restricted
      • Permanently restricted
  • Statement of Cash Flows
    • Its format is similar to that for commercial entities
health care providers9
Health Care Providers
  • Summary of hospital accounting and financial reporting
    • Major operating activities take place in the general fund.
    • The restricted funds are holding funds that transfer resources to the general fund for expenditures upon satisfaction of their respective restrictions.
    • General fund uses the accrual basis of accounting.
    • Patient services revenue is reported at gross amounts measured at standard billing rates.
health care providers10
Health Care Providers
  • Summary of hospital accounting and financial reporting
    • A deduction for contractual adjustments is then made to arrive at net patient services revenue.
    • Other revenue is recognized for ongoing nonpatient services.
    • Charity care services are presented only in the footnotes; no revenue is recognized for them.
health care providers11
Health Care Providers
  • Summary of hospital accounting and financial reporting
    • Operating expenses in the general fund include depreciation, bad debts, and the value of recognized donated services that are in support of the basic services of the hospital.
    • Not all donated services are recognized.
    • Donated property and equipment are typically recorded in a restricted fund until placed into service, at which time they are transferred to the general fund.
    • Donated assets are recorded at fair values at the date of gift.
practice quiz question 3
Practice Quiz Question #3

Which of the following is false with respect to not-for-profit hospital accounting?

  • Not-for-profit hospitals follow FASB rules.
  • Not-for-profit hospitals usually use fund accounting.
  • Not-for-profit hospitals do not prepare a statement of cash flows.
  • The general fund of not-for-profit hospitals uses the accrual basis of accounting.
learning objective 4
Learning Objective 4

Understand financial reporting rules and make basic journal entries for not-for-profit voluntary health and welfare organizations.

voluntary health and welfare organizations
Voluntary Health and Welfare Organizations
  • Voluntary health and welfare organizations (VH&WOs) provide a variety of social services
    • They solicit funds from the community at large and typically provide their services for no fee.
    • VH&WOs are typically audited.
    • The federal government normally provides them tax-exempt status.
voluntary health and welfare organizations1
Voluntary Health and Welfare Organizations
  • Accounting for a VH&WO
    • Similar to other not-for-profit organizations except for special financial statements that report on the important aspects of VH&WOs.
    • The accrual basis of accounting is required.
    • VH&WOs have been free to use fund accounting in their accounting and reporting processes.
voluntary health and welfare organizations2
Voluntary Health and Welfare Organizations
  • Financial statements for a VH&WO
    • Statement of Financial Position
    • Statement of Activities
    • Statement of Cash Flows
    • Statement of Functional Expenses
  • The statements are designed primarily for those who are interested in the organization as “outsiders.”
voluntary health and welfare organizations3
Voluntary Health and Welfare Organizations
  • The Statement of financial position for a VH&WO
    • Major balance sheet accounts:
      • Pledges from donors
      • Investments
      • Land, buildings, and equipment
      • Liabilities
      • Net assets
voluntary health and welfare organizations4
Voluntary Health and Welfare Organizations
  • Statement of activities
    • The overall structure of the statement of activities for voluntary health and welfare organizations and other not-for-profit entities should be very similar as a result of FASB 117.
voluntary health and welfare organizations5
Voluntary Health and Welfare Organizations
  • Statement of activities
    • Public support
      • The primary source of funds is likely to be contributions from individuals or organizations that do not derive any direct benefit from the VH&WO for their gifts.
    • Revenues
      • Funds received in exchange for services provided or other activities
    • Gains
      • Gain or loss on sale of investments and other assets
voluntary health and welfare organizations6
Voluntary Health and Welfare Organizations
  • Statement of activities
    • Donated materials and services
      • Should be recorded at fair value when received
    • Expenses
      • Information about the major costs of providing services to the public, fund-raising, and general and administrative costs
    • Costs of informational materials that include a fund-raising appeal
      • Many VH&WOs prefer to classify such costs as program rather than fund-raising
voluntary health and welfare organizations7
Voluntary Health and Welfare Organizations
  • Statement of Cash Flows
    • The format of this statement is similar to that for hospitals.
  • Statement of Functional Expenses
    • Details the items reported in the expenses section of the statement of activities
voluntary health and welfare organizations8
Voluntary Health and Welfare Organizations
  • Summary of Accounting and Financial Reporting for VH&WOs
    • Reporting requirements are specified in FASB 116, FASB 117, and the AICPA Audit and Accounting Guide for Not-for-Profit Organizations.
    • The accrual basis of accounting is used.
    • Primary activities are reported in the unrestricted asset class.
voluntary health and welfare organizations9
Voluntary Health and Welfare Organizations
  • Summary of Accounting and Financial Reporting for VH&WOs
    • Resources restricted by the donor for specific operating purposes or future periods are reported as temporarily restricted assets.
    • Assets contributed by the donor with permanent restrictions are reported as permanently restricted assets.
practice quiz question 4
Practice Quiz Question #4

Which of the following is false with respect to the accounting for voluntary health and welfare organizations?

a. VH&WOs solicit funds from the community and typically provide their services for no fee.

b. VH&WOs use the modified accrual basis of accounting.

c. VH&WOs must provide a statement of cash flows.

d. VH&WOs primary activities are reported in the unrestricted asset class.

learning objective 5
Learning Objective 5

Understand financial reporting rules and make basic journal entries for other

not-for-profit organizations.

other not for profit entities
Other Not-for-Profit Entities

Examples of other not-for-profit organizations (ONPOs):

  • Cemetery organizations
  • Civic organizations
  • Fraternal organizations
  • Labor unions
  • Libraries
  • Museums
  • Other cultural institutions
  • Performing arts organizations
  • Political parties
  • Private and community foundations
  • Private elementary and secondary schools
  • Professional associations
  • Public broadcasting stations
  • Religious organizations
  • Research and scientific organizations
  • Social and country clubs
  • Trade associations
  • Zoological and botanical societies
other not for profit entities1
Other Not-for-Profit Entities
  • Accounting for ONPOs
    • In addition to FASB 116 and FASB 117, the AICPA Audit Guide for Not-for-Profit Organizations provides guidance for accounting and financial reporting standards.
    • While accrual accounting is required for all ONPOs, some small organizations operate on a cash basis during the year and convert to an accrual basis at year-end.
other not for profit entities2
Other Not-for-Profit Entities
  • Accounting for ONPOs
    • With the adoption of FASB 116 and FASB 117, the procedures used by ONPOs and VH&WOs may move away from the traditional funds used
    • They may account for all transactions in a single entity or by establishing separate accounts for unrestricted, temporarily restricted, and permanently restricted net assets
other not for profit entities3
Other Not-for-Profit Entities
  • Financial Statements of ONPOs
    • Explains how the available resources have been used to carry out activities.
    • They should disclose the nature and source of the resources acquired, any restrictions on the resources, and the principal programs and their costs.
    • They should also provide information on the ability to continue to carry out objectives.
    • FASB 117 requires
      • A Statement of Financial Position
      • A Statement of Activities, and
      • A Statement of Cash Flows
other not for profit entities4
Other Not-for-Profit Entities
  • Summary of Accounting and Financial Reporting
    • Accounting is similar to that for VH&WOs.
    • The accrual basis of accounting is used .
    • When a large number of programs or a number of very different types of programs are part of the operations, it may be desirable to prepare a statement of expenses by functional area or major program as well.
    • As a result of FASB 116 and FASB 117, the reporting requirements of ONPOs are substantially the same as VH&WOs.
practice quiz question 41
Practice Quiz Question #4

Which of the following is false with respect to the accounting other not-for-profit organizations?

a. While accrual accounting is required for all ONPOs, some small organizations operate on a cash basis during the year and convert to an accrual basis at year-end.

  • Accounting is similar to that for VH&WOs.
  • ONPOs may account for all transactions in a single entity or by establishing separate accounts for unrestricted, temporarily, and permanently restricted net assets

d. ONPOs follow GASB rules.

conclusion
Conclusion

The End