Governmental Financial Reporting The Reporting Entity Chapter 5 – Part 4 Government-wide Statements, RSI & Notes
Review of the Financial Reporting Model & Fund Financial Statements Chapter 5 – Part 2 & 3
The Financial Reporting Model <ul><li>Financial reporting model defines contents of external financial reports </li></ul><...
The Financial Reporting Model <ul><li>Minimum reporting requirements for external general purpose FS </li></ul><ul><ul><li...
<ul><li>Government-wide financial statements </li></ul><ul><ul><li>Statement of Net Assets </li></ul></ul><ul><ul><li>Stat...
Comprehensive Annual Financial Report (CAFR) <ul><li>Goes beyond GASB requirements for general purpose external reporting ...
Fund Level Financial Statements <ul><li>Short-term focus - financial accountability </li></ul><ul><li>Reported based on ty...
Fund Level Financial Statements <ul><li>Present all categories of funds </li></ul><ul><ul><li>Governmental </li></ul></ul>...
Fund Level Financial Statements <ul><li>Presented for major funds & nonmajor funds in the aggregate </li></ul><ul><ul><li>...
Major Funds <ul><li>General  </li></ul><ul><ul><li>Always general fund </li></ul></ul><ul><ul><li>May designate additional...
Government-wide Statements Required Supplementary Information Footnotes Chapter 5 – Part 4
Government-wide Statements <ul><li>Statement of net assets – page 150 </li></ul><ul><ul><li>Columnar approach </li></ul></...
Government-wide Statements <ul><li>Statement of activities – page 152 </li></ul><ul><ul><li>Expenses by function </li></ul...
Government-wide Statements <ul><li>Statement of activities – page 152 </li></ul><ul><ul><li>Revenues by category </li></ul...
Required Supplementary Information <ul><li>MD&A </li></ul><ul><li>Budgetary information – page 154 </li></ul><ul><ul><li>O...
Footnotes to Required Financial Statements <ul><li>Summary of significant accounting policies </li></ul><ul><li>Cash & cas...
Required Exercises – Chapter 5 <ul><li>Problems pages 180 & 181 </li></ul><ul><li>5-4 5-8 5-11 </li></ul><ul><li>5-5 5-9 <...
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Governmental Financial Reporting The Reporting Entity

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Governmental Financial Reporting The Reporting Entity

  1. 1. Governmental Financial Reporting The Reporting Entity Chapter 5 – Part 4 Government-wide Statements, RSI & Notes
  2. 2. Review of the Financial Reporting Model & Fund Financial Statements Chapter 5 – Part 2 & 3
  3. 3. The Financial Reporting Model <ul><li>Financial reporting model defines contents of external financial reports </li></ul><ul><ul><li>June 1999 = GASB No. 34 </li></ul></ul><ul><li>Current reporting model based on </li></ul><ul><ul><li>Accountability </li></ul></ul><ul><ul><ul><li>Fiscal </li></ul></ul></ul><ul><ul><ul><ul><li>Complied with revenue & expenditure decisions of public </li></ul></ul></ul></ul><ul><ul><ul><li>Operational </li></ul></ul></ul><ul><ul><ul><ul><li>How efficiently business-type activities met operating objectives </li></ul></ul></ul></ul><ul><ul><li>Information useful for decision making </li></ul></ul>
  4. 4. The Financial Reporting Model <ul><li>Minimum reporting requirements for external general purpose FS </li></ul><ul><ul><li>Management’s Discussion & Analysis (MD&A) </li></ul></ul><ul><ul><ul><li>Classified as Required Supplementary Information </li></ul></ul></ul><ul><ul><li>Basic Financial Statements (BFS) </li></ul></ul><ul><ul><ul><li>Covered by audit opinion </li></ul></ul></ul><ul><ul><li>Required Supplementary Information (RSI) </li></ul></ul><ul><ul><ul><li>Other than MD&A </li></ul></ul></ul>
  5. 5. <ul><li>Government-wide financial statements </li></ul><ul><ul><li>Statement of Net Assets </li></ul></ul><ul><ul><li>Statement of Activities </li></ul></ul><ul><li>Fund financial statements </li></ul><ul><li>Notes to the financial statements </li></ul>Basic Financial Statements
  6. 6. Comprehensive Annual Financial Report (CAFR) <ul><li>Goes beyond GASB requirements for general purpose external reporting </li></ul><ul><li>Include non-GAAP information & GAAP based information </li></ul>
  7. 7. Fund Level Financial Statements <ul><li>Short-term focus - financial accountability </li></ul><ul><li>Reported based on type of fund </li></ul><ul><ul><li>Governmental funds - modified accrual </li></ul></ul><ul><ul><li>Proprietary funds - essentially same as for-profit entities </li></ul></ul><ul><li>Information on fund level financial statements must be reconciled to information reported in GWS </li></ul>
  8. 8. Fund Level Financial Statements <ul><li>Present all categories of funds </li></ul><ul><ul><li>Governmental </li></ul></ul><ul><ul><li>Proprietary </li></ul></ul><ul><ul><li>Fiduciary </li></ul></ul>
  9. 9. Fund Level Financial Statements <ul><li>Presented for major funds & nonmajor funds in the aggregate </li></ul><ul><ul><li>Page 131 </li></ul></ul><ul><ul><ul><li>Two governmental fund financial statements </li></ul></ul></ul><ul><ul><ul><li>Three proprietary fund financial statements </li></ul></ul></ul><ul><ul><ul><li>Two fiduciary fund financial statements </li></ul></ul></ul>
  10. 10. Major Funds <ul><li>General </li></ul><ul><ul><li>Always general fund </li></ul></ul><ul><ul><li>May designate additional funds as major </li></ul></ul><ul><ul><li>ISF never major fund </li></ul></ul><ul><li>A two step process </li></ul><ul><ul><li>10% test </li></ul></ul><ul><ul><ul><li>Item for fund type </li></ul></ul></ul><ul><ul><li>5% test </li></ul></ul><ul><ul><ul><li>Same item for all fund types </li></ul></ul></ul>
  11. 11. Government-wide Statements Required Supplementary Information Footnotes Chapter 5 – Part 4
  12. 12. Government-wide Statements <ul><li>Statement of net assets – page 150 </li></ul><ul><ul><li>Columnar approach </li></ul></ul><ul><ul><li>Net assets </li></ul></ul><ul><ul><ul><li>Invested in capital assets net of related debt </li></ul></ul></ul><ul><ul><ul><li>Restricted </li></ul></ul></ul><ul><ul><ul><ul><li>Legal </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Contractual/external </li></ul></ul></ul></ul><ul><ul><ul><li>Unrestricted </li></ul></ul></ul>
  13. 13. Government-wide Statements <ul><li>Statement of activities – page 152 </li></ul><ul><ul><li>Expenses by function </li></ul></ul><ul><ul><ul><li>Allocation of direct expenses required </li></ul></ul></ul><ul><ul><ul><ul><li>Includes depreciation </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Interest on LTD MAY be allocated </li></ul></ul></ul></ul><ul><ul><li>Revenues by category – dictated by revenue source </li></ul></ul><ul><ul><ul><li>General </li></ul></ul></ul><ul><ul><ul><ul><li>Taxes even if restricted to specific program </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Income from government itself </li></ul></ul></ul></ul><ul><ul><ul><li>Program </li></ul></ul></ul><ul><ul><ul><ul><li>Charges for services </li></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Not from citizens may be general if not program restricted </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><li>Program-specific operating & capital grants </li></ul></ul></ul></ul>
  14. 14. Government-wide Statements <ul><li>Statement of activities – page 152 </li></ul><ul><ul><li>Revenues by category </li></ul></ul><ul><ul><ul><li>General </li></ul></ul></ul><ul><ul><ul><li>Program </li></ul></ul></ul><ul><ul><ul><ul><li>Charges for services </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Program-specific operating & capital grants </li></ul></ul></ul></ul><ul><ul><ul><li>Source of revenue dictates category </li></ul></ul></ul>
  15. 15. Required Supplementary Information <ul><li>MD&A </li></ul><ul><li>Budgetary information – page 154 </li></ul><ul><ul><li>Option to include as part of BFS </li></ul></ul><ul><ul><li>Minimum reporting </li></ul></ul><ul><ul><ul><li>Original & final budget </li></ul></ul></ul><ul><ul><ul><li>Actual on budgetary basis </li></ul></ul></ul><ul><ul><ul><li>Funds </li></ul></ul></ul><ul><ul><ul><ul><li>General fund </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Major special revenue funds with legally adopted budget </li></ul></ul></ul></ul><ul><li>Modified approach to infrastructure </li></ul><ul><ul><li>Assessed condition </li></ul></ul><ul><ul><li>Cost to maintain at adopted condition levels </li></ul></ul>
  16. 16. Footnotes to Required Financial Statements <ul><li>Summary of significant accounting policies </li></ul><ul><li>Cash & cash equivalents </li></ul><ul><li>Investments </li></ul><ul><li>Policies (capitalization, operations, etc.) </li></ul><ul><li>Capital assets (balances & changes therein) </li></ul><ul><li>Long term debt (balances & changes therein) </li></ul><ul><li>Interfund transactions & balances </li></ul><ul><li>Pensions & OPEB </li></ul><ul><li>Subsequent events </li></ul>
  17. 17. Required Exercises – Chapter 5 <ul><li>Problems pages 180 & 181 </li></ul><ul><li>5-4 5-8 5-11 </li></ul><ul><li>5-5 5-9 </li></ul><ul><li>NOTE: These ARE part of your required assignment for this chapter. Please have them ready to hand in at the beginning of the designated class. </li></ul>

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