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54 Cards in this Set
- Front
- Back
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What are the 5 things that are in cash outflows?
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Cash outflows: cash pymts for:
1) to acquire mat'ls for providing svcs & manufacturing goods for resale, including prin pymts on A/P & both s & LT N/P to suppliers. 2) to other suppliers for other goods or svc, including employees 3) for grants to other gov'ts or organizations for specific activities that are considered to be operating activities of the grantor gov't 4) for taxes, duties, fines & other fees or penalties 5) for quasi-external operating trans with other funds, including pymts in lieu of taxes |
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What's in capital & related financing activities?
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Includes acquiring & disposing of capital assets used in providing svcs or producing goods; borrowing money for acquiring, constructing, or improving capital assets & repaying the amts borrowed, including int, & paying for capital assets obtained from vendors on credit.
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What two things are included in other RSI?
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After F/S
1. Budgetary Comparison Schedule (BCS) 2. Infrastructure Schedules |
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Order of CAFR?
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1. Intro
2. Financial a. MD&A b. Basic F/s 1. GWS - net assets & acti 2. Fund F/S 3. Notes to F/S c. RSI d. Comibining Statements e. Individual Fund Statements & Schedules |
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What's in investing activities on CF's?
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Making & collecting loans (except program loans) & acquiring & disposing of debt or equity instruments.
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What's in Noncapital Financing Activities?
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Includes borrowing for purposes other than to acquire, construct or improve cap assets, as well as repaying borrowed amts, including interest.
This category includes proceeds from all borrowings (such as revenue anticipation notes) not clearly attributable to capital assets, regardless of the form of the borrowing. |
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What are the 5 things that are in cash inflows?
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Cash Inflows: Receipts of cash from
1) Sales of goods/svc, including receipts from collection or A/R & both S & LT Notes Rec from customers arising from sales. 2) Quasi-external operating trans with other funds 3) Grants for specific activities that are considered to be operating activities of the grantor gov't. (A grant arrangment of this type is essentially the same as a contract for svcs) 4) Other funds for reimbursement of operating trans 5) Loan programs that are made & collected as part of a governmental program. ex. student loans |
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What's included in the operating section of CF's?
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Cash inflows, receipts, & pymts that do not result from transactions defined as capital & related financing, non-cap financing, or investing activities.
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How should fiduciary funds be prepared?
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Same as Proprietary as far as economic resource measurement focus & the accrual basis of accting.
Req'd statements are: 1) State of N/A 2) State of changes in N/A *Major fund recording is NOT used in Fiduciary Funds* |
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How should the proprietay funds be prepared?
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F/S should be prepared using the economic resources measurement focus & the accrual basis of accting. Internal svc funds also should be reported in the aggregate in a separate column on the proprietary fund statements.
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What's the link btw Gov't Wide & Fund Statements?
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A reconciliation to convert the governmental funds to the economic resources measurement & accrual basis of accting. Adj usually include moving the trans. for gen'l capital assets & gen'l LT liab from the operating statements to the B/S. Other reconciling items may include adj to deferred revenues or internal svc fund net assets.
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What's the major diff btw Gov't CF's and regular?
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4 categories: Operating, Non-Cap Financing, Cap & Related Financing, Investing Activities
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What should enterprise fund f/s consist of?
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a) statement of net assets or b/s - net assets should be reported in the same categories req'd for the GWS.
b) statement of rev's, expenses & changes in fund net assets |
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What's considered a major fund?
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Gen'l fund is ALWAYS major!
2 other criteria are: 1) At least 10% of the corresponding total for the relevant fund category (gov'tl or proprietary) 2) At least 5% of the corresponding total for all governmental & proprietary funds combined. |
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What 2 statements are req'd for governmental funds?
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1) Balance Sheet
2) Statement of Revenues, Expenditures, and changes in fund balance. |
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What's included in Bus-Type funds?
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Amts from enterprise funds & exceptional internal svc funds.
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How are capital assets & LT Liab recorded in GWS?
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a) Amts are presented within the appropriate gov'tl activities, bus-type activities, & component unit classification.
b) Depn is not req'd if other criteria is met. |
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What 2 requirements need to be met for infrastructure assets that are part of a network or subsystem of a network to not be depreciated?
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1) Gov't manages the eligible infrastructure assets using an asset mnmgt system. Such as up to date inventory, perform condition assessments, estimate each yr of maintenance & preserve.
2) Gov't documents that the eligible infrastructure assets are being preserved approxiamately at (or above) a condition level established & disclosed by the gov't. |
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When should gov'ts capitalize collections or "things"?
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Works of arts, historical treasures. If collection is exhaustible it should be depreciated over it's useful life.
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When should a capital asset be considered impaired?
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If both:
a) the decline in svc utility of the capital asset is large in magnitude b) the event or change in circumstance is outsie the normal life cycle of the cap asset. |
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Explain Infrastructure Assets system for retroactive reporting.
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Retroactive reporting is req'd 4 yrs after the effective date on the basic provisions for all major gen'l infrastructure assets that were acquired or significantly reconstructed, or that received significant improvements, in fiscal yrs ending after 6/30/80.
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What's included in Governmental Activities?
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Includes the amts from the governmental funds (restated on the accrual basis of accting) plus, typically the amts from the internal svc funds. Exception applies if the internal svc fund provides svcs primarily to enterprise funds.
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8 parts of the letter of transmittal are?
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1) Discussion
2) Comparison 3) Analysis of Overall Financial Position 4) Analysis of Balances & transactions of individual funds 5) Analysis of significant budget changes 6) Capital asset & LT Liab activities 7) Infrastructure 8) Currently known facts, decisions or conditions |
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Explain eliminations & reclassifications!
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Eliminations deduct the duplication resulting from interfund transfers & internal svc fund transactions. Interfund rec's and payables are eliminated, except for residual balances btw governmental & bus-type activities. Internal events that are essentially allocations or OH expenses are also eliminated from the statement of activities. Interfund services provided & used btw functional categories, such as sales of utilities, are not eliminated.
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Explain what special & extra items are!
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Special & extra items are nonoperating sources or uses. They are displayed separately on the statement of activities after the calculation of excess revenues. Special items are within the control of mngmt but are both abnormally big in size & either unusual in nature or infrequent in occurrence. Extra items are trans or other events that are both unusual in nature and infrequent in occurrence.
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What are fiduciary funds?
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The fiduciary fund category includes only those funds used to report assts held in a trustee or agency capacity for others & that cannot be used to support the gov'ts own programs. Private-purpose trust funds & permanent funds distinguish btw resources held in a fiduciary capacity & those available to the gov't. Private purpose trusts are fiduciary funds, permanent fuds are governmental funds, NOT fiduciary funds!!
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What's the primary Gov't on the GWS?
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Sum of the governmental & business-type activities.
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What's a letter of transmittal?
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GASB don't require it, but it's for gov'ts that participate in the GFOA certificate of achievement for excellence in financial reporting. Sort of reflects GASB requirements for MD&A.
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What are proprietary funds?
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Enterprise & internal svc funds! If the sponsoring gov't is the predominant "customer" for the the activity, the activities are reported in an internal svc fund. Otherwise an enterprise fund is used.
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What are some characteristics of fund statements?
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Fund statements appear btw the GWS & the notes. The combining statements report funds by type for the fiduciary funds & the combo of nonmajor funds.
1) A reconciliation to GWS appears on the face of the governmental fund financial statements, in a seperate schedule, or in the notes. 2) Cash flows statements appear only in the fund statements for proprietary funds! 3) Optional combining fund statements (for nonmajor funds) may be presented after the notes to the f/s. |
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What are basic f/s?
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Basic F/S include both GWS & the fund statements, as well as the notes.
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When is the accrual basis used?
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In GWS for all amts. Also, in Prop fund statements, where rev's & expenses are recorded & NI (loss) is reported. Also used in fiduciary fund statements, except for the recognition of certain liab of defined benefit pension plans & certain postemployment healthcare plans.
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Is the reserve for encumbrances account a liability account?
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No!! It's a reservation of fund balance similar to the appropriated RE of a business enterprise.
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Explain the encumbrance system!
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The encumbrance system is used in governmental funds (gen'l, spec rev, & cap projects) to prevent over-expenditure & to show compliance with legal req'mts. When a PO is issued or a contract is approved, the estimated amt of the planned expenditure is encumbered (committed) by debiting Encumbrances & crediting Reserve for Encumbrances. When the related invoice is received, the encumbrance entry is reversed and the actual expenditure is recorded.
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What is the basis of accting in GWS?
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All amts in the GWS, including from the gov'mtl funds, are determined using the economic resources measurement focus and accrual basis of accting!
Governmental funds presented in the fund F/S use current financial resources and modified accrual basis. Prop & Fiduciary funds use the economic resources focus & accrual basis in the fund statements, with limited exceptions for some fiduciary funds. |
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What should be done if at the end of the yr if encumbered funds have not yet been expended?
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Close the encumbrances acct by debiting fund balance & crediting encumbrances.
This reduces the unreserved fund balance acct & causes the reserve for encubrances acct - which merely offsets the encumbrances acct during the yr - to be the true fund balance reserve. *At beginning of the next period reverse the closing entry* |
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What are 2 characteristics of the modified accrual basis of accting?
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1) Revenues - accrued when available & measurable
2) Fixed assets are expenditures *Modified accrual is used in the gov't-type fund statements (gen'l, spec rev, cap projects & debt svc funds) |
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What are the 4 req'd columns in GWS?
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The four req'd columns are: governmental activities, bus-type activities, the primary gov't (sum of the previous two), & component units.
Note **Funds do not explicitly appear in GWS, the amounts in governmental fund, prop fund and component units statements match or are reconciled to GWS amts. |
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How many of each type of funds should a gov't have?
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Only 1 gen'l fund & none, one or more of the other types of funds.
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Do Fiduciary funds appear in GWS?
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NO!
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What are 4 examples of Fiduciary Funds?
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Pension Trust Funds, Investment Trust Funds, Private-purpose trust funds & Agency Funds (which are purely custodial A = L)
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What are the 2 Prop Funds?
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1. Enterprise (ex. Utilities)
2. Internal Svc Funds (ex. central repair shop) |
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Do Prop and Fiduciary funds need budgets?
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NO!!!!
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Explain Fund Accting!
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A specific governmental unit is not accounted for through a single accounting entity. Instead, the accounts of a gov't are divided into several funds. A fund is a fiscal & accounting entity with a self-balancing set of accounts recording cash & other financial resources, together with all related liabilities & residual equities & balances, & changes therein, that are segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions, or limitations.
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What are fiduciary funds?
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Fiduciary funds acct for resources ($ related liab) held by gov'ts in a trustee capacity (trust funds) or as an agent for others (agency funds).
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What are Prop funds used for?
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They are used to finance a gov'ts self-supporting business-type activities (ex. utilities). The accting equation is the same as a business corp! Prop fund operations are measured in terms of revenues earned, expenses incurred & Net Inc or loss.
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What are fund balance reserves?
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When some of the assets of a governmental fund are not working capital available for expenditure-e.g., assets of one fund have been loaned to another fund for several yrs - a fund bal. reserve is established.
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What are 5 kinds of Governmental funds?
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Gen'l, SRF, CPF, DSF & Permanent Fund
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What are revenues?
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Additions to fund assets or decreases in fund liabilities (except from other financing sources).
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What are appropriations?
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Forecasts of ($ authorizations of ) asset outflows of estimated uses of fund working capital (except for other financing uses).
The appropriations control account is credited to record the budgeted expenditures (and closed at end of period with a debit). |
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What are expenditures?
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Increases in fund liabilities or decreases in fund assets (except for other financing uses).
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What is estimated revenue?
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Forecasts of asset inflows of estimated sources of fund working capital (except from other financing sources).
The est revenues control acct is debited to record the revenue budget ($ is closed at the end of the period with a credit). |
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What's a fund balance?
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The fund residual equity acct that balances the A & L accts of a governmental fund, thus recording the amount available for expenditures. (The Fund Bal. Acct. is similar to OE of a common enterprise only in this balancing feature; however, it does not purport to show any ownership in a fund's assets).
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What are governmental funds used for?
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To finance the cops, fire protection, courts, inspection & gen'l admin.
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