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86 Cards in this Set
- Front
- Back
what account must be closed at the end of every year?
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expenditures account |
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as an exception to using some accrual method for expenditures, |
unmatured principal or interest on debt are expensed |
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government-wide FS consist of what 2 statements? |
1. Statement of Net Position 2. Statement of Activities |
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Estimated Revenues includes |
taxes, licenses and fines |
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proceeds from debt issuance are recorded as either... |
-a liability -proceeds of bonds |
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fines and forfeitures are recorded as |
Charges for Services, rather than General Revenues |
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Debt issuance costs should |
be expensed, except for prepaid insurance, which may either be allocated among accounting periods or expensed |
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Govt-Wide FS measure what, with what focus, using what type of accounting? |
measures Operational Efficiency Economic Resources focus uses Accrual Accounting |
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Funds-Based FS measure what, using what type of accounting? |
measures Accountability uses Modified-Accrual Accounting |
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2 Required Reconciliations |
1. Govt Fund BS to Statement of Net Position 2. Net Change in Fund Balance to Change in Govt-Wide Net Position |
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3 types of funds |
1. governmental 2. proprietary 3. fiduciary |
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Interfund Transactions - examples of Reciprocal |
-interfund loans -interfund services |
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Interfund Transactions - examples of Nonreciprocal |
-capital contributions -residual amounts of liquidated funds -operating subsidies -interfund reimbursements |
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Temporary Transfers terminology |
due from or due to |
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Permanent Transfers terminology |
Other Financing Uses/Sources |
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Deferred Outflows of Resources |
consumption of net assets applicable to future reporting periods -reported as a separate section following assets on Statement of FP i.e. paid in advance, deferred charges, prepaids |
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Deferred Inflows of Resources |
acquisition of net assets applicable to a future reporting period -reported as a separate section following liabilities on Statement of FP i.e. money received in advance |
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Statement of Net Position - 3 components |
Net Position rather than Net Assets 1. net investment in capital assets 2. restricted 3. unrestricted |
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Modified-Accrual Accounting - Grants |
cannot recognize grant as revenue until it is spent for the intended purpose |
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Grants - no time restriction |
Cash XX Def Revenue XX Def Revenue XX Revenue XX |
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Grants - time restriction |
Cash XX Def Inflow XX when time is met Def Inflow XX Revenue XX |
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Fund Accounting - measurement focus and purpose and accounting method |
measurement focus: Current Financial Resources Raised and Expended/Position/Changes in FP/Flow of Resources purpose: ensures Fiscal Compliance method: modified-accrual basis |
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Fund Accounting - revenues are recorded when |
measurable and available available: due and receivable within period and collected or expected to be collected within 60 days after end of fiscal period |
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Fund Accounting - expenditures are recorded when |
measurable, incurred and payable |
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Governmental Funds - info |
no: LT assets, LT debt, related interest, depreciation, or amortization on books -fixed asset expenditures are expensed (Expenditures Control Account) |
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5 Types of Governmental Funds |
1. general (only one) 2. special revenue 3. capital projects 4. permanent 5. debt service |
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Governmental Funds - General Fund |
accounts for routine operations -use measurable & available rule for normal taxes: i.e. property, sales, income taxes -use cash basis for random tax revenues (parking fees, fines) |
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revenues control account increases when |
property taxes are recorded |
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entry to levy property taxes |
Property Tax Rec - current XX Property Tax Revenue XX Allow for Uncollectibles XX |
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Governmental Funds - Special Revenue |
restricted to a specific purpose other than debt service or capital good acquisition |
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Governmental Funds - Capital Projects |
restricted for acquisition or construction of major capital facilities -money received from grants = Revenue -proceeds from bond issuance and interfund transfers = Other Financing Sources |
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Governmental Funds - Permanent |
endowments; principal is permanently maintained while income is used for specified programs |
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Governmental Funds - Debt Service |
payment of LT general debt principal and interest -NOT for proprietary of fiduciary funds; their principal and interest are taken from those funds directly |
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both Proprietary and Fiduciary funds... |
-carry LT assets and LT liabilities -depreciate their own fixed assets -service their own LT debt and carry related interest expense -use full-accrual basis -Economic Resources Measurement Focus |
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Proprietary Funds - info and types |
resemble commercial activities; profit-oriented 1. enterprise funds 2. internal service funds |
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Proprietary Funds - Enterprise |
profit-making focus i.e. most govt-owned utilities |
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Proprietary Funds - Internal Service |
in-house business activities; cost-reimbursement basis -temporary transfers do not affect income of fund -uses Operating Revenues for billing other units |
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Required Fund FS |
1. Statement of Net Position 2. Statement of Revenues, Expenses and Changes in Fund Net Position 3. Statement of Cash Flows (direct method) |
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Statement of Net Position setup |
+ all assets + def outflows of resources - all liabilities - def inflows of resources = Net Position |
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Statement of Revenues, Expenses and Changes in Fund Net Position setup |
+ operating revenue - operating expenses + non-operating revenue - non-operating expenses = Change in Net Position |
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Statement of Cash Flows: objective |
reconcile Operating Income to Net Cash Flows |
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Statement of Cash Flows: 4 sections - Cash Flows From... |
1. Operating Activities 2. Capital and Related Financing Activities 3. Noncapital Financing Activities 4. Investing Activities |
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calculate Cash Flows from Operating Activities |
operating revenues - operating expenses |
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what's included in Capital and related financing activities |
-buy/sell of PPE -borrow/repay principal to acquire, construct, or improve capital assets -interest paid |
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what's included in Noncapital financing activities |
-borrow or repay principal for non-capital purpose -state subsidies -interest paid |
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what's included in Investing activities |
-buy/sell of investments -interest/dividend income |
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SCF: key FASB and GASB differences |
-cash receipts from interest are classified as investing (not operating) -cash payments for interest are classified as financing (not operating) -purchases of capital assets are considered financing (not investing) |
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Fiduciary Funds - 4 types
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1. Pension Trust 2. Private Purpose Trust 3. Investment Trust 4. Agency |
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Fiduciary Fund required FS |
1. Statement of Net Position (assets - liabilities = NP) 2. Statement of Changes in Net Position -additions/deductions rather than rev/exp -DO NOT include Agency Funds |
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Fiduciary Funds are reported... |
by fund type, not by major funds |
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Fiduciary Fund components are reported... |
only in fund-based FS, NOT govt-wide FS |
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entry to record Budgeted Appropriations |
Encumbrances XX Appropriations Control XX |
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expenditures Multiple Classification Scheme levels |
1. fund 2. function/program 3. organizational unit (dept) 4. activity 5. character 6. object (what is acquired) (i.e. salaries) |
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Fiduciary Funds - Private-Purpose Trust |
resources held in trust for the benefit of NON-GOVERNMENTAL parties |
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debt and lease obligation disclosure requirements |
separate disclosure of principal and interest for each of the 5 subsequent years, and in 5 year intervals after that |
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Defined Benefit Contribution Plan disclosure requirements
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types of employees covered and both employee and employer obligations to contribute to the plan |
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CAFR: 3 main sections |
1. introductory 2. financial 3. statistical |
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CAFR - Introductory section |
-letter of transmittal -organizational chart -roster of officials -consultants, indep auditors and advisors |
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CAFR - Financial section |
-independent auditor's report -RSI -basic FS |
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CAFR - what's included in RSI |
-MD&A -budgetary comparison schedules -combined & indiv FS for nonmajor funds and component units -nonmajor funds are aggregated in a single column called Other Govt Funds |
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CAFR - what are the Basic FS? |
-govt-wide FS -fund FS -notes to FS |
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CAFR - Statistical section |
-ten-year trends info -revenue and debt capacity info -demographic info -operating info |
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2 levels of CAFR reporting |
1. Govt-wide: operational efficiency; accrual 2. Fund-Based: fiscal accountability; modified acc |
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what funds are not included in govt-wide FS? |
fiduciary funds |
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CAFR - 2 Govt-Wide FS |
1. govt-wide statement of Net Position 2. govt-wide statement of Activities both use: govt activities business activities primary govt totals discretely presented component units |
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Govt-Wide Statement of Net Position - govt activities section |
1. govt activities -govt fund assets & liabilities -general capital assets -general LT liabilities -assets & liab of internal service fund activities |
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Govt-Wide Statement of Net Position - business-type activities section |
2. business-type activities -enterprise activities -internal service funds (if services are to enterprise funds) |
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Govt-Wide Statement of Net Position - primary government totals section |
presented after eliminating balances between governmental and business-type activities |
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Govt-Wide Statement of Activities |
Upper Section: focuses on cost of services Lower Section: reports how net program expenses incurred compare with general revenues |
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Govt-Wide Statement of Activities - Upper Section |
-reports Total Exp and Net Rev/Exp by function Expenses - Program Revenues = Net Rev/Exp |
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Govt-Wide Statement of Activities - Lower Section |
-general revenues -contributions to permanent funds -special items -extraordinary items -transfers |
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what's included in Program Revenue? |
-operating grants & contributions -capital grants & contributions -investment income |
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what's included in General Revenue? |
-all taxes -unrestricted gifts, grants and investment income -multi-purpose restricted income |
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what's included in Other Revenue Items? |
-contributions to endowments -special items -extraordinary items -transfers |
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how is depreciation reported in CAFR? |
both general capital assets and business-type capital assets should be allocated to that function |
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how is interest reported in CAFR? |
interest on general LT debt incurred for the benefit of a particular function should be reported as expenses of that function |
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Component Unit |
legal separate organization for which the elected officials of a primary govt are financially accountable -may be discreetly presented or blended |
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when are component units blended with primary govt |
when component unit is substantially the same as the primary govt -financial benefit or burden relationship -component provided services almost totally for primary govt -total debt outstanding is to be repaid by primary govt |
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Govt-Funds FS - 5 categories. |
1. nonspendable 2. restricted: externally imposed 3. committed: imposed by govt 4. assigned: constrained by govt's intent to be used for a specific purpose, but not committed or assigned 5. unassigned: residual classification for the general fund |
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Govt-Funds - required FS |
-fund BS (sep column for major funds) -Statement of Rev, Exp and Changes in Fund Bal (reconciles beg and end total fund balance) -second one for the general fund and major special revenue funds -budget comparisons may be presented as RSI |
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what are examples of Other Financing Sources/Uses? |
-transfers -special items -extraordinary items |
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2 required Reconciliations to be presented along with Basic FS |
1. BS rec: govt fund BS to statement of Net Assets 2. IS rec: Net Change in fund balance to change in Govt-Wide Net Assets |
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2 types of Reconciling Items |
1. explain differences in scope of activities 2. explain differences in accounting bases |
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BS Rec - how to reconcile |
add back: Capital Assets Internal Service Fund balance Accrued Revenues that'll be collected after YE back out: Liabilities not due in current period Accrued Exp that will be paid after YE |
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IS Rec - how to reconcile |
net change in fund balance is converted to economic resources measurement and accrual basis Capital Assets- capitalize and depreciate Cap Ass Disposition- report proceeds of sale Depreciation Exp- deduction LT Debt- reduce for new debt proceeds LT Debt- add back debt repayments Revenues: add back rev that do not provide current financial resources Expenses: subtract exp that do not take current financial resources |
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Governmental Organization |
a controlling majority of members of governing board are appointed by state government officials |