Introduction to governmental and not for profit accounting 7th by pattion

Introduction to governmental and not for profit accounting 7th by pattion Introduction to governmental and not for profit accounting 7th by pattion Introduction to governmental and not for profit accounting 7th by pattion Introduction to governmental and not for profit accounting 7th by pattion Introduction to governmental and not for profit accounting 7th by pattion Introduction to governmental and not for profit accounting 7th by pattion

www.downloadslide.com Introduction to Governmental and Not-for-Profit Accounting www.downloadslide.com This page intentionally left blank www.downloadslide.com Seventh Edition Introduction to Governmental and Not-for-Profit Accounting Martin Ives New York University (retired) Terry K Patton Midwestern State University Suesan R Patton UHY LLP Boston Columbus Indianapolis New York San Francisco Upper Saddle River Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi Mexico City São Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo www.downloadslide.com Editor in Chief: Donna Battista Editorial Project Manager: Christina Rumbaugh Editorial Assistants: Jane Avery and Lauren Zanedis Director of Marketing: Maggie Moylan Leen Marketing Assistants: Kimberly Lovato Director of Production: Nancy Fenton Production Project Manager: Clara Bartunek Creative Art Director: Jayne Conte Cover Designer: Bruce Kenselaar Cover Art: Fotolia Full-Service Project Management: Munesh Kumar/Aptara®, Inc Printer/Binder: Courier Companies/Westford Cover Printer: Lehigh/Phoenix—Hagerstown Text Font: Minion Pro Regular Credits and acknowledgments borrowed from other sources and reproduced, with permission, in this textbook appear on the appropriate page within text Copyright © 2013, 2009, 2004 by Pearson Education, Inc., publishing as Prentice Hall All rights reserved Manufactured in the United States of America This publication is protected by Copyright, and permission should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise To obtain permission(s) to use material from this work, please submit a written request to Pearson Education, Inc., Permissions Department, One Lake Street, Upper Saddle River, New Jersey 07458, or you may fax your request to 201-236-3290 Many of the designations by manufacturers and sellers to distinguish their products are claimed as trademarks Where those designations appear in this book, and the publisher was aware of a trademark claim, the designations have been printed in initial caps or all caps Library of Congress Cataloging-in-Publication Data Ives, Martin Introduction to governmental and not-for-profit accounting / Martin Ives, Terry Patton, Suesan Patton.—7th ed p cm Rev ed of: Introduction to governmental and not-for-profit accounting / Martin Ives [et al.] 6th ed ISBN-13: 978-0-13-277601-1 ISBN-10: 0-13-277601-4 Fund accounting Finance, Public—Accounting Nonprofit organizations—Accounting I Patton, Terry K II Patton, Suesan R III Introduction to governmental and not-for-profit accounting IV Title HF5681.F84R39 2013 6579.835—dc23 2012020546 10 ISBN 10: 0-13-277601-4 ISBN 13: 978-0-13-277601-1 www.downloadslide.com BRIEF CONTENTS Chapter Governmental and Not-for-Profit Accounting Environment and Characteristics Chapter The Use of Funds in Governmental Accounting Chapter Budgetary Considerations in Governmental Accounting 58 Chapter The Governmental Fund Accounting Cycle: An Introduction to General and Special Revenue Funds 100 Chapter The Governmental Fund Accounting Cycle: General and Special Revenue Funds (Continued) 127 Chapter The Governmental Fund Accounting Cycle: Capital Projects Funds, Debt Service Funds, and Permanent Funds 182 Chapter The Governmental Fund Accounting Cycle: ProprietaryType Funds 228 Chapter The Governmental Fund Accounting Cycle: Fiduciary Funds 264 Chapter Reporting Principles and Preparation of Fund Financial Statements 308 Chapter 10 Government-Wide Financial Statements 15 355 Chapter 11 Federal Government Accounting and Reporting Chapter 12 Accounting for Not-for-Profit Organizations Chapter 13 Accounting for Health Care Organizations 398 435 487 Chapter 14 Analysis of Financial Statements and Financial Condition 535 Chapter 15 Fundamentals of Accounting Index 574 617 v www.downloadslide.com This page intentionally left blank www.downloadslide.com CONTENTS Preface xiii About the Authors xvii Chapter GOVERNMENTAL AND NOT-FOR-PROFIT ACCOUNTING ENVIRONMENT AND CHARACTERISTICS Governmental and Not-for-Profit Organizations The Operating Environment Users and Uses of Accounting Information Objectives of Financial Reporting Distinctive Accounting and Financial Reporting Characteristics Accounting Principles and Standards 10 Organization of Textbook 12 Review Questions 13 Discussion Scenarios and Issues 13 Exercises 14 Chapter THE USE OF FUNDS IN GOVERNMENTAL ACCOUNTING 15 Fund Accounting 18 Measurement Focus and Basis of Accounting 21 Governmental-Type Funds 27 Proprietary-Type Funds 36 Fiduciary-Type Funds 43 Review Questions 46 Discussion Scenarios and Issues 46 Exercises 47 Problems 50 Chapter BUDGETARY CONSIDERATIONS IN GOVERNMENTAL ACCOUNTING 58 Budget Laws 60 Budgetary Types and Approaches 60 The Budget Process 63 Service Efforts and Accomplishments 70 Budgetary Review 70 The Budget Document 73 Legislative Consideration and Adoption of the Budget 73 Property Tax Levy 75 Using Budgetary Information 76 vii www.downloadslide.com viii Contents Classifying Revenues and Expenditures 78 Budgetary Accounting 81 Other Aspects of Budgetary Accounting 88 Review Questions 91 Discussion Scenarios and Issues 91 Exercises 92 Problems 95 Chapter THE GOVERNMENTAL FUND ACCOUNTING CYCLE: AN INTRODUCTION TO GENERAL AND SPECIAL REVENUE FUNDS 100 Background 101 Basic Entries in General and Special Revenue Funds 104 Fund Financial Statements 111 Closing the Accounts 115 Control Accounts and Subsidiary Ledgers 116 Other Matters and Concluding Comments 117 Review Questions 118 Discussion Scenarios and Issues 118 Exercises 119 Problems 121 Chapter THE GOVERNMENTAL FUND ACCOUNTING CYCLE: GENERAL AND SPECIAL REVENUE FUNDS (CONTINUED) 127 Recognition and Measurement—General Principles 129 Property Tax Revenues and Receivables 131 Sales Tax and Income Tax Revenues and Receivables 136 Intergovernmental Grants and Other Revenues 138 Expenditures and Fund Liabilities 141 Interfund Transactions 145 Other Accounting Matters 149 Fund Balance Presentation 151 Review of Year-end Financial Statements 155 Review Problem on the General Fund 156 Review Questions 169 Discussion Scenarios and Issues 169 Exercises 170 Problems 174 Summary Problem—Complete Accounting Cycle of General Fund 179 www.downloadslide.com Contents Chapter THE GOVERNMENTAL FUND ACCOUNTING CYCLE: CAPITAL PROJECTS FUNDS, DEBT SERVICE FUNDS, AND PERMANENT FUNDS 182 Measurement Focus and Basis of Accounting 185 Capital Projects Funds 185 Debt Service Funds 198 Leased Assets 207 Permanent Funds 209 Concluding Comment 211 Review Questions 213 Discussion Scenarios and Issues 213 Exercises 214 Problems 217 Summary Problem 225 Chapter THE GOVERNMENTAL FUND ACCOUNTING CYCLE: PROPRIETARY-TYPE FUNDS 228 Overview 229 Specific Aspects of Internal Service Funds 231 Specific Aspects of Enterprise Funds 240 Review Questions 252 Discussion Scenarios and Issues 252 Exercises 253 Problems 255 Summary Problem 262 Chapter THE GOVERNMENTAL FUND ACCOUNTING CYCLE: FIDUCIARY FUNDS 264 Overview of Employer Government Pension and OPEB Accounting 266 Fiduciary-Type Funds: Pension Trust Funds 273 Fiduciary-Type Funds: Investment Trust Funds 283 Fiduciary-Type Funds: Private Purpose Trust Funds 289 Fiduciary-Type Funds: Agency Funds 293 Review Questions 297 Discussion Scenarios and Issues 298 Exercises 298 Problems 302 Summary Problems 305 ix www.downloadslide.com Index Budget revisions, 88–89 Budget solvency and operating results indicators, 544–546, 555–556 budgetary cushion, 544–546, 556 operating margin, 544–545, 555–556 program service ratio, 544, 546 Budgetary accounting (federal government), 8, 409–410, 411, 414–421 Budgetary accounting (state and local government), 8, 81–91, 104–106, 108 allotment accounting, 90 budgetary interchanges, 88–89 budgetary revisions, 88–89 encumbrance accounting, 83, 108 receipt of partial orders, 90 recording the adopted budget, 81–82, 84, 104–106 Budgetary comparison schedules (or statements), 113–114, 333, 335–336 Budgetary control, legal level of, 79–80 Budgetary cushion, 544–546, 546 (feature), 556 Budgetary entries (state and local government), 82–88, 104–106, 108 Budgetary equation (in federal government), 409 Budgetary fund balance, 82 Budgetary fund balance reserved for encumbrances, defined, 103 Budgetary interchanges, 88–89 Budgetary policy guidelines, 64–65 Budgetary revisions, 88–89 Business-type activities (in government-wide statements), 357 C Cancelled purchase orders, 90 Capital assets, acquiring and depreciating, 149 (state and local governments), 412 (federal government) financing of, 185, 186 (feature) reporting in government-wide statements, 369, 378–379, 385–388 sale of, in governmental-type funds (149) See also Infrastructure assets Capital budgets, 61, 185–186 Capital contributions (in governmental accounting), 232, 249–251 (feature) Capital grants, 362, 364 Capital Investment Account Group (CIAG), 386–388 619 Capital outlay expenditures, 149 Capital Projects Funds, 33–34, 183–198 accounting for, 187–196 bond discounts, 195–196 bond premiums, 195–196 capital budgets, 61, 185–186 closing entries, 190–191, 194 continuation of project, 192–194 control of activities, 187 financial statements illustration, 29–30, 193, 197–198 leased assets, 207–209 measurement focus and basis of accounting, 185 operating entries, 187–190, 192–194 sources of financing, 33–34, 185 summary of activities, 187 types of assets and liabilities, 33–34 when used, 34, 183 Capitation agreements, 494 Capitation premiums, accounting for, 495 Cash equivalents, defined, 542 Cash forecasts, 61 Charges for services (in government-wide financial statements), 362, 364 Charitable remainder trust, 457, 485 Charity care provided by hospitals accounting for, 493–494 reporting on (feature), 496 Claims and judgments, 141, 142–143, 501–502 Claims-made policy, 502 (feature) Classifications of fund balance, 152–155 Classification of net position components, 329–330, 361 Classification of revenues and expenditures, 78–81 Classified statements, in governmental fund-level reporting, 230, 329 Classified statements, in government-wide reporting, 361 Cleanup costs (in federal government), 413; (as extraordinary item) 324 Closing entries Capital Projects Funds, 191, 194–195 Debt Service Funds, 205 Enterprise Funds, 243 Federal agency accounting, 420–422 General Fund, 115, 168 Internal Service Funds, 234–234 Investment Trust Funds, 286 Pension Trust Funds, 277–278 www.downloadslide.com 620 Index Closing entries (continued) Private-Purpose Trust Funds, 291 Special Revenue Funds, 115, 168 Closing the books , 602–604 Collections, contributions to, 453, 454 (feature) Colleges See Not-for-profit organizations, accounting for Combining financial statements, 319, 326, 328 Committed fund balance, 153 Commitment accounting (in federal government), 401, 411, 415 Common size statements, 540, Comparative analysis, 541 Compensated absences, 141, 143, 158 and 162 (illustration) Component units, 18, 313–315, 358 Comprehensive Annual Financial Report (CAFR), 317–339, 356–385 auditor’s report, 317, 318 basic financial statements, 318 combining statements, 319 financial section of, 317, 318–319 fund financial statements, 322–331 government-wide financial statements, 356–385 introductory section of, 318 management’s discussion and analysis (MD&A), 318, 320–322 minimum external financial reporting requirements, 319–320 notes to financial statements, 318, 331–333 required supplementary information (RSI), 319, 333–335 statistical section of, 319, 337–339 Conditional promises to give, 451 Conditions and restrictions, compared, 451 Consolidated U S Government financial statements, 403–408 Construction grant, advance received on, 188 Consumption method of inventory accounting, 150 Contractual adjustments, 492, 493–494, 495 Contributed services, 452–453, 500 Contributions receivable note (university illustration), 485 Contributions received by Health Care organizations cash and supplies, 499 contributed services, 500 received by hospital foundation, 502–503 Ses also Health care organizations, accounting for Contributions received by Not-for-Profit organizations, 444–454 collections, 453–454 contributed services, 452–453 general rule, 444–445 other than services and collections, 447–452 unrestricted, 447 See also Not-for-profit organizations, accounting for Control accounts, 116 Cost-sharing pension plans, 271–272 Cumulative results of operations, 412 Current assets, defined, 41, 537, 537n Current financial resources measurement focus, 22, 26 (feature), 323 Current liabilities, defined, 41, 537, 537n Current ratio, 542, 561 Current Restricted Funds, 461 Current Unrestricted Fund, 461 Custodial credit risk (feature), 332 D Debits and credits, 586–590 Debt affordability, 548 (feature) Debt burden, 547–548, 556–557, 559 (feature) Debt burden and other long-term financial flexibility indicators, 546–550, 556–558, 564–565 debt issued by general-purpose governments, 547–549, 556–557 debt issued by governmental enterprises, 549 debt issued by not-for-profit organizations, 549 debt service coverage, 549, 564 long-term debt-to-equity (or capitalization) ratio, 549, 564 pension obligations, 549–550, 558 Debt capacity (in statistical data), 337 Debt payback (or pay-down), 549, 558 Debt service, defined, 184 Debt service burden, 547, 548–549, 557–558, 559 (feature) Debt service coverage, 549, 564 Debt Service Funds, 35–36, 198–207 accounting for, 201–206 control of activities, 201 closing entries, 205 financial statements illustration, 29–30, 206–207 interest due and not due, 202–203 measurement focus and basis of accounting, 185 www.downloadslide.com Index operating entries, 201–204, 205–206 sources of financing, 35, types of assets and liabilities, 35 when used, 35, 183, 198 Debt service requirements to maturity, disclosure of, 332, 334 (feature) Deferred inflows of resources, 33, 231 Deferred outflows of resources, 231 Deferred maintenance (federal government), 412 Deferred property taxes, 133 Defined benefit pension plans, 266–267, 413 Defined contribution pension plans, 266–267 Delinquent property taxes, 133 Delivered orders (in federal government), 402, 410, 411 Demographic and economic information (in statistical data), 338 Deposits (from contractors), 242 Depreciation, in federal accounting, 412 Depreciation, in government-wide statements, 362 Depreciation, in state and local government accounting, 362 Depreciation, in not-for-profit accounting, 459 Derived tax revenues, 370 Disbursement schedule, 402, 416 Discrete presentation of component units vs blending, 316–317 Donated food, valuation of (feature), 448 Donor-imposed restrictions, contributions with, 439, 447–448 Donor-imposed restrictions, expiration of, 448–450 Due to and due from other funds, 28, 31 financial reporting of, 28, 31,365, 366 E Earmarked funds (in federal government), 402–403, 405 Earnings margin, 544–545 Economic resources measurement focus, 21 Efficiency indicators, 543–544, 554, 562–563 Eligibility requirements (regarding grants), 138–139 Employee benefits See Other postemployment benefits, pensions, retireee health care Enabling legislation, defined, 153, 508 Encumbrances accounting for, 83, 85 621 defined, 83 open at year-end, 155 partial orders, 90 Endowment Funds, 461, 505, 507 Enterprise Funds, 36–37, 229–231, 240–252 accounting for, 240–244 activities of, 36–37, 229 financial reporting, 38–42, 244–252 when required, 37,230 when used, 36, 229–231 See also Proprietary-type funds Entity concept, 18, 312–315 Equity method of accounting, 502–503 Escheat property, 289 Estimated revenues, accounting for, 82,84 Estimated third-party settlements, 495 Expended appropriations, 412 Expenditure control—encumbrances, 83 Expenditure-driven construction grant, accounting for, 188–189 Expenditures (in state and local government accounting), 103, 130, 141–145 accounting for, 103, 141–145 classification of, 78–81 defined, 28n relation to budgeting, 129–131 when accrued, 103, 130–131, 156–163 (illustration) when recognized, 103, 130–131 Expenses Accruing (in basic accounting), 582–584 hospitals, 500–502 not-for-profit organizations, 449 “stub period” interest on governmental longterm debt, 372 External financial reporting for NFPOs, 438–442 External investment pools, 283–286 Extraordinary events and items, 41, 323–324 F Fair value (of investments), 190, 455–456 FASAB, 400, 404 jurisdiction, 11 SFFAC No 1, “Objectives of Federal Financial Reporting,” 408–409 SFFAS No 3, “Inventory and Related Property,” 412 SFFAS No 4, “Managerial Cost Accounting Concepts and Standards,” 422 www.downloadslide.com 622 Index FASAB (continued) SFFAS No 5, “Accounting for Liabilities,” 413 SFFAS No 6, “Property, Plant, and Equipment,” 412–413 SFFAS No 17, “Accounting for Social Insurance,” 414 SFFAS No 37, “Social Insurance: Additional Requirements,” 414 FASB jurisdiction, 10 Accounting Standards Codification (ASC) 450–20 (insurance), 501 Accounting Standards Codification (ASC) 820–10-20 (investments), 455 Accounting Standards Codification (ASC) Topic 954 (health care entities), 490 Accounting Standards Codification (ASC) Topic 958 (not-for-profit entities), 438, 490 ASC Topic 954 subsections, 490, 496, 497, 516, 518 ASC Topic 958 subsections, 437n, 439n, 440n, 442n, 444n, 445n, 450n, 452n, 453n, 454n, 457n, 459n, 460n, 499, 504, 516 Statement No 116, “Accounting for Contributions Received and Contributions Made,” 437n, 438 Statement No 117, “Financial Statements of Not-for-Profit Organizations,” 438, 482 Federal Accounting Standards Advisory Board (FASAB) See FASAB Federal deficit in perspective (feature), 408 Federal government accounting and reporting, 7, 11, 398–427 accounting standards, 412–414 accounting and financial reporting model, 408–412 agency accounting cycle, 414–422 agency financial statements, 422–425 budgetary accounting track, 409–410 budgetary process, 401–402, 406 consolidated financial statements, 399, 403–408 funds used, 402–403 proprietary accounting track, 410–412 status of Social Security (feature), 426–427 typical journal entries, 411, 414–422 See also FASAB, Fiduciary-type funds, 20, 42–45, 265–297 financial statements for,43–45, 278–279, 287–289 reporting in government-wide financial statements, 358 when used, 20, 42, 265–266 See also Agency Funds, Investment Trust Funds, Pension Trust Funds, PrivatePurpose Trust Funds See also Fund financial statements Financial Accounting Standards Board (FASB) jurisdiction, 10 See also FASB, Financial assets, 33 Financial condition, defined, 539n Financial condition assessment, 550, 552–553 See Financial statement and financial conditions analysis Financial reporting—federal government, 403–408, 422–425 Financial reporting—not-for-profit organizations, 438–444 Financial reporting—state and local governments, 309–339, 356–385 component units in government-wide statements, 357, 358, 359 fund financial statements in, 20, 322–331 minimum external reporting requirements, 319–320 reporting entity, 312–317 See also Comprehensive Annual Financial Report (CAFR) Financial reporting entity—government, 312–317 Financial reporting objectives, federal government, 7, 408–409 not-for-profit organization, 7–8, 438–439 state and local government, 7310–312 Financial resources (current), 22, 28 Financial statement and financial condition analysis—general, 536–553 asset turnover or efficiency indicators, 543–544 budget solvency and operating results indicators, 544–546 comparative analysis, 541 converting data to more useful formats, 540 debt burden and other long-term financial flexibility indicators, 546–550 financial condition assessment, 550–553 information content of financial statements, 537–539 liquidity indicators, 542–543 summary of indicators, 551 time-series analysis, 540 www.downloadslide.com Index Financial statement and financial condition analysis— state and local governments, 553–559 budgetary solvency and operating results indicators, 555–556 debt burden and other long-term financial flexibility indicators, 547–549, 556–558 efficiency indicator (tax collection rate), 554–555 liquidity indicator (quick ratio), 554 Financial statement and financial condition analysis—not-for-profit hospitals, 559–565 debt burden and other long-term financial flexibility indicators, 564–565 efficiency indicator (number of days’ revenue in receivables), 562–563 liquidity indicators, 561–562 operating results indicator, 563 Financial statements Agency Funds, 43, 296–297, 331 Balance sheet, 113, 324–326, 407, 511–513, 515 Basic financial statements, 318 Capital Projects Funds, 29–30, 193, 197–198 Debt Service Funds, 29–30, 206–207 Enterprise Funds, 38–40, 231, 244–252 Fiduciary funds, 43–45, 278–279, 281–282, 287–288, 291–292, 296–297, 330–331 General Fund, 29–30, 111–114, 165–167, 325 Internal Service Funds, 38–40, 231, 235–239 Investment Trust Funds, 44–45, 287–289,331 Major funds, 322–323 Notes to, 331–333 Pension Trust Funds, 44–45, 278–279, 281–282, 331 Permanent Funds, 211–212 Private-Purpose Trust Funds, 44–45, 331 Proprietary Funds, format, 38–41 Special Revenue Funds, 29–30, 111–114 Statement of activities, 362, 440 Statement of budgetary resources, 425 Statement of cash flows, 40, 237, 239, 247, 250, 330, 442, 514, 517 Statement of changes in fiduciary net position, 44, 278, 287–288, 291–293, 330 Statement of changes in net assets, 491 Statement of changes in net position, 424 Statement of changes in owner’s equity, 601 Statement of fiduciary net position, 45, 279, 288–289, 202–293, 296–297, 330 Statement of financial position, 440 623 Statement of functional expenses, 442 Statement of net position, 39, 236, 238, 246, 249, 329, 358–362, 515 Statement of net costs, 404, 422, 423 Statement of net operating cost and unified budget, 406 Statement of operations, 491, 512 (and 516–519) Statement of operations and changes in net position, 405 Statement of revenues, expenditures, and changes in fund balances, 29–33, 112, 165, 193, 197–198, 324–328 Statement of revenues, expenses, and changes in net position, 38, 231, 235, 238, 245, 248, 251, 330, 516 See also Not-for-profit organizations, accounting for; Fund financial statements Financially accountable, defined, 313–314 Fines, accounting for, 140, 370, 371 Fiscal entity, defined, 18 Flexible budget, 232, 240 Foundations (fund-raising), 502–503, 512–513 Functional expenses, 442 Fund, defined, 18 Fund accounting as distinctive characteristic, by governmental and not-for-profit hospitals, 504–510 by not-for-profit organizations, 461–469 why used, 18–19 See also Governmental accounting, use of funds in See also Not-for-profit organizations, accounting for Fund balance classification, 151–155 assigned, 153–154, 155 committed, 153 nonspendable, 147, 151, 152 restricted, 152–153, 190n unassigned, 154 Fund balance with Treasury (federal government), 411, 412, 415 Fund categories, 19–20 Funded ratio (funding progress), 279–280, 282, 549, 550 (feature), 558 Fund financial statements, 27, 28–45, 322–333 fiduciary-type funds, 42–45, 278–279, 281–282, 287–288, 291–292, 296–297, 330–331 www.downloadslide.com 624 Index Fund financial statements (continued) governmental-type funds, 28–36, 111–114, 165–167, 324–328 proprietary-type funds, 36–42, 231, 235–239, 245–252, 329–330 See also Agency Funds, Capital Projects Funds, Debt Service Funds, Enterprise Funds, General Fund, Internal Service Funds, Investment Trust Funds, Pension Trust Funds, Permanent Funds, Private-Purpose Trust Funds, Special Revenue Funds, Fund-raising activities and expenses, 442, 459–460 Telemarketing as a source of donations (feature), 460 Fund-raising foundations, 502–503, 512–513 G GAAP See Generally accepted accounting principles Gains, as distinguished from revenues, 441–442 GAO See U.S Government Accountability Office (GAO) GASB Concepts Statement No 1, “Objectives of Financial Reporting,” 310 Concepts Statement No 2, “Service Efforts and Accomplishments Reporting,” 312 Concepts Statement No 3, “Communication Methods {in reporting]”, 331n Concepts Statement No 4, “Elements of Financial Statements,” 231 Statement No 10, “Accounting and Financial Reporting for Risk Financing and Related Insurance Issues,” 501 Statement No 14, “The Financial Reporting Entity,” 313 Statement No 25, “Financial Reporting for Defined Benefit Pension Plans and Note Disclosures for Defined Contribution Plans,” 268 Statement No 27, “Accounting for Pensions by State and Local Governmental Employers,” 271 Statement No 31, “Accounting and Financial Reporting for Certain Investments and for External Investment Pools,” 497 Statement No 33, “Accounting and Financial Reporting for Nonexchange Transactions,” 499, 508, 509 Statement No 34, “Basic Financial Statements and Management Discussion and Analysis for State and Local Governments,” 20, 309, 311, 312, 317, 320, 322, 323, 330, 358, 508, 519 Statement No 37, “Basic Financial Statements, etc.: Omnibus,” 322 Statement No 39, “Determining Whether Certain Organizations Are Component Units,” 503n Statement No 43, “Financial Reporting for Postemployment Benefits Other than Pension Plans,” 268 Statement No 44, “Economic Condition Reporting: The Statistical Section,” 337 Statement No 45, “Accounting and Financial Reporting by Employers for Postemployment Benefits Other than Pensions,” 271 Statement No 54, “Fund Balance Reporting and Governmental Fund Type Definitions,” 153 Statement No 58, “Accounting and Financial Reporting for Chapter Bankruptcies,” 323n Statement No 61, “The Financial Reporting Entity: Omnibus,” 313 Statement No 62, “Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements,” 230, 323, 490 Statement No 63, “Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position,” 329 General Fund (in hospitals), 504–505 General Fund (in state and local governments), 101–117, 128–168 accounting for, 101–110, 129–168 budgeting, 61 closing entries, 115, 168 definition, 28 expenditure accounting, 108–110, 141–145 financial statements illustration, 28–33, 111–114, 165–167 fund balance presentation, 151–154 www.downloadslide.com Index interfund activity, 145–148 intergovernmental grant accounting, 138–140 measurement focus and basis of accounting, 103, 129–131 operating entries, 107–110, 131–151 personal income tax accounting, 137, 138 (feature) property tax accounting, 103, 131–135 sales tax accounting, 136–137 short-term financing and investing, 103–104, 107, 109 types of assets and liabilities, 28, 31, 130 types of revenues and expenditures, 28, 101–102 when used, 28, 101 See also Governmental fund accounting cycle See also Health care organizations, accounting for General Fund (in federal government), 403 General long-term debt or liabilities (in governmental fund accounting), 130, 141 General obligation debt, 183–184, 198 Generally accepted accounting principles (GAAP) defined, 10 establishing, 10–11 for hospitals and other health care entities, 489–490 hierarchy of, 12 jurisdiction, 10–11 not-for-profit organizations, 438 Government Finance Officers Association (GFOA), 545, 546n, 556 Governmental Accounting Standards Board (GASB), jurisdiction, 10 See GASB Governmental accounting, use of funds in, 16–45 Agency Funds, 42–43 Capital Projects Funds, 34–35 Debt Service Funds, 35–36 Enterprise Funds, 36–37 Federal government, 402–403 Fiduciary-Type Funds, 42–43 General Fund, 28–33 Governmental-Type Funds, 26–36 Internal Service Funds, 37 Investment Trust Funds, 42–43 Pension (and Other Postemployment Benefit) Trust Funds, 42–43 Permanent Funds, 36 625 Private-Purpose Trust Funds, 42–43 Proprietary-Type Funds, 36–42 Special Revenue Funds, 33–34 Governmental activities (in government-wide statements), 357 Governmental financial statement analysis, 536–559 budgetary solvency and operating results indicators, 544–546, 555–557 budgetary cushion, 544–546, 556 debt burden, 546–548, 556–557 debt service burden, 548–549, 557–558 efficiency indicator (tax collection rate), 543–544, 554–555 liquidity indicator (quick ratio), 542–543, 554 operating margin, 544–545, 555–556 pension benefit burden, 549–550, 558 Governmental funds financial statements See Fund financial statements Governmental fund liabilities (in governmental fund accounting), 141–145 Governmental hospitals See Hospitals, governmental, accounting and financial reporting for Governmental organizations, 2–6 characteristics, 3, 437 entities, environment, 3–6 role of the budget, Governmental-type activites, 17 Governmental-type funds, 19–20, 26–36, 101–117, 128–168, 183–212 as budgetary devices, 129 effect of budgeting on measurements, 129–131 in government-wide statements, 357 purposes, 19–20, 27 See also Capital Projects Funds; Debt Service Funds; General Fund; Special Revenue Funds; Permanent Funds See also Fund Financial Statements Governmental-type funds accounting cycle (General Fund, Special Revenue Funds), 101–117, 128–168 appropriations ledger, 86, 106 allotments, 90 budgetary interchanges, 88–89 budget revisions, 88–89 classifying revenues and expenditures, 78–81 closing entries, 115, 168 www.downloadslide.com 626 Index Governmental-type funds accounting cycle (continued) encumbrance accounting, 83,85 expenditures, 141–145 financial statements, 111–114, 155–156, 165–167 liabilities, 141 operating entries, 107–110, 131–151 open encumbrances, 155 partial orders, 90 recording the budget, 82, 84, 104, 160 recording encumbrances, 83, 85, 106 revenues ledger, 85, 106 See also Capital Projects Funds; Debt Service Funds; General Fund; Special Revenue Funds See also Interfund activity; Property tax accounting; Special assessments Government-wide financial statements, 356–385 adjusting fund statements to government-wide, 364, 368–385 basic principles for preparing, 356–357, 368 capital assets reporting, 369, 378 component unit reporting, 358, 359 creating, from fund financial data, 358 expense reporting, 364, 372–373, 380–381 format of statements, 358–367 focus of statements, 357–358 infrastructure asset reporting, 385–386 interfund receivables and payables, 365–366, 381 internal service fund balances and activity, 365–366 long-term debt reporting, 369–370, 380 measurement focus and basis of accounting, 364 modified apptroach for infrastructure assets, 385–386 net functional expenses, 364 pensions and OPEB, 373 program revenues, 362 reconciliation of fund and government-wide statements, 358, 360 revenue reporting, 362, 370–372, 380 statement of activities, 362–367 statement of net position, 358–362 stub-period interest, 372–373, 380–381 Grants, accounting for, 138–140 eligibility requirements, effect of, 138–140 time requirements, effect of, 138–140 H Health care organizations, not-for-profit, accounting for, 488–520 assets limited as to use, 504, 512 bad debts, 494–495 balance sheet, 511 (and 512–513) capitation premiums, 492, 495 charity care, 492, 494 contractual adjustments, 492, 494 contributions—cash and supplies, 499 contributions—services, 500 estimated third party settlements, 495 financial reporting, 490–492, 510–520 financial reporting framework, 490–492 fund accounting, 504–508 fund-raising foundations, 502–503, 512–513 gains, distinguished from revenues, 499 investments, 497–498 medical malpractice claims, 501–502 net patient service revenues, defined, 493 notes to financial statements, 496–497, 496 (feature) parking revenues, 499 patient service revenues, 492–497 payment systems, 492 prospective rate adjustments, 492, 493–494 restrictions, accounting for, 504–508 retrospective rate adjustments, 492, 495 sources of GAAP, 489–490 statement of cash flows, 514, 519–520 statement of changes in net assets, 513, 516, 518 statement of operations, 512, 515, 518 Hierarchy of GAAP, 12 Hospitals, governmental, accounting and financial reporting for, 488–520 bad debts, 494–495 contributions of cash and supplies, 495 contributons of services, 496 financial reporting, 491 fund-raising foundations, 503, 512–513 investments, 497–498 medical malpractice claims, 501–502 restrictions, accounting for, 508–510 sources of GAAP, 489–490 statement of cash flows, 517, 519 statement of net position (or balance sheet), 512–513, 515 www.downloadslide.com Index statement of revenues, expenses, and changes in net position, 516, 519 See also Health care organizations, not-forprofit, accounting for I Imposed nonexchange revenues, 370–371 Income tax revenues, 136–137, 138 (feature), 370 Incurred but not reported (IBNR) claims, 501, 502 (feature) Infrastructure assets, 385–387 Interest expenditures—capital leases, 209 Interest expenditures in debt service funds, 23, 202–203 Interest expenditures on tax anticipation notes, 103–104, 109 Interest income, accrual in governmental-type funds, 117, 189 Interfund activity (in governmental funds), 145–148, 462 Interfund activity (government-wide statements), 365–376 Interfund balances, 365–366 Interfund loans,146–147 Interfund receivables and payables, 365–366 Interfund reimbursements, 148 Interfund services provided and used, 145 Interfund transfers, 146, 148 (feature), 366, 462 Interfund transfers and balances, disclosure of, 333 Intergovernmental aid, 371–372 Intergovernmental grants, 138–140, 364 Internal Revenue Service (IRS) Form, 990, 442, 443 Internal Service Funds, 229–239 accounting for, 232–235 control of activities, 232 in government-wide financial statements, 366–367 fund financial statements, 235–239 when used, 230, 231 Inventories (in federal accounting), 412 Inventories (in govermental-type funds), 150 Invested in capital assets, net of related debt, 244–245, 361, 381 Investment accounting and activities by colleges and universities, 486 by governmental pension funds, 274–276 by hospitals (governmental and not-for-profit), 497–498 by not-for-profit organizations, 455–456 by state and local governments, 190 financial reporting, 518 risks, reporting on (feature), 332 Investment disclosures (not-for-profit organizations), 456, 486 Investment gains and losses (realized and unrealized), 455–456, 497–498 Investment pool, 283–284 Investment return, 486, 497 Investment Trust Funds, 42–43, 283–289 accounting for, 284–286 financial statements, 43–44, 287–289 when used, 42–43 Investment valuation account, 455, 456, 498 J Journals, 586, 592–593 Judgments and claims, 141, 142–143, 501–502 Jurisdisction of standards-setters, 10–11 L Land, Building, and Equipment Funds, 462 Landfill closure costs, 141 Lapsed appropriations—state and local governments, 155 Lease-purchase debt, 200, 200 (feature), 207–209 Leased assets, accounting for, 207–209 Ledger, 586, 593–594 Licenses, accounting for, 140 Liability (GASB definition), 360 Lien accounting, 134–135 Line-item approach to budgeting, 63 Liquidity, reporting on (in government-wide statements), 361 Liquidity indicators, 537, 542, 554, 561 Long-term debt (in governmental-type fund financial statements) , 23 Long-term debt (in government-wide financial statements), 369–370, 380 Long-term debt note disclosures, 332–333, 334 (feature) Long-term debt-to-equity (or capitalization) ratio, 549, 564 Losses from investments, reporting by NFPO’s, 455 627 www.downloadslide.com 628 Index M Major funds, 322–323, 331 Management’s discussion and analysis (MD&A), 318, 320–322 Mandatory transfers, 462 Matching gift, 451, 452 Matching process, 584 Matured short-term liabilities, 33 Measurable and available, 129–130 adjustments for preparing government-wide statements, 364, 368, 369–373 applied to fines, fees, licenses, 140 applied to personal incme taxes, 136–137, 138 (feature) applied to property taxes, 131–133 applied to sales taxes, 136–137 defined, 129–130 Measurement focus, 21–25 and governmental-type funds, 22–25 and fiduciary-type funds, 21 and proprietary-type funds, 21 defined, 21 distinctive characteristic in governmental accounting, Capital Projects Funds, 185 Debt Service Funds, 185 General Fund, 129–131 Special Revenue funds, 129–131 Medical malpractice claims, 501–502, 502 (feature) Membership income, 458 Millage rate, 76 Minimum external reporting requirements, 319–320 Modified accrual basis of accounting, 22–25, 103, 129–131, 323 defined, 103 effect on accounting recognition, 22, 23, 103, 129–131 illustrated, 23, 131–144 Modified approach (regarding infrastructure assets), 321, 385–386 Museums, contributons to, 453, 454 (feature) N Net assets (in not-for-profit accounting) classification of, 439 in statement of activities, 441 in statement of financial position, 440 permanently restricted, 439 temporarily restricted, 439 unrestricted, 439 Net direct debt, 547 Net functional expenses, 364 Net patient service revenue, 493–495, 518 Net position (in governmental accounting) classification of, 361 invested capital assets, net of related debt, 361 reporting in enterprise funds, 245 reporting in government-wide statements, 361 reporting in internal service funds, 236 restricted, 361 unrestricted, 361 Net position invested in capital assets, net of related debt, 244–245, 329–330, 361 Net position, statement of changes in, 424 Net realilzeable value of receivables, 493, 494 Net unrealized and realized investment gains and losses, 455 Noncurrent assets, defined, 41 Noncurrent liabilities, defined, 41 Nonexchange revenues See Imposed nonexchange revenues Nonmandatory transfers, 462 Nonspendable fund balance, 147, 151 Notes to the financial statements, 272–273 (pensions), 331–333 (general), 539 (general) hospitals, 496–497, 496 (feature) Not-for-profit organizations accountability standards (feature), 443 characteristics of, 3, 437 entity environment, 3–5, 437 examples of, 437–438 See also Not-for-profit organizations, accounting for Not-for-profit organizations, accounting for accounting standards jurisdiction, 10 board designations, 458 colleges and universities (financial statements and notes), 482–486 contributions, 444–454 collections, 453–454 conditional promises to give, 451 donor-imposed restrictions, 447–448 general rule, 444–445 other than services and collections, 447–452 reclassifications, 448–450 supplies, 447 www.downloadslide.com Index 629 services, 452 unconditional promises to give, 450 unrestricted, 447 depreciation, 459 description of organizations, 437–438 donated food, 448 (feature) Endowment Funds, 461 exchange transactions, 458 financial reporting—overview, 438 financial statements and notes, 440–442, 443, 450, 452, 454, 456 fund accounting transactions and financial reporting, 462–469 fund-raising activities and expenses, 442, 443 (feature), 459, 460 (feature) funds used, 461–462 interfund transfers, 462 investments—valuation, income, gains, losses, 455, 456 Plant (or Land, Building, and Equipment Funds), 462 permanently restricted net assets, 439–440, 444, 445 (reporting illustration) Quasi-Endowment Funds, 462 Restricted Current Fund, 461 reclassifications, 448–450 reporting by net asset classification, 439 sources of accounting guidance, 438 split-interest agreements, 457 statement of activities, 440–441, 445 (illustration) statement of cash flows, 442, 446 (illustration) statement of financial position, 440, 444 (illustration) statement of functional expenses, 442, 446 (illustration) subscription and membership income, 458 temporarily restricted net assets, 439–440, 443, 445 (reporting illustration) Unrestricted Current Fund, 462 unrestricted net assets, 439–440, 445 (reporting illustration) Number of days’ cash on hand, 542, 562 Number of days’ revenue in receivables, 543, 544, 562–563 Obligated “in some manner,” 314n Obligation (in federal accounting), 402 Office of Management and Budget (OMB), 400, 401 OMB Circular A-11, 417n, 419n OMB Circular A-136, “Financial Reporting Requirements,” 400, 424 “One-shots,” 148 (feature), 555 Open encumbrances, 155 appropriations lapse, 155 appropriations remain open, 155 Operating entries Agency Funds, 294–295 Capital Projects Funds, 187–190, 192–194 Debt Service Funds, 201–204 Enterprise Funds, 240–243 Federal agency, 414–420 General and Special Revenue Funds, 107, 110, 131–151 Internal Service Funds, 232–234 Investment Trust Funds, 284–286 Pension Trust Funds, 273–277 Permanent Funds, 210–211 Private-Purpose Trust Funds, 289–291 Operating grants, 362, 364 Operating margin, 544, 545, 555–556, 563 Operating results indicators, 544–545, 555–556, 563 Other financing sources, defined, 28n Other financing sources and uses, 148 (feature), 149 Other financing uses, defined, 28n bond proceeds as, 24, 187 proceeds from sale of fixed assets as, 149 transfers as, 146, 326 Other not-for-profit organizations (ONPOs), 437, 438 See also Not-for-profit organizations, accounting for Other postemployment benefits (OPEB), 141, 143–144, 266–273, 373, 374 (feature) See Pension accounting and reporting (employers) and Pension Trust Funds Outlays (in federal government), 402, 425 Overlapping debt, 547, 557 O P Object-of-expenditure approach to “budgeting, 63 Object-of-expenditure classification, 79 “Pancake-type” reporting format, 441,482 Parking revenues, NFPOs and hospitals, 458, 499 www.downloadslide.com 630 Index Partial orders, budgetary accounting for, 90 Pass-through grants, 139–140 Patient service revenues See Revenues from patient care, accounting for Payments in lieu of property taxes (PILOTs), 140–141 Pension (and other employee benefit) Trust Funds, 43–44, 273–283 accounting for, 273–277 closing entry, 277–278 financial statements, 43–45, 278–279 operatng entries, 273–276 schedule of funding progress, 279–280 schedule of employer contributions, 279–280 when used, 42–43 Pension accounting and reporting (employers), 143–144, 266–273 computation of contribution, 269–273 expenditure and liability recognition, 141, 143–144, 144 (feature), 158 and 162 (illustration) financing of, 267 in government-wide statements, 373 note and RSI disclosures, 272–273, 335 structure of plans, 268 types of plans, 266–268 Pension plan cost, 271–272 agent multi-employer plans, 271 cost-sharing plans, 271 sole-employer plans, 271 Pension obligations, 143–144, 144 (feature), 272 Pension payout coverage, 549 Pension Trust Funds, 43–44, 273–283 See Pension (and other emplyee benefit) Trust Funds Per capita information, 540 Percentage change information, 540 Performance and Accountability Report, 400, 422, 427 Performance indicator, 516, 518, 544–545 Permanent accounts, 602 Permanent Endowment Funds, 461, 505, 506–507 Permanent Funds, 36, 209–212 accounting for, 210–211 control of, 210 financial statements, 211–212 measurement focus, 185 when used, 36, 184, 209 Permanently restricted net assets, defined, 439; reporting illustration, 445 Perpetual trust, 485 Personal income taxes, 136–137, 138 (feature) 370 Plant Funds, 462 Plant Replacement and Expansion Funds, 462, 505 Pledges, accounting for, 450–451 Postemployment benefits other than pensions, 141, 143–144, 373, 374 Postemployment health-care benefits, 141, 143–144 Premium (capitation) revenue, 495 Prepayments, 151, 360 Primary government, 18, 313 Principal payment (of debt) journal entry, 206 Private donation with purpose restriction, 447 Private-Purpose Trust Funds, 42–45, 289–293 accounting for, 289–291 financial statements, 43–45, 291–293 when used, 42–43, 289 Professional fees and services, 141; as extraordinary item, 324 Program revenues, 362 Program service ratio, 544, 546 Program-specific capital grants and contributions, 364 Program-specific operating grants and contributions, 364 Property tax accounting, 131–135 allowance for uncollectible taxes, 132–133 (also, see feature on 132) basic journal entries, 107, 109, 131–134 deferred taxes, 133–134 delinquent taxes, 133 in government-wide statements, 370 over- and underassessed taxes, 131–132 (also, see feature on 132), payments in lieu of taxes, 140–141 refunds of taxes, 132 (also, see feature on 132) tax discounts, 134 tax lien accounting, 134–135 uncollectible taxes, 132 Property tax calendar, 131, 334 (feature) Property tax collection rate, 543 Property tax levy, 75–76 Property tax receivable rate, 543 Property tax revenue deferral, 133–134 Proprietary accounting (federal government), 410–412, 414–422 www.downloadslide.com Index Proprietary-type funds, 20, 36–42, 229–252 applicable accounting standards, 230 Enterprise Funds, 36–37, 240–252 accounting for, 36, 240–244 activities of, 36, 229–230, 240 control of activities, 240 financial reporting, 38–41, 244–252 when required and when used, 36–37, 229–230, 240 Internal Service Funds, 37, 231–240 accounting for, 37, 232–235 activities of, 37, 229–231 control of activities, 232 financial reporting, 38–41, 234–240 when used, 37, 229–230 in government-wide statements, 358, 368 when used, 20, 36–37, 229–230, 231, 240 special assessments, 245–247 See also Fund financial statements, Government-wide financial statements Public employee retirement plans, 267 Purchases method (of inventory accounting), 150 Purpose-type restrictions, (regarding grants, 138–139), (regarding donations, 447, 509) Q Quasi-Endowment Funds, 462 Quick ratio, 542, 554 R Ratios, 540 Real property taxes, See Property tax accounting Receivables and payables, interfund (elimination of), 365–366 property tax, 131–133 uncollectible, 131–133, 450–451 Reclassifications, not-for-profit organizations, accounting for, 448–450, 506–507 Reconciliation of fund and government-wide financial statements, 365, 384 Refunds, property tax, 132 (also see feature on 132) Reimbursements, interfund, 147–148 Reporting entity, 312–317 component units in the financial statements, 316–317 defining, 313–315 Required supplementary information (RSI), 319, 333–336, 539 Restricted (as defined by GASB), 152–153, 508 Restricted fund balance, 152–153, 190n, 204–205 Restricted resources hospital accounting for, 504–510 in Enterprise Fund financial statements, 41, 240 in government-wide financial statements, 361 Restricted Current Funds, 461 Restricted funds (in hospitals) 504–508 Restricted net position, 244–245, 329, 361 Restricted Operating Funds, 461 Restricted support, 447 Retainage, 189 Retained percentage, 189 Retiree health care benefits, 141, 143–144 Revenue anticipation notes (RANs), 103–104 Revenue bonds, 34n, 242 Revenue capacity (in statistical data), 337 Revenue classification, 78 Revenue estimates, 66 Revenue recognition under modified accrual basis of accounting, 23, 129–130 Revenues defined (and distinguished from gains), 441 defined (for governmental-type funds), 23, 28n from exchange-type transactions (not-forprofit organizations), 458 in government-wide statements, 370–372, 380 measurable and available, 129–130, 131, 136, 140 recognizing (in governmental-type funds), 129–130, 131, 136, 140 See also Accrual basis of accounting; Modified accrual basis of accounting Revenues from patient care, accounting for, 493–495 capitation premiums, 495 estimated third-party settlements, 495 gross patient service revenues and contractual adjustments, 493–494 hospital payment systems, 492 notes to financial statements regarding patient revenue recognition, 496–497 uncollectible receivables, 494–495 631 www.downloadslide.com 632 Index Revenues ledger, illustrated, 85 Risk, disclosure of, bank deposits and investments (feature), 332 S Salary expenditures, 141, 142 Sale of capital assets, 378 Sales tax accounting, 136–137, 370 Schedule of funding progress (pensons and OPEB), 279–280, 335 Schedule of employer contributions (pensions and OPEB), 279–280 Serial bonds, 199 Service assessments, 245, 247 Service concession, 200 Service efforts and accomplishments (SEA), 70 Services, contributed, 452–453 Servicing the debt, 184 Short-term financing, 103–104 Short-term investing, 103–104, 542 Social insurance programs, accounting for, 413–414 Social Security, 403, 413, 426–427 Sole-employer pension plans, 271 Special assessments, 245, 247 Special Funds (in federal government), 403, Special items, 41, 148 (feature), 323–324 Special Revenue Funds, 33–34, 102–117, 128–168 accounting for, 104–110, 115, 131–155 budgeting, 61 closing entries, 115, 168 examples of, 33 financial statements, 29–30, 111–114, 165–167 measurement focus and basis of accounting, 103, 129–131 operating entries, 106–110, 131–151 sources of revenues, 102 when used, 33, 102 Special termination benefits, 141 Specialized skills, defined, 452 Specific-Purpose Funds, 461, 505, 506 Split interest agreements, 457, 485 Standards-setting process, 11 Statement of activities, 362, 440, 538 (information content) Statement of budgetary resources, 425 Statement of cash flows, 40, 247, 330, 442, 514, 517, 519–520 Statement of changes in fiduciary net position, 43–45, 278, 287–288, 291–293, 296– 297, 330–331 Statement of changes in net assets, 491, 513 (and 515–519) Statement of changes in net position, 424, 515 Statement of changes in owner’s equity, 601 Statement of fiduciary net position, 43–45, 279, 288–289, 292–293, 330–331 Statement of financial position, 440 Statement of functional expenses, 442 Statement of net position, 39, 236, 238, 246, 249, 329–330, 358–362, 537–538 (information content) Statement of net costs, 404, 422, 423 Statement of net operating cost and unified budget, 406 Statement of operations, 491, 512 (and 516–519) Statement of operations and changes in net position, 405 Statement of revenues, expenditures, and changes in fund balance, 29–33, 112, 193, 198 Statement of revenues, expenses, and changes in net position, 38, 231, 235, 238, 245, 248, 251, 324–328, 330, 516 Statement of social insurance, 414, 426 Statements of Federal Financial Accounting Standards (SFFAS), 400, 412–414 Statistical section, preparing, 319, 337–339 “Stub period” interest on long-term debt, 203 Subscription income, 458 Subsidiary ledgers, 116 Subsidies for operating expenses, financial reporting, 251 (feature) Supplementary information, required (RSI), 319, 333–336, 539 Support (in not-for-profit accounting), 442 T Tax Agency Fund, 294–296 Tax anticipation notes, 103–104, 107, 109 Tax bite, 552 Tax collection rate, 554 Tax discounts, 134 Tax lien accounting, 134–135 Tax refunds, 132 (also, see feature on 132) Tax revenues, accruing, 132–133 Tax roll, 116 www.downloadslide.com Index Temporarily restricted net assets, defined, 439; reporting illustration, 445; illustrated, 447 Temporary accounts, 603 Term bonds, 199 Term endowment funds, 462, 505 Time requirements or restrictions, (regarding grants, 138–139, 509–510), (regarding donations, 447) Time-series analysis, 540 Total asset turnover, 544 Transfers, interfund, 146, 462 Trial balance, 599–600 Trust Fund (in federal government), 403 U Unassigned fund balance, 154 Uncollectible property taxes, adjustments to the allowance for, 133 Unconditional promises to give, 450–451 Unearned revenue, 360 Unexpended appropriations, used, 411, 412 Unfunded actuarial accrued liability (UAAL), 271, 280 University financial reporting, 482–486 Unrealized investment gains and losses, 455 Unrestricted Current Fund, 461 Unrestricted net assets (in not-for-profit accounting), defined, 439; reporting illustration, 447 Unrestricted net position, 244–245, 329, 361 Unrestricted Operating Fund, 461 Utilities, 142 U.S Government Accountabililty Office (GAO), 399, 400 U.S Standard General Ledger (USSGL), 400, 409 V Vacation pay, 141, 143, 158, 162 Valuation, actuarial, 269 Violations of legal and contractual provisions, disclosure of, 332 Voluntary health and welfare organizations (VHWOs), 437–438, 439 See also Not-for-profit organizations, accounting for, Voluntary nonexchange transactions, 508 Vouchers payable/voucher system, 105 W Warrants, 141 Works of art, contributed, 453, 454 Z Zero-based budgeting, 63 633 ... Ives, Martin Introduction to governmental and not- for- profit accounting / Martin Ives, Terry Patton, Suesan Patton. 7th ed p cm Rev ed of: Introduction to governmental and not- for- profit accounting. .. standards-setting process for governmental and not- forprofit entities GOVERNMENTAL AND NOT- FOR- PROFIT ORGANIZATIONS It is not always easy to distinguish among governmental, not- for- profit, and. .. reporting by governmental and not- for- profit organizations provides information to help answer these questions www.downloadslide.com Chapter • Governmental and Not- for- Profit Accounting Environment and