...ANSWERS TO QUESTIONS QUESTION 1-1 a. The similarities of accounting for profit-seeking and G&NP organizations include: 1. Double-entry system of accounts. 2. Most accounting mechanics, e.g., basic transaction documents, journals, ledgers, charts of accounts. 3. Where a G&NP organization has a business-type activity, e.g., a municipal electric utility, the accounting largely parallels that for a similar private business (e.g., electric utility). b. Among the unique aspects of G&NP organization accounting are: 1. Fund accounting—designed to separate resources according to the purposes for which they may be used and to account for their uses and balances. 2. Budgetary control techniques—to help assure appropriations are not overexpended and all resources due the G&NP organization are received by it. Question 1-2 a. A fund of a government organization is an independent fiscal and accounting entity. Each fund has a separate self-balancing set of accounts in which are recorded the resources segregated for specific purposes, the related liabilities and residual equity (fund balance or net assets), and the changes therein. Financial statements typically must be presented to report the financial position and operating activities of a fund of a government. b. As the term is generally used in commercial accounting, a "fund" merely indicates that a portion of an organization's assets is set aside and/or restricted to certain uses, e.g., a petty cash fund...
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...Chapter 07 Accounting for the Business-type Activities of State and Local Governments True / False Questions 1. | For proprietary funds, governments generally present a statement of net position in a format that displays assets, plus deferred outflows of resources, less liabilities, less deferred inflows of resources, equals net position. True False | 2. | Internal service funds of one government may not provide goods or services, on a cost-reimbursement basis, to other governments. True False | 3. | Revenues of internal service funds should be recognized only when they are expected to be available in time to pay current liabilities of the fund. True False | 4. | Internal service funds should account for operating expenditures on the accrual basis. True False | 5. | Internal service funds account within the fund for any long-term liabilities to be serviced from revenue derived from fund operations. True False | 6. | Internal service funds should not account for depreciation of capital assets used in their operations, since this would, in effect, charge the government twice for the same assets. True False | 7. | Internal service funds are intended to operate on taxes or other financing sources authorized by the legally enacted revenue budget for each year; therefore, they are classified as governmental funds. True False | 8. | The net position of an internal service fund consists...
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...Governmental and Nonprofit Accounting: Theory and Practice, 10e (Freeman) Chapter 1 Governmental and Nonprofit Accounting—Environment and Characteristics 1. Which of the following would not be considered a government or nonprofit organization? A. A software company that sells software exclusively to state and local governments. B. A public elementary school. C. A church. D. A private trust organized for charitable purposes. (Answer: A; Easy; LO1) 2. Which of the following activities would most likely be accounted for as a business-type activity? A. Fire protection. B. Recreation. C. Water operations. D. Street maintenance. (Answer: C; Moderate; LO1) 3. Prior to the creation of the Governmental Accounting Standards Board in 1984, which of the following organizations had the greatest influence over accounting concepts, principles, and standards for the state and local governments? A. The National Council on Governmental Accounting (NCGA) B. The National Association of College and University Business Officers (NACUBO). C. The American Institute of Certified Public Accountants (AICPA). D. The Comptroller General of the United States. (Answer: A; Moderate; LO1) 4. Which of the following is considered a health and welfare organization? A. Secondary schools. B. Young Men’s Christian Association (YMCA). C. Child protection agencies. D. United Way. (Answer: C; Easy; LO2) 5. Which of the...
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...Cost Accounting and the Federal Government Washington will spend $782 billion more from 2000 to 2003 than it did between 1996 and 1999--an increase of $5,000 per household. With public demand to reduce federal spending, the Federal Government is rethinking the way that it provides goods and services. In order to cut spending the Federal Government is looking for new approaches to old problems. The biggest problem being, accountability. One approach to the accountability problem is to implement managerial cost accounting practices throughout the Federal Government and it’s programs. Cost accounting would help the government focus policy and funding decisions around relevant information. It would help program managers in monitoring performance and in reporting results to Congress and the taxpayers. The five standards for managerial cost accounting that have been suggested are: 1. Accumulating and reporting costs of activities on a regular basis for management information purposes. 2. Establishing responsibility segments to match costs with outputs. 3. Determining the full cost of government goods and services. 4. Recognizing the costs of goods and services provided by one federal entity to another. 5. Using appropriate costing methodologies to accumulate and assign costs to outputs. The costs in a federal government cost accounting system would be divided into two categories: program costs and costs not assigned. Each of these has sub-categories. Program...
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...Running Head: GOVERNMENT REGULATION IN THE ACCOUNTING INDUSTRY Government Regulation in the Accounting Industry Rebecca Gregory Kaplan University Outline Introduction Securities Acts of 1933 and 1934 • Brief History of the Securities Act of 1933 • Objectives of the Securities Act of 1933 • Summary of the Securities Act of 1933 • Necessity of the Securities Act of 1934 • Summary of the Securities Act of 1934 • Peat Marwick Fraud/Scandal The Foreign Corrupt Practices Act of 1977 • Brief History of the Foreign Corrupt Practices Act of 1977 • Summary of the Foreign Corrupt Practices Act of 1977 • Kellogg Brown & Root LLC Fraud/Scandal Sarbanes Oxley Act (SOX) • The Purpose of SOX • Summary of SOX • US Bank of Seattle Fraud/Scandal Conclusion Government Regulation in the Accounting Industry The Great Depression and the Crash of 1929 led the United States into the beginning of new regulations. The first of these regulations was the Securities Act of 1933, which had a goal of prohibiting deceit, misrepresentation, and fraud in the sale of securities. The abusive practices of many banks and Wall Street firms resulted in the creation of the Securities and Exchange Commission (SEC) in 1934. It was established by The Securities Act of 1934 and gave the SEC power to monitor the sale of securities in the U.S. As a result of SEC investigations in the 1970's, it was discovered that many businesses were making payments to foreign officials for the purpose...
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...four basic differences between the information content of the fund financial statements and the government-wide financial statements are: In the fund financial statements, the current financial resources measurement focus and modified accrual basis of accounting are used. In the governmental type funds the measurement for those funds are converted to the economic resources measurement focus and accrual basis of accounting. The second difference is that the fund statements concentrate on individual major governmental and enterprise funds. A third difference is that fund statements include the fiduciary funds but exclude the discretely presented component units. The government wide statements exclude the fiduciary funds but include the discretely presented component units. 2. The column headings generally used in governmental wide statement of net position are governmental activities; business type activities; total of those two columns; discretely presented component units. 3. The three components of net assets in the government wide statement of net position are: 4. The purpose of a classified statement of net position is to be able to realize which statements are restricted, unrestricted or invested in capital assets. 5. The three categories of revenues that are deducted from expenses to compute the net expenses or revenues for each function or program shown in the government wide statement of activities are: Charges for services; Program-specific operating grants and contributions;...
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...The Financial Accounting Standards Board, the guideline making association for sound accounting standards, has issued two guidelines influencing the charitable part. These models will have the most noteworthy effect on philanthropies in more than 20 years. The two guidelines are Financial Accounting Standard No. 116, managing commitments made & got, & Financial Accounting Standard No. 117, managing monetary articulation group. Agreeability with both models is needed for a considerable length of time completion December 31, 1995 & past, with a discretionary one year delay for little associations which are those with yearly consumptions under $1000000 & aggregate possessions short of what $5000000. The effect of FAS 116 & 117 is extensive to the point that all levels of operations at a charitable will be influenced - not only the bookkeeping office. For instance, advancement officers will need to know the accurate terms of commitments keeping in mind the end goal to accurately record them under the new norms, lawful help may be required to focus the best possible treatment for blessing trust additions & misfortunes, & machine support may be obliged to suit the new reporting prerequisites. The accompanying is an outline of the two new gauges. FAS 117 on Financial Statement Display:- A set of monetary proclamations ought to incorporate an accounting report, articulation of action, proclamation of money streams &, for intentional wellbeing & welfare...
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...ACC460( Government and Non-Profit Accounting )Complete Class Click This Link to Get The Tutorial: http://www.myhomeworkspot.com/ACC455-Corporate-Taxation-Complete-Class-002.htm Week 1 Individual Governmental Accounting Standards Board (GASB) and Financial Accounting Standards Board (FASB) Analysis Paper Prepare a 350- to 700-word paper comparing and contrasting GASB and FASB accounting. Explain the objectives of the two standards boards and how they are similar and different. Describe how the modified accrual basis of accounting differs from full accrual accounting. Format your paper consistent with APA guidelines. Discussion Questions DQ 1 Log into http://www.charitynavigator.org/. Choose a good charity and a bad charity and explain why you feel they should labeled good or bad. DQ 2 What is fund accounting? How does it compare to proprietary accounting? Why is fund accounting necessary? What are the major fund types? DQ 3 What are some examples of government and not-for-profit organizations? How do businesses measure success? How do government organizations measure success? DQ 4 What is the purpose of CAFR? What are the components of CAFR? Why is the Federal Government not subject to GASB 34? How do government-wide financial statements add information not available in fund financial statements? Week 2 Individual Ch. 1, 2, & 3 Textbook Exercises Resources: Ch. 1, 2, & 3 of Government and Not-for-Profit Accounting Prepare written...
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...com/look-back-2010-onto-2011/the-most-popular-stories-of-2010) I am an accountant for Emirates Airlines and in charge of creating a project aiming to increase the company’s market share and gain more profit without sacrificing the company’s quality of services and reputation. I just recently began my employment in the company and now facing the big challenge of creating this project and attaining the goal of making it huge in international market and increasing our sales without compromising our excellent customer service. To be able to achieve this goal, I definitely need to focus in training and development of the company’s employees, both current and newly hired ones. I am optimistic about this project and I will do my best to make it work. However, I feel that accounting department alone cannot achieve this goal thus I...
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...ACCT 567 Funds, Statements, Taxes, Accounting for Government and NFP Keller PLEASE DOWNLOAD HERE! HTTP://WWW.STUDENTSWITHSOLUTIONS.COM/VIEW-TUTORIAL.ASPX?TUTORIALID=14604 ACCT 567 Funds, Statements, Taxes, Accounting for Government and NFP Keller 1. Explain the primary differences between ad valorem taxes, such as property taxes, and other taxes that generate derived tax revenues, such as sales and income taxes. How does accounting differ between these classes of taxes? http://www.studentswithsolutions.com/view-tutorial.aspx?TutorialId=14555 2. Can you name the statements which should be prepared by all not-for-profit organizations? http://www.studentswithsolutions.com/view-tutorial.aspx?TutorialId=14558 3. Name a budgetary account of a governmental fund http://www.studentswithsolutions.com/view-tutorial.aspx?TutorialId=14559 4. How are the major funds of a state or local government determined by a governmental entity? http://www.studentswithsolutions.com/view-tutorial.aspx?TutorialId=14556 5. Agency funds pay interest and principal on long term debt? http://www.studentswithsolutions.com/view-tutorial.aspx?TutorialId=14557 6. A refuse collection service can be accounted for by using one of several different funds. The service could be a part of the general fund, it could be a special revenue fund or an enterprise fund. What circumstances would determine which fund would be the most appropriate to use? http://www.studentswithsolutions...
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...430 Governmental Accounting (Online) Chapter 1 Questions 1-2. Identify and describe the five environmental differences between governments and for-profit business enterprises as identified in the Governmental Accounting Standards Board’s Why Governmental Accounting and Financial Reporting Is-and Should be-Different. 1. Organizational Purposes-A governments organizational purpose is to provide public services for the well-being of citizens regardless of profit. Whereas a for-profit business’s organizational purpose is to generate a profit for the owner while providing services to the public. 2. Sources of Revenues-A for-profit business’s source of revenue is its net income (total revenues (sales)-total expenses). A government’s source of revenue is mainly from taxes. 3. Potential for Longevity-State and local governments rarely go out of business, because they are given the ability to tax. For this reason, governments view accounting operations on a long-term basis instead of short-term. Governments focus on maintaining services and how to meet future demands. 4. Relationship with Stakeholders-Since a Governments main source of revenue is taxes, which are paid by citizens; they are required to account for these public funds. Whereas a business can use its resources as it chooses. 5. Role of Budget-Business’s prepare a budget for planning and control purposes and are normally not provided to creditors or investors. Governments on the other hand...
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...5. Government accounting and the use of the accruals basis 5.1 Government accounting Government accounting is the process of recording, analyzing, classifying, summarizing communicating and interpreting financial information about government in aggregate and in detail reflecting transactions and other economic events involving the receipt, spending, transfer, usability and disposition of assets and liabilities. The purposes of government accounting are: • To carry out the financial business of government in a timely, efficient and reliable manner (e.g. to make payments, settle liabilities, collect sums due, buy and sell assets etc.) subject to necessary financial controls. • To keep systematic, easily accessible accounting and documentary records as evidence of past transactions and current financial status, so that detailed transactions can be identified and traced and all aggregates can be conveniently broken down into their constituent parts. • To provide periodic financial statements, containing appropriately classified financial information, as a basis for (a) stewardship and accountability and (b) decision-making. • To maintain financial records suitable for budgetary control, internal control and the needs of auditors. • To provide means for effective management of government assets, liabilities, expenditures and revenues. In government, the producers of accounting information are rarely qualified accountants. Therefore few...
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...Sector Accounting - An Interdisciplinary Field Involving Accounting, Economics, and Jurisprudence 1 Ryosuke Tao Research Fellow, Institute of Administrative Management Abstract Public sector accounting has recently been improved. Currently, there are requirements to disclose stock information in addition to the flow information presented in budget statements or accounts statements. Public sectors have prepared and disclosed their financial statements (including balance sheets and income statements) based on business accounting approaches. Moreover, as a matter of policy, the government tends to prepare and disclose cost information along with the financial statements for the individual ministries and governmental agencies. The objectives of clarifying the fiscal conditions in a state through the preparation and disclosure of financial statements are to fulfill the state’s accountability to its citizenry and market participants and to optimize and enhance the efficiency of its fiscal activities. Most importantly, the improved information should contribute to democratic decisions on public finance. A perspective different from the business accounting is that public sector accounting places more emphasis on inter-generational fairness. With respect to the inter-generational benefits and burdens, however, various factors must be considered, and the differences between assets and liabilities in the balance sheet may not be the indicators for that purpose. Public sector accounting is...
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...China’s budgetary system Year III Finance and Banking Balea Calin Dobrovolschi Natalia 2012 Content Introduction………………………………………………………………..pg 3 Traditional Budget Accounting…………………………………...……… pg 3 1.Taxonomy of Chinese Accounting……..…………….......................... pg 3 1.1 The Domain of Budget Accounting……….…………...………... .pg 3 1.2 Chinese units……………………………………………………... pg 4 2. Public Financial Management Process……………………..……….. pg 4 Conventional Budget Accounting …………………………………………pg 5 1. Overall and Unit Budgets…………………….…………………….. pg 5 2. Characteristics of the Chinese Budget Accounting System ….….…..pg 6 2.1 Accounting as a Budget Tool…………………….…………….. pg 6 2.2 Characteristics…………….…………………….……………… pg 7 The 1994 Budget Law………………………………..…………………… pg 8 1. Scope…….……………………………………………………….....pg 8 2. Institutional structure…………………………………………….....pg 8 3. Budget policy……………………………………………………….pg 9 3.1 General Policy…………………………………………………. pg 9 3.2 Separate Revenue System……………………………………....pg 9 3.3 Dual Budgeting System………………………………………...pg 10 3.4 Functional Classification of the Budget………………………...pg 10 3.5 Increased Budgetary transparency………………………………pg 11 3.6 Increased Effectiveness in resource utilization………………….pg 11 Further development………………………………………………………...
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...Evidence from Vietnam of Public Sector in Current Conditions In recent years, Vietnam has made a significant progress in completing the legal system in general and the regulations on accounting and auditing in particular, including the regulations to ensure the efficient management of public expenditure and to create a more favorable environment for the operations of the public sectors (Kara, 2012). The actual implementation of current legal framework of accounting in public sectors, however, shows the lack of consistency among the accounting system of state budget revenue and expenditure, the accounting of entities financed by the budget (general budget fund), and the accounting of entities financed by financial funds (off-budget funds). Therefore, Vietnam needs a uniform legal framework for the implementation of accounting. This is not only the external objective requirement but also the internal requirement of Vietnam’s economy itself, because current financial and accounting information in the public sector, through actual implementation, shows inconsistency between the current accounting systems and incompliance with international practices. Meanwhile, the participation in international and regional economic organizations such as the World Trade Organization (WTO), Vietnam-US bilateral trade agreement, and the commitment to financial organizations such as the Asian Development Bank (ADB), World Bank (WB), International Monetary Fund (IMF), etc. of Vietnam have created the...
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