After completing this chapter, you should be able to do the following:
- Identify what must be included in the management discussion and analysis (MD&A) and required supplementary information (RSI).
- Identify major funds for reporting purposes.
- Recognize format and requirements of funds' financial statements.
- Identify the reporting entity of a government.
What a Government Reports
Governments are required to include certain minimum information in their external financial reports. The requirements are designed to meet the basic needs of a broad group of external users. A government's general purpose external financial statements contain, at a minimum, the following items: management's discussion and analysis, basic financial statements, and required supplementary information.
Fund Financial Statements
The financial statements for governments include both fund-based and government-wide statements. GAAP requires that the general purpose external financial statements contain at a minimum, the following:
- Management discussion and analysis (MD&A)
- Basic Financial Statements
— Government-Wide Financial Statements
— Fund Financial Statements
— Notes to the Financial Statements
- Required Supplementary Information (RSI) (other than MD&A)
The relationship of the different elements that are required for general purpose financial statements can be seen in the following chart. This chapter ...