Government and Not For Profit Accounting: Concepts and Practices, 6th Edition

LEARNING OBJECTIVES

After studying this chapter you should understand:

• How to convert fund statements to government-wide statements
• Why the makeup of a government's or not-for-profit's reporting entity is an issue
• The criteria that the Governmental Accounting Standards Board (GASB) have established to determine the units that constitute a government's reporting entity
• The various ways of reporting component units
• The reports of special-purpose entities
• The main elements of a government's comprehensive annual financial report (CAFR)
• The critical factors to be taken into account in assessing a government's financial condition

This chapter—the final chapter that deals mainly with external reporting by governments—presents an overview of the annual financial report. We have now discussed each of the major fund types maintained by governments. This chapter highlights how individual fund statements can be consolidated into government-wide statements—the first of the statements to be presented in a CAFR. The chapter then considers the issue of the reporting entity—which associated organizations a primary entity must incorporate into its financial reports. Thereafter it highlights the structure of the annual report and the need for statistical information to supplement the financial statements. It then addresses reporting issues faced by special-purpose governments. It concludes by presenting ...