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Unformatted text preview: Chapter 02 - Principles of Accounting and Financial Reporting for State and Local Governments 2-1 CHAPTER 2: PRINCIPLES OF ACCOUNTING AND FINANCIAL REPORTING FOR STATE AND LOCAL GOVERNMENTS OUTLINE Number Topic Type/Task Status (re: 14/e) Questions: 2-1 Governmental activities Describe Same 2-2 Business-type activities Describe Same 2-3 Fiduciary activities Describe Same 2-4 Reporting entity Define and explain Revised 2-5 Component unit reporting Explain Same 2-6 Fund categories Explain New 2-7 Definition of fund Explain New 2-8 Modified accrual; definition and rules Distinguish New 2-9 Distinguishing effects of governmental transactions Journalize New 2-10 Major fund criteria Explain New Cases: 2-1 Defining the reporting entity Internet; locating information in the CAFR Same 2-2 Accounting and reporting principles Identification Analysis; explanation 2-3 2-3 Identification of major funds; application of major fund criteria Internet; identifi- cation; calculation New Exercises/Problems: 2-1 Examine the CAFR Examine Revised 2-2 Various Multiple Choice Items 1,3, and 5 revised; Other items are new 2-3 Various True/False Revised 2-4 Matching government-wide and fund financial reporting characteristics Matching Revised format 2-5 Matching transactions with funds Matching Same 2-6 General long-term liability and general capital asset transactions Journalize and explain 2-7 revised 2-7 Determination of major funds Calculation; written report 2-6 revised Chapter 02 - Principles of Accounting and Financial Reporting for State and Local Governments 2-2 CHAPTER 2: PRINCIPLES OF ACCOUNTING AND FINANCIAL REPORTING FOR STATE AND LOCAL GOVERNMENTS Answers to Questions 2-1. Certain core services are provided by most general purpose governmentsthose related to the protection of life and property (e.g., police and fire protection), public works (e.g., streets and highways, bridges, and public buildings), parks and recreation facilities and programs, and cultural and social services, among others. Governments must also incur costs for general administrative support (such as, data processing, finance, and personnel) of its service departments. Core governmental services, together with general administrative support, comprise the major part of what GASB refers to as governmental activities . The measurement focus and basis of accounting for these activities is on the flow of current financial resources on the modified accrual basis in the governmental funds and on the flow of economic resources on the accrual basis in the Governmental Activities column of the government-wide financial statements. 2-2. The business-type activities of a government include public utilities (such as electric, water, gas, and sewer utilities), transportation systems, toll roads and bridges, hospitals, parking garages and lots, liquor stores, golf courses, airports, and swimming pools, among other activities. Many of these activities are intended to be self-supporting by charging users for the services they receive. Focusing financial reporting on economic charging users for the services they receive....
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- Fall '08