Chapter 1pp 2011

Chapter 1pp 2011 - Chapter 1 Introduction to Governmental...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Chapter 1 Introduction to Governmental and Nonprofit Accounting Characteristics of G&NP Organizations Organizations • • • Absence of profit motive Owned by constituents – no stock Contributors of resources do not receive Contributors proportional share of benefits proportional • Decisions made – directly or indirectly – Decisions by voters by • Meetings where decisions are made Meetings usually open to the public usually Similarities to the Private Sector Similarities • Operate in the same economy and compete for Operate same resources: financial, capital, and human same • Acquire & convert scarce resources into goods & Acquire services services • Use of accounting & other information systems • Need to operate economically, effectively, & Need efficiently efficiently • Provide goods and services, many of which may Provide be similar be Differences from the Private Sector Differences • Organizational objectives • Sources of financial resources • Methods of evaluating performance and Methods operating results operating • GASB establishes standards for SLG. • Read pp 9-12 and handout. Types of G&NP Organizations Types • Governments: Federal, state, county, city, township, Federal, village, and special districts village, • Education: kindergartens, elementary & secondary kindergartens, schools, vocational & technical schools, and colleges & universities universities • Health and welfare: hospitals, nursing homes, American Red Cross, and United Service Organizations (USO) (USO) • Religious: YMCA, YWCA, Salvation Army, and churchrelated organizations • Charities: United Way, Community Chest, & other fundraising organizations • Foundations: Private trust that operate religious, Private educational, or charitable organizations educational, Special Regulations & Controls Applied to Governments Applied • Organization structure – form; board Organization composition; number & duties of personnel personnel • Personnel policies & procedures – who Personnel has power to appoint or hire personnel; tenure; termination policies; promotion policies policies • Sources of financial resources – types and Sources amounts of taxes, licenses, fines or fees; procedure for setting user charges procedure Special Regulations (continued) (continued) • Use of financial resources – purposes, Use including legal restrictions; purchasing procedures; budgeting methods procedures; • Accounting • Financial reporting – type & frequency of Financial reports; format; recipients reports; • Auditing – frequency; who performs; Auditing scope & type; time & place scope Defining a “Government” Defining Overall characteristics: • Public corporations – “an instrumentality of Public the state, founded and owned in the public interest, supported by public funds, and governed by those deriving their authority from the state from • Bodies corporate and politic • WHO HAVE ONE OF THE FOLLOWING WHO ONE CHARACTERISTICS (know these!) CHARACTERISTICS Other Characteristics of a “Government” “Government” • Popular election of officers or appointment Popular (or approval) of a controlling majority of members of governing body by one or more SLGs more • Potential for unilateral dissolution by a Potential government with net assets reverting to a government government • Power to enact and enforce a tax levy • Ability to issue tax exempt debt (page 8) Typical Activities of a SLG Typical • Governmental activities – unique to SLGs – – – – Police and fire protection Education Social Services Courts • Business-type activities – similar to private Business-type sector operations sector – Utilities – Golf Courses – Airports Characteristics of SLG Characteristics Accounting & Reporting • Use of fund accounting – Separate fiscal and accounting entities, Separate segregated according to purpose or activity segregated – Governmental, Proprietary, Fiduciary • Budgets and appropriations – Fixed-dollar budget – Appropriations authorize and limit Appropriations expenditures expenditures Expendable vs nonexpendable resources ...
View Full Document

This note was uploaded on 10/17/2011 for the course ACCT 4325 taught by Professor Staff during the Spring '08 term at UT Arlington.

Ask a homework question - tutors are online