FAR 8 - Applications of modified accrual

StudyBlue printing of FAR 8 - Applications of modified accrual html, body, div, span, applet, object, iframe, h1, h2, h3, h4, h5, h6, p, blockquote, pre, a, abbr, acronym, address, big, cite, code, del, dfn, em, font, img, ins, kbd, q, s, samp, small, strike, strong, sub, sup, tt, var, b, u, i, center, fieldset, form, label, legend, table, caption, tbody, tfoot, thead, tr, th, td { margin: 0; padding: 0; border: 0; outline: 0; font-size: 100%; background: transparent; } body { line-height: 1; } blockquote, q { quotes: none; } blockquote:before, blockquote:after, q:before, q:after { content: ''; content: none; } /* remember to define focus styles! */ :focus { outline: 0; } /* remember to highlight inserts somehow! */ ins { text-decoration: none; } del { text-decoration: line-through; } /* tables still need 'cellspacing="0"' in the markup */ table { border-collapse: collapse; border-spacing: 0; } /* end RESET */ .header { min-width:800px; } .logo { padding:6px 20px 2px 20px; margin:0; font-size:25px; font-weight:bold; color:#808285; position:relative; border-bottom: 1px solid #c5c5c5; } .logo-blue { color:#70adc4; } .logo-desc { font-weight:normal; font-size:19px; color:#cccccc; margin-top:50px; position:absolute; display: none; } .back-button { position:absolute; top:20px; right:20px; font-size:13px; line-height:25px; color:rgb(0,175,225); font-weight:normal; } .back-button a { color:rgb(0,175,225); } .instructions { padding:0; margin:0; width:100%; position:relative; color:rgb(100,100,100); } .step-holder { border-left:1px solid #ededed; margin-left:20px; } .steps { padding:15px 0; float:left; width:24%; border-right:1px solid #ededed; text-align:center; } .steps-01 { } .steps-02 { } .steps-03 { } .steps-04 { } .label { padding:5px 10px; } .print-button { } .print-button a { background-color:rgb(0,175,225); color:white; line-height: 19px; padding:9px 8px 5px 30px; font-size:14px; text-decoration:none; background-image: url(images/printer.png); background-repeat: no-repeat; background-position: 7px 50%; -moz-border-radius: 5px; -webkit-border-radius: 5px; } .print-button a:hover { background-color:black; } .theNote .content { width: 8.0in !important; margin: 5px auto; padding:20px; background-color:white; } .theNote .header { border-bottom: 1px dashed #C8C8C8; font-size: 17px; padding: 0 0 10px; line-height: 19px; color: #00ADE1; min-width:500px; } .theNote .body { font-size: 14px; line-height: 19px; padding: 10px 0; } .theNote{ padding:6px 0; clear:both; background-color: rgb(200,200,200); } .theNote h3{ color: rgb(100,100,100); } .theNote h1, .theNote h3{ background-color:white; padding:2px 20px; width:8.0in !important; margin: 0 auto; font-size: 15px; } .theNote h1{ padding-top: 10px; font-size: 15px; } .theNote h1:first-child{ font-size: 20px; } .theNote h3 { font-size: 14px; font-weight: normal; } #options { border: 3px double #ccc; padding: 5px 12px; margin: 10px 50px 10px 20px; float: left; } #info { border-top: 1px solid #ccc; padding-top: 5px; font-style: italic; } li { margin: 5px 10px 5px 25px; } ul li { list-style: disc; } ol li { list-style: decimal; } img { border: 0; } table { clear: both; width: 100%; border: 1px solid #c5c5c5; border-width: 1px 0; margin: 0; page-break-after: always; } table#page { page-break-after: auto; } td { text-align: center; font-size: 12px; border-bottom: 1px dashed #c5c5c5; height: 1.75in; width: 50%; padding-left: 15px; } .leftside { border-right: 1px solid #cccccc; padding: 0 15px 0 0; } .bottom td { border-bottom: none; } .clearfix { clear:both; line-height:1px; height:1px; } img { max-width:80%; max-height:150px; margin:20px; } @media print {.header { display: none; } .content .header{ display:inherit; } table { border: 1px dashed #bbb; border-width: 1px 0; } .theNote{ background-color:white; } } Financial 8 cont'd Most governmental (GRASPP) funds record budgets, activity , and encumbrances during the year and close them out at the end of the year (BAE BAE) Recording a budget that is formally integrated with a government's accounting system involves journalizing budgeted transactions using the following accounts at the start of the year: estimated revenues, appropriations, and estimated other sources/uses Natural account balances for budgetary accounting are the opposite of actual activity: estimated revenues are debits and appropriations (estimated expenditures) are credits. Any excess, or projected surplus, is credited to budgetary fund balance. A projected shortfall, or deficit, would be debited. The entry is closed at year-end Revenue activity is recorded in the real accounts when it is measurable and available. "Available: is generally defined as collected within 60 days of year-end. Real property taxes (imposed non-exchange revenues) are accrued when billed to property owners with related revenue recognition subject to measurable and available criteria. Sales taxes (derived tax revenues) are accrued if measurable and collected within 60 days after fiscal year-end (available) and are considered revenue Expenditure activity is recorded as funds are spent or a current liability is incurred. Operating and capital expenditures are handled the same way: 1) Modified accrual accounting generally recognizes expenditures consistently with commercial accounting (when incurred). Interest expenditures, which are not accrued, are an important exception 2) The current financial resources measurement focus changes how the expenditure is recognized. Non-current assets are not recognized 3) Some current assets are recognized. Expenditures for supplies, (prepaid) insurance and inventory can be accounted for by the purchase method or consumption method Transfers out to other funds, or interfund transfers , represent a use of financial resources, not an expenditure Governmental expenditures are classified as function (program), organizational unit, activity, character, or object class Fixed assets purchased, constructed or leased are not capitalized ; however, they are reported on the government-wide financials . Likewise, LTD is not recorded as debt in a governmental fund - it is an other financing source . LTD also goes to the government-wide financials Open purchase orders represent an encumbrance of a governmental fund. An encumbrance (debit) is set up with a credit to reserve for encumbrances, budgetary Fund balance when the order goes out. When the order is filled, the Encumbrance J/E is reversed for the amount originally recorded and the actual expenditure is recorded in a separate JE Encumbrances are not identified on the face of a governmental fund's financial statements but may be disclosed Governmental funds will prepare a balance sheet and a statement of revenues, expenditure, and changes in fund balance (not I/S)