Download Understanding Governmental Financial Reporting: State & Local Accounting Model and more Study notes Accounting in PDF only on Docsity! Lecture #2 Introduction to Governmental Financial Reporting Page 1 of 4 Class Comments The “GASB 34” Accounting and Reporting Model for SLG’s1 Notes: 1. Before you get to far into this you should read, but not necessarily fully understand, the inside cover of the text – an explanation of dual tracking 2. The “reporting model” for most of you will be a new concept. But it actually one of the components of your Accountancy 111, 112, and 113 classes. It is probably more that the term is new to you, not the concept. 3. The accounting model above includes the various governmental entities that make up the reporting unit – discussed later – it is not a single entity 4. Now it makes some sense to get “our arms around this” reporting model/accounting model to give us an anchor to keep us from getting lost in the detail. For this purpose in our class we use the financial statements for the State of California and for the City and County of San Francisco. Lets go to the City and County of San Francisco’s (CCSF) financial statement. For now they are included in a separate file in the class web page next to these lecture notes. 1 SLG’s is jargon for state and local governments as opposed to the federal government. Economic Events ~ GAAP Administrative Events ~ Political A subset of “financial events” in terms of fund accounting Fund Financials Government- Wide Financials The Accounting Model for the Reporting Entity The Reporting Model for the Reporting Entity docsity.com Lecture #2 Introduction to Governmental Financial Reporting Page 2 of 4 Terms and Concepts2 A. What governments do (page 34) drives the financial reporting model: 1. Governmental activities – provides primarily public goods 2. Business-type activities – provides primarily private goods 3. Fiduciary activities – provides trust services 4. The idea of a “public good” - means that any number of people can consume the good simultaneously; one person’s consumption of the good does not diminish another person’s ability to consume the good at the same time. B. How governmental entities are organized 1. The reporting entity – it is a “construct” for financial reporting purposes. Generally follows the political and administrative functions but not a true accounting entity – see Illustration 2-1 on page 40 and page 37 of the earlier edition. This is a very hard diagram to understand for now – we cover it for the next eight weeks. 2. Primary government 3. Component units i. Discreet presentation ii. Blending and blended presentation C. How do we measure (account for) these activities for these entities? It will take most students a few weeks to see how this works. If you segment the reporting entity it works well. Here is a graphic from the CCSF CAFR. Source: City and County of San Francisco CAFR – Comprehensive Annual Financial Report. This is similar to the table on page 48 and on page 46 in the earlier edition 2 Refer to the glossary in the text for these terms and concepts when reviewing for the exams docsity.com
