Government Financial Statements

Concept

Two Sets of Statements

Government-wide statements use full accrual accounting and show the government as a whole (like a business). Fund-level statements use modified accrual for governmental funds and full accrual for proprietary and fiduciary funds. A reconciliation bridges the two.

Example

Key Statements

Government-Wide: • Statement of Net Position (like a balance sheet) • Statement of Activities (like an income statement) Governmental Fund Level: • Balance Sheet • Statement of Revenues, Expenditures, and Changes in Fund Balance Proprietary Fund Level: • Statement of Net Position • Statement of Revenues, Expenses, and Changes in Net Position • Statement of Cash Flows

Key Point

GASB vs FASB

GASB (Governmental Accounting Standards Board) sets standards for state and local governments. FASB sets standards for businesses and nonprofits. They are separate standard-setters with different rules.

Modified Accrual Accounting

Budgetary Accounting

Ready to test your knowledge?

Practice questions from this module to reinforce what you learned.

Practice Questions