Such a discrepancy can exist under generally accepted accounting principles (GAAP) applicable to governments, and it is not necessarily indicative of an error. This difference in reporting property taxes between the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances and the government-wide Statement of Activities arises due to the difference in the basis of accounting used for these two sets of financial statements. Basis of Accounting: Governmental funds typically use a modified accrual basis of accounting. Under this method, revenues are recognized when they become both measurable and available, which often means they are recorded when received in cash or expected to be received soon. Expenditures are recognized when they are incurred. Full Accrual Basis: In contrast, the government-wide financial statements, including the Statement of Activities, use the full accrual basis of accounting. Under this method, revenues are recognized when earned and expenses when incurred, regardless of when cash is received or paid. The difference in timing of revenue recognition can result in variations in reported amounts between the two sets of financial statements. This is especially common with property taxes because they are often collected in installments throughout the year. In the Governmental Funds Statement, they may only be recognized when received, whereas in the government-wide Statement, they are recognized when they are assessed and become legally due, even if not yet collected. To ensure transparency and provide a comprehensive view of the government's financial position and activities, GAAP requires both sets of financial statements to be presented. Mayor Carol Hunt should consult with the chief accountant, Sheila Prevatte, to ensure that the differences are due to accounting principles and not errors in reporting. It is crucial to explain these differences to concerned residents like Mickey Locklear to maintain transparency and trust in the government's financial reporting