TRUE OR FALSE All internal service funds are aggregated and reported in a single column on the fund statements At the government wide level the internal service funds balances are essentially collapsed into the Government Activities column of the government wide statements A debt limit is the maximum amount of long term debt that a government may legally have outstanding at any point in time, expressed as a proportion or percentage of some measure of property value within the governments jurisdiction Restricted assets are assets that have been segregated, pursuant to an agreement with an external party or by law or regulation, for a specified purpose and therefore are not available for the discretionary use of management A debt service fund exists to record and manage not only payments of principal and interest related to general long term liabilities, but also to record and manage revenues restricted for debt repayment and other funds, such as interfund transfers, that will be used for those payments Public Trust Funds are those whose principal or income or both must be used for some private purpose GASB Codification Section 2200 117 125 provides the following three components for the classification of net position net investment in capital assets, restricted, and unrestricted Net investment in capital assets is calculated as the total of gross capital assets, net of accumulated depreciation, less any outstanding debt related to the acquisition or construction of capital assets F Regulatory accounting principles (RAP) are accounting principles established by any one of a number of county and or special district entities Fiduciary activities are reported only in the fiduciary fund financial statements they have no effect on the governmental or business type activities of the primary government reported in the government wide financial statements The GASB requires the indirect approach for preparing the statement of cash flows, and, instead of four categories (operating, investing, financing, and stockholders equity), a proprietary fund reports five categories operating, noncapital financing, capital and related financing, investing, and noninvesting) Custodial fund financial information is not reported in a separate column of the statement of fiduciary net position and the statement of changes in fiduciary net position A private purpose trust fund is a fiduciary fund administered by a government entity for beneficiaries external to the administering government, such as individuals, organizations, or governments other than the government administering the trust No differences exist between proprietary funds' accounting and reporting versus for profit orginizations accounting and reporting The dual track accounting approach is useful for recording transactions reported under both the modified accrual (governmental funds) and the accrual (government wide) basis of accounting The permanent governmental funds record and report private purpose trust funds To establish a fiduciary relationship, GASBS 84 identifies five criteria that need to be met The five criteria are (1) the assets related to the activity must be controlled by the government, (2) the assets related to the activity cannot be generated by the governments exchange or non exchange revenues (there is an exception for pass through grants on this criterion), (3) the government cannot benefit from the assets, (4) the asset must not be controlled by a fund, and (5) the government should benefit from the liabilities According to GASB Codification Section I30 115, debt issuance costs (e g , insurance financing, legal, administrative, and trustee fees, etc ) are recognized as expenditures at the governmental fund level Internal Service Funds are often described as being operated more like a component unit than most profit making business, and the reporting is similar to that of for profit organizations For a pass through custodial fund to be appropriate, the government acting as the conduit must have no administrative or direct financial involvement Budgets are not needed to help manage the repayment of the debt, and help ensure that funds are available for payments required in the current period, as well as over the life of the debt

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 17, 2024

TRUE OR FALSE All internal service funds are aggregated and reported in a single column on the fund statements. At the government-wide level the internal

TRUE OR FALSE

All internal service funds are aggregated and reported in a single column on the fund statements. At the government-wide level the internal service funds balances are essentially collapsed into the Government Activities column of the government-wide statements.
A debt limit is the maximum amount of long-term debt that a government may legally have outstanding at any point in time, expressed as a proportion or percentage of some measure of property value within the governments jurisdiction.

Restricted assets are assets that have been segregated, pursuant to an agreement with an external party or by law or regulation, for a specified purpose and therefore are not available for the discretionary use of management

A debt service fund exists to record and manage not only payments of principal and interest related to general long-term liabilities, but also to record and manage revenues restricted for debt repayment and other funds, such as interfund transfers, that will be used for those payments.

Public Trust Funds are those whose principal or income or both must be used for some private purpose.
GASB Codification Section 2200.117-125 provides the following three components for the classification of net position: net investment in capital assets, restricted, and unrestricted. Net investment in capital assets is calculated as the total of gross capital assets, net of accumulated depreciation, less any outstanding debt related to the acquisition or construction of capital assets. F
Regulatory accounting principles (RAP) are accounting principles established by any one of a number of county and/or special district entities.

Fiduciary activities are reported only in the fiduciary fund financial statements; they have no effect on the governmental or business-type activities of the primary government reported in the government-wide financial statements.
The GASB requires the indirect approach for preparing the statement of cash flows, and, instead of four categories (operating, investing, financing, and stockholders equity), a proprietary fund reports five categories: operating, noncapital financing, capital and related financing, investing, and noninvesting).

Custodial fund financial information is not reported in a separate column of the statement of fiduciary net position and the statement of changes in fiduciary net position.
A private-purpose trust fund is a fiduciary fund administered by a government entity for beneficiaries external to the administering government, such as individuals, organizations, or governments other than the government administering the trust.

No differences exist between proprietary funds' accounting and reporting versus for-profit orginizations accounting and reporting.
The dual-track accounting approach is useful for recording transactions reported under both the modified accrual (governmental funds) and the accrual (government-wide) basis of accounting.
The permanent governmental funds record and report private purpose trust funds.

To establish a fiduciary relationship, GASBS 84 identifies five criteria that need to be met. The five criteria are: (1) the assets related to the activity must be controlled by the government, (2) the assets related to the activity cannot be generated by the governments exchange or non-exchange revenues (there is an exception for pass-through grants on this criterion), (3) the government cannot benefit from the assets, (4) the asset must not be controlled by a fund, and (5) the government should benefit from the liabilities.

According to GASB Codification Section I30.115, debt issuance costs (e.g., insurance financing, legal, administrative, and trustee fees, etc.) are recognized as expenditures at the governmental fund level.

Internal Service Funds are often described as being operated more like a component unit than most profit-making business, and the reporting is similar to that of for-profit organizations.

For a pass-through custodial fund to be appropriate, the government acting as the conduit must have no administrative or direct financial involvement.
Budgets are not needed to help manage the repayment of the debt, and help ensure that funds are available for payments required in the current period, as well as over the life of the debt.