Governments. A government in whose jurisdiction a company is located will request financial statements in order to determine whether the business paid the appropriate amount of taxes. Investment analysts. Suppliers will require financial statements in order to decide whether it is safe to extend credit to a company.
What are the financial statements for the governmental funds?
Government Statement of Revenues, Expenditures, and Changes in Fund Balance. The statement of revenues, expenditures, and changes in fund balance is the income statement for government funds. It tracks the flow of revenue and resources in and out of each fund.
Why accountability is the cornerstone of all financial reporting in government?
1 describes accountability as a broad concept that forms the cornerstone of all financial reporting for state and local governmental entities. 1 states that “accountability requires governments to answer to the citizenry-to justify the raising of public resources and the purposes for which they are used.
What is the purpose of government accounting and financial reporting?
Government accounting and financial reporting aims to protect and manage public money and discharge accountability In order to achieve ambitious socioeconomic goals, developing countries require public sector institutional capacity for setting and implementing public policy, which in turn necessitates government …
What are the three main types of fund financial statements?
Background on Fund Reporting There are three groups of funds for which financial statements are prepared—governmental, proprietary, and fiduciary.
What are some of the similarities and differences between a general fund and a special revenue fund?
They differ in that the General fund accounts for revenues and other financing sources raised to provide for all day-to-day-operating activities, whereas Special Revenue Funds are used to account for a specific revenue source that must be used only to finance a specified activity.
What should be the government wide financial statements report on and why?
The government-wide statements bring the financial activity together in one place and report accrual-based economic resources information. The government-wide statements organize information by whether it relates to governmental activities or business-type activities.
What is the importance of government accounting?
The purposes of government accounting are: To carry out the financial business of government in a timely, efficient and reliable manner (e.g. to make payments, settle liabilities, collect sums due, buy and sell assets etc.) subject to necessary financial controls.
