First the income statement is prepared, then the retained earnings statement is prepared, finally the balance sheet is prepared.

The financial statements for a nongovernmental not-for-profit college or university will include: A) Statement of financial position; statement of activities; statement of cash flows. B) Statement of financial position; statement of activities; statement of cash flows; statement of functional expenses.

Revenue statement. A revenue statement is not a basic financial statement.

Financial Accounting Standards Board (FASB)

Net assets released from restrictions refers to those restricted assets that have been re-classified as unrestricted net assets. This transfer occurs because the original donor-imposed restrictions associated with certain assets have been satisfied.

2. Imposed nonexchange revenues – result from assessments imposed on nongovernmental entities, including individuals, (other than assessments imposed on exchange transactions). Examples are property taxes, fines, and seized property.

The two types of proprietary funds are enterprise funds and internal service funds. An enterprise fund is used to account for any activity for which external users are charged a fee for goods and services.

Derived tax revenues result from assessments imposed on exchange transactions, such as income taxes and sales taxes. Imposed nonexchange revenues result from assessments imposed on nongovernmental entities, other than assessments on exchange transactions.

The fiduciary funds (such as pension trusts and agency funds) are not included in the government-wide statements, because the resources they account for do not belong to the government. The governmental and business-type activities combine to represent the total primary government.

Two main aspects of government-wide financial statements are the financial statement and the statement of net assets. The financial statement shows the revenue collected and the amounts that the government spent.

According to the GAAFR (the Blue Book), governmental funds are “used to account for activities primarily supported by taxes, grants, and similar revenue sources.” Within the category of Governmental Funds, there are five types: General Fund, special revenue funds, debt service funds, capital projects funds, and …

Sources of funding include credit, venture capital, donations, grants, savings, subsidies, and taxes. Fundings such as donations, subsidies, and grants that have no direct requirement for return of investment are described as “soft funding” or “crowdfunding”.

GOVERNMENTAL FUNDS Four fund types are used to account for a government’s “governmental- type” activities. These are the general fund, special revenue funds, debt service funds, and capital projects funds. Basis of Accounting: All governmental funds are accounted for using the modified accrual basis of accounting.

The government financial statements usually include a statement of activities (similar to an income statement in the private sector), a balance sheet and often some type of reconciliation. Cash flow statements are often included to show the sources of the revenue and the destination of the expenses.

A government-wide financial statement is a detailed summary of all the major government funds, what they have spent, and how much money they have left. This statement shows in detail each aspect the government has spent money on and how much money is left, if any.

• Required Supplementary Information (RSI) Other Than Management’s Discussion and Analysis (MD&A)
• Financial Trends Information.
• Revenue Capacity Information.
• Debt Capacity Information.
• Demographic and Economic Information.
• Operating Information.

economic resources measurement focus

The purpose of government-wide financial statements is to present the financial position and the operating results of the governmental entity as a whole.

Fiduciary funds report the following two financial statements: statement of fiduciary net position and statement of changes in fiduciary net position. For pension (and other employee benefit) trust funds, there are additional required supplementary information (RSI) requirements.

Custodial funds will be reported in a statement of fiduciary net position. In addition, the statement of changes in fiduciary net position will include custodial fund activity. This change will result in more detail of additions to and deductions from custodial funds than currently reported for agency funds.