Government-Wide Financial Statements and Accounting

Subject: Accounting
Pages: 2
Words: 474
Reading time:
2 min

The government-wide financial statements are the statements that focus on the whole government. In the preparation of these statements, there is no consolidation since there is always a need for intra- entity transactions that should be eliminated. In the preparation of the government-wide statements, the most commonly used basis is the accruals and economic resources perspectives. Included in these statements are all the assets and liabilities as indicated in the statement of net assets. The expenses and liabilities are shown in the statement of activities. The exclusion of fiduciary activities is also a notable aspect as they are seen not available in supporting the activities of the government. The statement of the net assets indicates th4e fiscal position of the government at the end of the fiscal year.

A notable increase in the net assets indicates an improvement in the condition of the government, while a decrease shows a worse off state. The statement of activities shows how the financial position of the government has changed. The different program is aggregated according to the functional areas of government. There is a lot of segregation on the part of these statements. Some of the basis for segregation is the government operations as well as business-related activities. There are also legally separated entities in which the government has accountability. On the other hand, the government-wide financial statements give extra detail about the financial position and activities of the state. However, some give information different from the one given by government-wide statements based on the perspective of reporting and principles used.

The Funds involves a combination of accounts outlined by the acceptable accounting principles. The most commonly operated funds by the government include governmental, proprietary, and fiduciary funds. They all show their financial position. The governmental Funds include individual and states funds. These funds are usually presented using current financial resources. This is to means that they are presented on a short-term basis. This kind of fund presented the information using the modified method of accruals accounting where differing of some revenues to be earned in the future is done as they will only be paid in future.

Under the presentation, the focus is on when the cash will be received. Some of the examples of government funds include general, special revenue the debt service, capital projects, and permanent funds. Another type of fund is the propriety fund which is used in the internal service and by state agencies. Fiduciary funds reports contain the agreements held in the form of an individual fund or for companies and the government. In the government fund financial statements, the key measurement focus is economic resources in terms of assets and liabilities. In addition, the accrual basis of accounting is used in reporting the assets.