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Governmental Financial Statement Analysis
Who uses S & L Government financial statements? Citizen Groups Legislative oversight officials Investors and Creditors
The Public Finance Market Primary (Original Issues) Secondary (Existing issues)
Financial Statement AnalysisState and Local Governments
Net Debt Per Capita: LTD/population LTD is adjusted by amount available
Net Debt Per Fair Value of Property LTD/Fair Value of Property
Interest Coverage: Enterprise Funds Operating Income/Interest Charges
Debt Service/Total Revenues Debt Service Exp/Total Revenues
Accounting for Special Purpose Government Entities General Purpose Governments
State and local governments that provide multiple services
Follow accounting as we have studied Chapters 2-8
Special Purpose Governments Limited, sometimes one type of service Fire protection, Library, Public Schools
Accounting Blips-Special Purpose Funds
Categories as to activities Single governmental activity
Combined G-W and Fund Financial Statements More than one governmental activity
GASB 34 to include G-W and Fund Statements Both governmental and business-type
activities GASB 34 and 35; G-W and Fund Statements
Only business-type activities (GASB 34-35) Only Fiduciary Activities (GASB 34)
Public Colleges and Universities Pre-GASB 35
AICPA Model or S & L Government Model GASB 35 amends GASB 34 to include
Public Colleges and Universities in S & L Government category
Same implementation dates Reporting Categories
Only governmental activities Both governmental and business-type Only business-type activities
Accounting Notes-Public C & U Most will probably report as entities engaged
only in business-type activities Accrual basis of accounting and economic
resources measurement focus Net Assets
Invested in Capital Assets, net of related debt Restricted (Expendable and Nonexpendable) Unrestricted
Capital assets and Infrastructure reported same as GASB 34
Foundations are often set up to manage restricted assets
Public C and U Continued Tuition discounts and scholarships for which
no work is performed reported as revenue reductions
Statement of Net Assets broken down into current and non-current assets and liabilities similar to FP business
Operating Income is distinctively displayed on Statement of R, E, and Changes in Net Assets
Non-operating revenue includes State appropriations, Gifts, and Investment Income
Cash Flow Statement is similar to B-T GASB 34