Chapter 3 - Governmental operating statement accounts; budgetary accounting. After studying Chapter 3, you should be able to: Explain how operating expenses and revenues related to governmental activities are classified and reported in the government-wide financial statements; distinguish, in governmental funds, between revenues and other financing sources and between expenditures and other financing uses; explain how revenues and expenditures are classified in the General Fund;. | Chapter 3 Governmental Operating Statement Accounts; Budgetary Accounting Learning Objectives After studying Chapter 3, you should be able to: Explain how operating expenses and revenues related to governmental activities are classified and reported in the government-wide financial statements Distinguish, at the fund level, between revenues and other financing sources and between expenditures and other financing uses Explain how revenues and expenditures are classified in the General Fund 3- 1 Learning Objectives (Cont’d) Explain how budgetary accounting contributes to achieving budgetary control over revenues and expenditures, including such aspects as: Recording the annual budget Accounting for revenues Accounting for encumbrances and expenditures Accounting for allotments Reconciling GAAP and budgetary accounts 3- 1 Learning Objectives (Cont’d) Describe computerized accounting information systems Explain the classification of revenues and expenditures of a public school | Chapter 3 Governmental Operating Statement Accounts; Budgetary Accounting Learning Objectives After studying Chapter 3, you should be able to: Explain how operating expenses and revenues related to governmental activities are classified and reported in the government-wide financial statements Distinguish, at the fund level, between revenues and other financing sources and between expenditures and other financing uses Explain how revenues and expenditures are classified in the General Fund 3- 1 Learning Objectives (Cont’d) Explain how budgetary accounting contributes to achieving budgetary control over revenues and expenditures, including such aspects as: Recording the annual budget Accounting for revenues Accounting for encumbrances and expenditures Accounting for allotments Reconciling GAAP and budgetary accounts 3- 1 Learning Objectives (Cont’d) Describe computerized accounting information systems Explain the classification of revenues and expenditures of a public school system 3- 1 Government-wide Statement of Activities Expenses should be reported by function or program Direct expenses - those associated with a function or program Indirect expenses - those that are not directly linked to an identifiable function 3- Government-wide Statement of Activities Revenues should be distinguished between Program revenues - reported in the program/functions section of the statement General revenues - not directly linked to any program/function and reported in the bottom section of the statement 3- Government-wide Statement of Activities (Cont’d) Program revenues are reported in three categories: Charges for services Operating grants and contributions Capital grants and contributions A net expense or revenue format is used in the top section of the statement of activities: Expenses - Program revenues = Net (expense) Revenue 3- Government-wide Statement of Activities (Cont’d) Extraordinary items, special items, and transfers are reported as .
