GNP CPT 4__GEN FUND &SPEC REV FUND

GEN FUND

ACCT FOR ALL FIN RESOURCES NOT ACCT FOR OR REPORTED IN OTHER FUNDS

SPECIAL REVENUE FUND

ACCT FOR GEN GOVT FINANCIAL REOURCES THAT ARE RAISED FROM SPECIFIC REVENUE SOURCES THAT ARE RESTRICTED OR COMMITTED TO EXPENDITURE FOR SPECIFIC PURPOSE OTHER THAN DEBT SVC OR CAPITAL OUTLAY

GEN FUND & SPECIAL REV FUND:
BASIC EQUATION

FA + DO - RL + DIR = FB
FINANCIAL ASSETS:
CASH, A/R, INVENTORY, INVESTMENTS, PREPAID
RELATED LIABILITIES:
PRIMARY TO GENERAL GOVT LIABILITIES THAT ARE RELATED TOT HE CURRENT YR AND ARE NORMALLY PAID FROM AVAIL EXPENDABLE FIN ASSETS

Nonspendable Fund Balance

IF SOME OF THE GENERAL FUNDS NET RESOURCES ARE NOT CURRENTLY AVAILABLE FOR EXPENDITURE, such as a 3 yr inter-fund loan has been made from the general fund to another fund, this is indicated by reporting a portion of the total fund balance as NONSPENDABLE

BUDGETARY ENTRY

Look at the "Annual Operating Budget" and determine the:
-Total ESTIMATED REVENUES
-APPROPRIATIONS
___________AND__________
DR Estimated Revenues XX
--CR Appropriations XX
--CR Fund Balance XX (for the remainder)

REVENUE ESTIMATE INCREASED
EX: the governing body increased the officail estimate of intergovernmental revenues by $4,000

DR ESTIMATED REVENUES 4K
--CR FUND BAL 4K

APPROPRIATIONS INCREASED
EX: Total Appropriation increased of 3k

DR FUND BAL 3K
--CR APPROPRIATIONS 3K (CR is the normal/increase for appropriations)

TRANSACTION 1)
Govt Unit's property tax levy for 20X1 is $200k, 3K is expected to be uncollectible
ENTRY?

DR Tax Receiv- Current 200K
--CR Allowance for Uncollect Taxes-Current 3K*
--CR REVENUE-Property Taxes 197k**
*CR Allowance for Uncollect Acct is a contra asset; portion not expected to be collected
**CR Revenue for the remaining that is deemed collectibl

If $5k of these 20X1 Taxes Receivable were not expected to be collected soon enough to be considered "available" to pay for 20X1 expenditures, then
ENTRY?

DR Tax Recv-current 200k
--CR ADA Taxes-Current 3K
--CR Deferred Revenues 5K!!!!
--CR Revenue-Property Taxes 195K <=for the difference
20X1 BALANCE SHT:
Deferred Inflow of Resrouces_____________ 5K

As specific amounts ARE Determined to be Uncollectible, they are WRITTEN OFF....
ENTRY?

TO WRITE OF UNCOLLECT:
DR Allowance for Uncollect Taxes-Current
......CR Taxes Receivable

REVENUE BILLED
EX: Assume govt unit bills service charges revenues of $36K during 20X1, that $1k of these revenues are expected to be uncollectible, and the remainder is expected to be collected currently

DR Account Receivables 36K
CR Allowance for Collectible A/R 1k
CR Revenues 35k

ENCUMBRANCES
EX: Orders were place for materials and equipment estimated cost $30K

ENCUMBRANCES INCURRED
DR Encumbrances 30k
--CR Reserve for Encumbrances 30k

ACTUAL EXPENDITURE INCURRED
EX:Govt received the materials and equip in transact 3 at an actual cost of only 29,900

1) DR Reserve for Encumbrances 30k
----CR Encumbrances 30k
2) DR Expenditures 29,900
----CR Voucher Payable 29,900
----------and------
the purchase of the equipment also affects the GCA-GLTL accts:
GCA: +6100 for the Equip
NP: +6100 for the Equip

EXPENDITURES
EX: Payroll at the end of the pay period were $40k, entry to record payroll upon approval

DR Expenditure 40k
--CR Voucher Payable 40k

INTER-FUND REIMBURSEMENTS
EX: Govt acct determined that the Gen Fund expenditures of $2k should have been recorded as expenditure of a Special Rev Fund

Nonreciprocal transaction, in which a government determined that an expenditure/expense:
*Initial recorded in the current year's fund
*Should be accounted for and reported as an expenditure/expense in a DIFFERENT fund
DR DUE FROM SRF 2k
--CR EXPENDITURES

INTERFUND TRANSFER

Moving assets (e.g. cash & inventory) accounted for in one fund to another fund without a reciprocal flow of resources or services in return.
Doesn't require repayment-->if it does its an Interfund LOAN
(Common examples CH 4 PG 119)
INTERFUND TRANSFERS MU

Interfund Transfers
EX: $5k was authorized and paid to the debt service fund to provide for principal and interest payments and for fiscal agent fees

DR Transfer to DSF 5k
CR Cash 5k
--------and-----------
the transfer would also have an effect on the DSF:
FA - RL = FB
FA: +5k
FB: +5K (Other Fin SOURCE)

Interfund Transfers
EX: gov ordered $10k to be transferred from SRF to the Gen Fund; the cash will be distributed and paid later

DR Due from SRF
CR Transfer From SPRV
-------and-----------
the impact on the SRF:
FA - RL = FB
RL: +10k
FB: -10K (Other Fin USES)

Interfund Transfers
EX: Gen Fund $6k cash was paid to a new Enterprise Fund to provide capital, not expected to be repaid

DR Transf to Enterpris Fund6k
CR Cash 6k
-------and-----------
Impact on the Enterprise Fund equation: ASSETS - LIAB = NET POSITION
Assets: +6k
NP: +6K (TRANSFER IN**)
*Governmental fund INTERFUND TRANSFERS: reported as "OTHER FIN SOURCES(USES)
**Propriet

INTERFUND SERVICE

Sales and purchases of goods and services between funds for a price approximating their external market value
Seller-->reports rev
Buyer-->reports as expenditure/expense
Service Transactions usually result from:
INTERNAL SERVICE FUND Depts providing goods

INTERFUND SERVICES
Unpaid balances from theses transactions are reported as....

INTERFUND RECEIVABLES AND PAYABLES
*not as A/R or A/P

INTERFUND SERVICES
EX: Supplies were purchased from the Internal Service Fund store for the following:
Gen Govt $4k
Public Safety $6k
Highway & St $10k
Health & Sanitation $3k

We purchased the supplies so,
DR Expenditures 30k
CR Due to ISF 30k
----------and----------
Impact on the ISF:
ASSETS - LIAB = NET POSITION
Assets: +30k
NP: +30K (Revenues)

INTERFUND LOANS

Loaning the resources (usually cash)_ of one fund to another fund WITH the requirement/expectation of repayment
-Does not affect the FB;each has a liability or an asset
Lender-->interfund receivable
Borrower-->interfund payable

INTERFUND LOANS
EX: A $1250 (90day) loan was made from the Gen Fund to the SRF to provide temporary financing for expenditure to be reimbursed by fed grant
1. ENTRY FOR LOAN?
2. ENTRY FOR REPAYMENT?

1. ENTRY FOR LOAN:
DR Due From SRF 1250 (asset)
--CR Cash 1250
----------and----------
Impact on the SRF:
FA - RL = FB
FA: +1250
RL: +1250
2. ENTRY FOR REPAY:
DR Cash
CR Due from SRF
----------and----------
Impact on the SRF:
FA - RL = FB
FA: -1250
RL: -1

SHORT-TERM EXTERNAL BORROWING
The government borrowed $20k on a short-term note from a local bank to alleviate a Gen Fund cash shortage

DR Cash 20k
CR Notes Payable-CURRENT 20k

SHORT-TERM EXTERNAL BORROWING
$5k of principal and $600 of interest was paid from the Gen Fund on the short-term note payable

DR Notes Pay-Current 5k
DR Expenditures-Interest 600
CR Cash 5,600
*Short term lending and repayments of principal does not affect FB
**A fund Liability is recorded in the borrower fund, and its Fund Balance is Affected by INTEREST INCURRED ONLY (paid/acc

Extraordinary Items
Examples: EARTHQUAKE DAMAGES, CRASH OR ORGANIZATION AIRPLANE

Events and transactions that are NOT within mngmt control AND ARE,
Unusual in nature-and-
Infrequent in occurrence
EX:A new computer purchased for the acct dept for $6k was destroyed in flash flood. The city received $5750 from insurer to cover the cost o

SPECIAL ITEMS
EX: SALE OF PART OR ALL OF CITY-OWNED BEACH PROPERTY TO HELP FINANCE THE CURRENT BUDGET

Items WITHIN MGMT CONTROL, and may be Either Unusual in nature-or- Infrequent in occurrence
*One Shot revenue items: provide help for a single yr, but not a continuous source
EX: Govt decided to sell to developer for $8k a section of beach fron tproperty,

TAXES RECEIVABLE of $160K and Accounts Receivable of $15k were COLLECTED

DR Cash =bal
-CR Taxes Recv-Current 160k
-CR Acct Reciev 15k

CURRENT TAXES RECEIVABLE" & the related "ALLOWANCE"
-->RECLASSIFIED AS "DELINQUENT" after the due date

TOTAL LEVIED= $200k
(transact 1)
LESS: COLLECTIONS OF CURRENT TAXES= $160k (above)
--------------------------
EQUALS: $40K
Thus, CURRENT TAXES RECEIVABLE 40K and the related ALLOWANCE 3K (from transac 1) were reclassified as DELINQUENT:
DR Tax Reciev-DELI

WHEN AUTHORIZATION TO WRITE OFF TAX RECEIVABLE

DR Allowance
CR Account Receivable

REVENUES that have not been accrued previously were collected as follows:
Taxes-Other than property $58k
License &Permits $68k
Intergovernmental Revenues $52,500
Charges for Service $6k
Fines & Forfeits $19k
Other Revenues $1500
JOURNAL ENTRY?
OPERATING S

DR Cash $205k
CR Revenue $205k=for total
REVENUE:
Taxes-Other than property .....................................................$58k
License &Permits.................$68k
Intergovernmental Revenues
................................................$52,500

Purchase orders were issued for the following functions and amts:
Public Safety $7k
Health & Sanitation $13k
JOURNAL ENTRY?
OPERATING STMT?

DR Reserve for Encumb 20k
CR Encumbrances 20k
EXPENDITURES:
Public Safety.................$7k
Health & Sanitation....$13k
_____________________________________
Total..................................$20k
____________________________________

$20,000 OF DELINQ TAX RECIEVABLE & RELATED INTEREST AND PENALTIES (Not Previously Accrued) OF $200 WERE COLLECTED

DR Cash $20,200 (for total)
CR Tax Reciev-DELINQ $20k
CR Revenues $200
***To record collection of delinquent taxes receivable and interest & penalties not accrued previously
REVENUES:
Other (interest & penalties)..............$200
________________________

$10k of temporary investments were purchased

DR Investment 10k
CR Cash 10k

EXPENDITURES WERE VOUCHERED for PAYMENT of the following:
Gen Govt $30k
Public Safety $112k
Highways & St. $90k
Health & Sanatation $35,400
Other $9,600
Capital Outlay (Equipment) $23k

DR Expenditure $300k (for total)
CR Vouchers Payable $300k
Operating Stmt
EXPENDITURES:
Gen Govt....................... $30k
Public Safety.................$112k
Highways & St..............$90k
Health & Sanatation..$35,400
Other............................

AN AUDIT DISCLOSED THAT A 20X0 EXPENDITURE & LAIBILITY $300 HAD NOT BEEN RECORDED DEC 31, 20X0

DR Correction of Prior Year Error $300
CR Vouchers Payable $300

YEAR-END ADJUSTMENTS

LEFT OFF HERE
CH 4 PG 126