Wht is the distinction between eenditures nd eenses s the terms re us in governmentl ccounting?

Eenditures re concern with governmentl funds, while eenses re concern with proprietry funds. Eenditures re decreses in net finncil resources nd eenses re decreses in net economic resources. When n sset is cquir, it is generlly ccept s n eenditure. When n sset is consum it is generlly ccept s n eense.

government eects to py its eleic bill relting to its current fiscl yer sometime in the following yer. n officil of the government requests your dvice s to whether the nticipt pyment should be chrg s n eenditure of the current or the following yer. How would you respond?

The government should record its eleic bill s n encumbrnce to be pid in the following yer. When the encumbrnce is record, the budget mount for eenditures is ruc, while portion of unreserv fund blnce is reserv for the encumbrnce.

lthough y governments prepre for both cpitl projects nd debt service funds nd integrte them into their ccounts, budgetry control over these funds is not s essentil s it is for other governmentl funds. Do you gree? Elin. If re prepr for cpitl projects funds, in wht significnt wy my they differ from those prepr for other funds?

I disgree tht budgetry control over cpitl projects nd debt service funds in not s essentil s it is for other governmentl funds. While budgetry entries for projects nd service funds re intend s n internl control mechnism, nd do not ffect yer-end finncil sttements, it is still importnt to mintin budgetry control to eenditures exceing uthoriztions. prepr for these projects funds re significntly different from those prepr for other funds in the sense tht cpitl project funds re sttionry in nture nd cn often be preserv for significntly greter number of yers.

How should governments report their cpitl projects nd debt service ctivities in their government-wide sttements?

Governments should report their cpitl projects nd debt service ctivities in their government-wide sttements s long-term obligtions s combin funds which includes ll other governmentl funds in the governmentl ctivities column.

For dditionl informtion bout , contct the Phoenix CPAArizona accounting firm.

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