The Accounting Cycle for Governmental Funds and Account
Groups
Lessons in
chapter V
of
Financial Reporting in Government
By
Dr. John Sacco
,
George Mason University
Revised
Saturday, April 12, 1997
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The big picture in governmental financial reporting is
assessing financial performance, that is, how well the
government is doing with the money entrusted to it. From
the standpoint of making judgments about the performance
of government funds and government finance, the
financial reports, particularly the Comprehensive Annual
Financial Report (CAFR), are a good place to start.
These reports can provide a considerable amount of the
information for gauging financial compliance, success,
and health.
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This first full example of the accounting cycle is
designed to be relatively straightforward so that the
basic cycle concepts can be described. Only one fund is
covered and that is the general fund. Further, the
general fund is assumed to be the only fund operated by
this government. The dollar numbers are kept
artificially small too.
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This next example of the accounting cycle is designed to
be more elaborate and thus more complex. Having just
one fund as in the first illustration is peculiar to the
smallest of governments.
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Up to this point complexity associated with the
accounting cycle has been added largely by attaching
more funds to the cycle. However, individual
transactions and events within the accounting cycle can
get complex and involved. Several of these complexities
are covered in this lesson.
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The use of computer processing is excellent for
situations such as the accounting cycle where data are
voluminous and clerical mistakes can easily be made.
This lesson shows how computers and computer
applications, in particular, accounting software
packages, can be used to quickly and accurately handle
the volumes of data in the accounting cycle.
See Also:
the
introduction
,
a
pretest
,
a
discussion
,
the
study aides
,
a
test
,
and your
progress evaluation