In your government, appropriations for goods and services that remain encumbered at year-end are automatically carried forward to the next year. Thus, the budget for the following year must include the amounts required to pay for the goods that were encumbered at year-end. The budget, however, must be adopted prior to the start of the following year, and therefore the amount of year-end encumbrances is not known when the budget is adopted. In presenting the original budget in an actual-to-budget comparison, should the amounts of encumbrances be included even though they were not included when the budget was ﬁrst adopted?
Answer to relevant QuestionsYour government is permitted to amend the budget even after the end of the year. When presenting the ﬁnal actual-to-budget comparisons, is it permitted to include the amendments that were adopted after the year-end?What is meant by “deferred inﬂow of resources?” Provide an example of when a government might credit such an account.Until recently governments were not permitted to recognize revenue on increases in the value of investments. What arguments might you present in support of the current position that investments be stated at fair value and ...In August 2015, the last month of its ﬁscal year, Goldwaithe Township issued $88,000 worth of tickets for parking and trafﬁc violations. Of these, the township collected $45,000. It expects to collect an additional ...A city received two state grants in ﬁscal 2015. The ﬁrst was an award for a maximum of $800,000, over a two-year period, to reimburse the city for 40 percent of speciﬁed costs incurred to operate a job opportunity ...
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