Question: Many accountants note that for most governments the reported bottom
Many accountants note that for most governments the reported ‘‘bottom line’’ of their ﬁnancial statements (i.e., revenues less expenditures/expenses and other charges that affect fund balance/net position) will not greatly differ between their fund statements and their government-wide statements insofar as the expenditures/expenses relate to long-term assets and the long-term liabilities issued to ﬁnance those assets. That’s because governments typically repay the debt evenly over a period which approximates the economic life of the related asset. Assuming the accountant’s assumption as to means of ﬁnancing to be correct, will the expenditures and related charges affecting fund balance of the governmental fund statements approximate the expenses of the government-wide statements?
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