Question: Why does GASB prefer to use the term economic condition rather than financial condition? Economic condition considers the probability that the government will meet both

Why does GASB prefer to use the term economic condition rather than financial condition?

Economic condition considers the probability that the government will meet both financial and service obligations currently and in the future but financial condition does not.

Financial condition does not consider the ability to maintain service levels.

Economic condition focuses on both the ability and willingness to meet financial and service obligations.

Financial condition focuses primarily on liquidity.

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