Organizational Self-Balancing Fund

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An Organizational Self-Balancing Fund is a bookkeeping account that represent funds-related transactions.



References

2016

2015

  • (Wikipedia, 2015) ⇒ http://en.wikipedia.org/wiki/fund_accounting#Overview Retrieved:2015-12-28.
    • Nonprofit organizations and government agencies have special requirements to show, in financial statements and reports, how money is spent, rather than how much profit was earned. Unlike profit oriented businesses, which use a single set of self-balancing accounts (or general ledger), nonprofits can have more than one general ledger (or fund), depending on their financial reporting requirements. An accountant for such an entity must be able to produce reports detailing the expenditures and revenues for each of the organization's individual funds, and reports that summarize the organization's financial activities across all of its funds. [1]

      A school system, for example, receives a grant from the state to support a new special education initiative, another grant from the federal government for a school lunch program, and an annuity to award teachers working on research projects. At periodic intervals, the school system issues a report to the state about the special education program, a report to a federal agency about the school lunch program, and a report to another authority about the research program. Each of these programs has its own unique reporting requirements, so the school system needs a method to separately identify the related revenues and expenditures. This is done by establishing separate funds, each with its own chart of accounts.

  1. Hay, p. 4-5, 9.
  • (Wikipedia, 2015) ⇒ http://en.wikipedia.org/wiki/fund_accounting#State_and_local_government_funds Retrieved:2015-12-28.
    • State and local governments use three broad categories of funds: governmental funds, proprietary funds and fiduciary funds.

      Governmental funds include the following.[1] [2] * General fund. This fund is used to account for general operations and activities not requiring the use of other funds. * Special revenue (or special) funds are required to account for the use of revenue earmarked by law for a particular purpose. State and federal fuel tax revenues require special revenue funds, because federal and state laws restrict these taxes to transportation uses. * Capital projects funds are used to account for the construction or acquisition of fixed assets, [3] such as buildings, equipment and roads. Depending on its use, a fixed asset may instead be financed by a special revenue fund or a proprietary fund. A capital project fund exists only until completion of the project. [4] Fixed assets acquired and long-term debts incurred by a capital project are assigned to the government's General Fixed Assets and Long-Term Debts. * Debt service funds are used to account for money that will be used to pay the interest and principal of long-term debts. Bonds used by a government to finance major construction projects, to be paid by tax levies over a period of years, require a debt service fund to account for their repayment. The debts of special assessment and proprietary funds are serviced within those funds, rather than by a separate debt service fund. [5] * Permanent funds account for public infrastructure improvements financed by special levies against property holders. Sidewalk and alley repairs often rely on special assessments. Proprietary funds include the following. * Internal service funds are used for operations serving other funds or departments within a government on a cost-reimbursement basis. A printing shop, which takes orders for booklets and forms from other offices and is reimbursed for the cost of each order, would be a suitable application for an internal service fund. [6] * Enterprise funds are used for services provided to the public on a user charge basis, similar to the operation of a commercial enterprise.[7] Water and sewage utilities are common examples of government enterprises. [8] Fiduciary funds are used to account for assets held in trust by the government for the benefit of individuals or other entities. [9] The employee pension fund, created by the State of Maryland to provide retirement benefits for its employees, is an example of a fiduciary fund. Financial statements may further distinguish fiduciary funds as either trust or agency funds; a trust fund generally exists for a longer period of time than an agency fund. [10]

  1. Hay, p. 6
  2. "Touring the Financial Statements, Part III: The Governmental Funds" Government Accounting Standards Board (November 2007). Retrieved 2010-03-17.
  3. Fixed assets are sometimes referred to as capital assets, a broader term than fixed assets.
  4. Earl Wilson, Jacqueline Reck, Susan Kattelas (2006). Accounting for Governmental & Nonprofit Entities, 14th edition. p. 163. McGraw-Hill. ISBN 0-07-310095-1.
  5. Hay, p. 164-165
  6. Hay, p. 232
  7. State of Maryland Comprehensive Annual Financial Report, FY 2009 See "Fund Financial Statements," p. 12-13
  8. Hay, p. 247
  9. Hay, p. 286
  10. Hay, p. 291

2013

2005

2004

  • http://nces.ed.gov/pubs2004/h2r2/ch_4.asp#3
    • QUOTE: For governmental entities to ensure the proper segregation of resources and to maintain proper accountability, an entity's accounting system should be organized and operated on a fund basis. Each fund is a separate fiscal entity and is established to conduct specific activities and objectives in accordance with statutes, laws, regulations, and restrictions or for specific purposes. A fund is defined in GASB Codification Section 1300 as a fiscal and accounting entity with a self-balancing set of accounts recording cash and other financial resources, together with all related liabilities and residual equities or balances, and changes therein, which are segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions, or limitations.