Problem 1:
A public college or university can be characterized as governmental, business-like, or a combination of the two. What are the descriptions of each type, and how does a college choose among them?
Please provide an example of each type of college by going to their website and reviewing their financial statements.
Problem 2:
Class, why do colleges and universities report some scholarships as revenue deductions and others as expenses? What are some of the guidelines?
Does this distort the financial reporting process?
Problem 3:
Class, what are the unique accounting and measurement issues present for healthcare entities? How can a CFO address these issues?
Problem 4:
Good point Ethan. Class, this is illustration 17-2 (not 17-1). The differences in GAAP guidance is due to the different types of healthcare entities: investor-owned (like a corporate business and is for-profit), not-for-profit, and governmental.
Class, what are some of the unique ratios mentioned in chapter 17 that healthcare entities are evaluated on? Why might these ratios be used (think about the issues healthcare entities deal with)?
| ILLUSTRATION 17-2: GAAP for Health Care Entities in Different Sectors |
| Accounting and Reporting Issue |
Investor Owned |
Not-for-Profit |
Governmental |
| Reporting entity |
APB Opinion No. 18 |
AICPA SOP 94-3 |
GASB Codification. Sec. 2100 (see Footnote 9 for citiation) |
|
SFAS AO 94 |
|
|
| Contribution and financial statement display |
SFAS No 116 |
SFAS Nos 116 and 117 |
GASB Codification Secs NS0 and 2200 |
| Cash flows |
SFAS No 95 |
SFAS no 95 |
GASS Codification Sec. 2450 |
| Deposits with |
SEAS No 105 |
SFAS no., 105 |
GASS Codification Sec C20 |
| financial insututrons |
|
|
|
| Investments |
SFAS No 115 and AAG-HCO. Chapter 4 |
SFAS No 124 |
GASB Codification Sec. ISO |
| Operating leases |
SFAS No 13 |
SFAS No 13 |
GASS Codification Sec. C20 |
| Prepaid health care arrargements and self insurance program |
AAG.HCO. Chapten 8 and 14 |
AAG-HCO, Chapters 8 and 14 |
GASB Codification Secs C50 and Po20 |
| Compensated absense |
SPAS Nos 43 and 112 |
SFAS NOS. 43 and 112 |
GASS Codification Sec. C60 |
| Debt refundings |
APB Opinion No. 26, SFAS Nos. 4 and 125 |
APB Opnion No 26. SFAS Nos .4 and 125 |
GASS Codification Sec. D20 |
| Pensions |
SFAS Nos. 87, 132 (revcsed) and 158 |
SFAS Nos 87. 132 (tensed), and 158 |
GASS Codification Sec. P20 |
| Risks and uncertainties |
AICPA SOP 94-6 |
AICPA SOP 91-6 |
GASS Codification Sec. C SO |
| Post-retirement benefits |
SFAS Nos 106 and 132 (revised) |
SFAS NO 106 and 132 (revised) |
GASS Codification Sec. P50 |
| Fair value measurements |
SFAS No. 157 |
SFAS No 157 |
None |