ProjectOne: Governmental Accounting Guidelines

Overview

Thefirstfinal project for this course is the creation of an accounting workbook and accompanyinginformational report to taxpayers.

Governments are unique in that most of their revenue comes from taxes and fees imposed upon the citizens. It is the responsibility of the government accountant to provide accountability for these funds through financial reports.

By working through this project, you will understand how revenues and expenditures are accounted for in governments. The information is presented in various funds that provide accountability at a more detailed level through fund-level statements. The information is also presented in big-picture form through government-wide statements.

In the accounting workbook and report, you will use course-provided information to (1) analyze government transactions for various funds in accordance with the standards of the Government Accounting Standards Board (GASB);(2) create and use fund financial statements to assist in the creation of government-wide statements; and (3) communicate the results of operations to interested taxpayer groups.
In this assignment, you will demonstrate your mastery of the following course outcomes:

• Analyze governmental and nonprofit accounting procedures used for the preparation of financial statements to promote accountability in financial reporting and inform decision-making.

• Prepare journal entries, financial statements, and supporting documentation that impact reporting for nonprofit and governmental entities using appropriate accounting standards

• Evaluate governmental and nonprofit accounting statements in determining the fiscal position of various entities using appropriate tools of the discipline

• Select accounting methods appropriate to the differentiated needs of governmental and nonprofit organizations

• Determine appropriate strategies for effectively communicating the differences between private sector, governmental, and nonprofit reporting to stakeholders

Prompt

You are the accountant for a local government. Your job requires that you analyze transactions, post to ledgers, and prepare financial statements. Using the Final Project One Case Studydocument andthe Final Project One Student Workbookspreadsheet provided, you will prepare an accounting workbook, which includes supporting journals for governmental funds, proprietary funds, and fiduciary funds. The supporting journals will be used in preparation of the fund's financial statements. You will then perform a reconciliation to prepare the government-wide financial statements for governmental activities and business activities. Finally, you will prepare a five-to seven-page informational report explaining the different funds to a taxpayer group interested in understanding the purpose of the funds.

For Final Project One, you will use the Final Project One Student Workbook Excel spreadsheet provided for you.

If you would like a refresher course on using various features of Excel, sign in to Atomic Learning and type "Excel" in the search box. This will provide you with options to select the specific level of training that you need (i.e., intro, intermediate, or advanced) and the specific version of Excel that you have (i.e., 2011, 2013, etc.). The trainings are broken down into small, meaningful chunks. Therefore, you should be able to find specific topics at each level that will meet your needs.

IMPORTANT: For the transaction worksheets for each fund, in column A, the part shaded in yellow, code the account 1 for balance sheet accounts and 2 for operating statement accounts. For example, on sheet GF WS, cash is a balance sheet account so in cell A1 you will put 1. These codes will allow the worksheet to automatically populate the operating statement and balance sheet columns on the worksheets. These will automatically populate the corresponding financial statements.

For some funds, you will be required to prepare entries for transactions. Statements will automatically be created (if you properly code column A). You can check your work by ensuring debits equal credits and that the corresponding statements balance.

For other funds, you will be given the completed worksheet for the funds' transactions and you will be required to prepare the appropriate statements (statements will not automatically be populated from the completed worksheet).

Sheets you are required to complete will have white tabs. Sheets that automatically populate or that have given information will have green tabs.

SAVE YOUR WORK OFTEN!

General Fund

As one of the accountants for the City of Springfield, you will record the following transactions into the accompanying workbook?sheet GF WS. Note that some transactions have already been recorded in the workbook. The city has other accountants who also record transactions.

1. The city levied its general property taxes for the year of $1,580,000. The city estimates that $30,000 of the taxes will prove uncollectible. Record the taxes assuming the city will collect the remaining balance later during the fiscal year.

2. The city collected $1,300,000 of property taxes before the due date for taxes. The remainder of the taxes receivable became delinquent.

3. The city received and vouchered the materials and supplies that were on order from the previous year. The actual cost equaled the estimated cost of these materials and supplies, $19,000. The city records expenditures for materials and supplies when they are consumed.

A perpetual inventory system is used.

4. The city incurred and paid salary expenditures as follows:

Accrued salaries payable, January 1. . . . . . . . . . . . . . . . . . . . $ 50,000
General government. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 180,000
Public safety. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .580,000
Highways and streets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .175,000
Health and sanitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,000
Parks and recreation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .220,000
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,355,000

5. Billings were received from the Central Communications Network Internal Service Fund for communications services used by general government agencies and departments as follows:

General government. . . . . . . . . . . . . . . . . $ 18,000
Public safety. . . . . . . . . . . . . . . . . . . . . . . . 15,000
Highways and streets . . . . . . . . . . . . . . . . 3,500
Health and sanitation . . . . . . . . . . . . . . . . 6,630
Parks and recreation. . . . . . . . . . . . . . . . . 13,940
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 57,070

6. $61,000 was paid on the amounts owed to the Central Communications Network Internal Service Fund.

7. Other unencumbered expenditures incurred during the year were vouchered as follows:

General government. . . . . . . . . . . . . . . . . $ 11,420
Public safety. . . . . . . . . . . . . . . . . . . . . . . . 41,280
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 52,700

8. $500,000 was loaned from the General Fund to the Addiction Prevention Special Revenue Fund to provide working capital for that fund. The loan is to be repaid within a year.

9. The General Fund transferred resources to other funds as follows:

Addiction Prevention Special Revenue Fund . . . . . . . . . $ 60,000
Parks and Recreation Capital Projects Fund. . . . . . . . . . 200,000
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $260,000

10. The General Fund received a transfer of $100,000 from the Water and Sewer Enterprise Fund.

11. The city levied interest and penalties of $35,000 on the overdue taxes receivable. Interest and penalties of $5,600 are expected to prove uncollectible.

12. The city wrote off uncollectible taxes receivable of $23,000.

13. General government equipment with an original cost of $300,000 and accumulated depreciation of $187,000 was sold for $72,000, which was deposited in the General Fund.

14. Materials and supplies were used by General Fund departments during the year as follows:

General government . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11,000
Public safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,000
Highways and streets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75,300
Health and sanitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,400
Parks and recreation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $190,700

15. The city entered into a capital lease for parks and recreation equipment on December 31. The capitalizable cost of the equipment was $90,000, including a down payment of $10,000.

16. The city contributed $60,200 to the city Police and Fire Pension Trust Fund.

17. The General Fund received $250,000 from the Addiction Prevention Special Revenue Fund in partial repayment of the interfund loan.

18. The city paid vouchers payable of $235,800.

Special Revenue Fund

The Addiction Prevention Special Revenue Fund was established in 20X4 to account for federal grants intended to help communities prevent and battle drug and alcohol addictions. Because this is the first year for this fund, there is no beginning trial balance for the Addiction Prevention Special Revenue Fund.

You are given the completed transaction worksheet (tab APSFR). From the worksheet:

A. Prepare the 20X4 Statement of Revenues, Expenditures, and Changes in Fund Balance for the Addiction Prevention Special Revenue Fund (tab AP OP).

B. Prepare the 20X4 balance sheet for the Addiction Prevention Special Revenue Fund (tab AP BS).

Parks and Recreation Capital Projects Fund
Record the following transactions to tab P&R CPF

1. The city approved a major capital improvement project to construct a recreational facility. The project will be financed by a bond issue of $1,500,000, transfers from the General Fund of $500,000, and a contribution from the county of $300,000. Record the budget assuming these amounts, along with an equal appropriation for the project, were adopted for 20X4.

2. The city received the county's contribution of $300,000. These resources are required to be used for the construction project. The grant is expenditure-driven. The city's policies indicate that resources restricted for a given purpose are considered expended prior to any unrestricted resources available for that purpose.

3. The city transferred $200,000 from the General Fund to the Parks and Recreation Capital Projects Fund.

4. The city issued bonds with a face (par) value of $1,500,000 at a premium of $50,000 on January 1. Bond issue costs of $15,000 were incurred. Interest of 8% per year and $100,000 of principal are due each December 31.

5. The city signed a $2,190,000 contract for construction of the new recreational facility. The process to establish the contract qualifies as a commitment under the city's commitments policy.

6. The city purchased land as the site for the facility at a cost of $110,000. Payment was made for the land.

7. The contractor billed the city $1,200,000. The city paid all but a 5% retainage.

8. The outstanding encumbrances were closed (use the transactions columns for this entry).

9. The budgetary accounts were closed at year end. Appropriations do not lapse at year end. Close the budgetary accounts in the transactions columns.

General Debt Service Fund

You are given the completed transaction worksheet (tab GEN DSF). From the worksheet,

A. Prepare the 20X4 Statement of Revenues, Expenditures, and Changes in Fund Balance for the General Debt Service Fund (tab GEN DSF OS).

B. Prepare the 20X4 balance sheet for the General Debt Service Fund (tab GEN DSF BS).

General Capital Assets

You are given the completed transaction worksheet CGA WS; prepare the General Capital Asset Note Disclosure (tab CGA Note).

General Long-Term Liabilities

You are given the completed transaction worksheet GLTL; prepare the General Long-term Liabilities Note Disclosure (tab GLTL Note).

Water and Sewer Enterprise Fund

You are given the completed transaction worksheet (tab W&S EF). From the worksheet,

A. Prepare the 20X4 Statement of Revenues, Expenditures, and Changes in Net Position (tab W&S OS).
B. Prepare the 20X4 Statement of Net Position (tab W&S SNP).

Central Communications Network Internal Service Fund

Record the following transactions to tab CCN ISF:

1. Billings to departments for communications network services during 20X4 were as follows:

General Fund departments . . . . . . . . . . . . . . . . . . . . . . $57,070
Water and Sewer Department . . . . . . . . . . . . . . . . . . . . 33,000
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $90,070

2. The department collected $61,000 from the General Fund and $30,000 from the Enterprise Fund.

3. Payroll of $60,000 was paid, and $3,000 was contributed to the statewide retirement system.

4. The department purchased materials and supplies costing $14,000 and a voucher was approved.

5. Materials and supplies costing $17,700 were used by the Central Communications Network during 20X4.

6. Vouchers payable of $15,000 were paid.

7. Depreciation for the year was $8,370.

8. Salaries and wages of $1,000 were accrued at the end of the year.

Police and Fire Pension Trust Fund

You are given the completed transaction worksheet (tab PTF WS). From the worksheet,

A. Prepare the 20X4 Statement of Changes in Net Position (tab PTF OS).

B. Prepare the 20X4 Statement of Net Position (tab PTF SNP).

Fund and Government-Wide Financial Statements

The tabs colored purple are the fund and government-wide statements. If all of your previous work is correct, your statements will be complete and will balance. Review the purple tabs to ensure all of your statements are complete and correct. Once they are correct, you are done with the assignment and may submit the entire workbook.

Attachment:- Workbook.xlsx