Questions from Accounting for Government and Non-Profit

Q: What is the rationale for accounting for nonexpendable endowment funds on a

What is the rationale for accounting for nonexpendable endowment funds on a full, rather than a modified, accrual basis? Why is it important that investments, even in nonliquid assets such as commerci...

Q: Suppose that you are the independent auditor for a local performing arts

Suppose that you are the independent auditor for a local performing arts association (either government or not-for-profit) that recently received a sizable endowment. The association’s president has a...

Q: You are the sole contributor to a philanthropic foundation. You must

You are the sole contributor to a philanthropic foundation. You must specify whether investment gains should be expendable or nonexpendable. Present the key arguments in favor of, and against, permitt...

Q: A college has adopted a “fixed rate of return” approach

A college has adopted a “fixed rate of return” approach to the distribution of investment income. Each year it transfers 6 percent of its endowment value to expendable funds, irrespective of actual ea...

Q: A not-for-profit organization has an endowment fund that

A not-for-profit organization has an endowment fund that, at the start of the year, has a value of $1 million— the amount initially contributed to establish the fund. Owing to investment losses, the y...

Q: Briefly explain what is meant by an “investment pool.” How

Briefly explain what is meant by an “investment pool.” How are its assets presented in the financial statements of the sponsoring government?

Q: A Department of Housing and Urban Development (HUD) program is

A Department of Housing and Urban Development (HUD) program is aimed at conserving and rehabilitating blighted but salvageable urban areas. One element of the program provides that HUD will make rehab...

Q: Why do the balance sheets of agency funds contain only assets and

Why do the balance sheets of agency funds contain only assets and liabilities, but no fund balances? Why is it often unclear whether the resources relating to a particular activity should be accounted...

Q: The following was taken from a pension note of Geffen County.

The following was taken from a pension note of Geffen County. During the year there were no changes to employees’ benefits, no changes in actuarial assumptions, no difference between...

Q: The CAFR of North Orange included the statement of fiduciary net position

The CAFR of North Orange included the statement of fiduciary net position for its employee pension plan presented here: North Orange Employee Pension Plan Statement of Fiduciary Net Position June 3, 2...