Implementation Guide - Federal Accounting Standards Advisory Board

116 Pages·1998·0.41 MB·English

This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
EDIUG NOITATNEMELPMI
DNA EUNEVER ROF GNITNUOCCA
SECRUOS GNICNANIF REHTO
6991 enuJ
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
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dna ecitcarp pleh ot dednetni snoitanalpxe
etutitsnoc ton seod ti ;gnidnatsrednu
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laicnaniF laredeF fo stnemetatS gniylppa
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,BMO morf detseuqer eb yam sdradnats esoht fo
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,431 ralucriC
Financial Accounting Principles
no ecnadiug ,oslA .)3991 ,02 yaM(
and Standards
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ot esu ot )s(tnuocca reporp eht gninrecnoc
morf thguos eb yam noitcasnart nevig a drocer
.draoB regdeL lareneG dradnatS eht
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
ROF EDIUG NOITATNEMELPMI
EUNEVER ROF GNITNUOCCA
DNA
SECRUOS GNICNANIF REHTO
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
EUNEVER ROF GNITNUOCCA OT EDIUG NOITATNEMELPMI
SECRUOS GNICNANIF REHTO DNA
STNETNOC FO ELBAT
SECRUOS GNICNANIF REHTO DNA EUNEVER NO GNITROPER :1 RETPAHC ..... 1
NOITCUDORTNI ................................................. 1
STNEMETATS LAICNANIF WEN FO WEIVREVO ......................... 2
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ytivitcA ;)4( tnemetatS fo segnahC ni teNnoitisoP
; )t5n(emetat Sf oy rsaetcergudo us;Be)tR5n(emetatS
)6( gnicnaniF fo
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eht ecnalaB teehS ;)9( weN stnemetatS foyrategduB
)21( gnicnaniF dna secruoseR
LEDOM GNITROPER LAREDEF GNIVLOVE EHT DNA YGOLONIMRET ......... 21
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STNEMETATS LAICNANIF WEN :2 RETPAHC .............................. 61
TSOC TEN FO TNEMETATS ........................................ 61
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;s)n3o2i(tacil prmoIf eht yalpsid fo laicepssesac
)62(
YTIVITCA LAIDOTSUC FO TNEMETATS .............................. 92
elanoitaR ;)92( evitartsu ltlnIemetatS folaidotsuC
)03( ytivitcA
NOITISOP TEN NI SEGNAHC FO TNEMETATS ......................... 13
evitartsullI tnemetatS fo segnahC ni teN noitisoP
;)23( snoitacilpmI fo eht mret ten" stluser fo
)23( "snoitarepo
SECRUOSER YRATEGDUB FO TNEMETATS ............................. 33
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GNICNANIF FO TNEMETATS ....................................... 53
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EUNEVER GNITROPER ............................................ 24
RETPAHC :3 NOSIRAPMOC NEEWTEB GNITNUOCCA DNA YRATEGDUB
SNOITCASNART FO SNOITACIFISSALC .............................. 44
NOITCUDORTNI ................................................. 44
CILBUP EHT HTIW SNOITCASNART ................................. 44
)74( segrahc resU ;)44( nosirapmoc lareneG
SNOITCASNART LATNEMNREVOGARTNI ............................... 84
METSYS NOITACIFISSALC FO ECIOHC .............................. 94
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
ii
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GNICNANIF ........................................................ 18
NOITCUDORTNI ................................................. 18
YTILIBAIL EVAEL LAUNNA EHT NI ESAERCED ....................... 28
ESAEL LATIPAC YB DERIUQCA STESSA ............................. 38
TNEMESRUBMIER TUOHTIW TUO DNA NI STESSA FO SREFSNART ......... 78
STESSA DEZILATIPAC FO ELAS ................................... 98
CILBUP EHT MORF EUNEVER EGNAHCXE ............................. 09
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___________________________________________
draoB yrosivdA sdradnatS gnitnuoccA laredeF
secruoS gnicnaniF rehtO dna euneveR rof gnitnuoccA
ediuG noitatnemelpmI
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
CHAPTER 1: REPORTING ON REVENUE
AND OTHER FINANCING SOURCES
INTRODUCTION
1. Statement of Federal Financial Accounting
Standards Number 7, Accounting for Revenue and
Other Financing Sources and Concepts for
Reconciling Budgetary and Financial Accounting
(SFFAS No. 7), provides authoritative standards
for classifying, recognizing, and measuring
inflows of resources to the U.S. Government and
its component reporting entities. These standards
help provide better information about the cost of
the Government's activities, make Federal
financial reporting more supportive of the budget
and performance measurement, and demonstrate
accountability. The standards reflect the concepts
adopted in Statement of Federal Financial
Accounting Concepts No. 1, Objectives of Federal
Financial Reporting (SFFAC No. 1), and Statement
of Federal Financial Accounting Concepts No. 2,
Entity and Display (SFFAC No. 2).
2. This document is an implementation guide for
SFFAS No. 7. It is not authoritative material. The
guide presents illustrations, explanations, and a
case study intended to help practice and
understanding. Authoritative guidance on form and
content (i.e., display) of financial reports
prepared pursuant to the Chief Financial Officers
Act of 1990 (as amended) is provided by OMB in its
periodic bulletins on the form and content of
agency financial statements. Further guidance on
applying SFFAS No. 7 and interpretations of it and
other Federal accounting standards may be
requested from the Office of Federal Financial
Management, Office of Management and Budget,
pursuant to OMB Circular A-134,
Financial
(May 20, 1993,
Accounting Principles and Standards
or as subsequently amended). 1 Also, guidance on
specific questions that arise in practice
concerning the proper account(s) to use to record
a given transaction may be sought from the
Standard General Ledger Board.

1.ediuG noitatnemelpmI siht ot xidneppA eht ni decudorper si 431-A
___________________________________________
draoB yrosivdA sdradnatS gnitnuoccA laredeF
secruoS gnicnaniF rehtO dna euneveR rof gnitnuoccA
ediuG noitatnemelpmI
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
2 CHAPTER 1
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)
3. FASAB prepared this implementation guide
pursuant to Paragraph III.I, "Pronouncements," of
FASAB's approved rules of procedure. Subparagraph
3 of paragraph III.I reads: "The FASAB may, in
its discretion and with or without appointment of
task forces, research, notice, public hearings, or
public exposure, issue in its name or at its
direction other communications of an informational
nature related to Federal accounting and financial
reporting, including the FASAB's mission,
policies, and activities. Such communications may
include, among others, discussion memorandums,
summary and related documents, research reports,
responses to requests and inquiries, and
statements of policy dealing with matters of
Federal accounting and financial reporting." Most
of this Guide is a revision or expansion of parts
of the material included in the exposure draft,
Accounting for Revenue and Other Financing Sources
(July 1995). It has been revised in light of the
comments on that exposure draft.
4. This implementation guide is organized largely
in terms of the new basic financial statements for
component Federal reporting entities. The
following new financial statements illustrate the
application of the standards in SFFAS No. 7:
o Statement of Net Cost,
o Statement of Custodial Activity,
o Statement of Changes in Net Position,
o Statement of Budgetary Resources, and
o Statement of Financing.
5. Some accounting and disclosure issues peculiar
to the consolidated financial statements of the
U.S. Government (required by the Government
Management Reform Act) have not yet been addressed
by the Board. Those consolidated statements may
differ from the statements of the component units
described in this guide.
OVERVIEW OF NEW FINANCIAL STATEMENTS
___________________________________________
draoB yrosivdA sdradnatS gnitnuoccA laredeF
secruoS gnicnaniF rehtO dna euneveR rof gnitnuoccA
ediuG noitatnemelpmI
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
REPORTING ON REVENUE AND OTHER FINANCING SOURCES 3
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)
6. The standards in SFFAS No. 7 contemplate that
for each component reporting entity, all costs
will be shown in a Statement of Net Cost, along
with applicable exchange (i.e., earned) revenues.
Another statement, the Statement of Changes in Net
Position, will report nonexchange revenues and
appropriations. Separating costs and exchange
revenues from nonexchange revenues and other
financing sources is necessary to calculate the
net cost incurred by a reporting entity in
providing its outputs and its contributions to
outcomes.
Statement of Net Cost
7. Under the new accounting standards, exchange
revenues will be deducted from gross costs on a
Statement of Net Cost to show the net cost of
the entity's operating activities. Gross cost
consists of all the costs recognized by an
entity for a given period under Federal
accounting standards. Net cost is the amount
for which the entity is responsible and may,
with appropriate details or "breakdowns" by
suborganizations and programs, be compared with
the entity's outputs to evaluate its
performance. Gross cost also is relevant to
performance measurement and, for some purposes,
is more useful than net cost. Net cost is also
the amount that, with some exceptions, must
ultimately be paid by the taxpayer. The only
major exception is for intragovernmental sales
of goods and services. The extent to which
taxpayers bear the costs of these goods and
services depends on whether the goods and
services are sold to entities that in turn sell
goods and services to the public, or to
entities that are financed by taxes. The net
cost of operations may also be financed by
other nonexchange revenue such as fines and
donations.
8. Details or breakdowns within the Statement
will also show exchange revenues deducted from
the related costs of the transactions that
generated these revenues. This will show the
extent to which the costs of goods and services
sold to the public are recovered by exchange
revenues. Exchange revenues will be included in
the Statement of Net Cost regardless of whether
the entity retains the amounts or transfers
them to others.

___________________________________________
draoB yrosivdA sdradnatS gnitnuoccA laredeF
secruoS gnicnaniF rehtO dna euneveR rof gnitnuoccA
ediuG noitatnemelpmI
This is the original Implementation Guide to SFFAS 7 and was replaced by the Revised Implementation Guide at
http://www.fasab.gov/pdffiles/impguid7200204.pdf. Neither guide has been updated for subsequent changes to SFFAS 7;
4 CHAPTER 1
please check for the most recent SFFAS 7 file in the FASAB Handbook at www.fasab.gov/pdffiles/handbook_sffas_7.pdf.
(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)(cid:31)
Statement of Net Cost

Focuses on:
Operating costs (gross costs) and
related exchange revenues of the
reporting entity
Presents information about:
All costs less earned revenues in total
and by suborganizations and programs
Emphasizes:
Net cost of operations for comparison
with performance measures

Statement of Custodial Activity
9. For reporting entities such as the Internal
Revenue Service (IRS) that collect taxes for
other entities, such custodial collections and
the adjustments to measure revenue will be
reported in statements that are separate from
those used to report on the collecting entity's
own operations. A Statement of Custodial
Activity will reflect the collections by type,
the adjustments to calculate the revenue, and
the disposition of the amounts to the entities
entitled to receive them. The collecting
entities will not recognize inflows from these
custodial activities as their own revenue. 2
Statement of Custodial Activity
Focuses on:
Revenue collections on behalf of other
entities
Presents information about:
Source and disposition of collections
and related accruals
Emphasizes:
Accountability for collections

2 ehT SRI dna eht smotsuC ecivreS won eraperp a tnemetatS folaidotsuC
.ytivitcA
___________________________________________
draoB yrosivdA sdradnatS gnitnuoccA laredeF
secruoS gnicnaniF rehtO dna euneveR rof gnitnuoccA
ediuG noitatnemelpmI