Basic Statements for University Reporting
by Public Institutions
Three Reports tie together in some way!!
of Net Assets = Balance Sheet
of Revenues, Expenses and Changes in Net Assets = Statement of
Changes in Fund Balance
- Statement of Cash
|Basic Accounting Principles
Balance Sheet Equation:
= Liabilities + Fund Balance
Principle: Requires that Revenues and Expenses be matched
Principle: Revenues are recognized when earned. (Revenues
received ahead of time are deferred until such time as the earnings
process is complete)
must be charged to the period when the expense was incurred
regardless of when the bill was paid
rule regarding expense accrual: If goods are received or services
are rendered by June 30, they MUST be charged to the fiscal
year just ended.
- If the
shipping terms were FOB Shipping Point, the critical date
is the date goods were shipped, not received because that
is when the University took title to the goods.
- A threshhold
is set annually, under which an accrual is not necessary.