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Student: Miss. Bayo Elizabeth Cary
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ACC7020-8
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JKuhn
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Federal Government, Higher Education, and Health-Care
Accounting
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Assignment 7
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Getting
back into the swing of things. I feel confident about my responses to the
assignment tonight. I will work harder, and I promise to do a better job next
week. I am homeless in Orlando FL. It rained here tonight. I had to move to
avoid the rain. Then I had to move again to avoid sprinklers. And, I had to
move again, to recharge my laptop. Orlando is no fun. I even have to provide my
own WiFi. I hope to turn the last assignment in, by this Thursday. This
Thursday, I will be flying from Orlando FL, to Oslo, Norway. Thank you for your
help. Will you be my instructor, for the next course-as well? I am PhD-or bust!
Thank you again.
June 12, 2016
Doctoral Student: Miss.
Bayo Elizabeth Cary, A.A., B.A., M.L.I.S.
Assignment 7: Write a
paper to compare and contrast the accounting and reporting requirements between
federal government, colleges, universities, and health care organizations. Be
sure to include the limitations on revenues, grants, endowments or gifts,
describe the funds used, measurement of performance, and required financial
statements for each, where applicable.
What are the: accounting,
auditing, and reporting requirements, for each genre, listed below?
1)
US Federal Government;
2)
US Colleges and Universities;
3)
US Healthcare Organizations.
The US Federal Government requires the use
of GASB, in order to audit, and to report, financial information, as it
pertains, to US Federal and Government organizations:
Established in 1984, the
Governmental Accounting Standards Board (GASB)
is the independent, private-sector
organization based in Norwalk,
Connecticut, that establishes accounting and
financial reporting standards
for U.S. state and local governments that
follow
Generally
Accepted Accounting Principles (GAAP). ("GASB About us," n.d.)
Separate accounting
principles and guidelines are used, for a private government and or business
type entity, as opposed to a US government entity. The determination, between a
public, or a private classification, is dependent solely, on what financing, an
entity receives, for instance:
In
the US, some colleges and universities are
considered
public, whilst others, are classified as private.
Public
colleges and universities-in the US, are defined as those which
receive, at least: $500,000.00 in money, from
the US
Federal government. Federal money, that is usually contributed
to
universities, that are classified as public-is usually in the form of:
student
financial aid, and, in the form of: research
sponsorship
money. (Kattelus, S. C., Reck, J. L., & Wilson, E. R., 2010)
Therefore, when
discussing the appropriate guidelines, to utilize, when auditing the financial
records of a college or a university, within the US, the first consideration,
must be, is the educational institution: public or private. For a public
university, it is appropriate to apply the standards, and the guidelines, that
are made readily available, through the: GASB. GSAB accounting standards are
applicable to both: public educational institutions, and to: Federal, state,
and local US government accounting. Whereas: FASB, is utilized when auditing
the accounts of, both: private universities, and, nonprofit organizations:
Financial reports, which include financial statements
prepared in conformity
with generally accepted
accounting principles, are essential for public
accountability
and for an efficient and effective functioning of our
democratic
system of government. Thus, the Board plays a major
role in fulfilling the government’s responsibility
to be publicly accountable. Federal financial reports should
be useful in assessing (1) the government’s accountability
and its efficiency
and effectiveness, and (2) the economic, political,
and social consequences, whether positive or negative, of
the allocation
and various uses of federal resources. ("FASAB
Mission," n.d.)
Healthcare organizations, in the US, are generally
classified, as nonprofit organizations. Due to the fact, that Healthcare organizations,
are usually classified as nonprofit organizations, auditing accounts, for
healthcare organizations, is most often conducted with FASAB guidelines,
however, some parts, of the US healthcare system, such as, the VA hospitals, do
fall under the category of a government funded, and therefore, government
entity. In such cases, as when a healthcare organization, falls under the classification
of, US government entity, then, the accounting auditing standards defined
through GASB-are applicable.
To sum
up, basically speaking, there are two types of major accounting standards, in
the US, which fall under the purview, of: GAAS (Generally Accepted Accounting Standards)
and the AICPA (American Institute of Certified Public Accountants). Financial accounts, that are considered
government accounts, utilize the accounting auditing guidelines provided by: GASB.
Whereas, financial accounts, that fall under the auspice of: private, or
nonprofit organization, utilize the account auditing guidelines, provided by:
FASB. Due to the fact that, public universities,
are considered government funded entities, they utilize the guidelines provided
by: GASB, just like a government funded hospital-whereas, private colleges and
universities, and nonprofit organizations, utilize, the account auditing
guidelines, provided by: FASB.
What specific funds are
used, as per each accounting genre?
Different funds are utilized, with:
GASB account auditing, than are utilized, for FASB, account auditing. Both:
GASB and FASB, use the organizing financial accounts categories, of: “funds.”
Dependent, of whether the accounts to be audited, are public or private, ie-as
to where or not: GASB or FASB guidelines, will be applicable, the specific type
of accounting guidelines chosen, decide, which funds are enumerated, and which
funds are present for the auditor-when making an evaluation, of the finances,
of either: a public government entity, or a private financial institution. In
my opinion, the accounting guidelines vary a great deal, between what is
required of an audit, by the US government, and, what is required an accurate
financial audit, by a private business owner/private entity. It is not unusual, for the US Federal
government, to have stricter standards, than that of, an advancing: investor,
and entrepreneur.
Additional Information
Regarding: Accounting, Auditing, and Reporting Requirements and Limitations:
1)
Revenue;
2)
Grants;
3)
Endowments and Gifts.
Revenue, is recorded differently, based on
whether the accounting principles, are being guided by: GASB, or FASB. I read
some, into how both accounting standards are supposed to be applied, and, there
are some differences, and, the differences seem rather insignificant to
me. For revenue, it is generally
recorded, in the same period in which it was earned. Then, dependent on how the
revenue was earned, that influences, haw the revenue is classified. For instance, revenue can be classified, as:
unrestricted, temporarily restricted, and also as permanently restricted. The
various classifications, of revenue, determine, how and when the money will be
spent-as well as, where money from each fund will go-if, there is a: loss, or a
gain.
Grants, are gifts of money, and are
generally given to college, and university students, for study. Both: public
and private universities, offer grant money, to students, who are studying, and
who are actively making progress, towards earning a degree. Because grants, are
routinely offered at colleges and universities, to both: public and private
educational institutions. Both: GASB and FASB, have guidelines, and information
available, in regards to-which fund, grant money for students, should be
classified in to? Grants are money, that a student does not ever have to pay
back, and grants, are money that are not usually attached to anything. Grant
money is usually something a student earns, for a GPA, or for classification,
as a certain student, in a certain state, attending a public university-such
as: the US Federal Loan Pell grant, that is almost always offered, to US
students, to help to pay for, their undergraduate studies.
Endowments and gifts, sometimes have
more meaning and purpose to them, than a grant. An endowment, or a gift, is
more like a scholarship-it is something that has to be earned. An endowment or
gift, can be given to a student, or to staff at a university for a research
experiment, as, a: nonexchange, or as an exchange. Should an endowment and gift, be given to a
university, as a nonexchange-then, the individual or organization, who made the
contribution, to the university, expected nothing in return. However, often
times, an endowment, or a gift, is offered to a university, with very specific
strings attached.
The endowment might offer specified
payment dispersal dates, for the gift, as well as require, written
communication, about how: an experiment is going, about what sorts of evidence
has been collected, regarding the progressing of an expensive and
complicated-yet highly important dissertation-etc. Sometimes, academic work, at a university, is
of such great importance, that it can make someone, an international star. I graduated, with my bachelor’s degree, from:
University of Florida. University of Florida, because of the football program
there-is where: “Gatoraid” originated. The scientist, who designed the electrolyte
sports drink Gatoraid, was in an exchange relationship, and, had to go through
some serious legal arguments about who was, the true owner of the new salty
soft drink.
Presently, what are the
established: “Measures of Performance,” for each genre listed above:
Measures of performance, are not
specific, in detailed or standardized record keeping-like the auditing, of the
financial records. The records of performance, are industry specific, and they
are kept flexible, to encourage various industries, to stay true to their
original mission statements, and to incorporate, their business entity-overall
objectives, into what is evaluated, when making the point, that, the: “Entity,”
has made some mile stones, and had also made some significant contributions to
society, through those achievements.
For instance, for the educational
community, there are several qualitative standards, that can be easily
quantified, to make a fast and helpful evaluation, of how well, a college or
university, is serving their student body, such as: Rate of graduation, Number
of student who graduate with a minor, Number of students who are employed-shortly
after their college graduation, GPA that students are being admitted to the
university with, GPA, that the students, are graduating from the university
with, etc. I think overall, it is important to remember, that while auditing
financial accounts accurately, is extremely important-it is not the whole
picture, as to how well, an particular entity-either: public or private, is
doing.
There are other qualitative
ways, other than looking to performance evaluations, to gage, if an entity, is
doing well, and if, the entity might proper, in the very near future. Due to
the fact, that even nonprofit businesses and organizations cannot function without
money, it is important, to try to gain a favorable opinion, from those in the
US, and Internationally, such as: Fitch, Moody, S&P, the SEC, etc., who
help to determine, how much an entity, is financially worth. Wealth, which is
financial worth, is a clear indication, as to whether an entity, is doing well,
in any given position, in an open market environment, such as, the American
stock market, and, within the American economy.
Having: high credit ratings, low loan
risk ratings, and a low debt to credit ratio, gives an entity, participating as
a competitor, on the world stage, an opportunity, to project a positive image,
of: integrity and confidence, and, to gain-a much required share of the
business market. Doing well financially, is also, a reassuring indication, that
an entity, is: “performing” well, and, is able to compete-which, does for
viability sake, forebode well, for a long and prosperous future.
Lastly, I
believe, it to be the whole picture, that allows a consumer to accurately
judge, whether an entity, has any: “Stay,” power to truly succeed, or not. “Even
after 25 years of effort and great progress by the majority of federal
agencies, some ask whether audited financial statements are useful for a
national government (Payne, Wendy M. 2016).” I too, have come to the conclusion, that it is
really is necessary, to have, and to know more, than just the results, from a
basic financial account audit, in order to determine, how well, a potential
investment, is doing, on the international market. The first perusal, might be
the audits, of an entities financial records. Is the business being run
correctly? Are the financial statements: accurate, honest, and is there enough
revenue being generated, to cover expenses? Is the money that is being spent, being
spent wisely?
Is
the company earning any money for shareholders? Would the company make a good
investment for retirement? Is the company able to do well, and hold on to high
credit ratings every quarter? Is the company drawing new investors? Is the
price of the stock rising? Is the company giving anything back to the
community? Is the company supporting the growth and development of the
employees, with free education, to promote from within, or with, additional
training/vacations, to relax, and upgrade the facilities, etc.? I am like most
investors. I chose to put my money, where my mouth is.
In
addition, to referencing, more than just a financial audit, to determine, the
viability, of a company, keeping up, with information that is shared
professionally, among those who monitor and maintain the standards, that
support: morals, and ethics-in money, and the correct handling, of financial
allocations, also lends, more credence, to the financial auditing valuations (“Journal
of Accountancy,” 2014). However, if the only indication, that an entity is
thriving in the US economy, is an accounts audit, once a year-then, that, would
never be enough!
References
Kattelus, Susan C., Reck,
Jacqueline L., & Wilson, Earl R. (2010). Accounting For Governmental
& Nonprofit Entities. Boston: McGraw-Hill Irwin.
Payne, Wendy M. (2016). New
Development: Putting A 25-year Experiment To The Test. Public Money &
Management, 36:3, 197-200. doi:10.1080/09540962.2016.1133973
Unknown, Author (N.D.). FASAB.
In Federal Advisory Standards Accounting Board (Mission). Retrieved
from http://www.fasab.gov/mission-objectives/
Unknown, Author (N.D.). GASB.
In Governmental Accounting Standards
Board (About the GASBS). Retrieved from http://www.gasb.org/jsp/GASB/Page/GASBSectionPage&cid=1176168081485
Unknown, Author (2014). Database:
Business Source Complete: Official Releases. Journal of Accountancy, 217 (6).
Retrieved from http://eds.b.ebscohost.com.proxy1.ncu.edu/eds/pdfviewer/pdfviewer?sid=f842ed44-848e-4f82-9644-a166921c2030%40sessionmgr107&vid=3&hid=112
Unknown, Author (n.d). Purdue
Owl APA Format. In Purdue Owl APA Online Guideline (APA). Retrieved
from https://owl.english.purdue.edu/owl/resource/560/03/
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