The United States have required governments to used comparison budgetary schedules in the reporting of certain external funds. By looking at budget similar to specific objectives of other governments, a state or a local government can have a basic idea of how to appropriate the money and be accountable for that appropriation. These funds are allocated to state and local governments. The scope of GASB includes structure, applicability and basis for the amendment (Kinnersley and Patton, 2005).
GASB 34 states that budgetary comparison schedules for general funds and any special revenue funds that is part of that government’s annual budget. The object of the funding must be “legally adopted” to be included in the annual budget. Governments with budgets created twice a year must include comparison schedules for a general fund and each special revenue fund. In general GASB does not give any specific guidelines for governments with budgets created twice a year.
The governments with those types of budgets have a structure in place based on when and how their budgets are created and passed (Kinnersley and Patton, 2005). Governments that divide budget amounts for the year have the following guidelines to follow to create their comparison schedules. Governments with two officially authorized budgets should report the first year’s budget of the fiscal year in the schedule. When the government authorizes the budget for the second half of the year then that government should then report the second year’s budget.
Governments with this type of budgeting can take funds not used during the first year and appropriate them for the second year budget. If a government has a biyearly budget but does not separate their funds for two different times must report the full amount during the first part of the year any amounts not included can be designated for the budget in the second half of the year (Kinnersley and Patton, 2005). GASB 34 requires that governments must issue a statement for general funds and each special fund the government has included in its annual budget.
What is excluded from the comparison schedule would be any type of statement or information such as service funds or capital project funds (Kinnersley and Patton, 2005). GASB would like for governments to present budget comparisons immediately following the “required supplementary information” or RSI on financial statements, but this is optionally. However, governments must include budgetary information as part of RSI and title it “schedule” and budgetary information title as “statement” on the financial state as well. Statement 41 describes the basis for this type of inclusion.
Inclusion in RSI does not require knowledge of the specific financial breakdown. Knowledge of the position and conclusion of the allocation of funds gives an overview. Specific knowledge of how the money was spent is not necessary because GASB does set each government’s budget (Kinnersley and Patton, 2005) . The basic set for budget comparisons include similar format, wording, and titles found in basic financial statements. The schedule can also be in a form of a budget documents which elected officials are more familiar with than other financial statements.
GASB does not have a preference in format. Earlier government requirements were for two columns in comparison statements: the actual budget and the approved budget. A third column is now required that includes the original budget before approval (Kinnersley and Patton, 2005). The first difference between statement 34 and statement 41 is that 41 makes the presentation requirements clear for governments who can not give comparison schedules for general and special funds.
For example, a city may have six different budgets, operation funds, housing funds, etc. The housing budget may use the fund structure as special revenue but does not need to use the fund structure for the other budgets. Because the city doesn’t use the fund structure for the other budgets would be difficult if not impossible to present a comparison schedule. Therefore, the city must present a budget comparison schedule for general operations since that is what controls all other activities (Kinnersley and Patton, 2005) .
Statement 34 has successfully aided governments in giving a systematic structure to appropriate funding to different areas and ensures accountability for their spending. Statement 41 has given clarification of special issues that may arise in budget comparisons. Work Cited Kinnersley, R. , & Patton, T. (March 2005). GASB Statements 34 and 41. The CPA Journal. Retrieved November 14, 2008, from http://www. nysscpa. org/ cpajournal/2005/305/essentials/p20. htm