What are proprietary funds?

What are proprietary funds?

A proprietary fund is used in governmental accounting to account for activities that involve business-like interactions, either within the government or outside of it. These activities are similar to what would be found in the private sector, so the reporting resembles what would be used by a private business.

What are examples of proprietary funds?

Examples of Proprietary Funds include interfund loans, proceeds of tax-supported bond issues, as well as transfers from other relevant governments.

What are the two types of proprietary fund?

There are two types of proprietary funds: enterprise funds and internal service funds. This chapter describes the basic characteristics and accounting for proprietary funds, both enterprise and internal service funds. Proprietary funds use the accrual basis of accounting and the economic resources measurement focus.

Where are proprietary funds reported?

proprietary fund statement of net position
Long-term liabilities directly related to and expected to be paid from proprietary funds should be reported in the proprietary fund statement of net position and in the government-wide statement of net position.

Which financial statements are required for proprietary funds?

Required proprietary fund statements are a statement of net assets; a statement of revenues, expenses, and changes in fund net assets; and a statement of cash flows.

What is the difference between governmental and proprietary funds?

Governmental funds—and the activities they pay for—are mostly tax supported. Proprietary funds account for business-like activities of the government, such as utilities. Proprietary funds are concerned with activities financed by self-generated revenues.

What are some differences between proprietary funds and private businesses?

This is because private businesses are organized with a focus on profitability, while governments are organized with a focus on public accountability. Governmental funds—and the activities they pay for—are mostly tax supported. Proprietary funds account for business-like activities of the government, such as utilities.

What do proprietary funds focus on?

Proprietary funds use the flow of economic resources measurement focus — a focus similar to that used by commercial entities. Proprietary funds focus on whether the enterprise is economically better off as a result of the events and transactions that occurred during the fiscal period reported.

What are the characteristics of a proprietary fund?

Proprietary funds focus on the flow of economic resources recognized on the accrual basis of accounting. These funds account for all assets and liabilities related to their operations, both short-term and long-term. Internal service funds are established to improve financial management of government resources.

Which fund financial statements are presented in the CAFR for proprietary funds?

Statement of Net Assets
Proprietary fund financial statements include the Statement of Net Assets (CAFR page 34); Statement of Revenues, Expenses, and Changes in Fund Net Assets (CAFR page 35); and Statement of Cash Flows (CAFR page 36).

What are the three categories of funds?

The three categories of funds are governmental, proprietary, and fiduciary.

What are governmental proprietary funds?

A proprietary fund is used in governmental accounting to account for activities that involve business-like interactions, either within the government or outside of it. The two types of proprietary funds are enterprise funds and internal service funds.

What is proprietary fund financial statement?

The proprietary fund financial statements include the Statement of Net Assets (or Net Position), the Statement of Revenues, Expenses, and Changes in Fund Net Assets (or Net Position), and the Statement of Cash Flows.

What are proprietor’s funds?

Proprietary funds are a government tool for keeping track of the money involved. Proprietary funds have two definitions. In government, proprietary funds, also known as enterprise funds and internal revenue funds, provide goods or services for a fee.

What are governmental fiduciary funds?

Fiduciary fund. A fiduciary fund is used in governmental accounting to report on assets held in trust for others. When financial statements are prepared for fiduciary funds, they are presented using the economic resources measurement focus and the accrual basis of accounting.