Governance and Accounting for Non-Profits: A Detailed Analysis

This assignment delves into the intricacies of governance and non-profit accounting, focusing on internal service funds and non-expendable endowment funds. It addresses the types of activities for which internal service funds are used, emphasizing that these funds track services or goods transferred between governmental departments on a cost-reimbursement basis. Examples include supply inventories, central stores, legal services, and motor pool operations. The assignment also clarifies that while governments are not required to account for these activities in a separate internal service fund, it is preferable if the reporting government is the predominant participant. Furthermore, it explains the rationale for using a full accrual basis for non-expendable endowment funds, highlighting that this method ensures accurate fund presentation and prevents misuse. The importance of charging depreciation on long-term assets held as fiduciary fund investments is also discussed, emphasizing its role in maintaining transparency and preserving donor principles. The solution concludes that internal service funds should be reported in a separate column and depreciation should be charged on long-term assets to uphold transparency and donor expectations. Desklib provides this assignment as a valuable resource for students studying financial accounting and governance in non-profit organizations.