Government and Not-for-Profit Accounting: Users, Reporting, and GASB

This report delves into the complexities of government and not-for-profit accounting. It begins by differentiating between internal and external users in government and business contexts, highlighting the unique challenges of the former. The report then explores the Governmental Accounting Standards Board (GASB) Statement No. 34, which mandates changes in financial reporting practices for state and local governments. It discusses the two primary grounds for reporting models under GASB 34: general purpose and special purpose governments, emphasizing their distinct objectives and service scopes. The general purpose governments encompass a wide range of services, while special purpose governments focus on specific areas. The report examines how these differences impact financial reporting and concludes with a comparison of the two accounting systems.

Government and Not for Profit
Accounting

TABLE OF CONTENTS
Introduction......................................................................................................................................3
Question 1........................................................................................................................................3
Question 2........................................................................................................................................3
Conclusion.......................................................................................................................................4
References........................................................................................................................................5

INTRODUCTION
In the present study, it is about the internal and external users of government and business and
their differences. Further, the study is about the two grounds on which the reporting model is
prepared.
QUESTION 1
It is more difficult to differentiate between internal as well as external users in government as
compared to business, as constituents like taxpayers might have considerable roles in forming
strategies and policies that are frequently taken into account in the monarchy of managers.
Furthermore, legislators are said to be internal to some degree as they set policies, but external as
far as the managerial brand should account to the legislative branch (Granof, Khumawala, &
Smith, 2016). The major users of government are inclusive of governing boards, creditors, and
investors, members of organizations, citizens, donors, regulatory agencies and constituents.
Governments require accounting standards and reporting tools that distinguish from those of
businesses. They have other important objectives than profit maximization. Thus, their progress
cannot be considered by the traditional bottom-lines and users of business. In addition to, they
are governed by their own budgets instead of the competitive markets.
Both the GASB and FASB have instituted objectives of financial reporting that put force on the
significance of offering information that allows users to consider inter-period compliance with
the mandates of budgets.
QUESTION 2.
The Governmental Accounting Standards Board Statement No. 34 (GASB 34) command
important modification in the detailing financial practices of local and state governments
externally. Investigation of information from bookkeeping and authorities of state and local
governments shows that they trusted GASB 34 would do moderately little to enhance the
convenience of their legislature’s reports.
In accordance with the Department of Housing and Urban Development (U.S), provisions of
GASB 34 were prepared by considering general purpose and special purpose governments. The
general purpose includes states, urban areas, district, villages and towns. Nonetheless, there are

numerous further legislative elements, inclusive of PHAs which are not wide-ranging purpose
but same are categorized into distinct purpose governments that give a constrained arrangement
of administrations or projects (Bloch, 2016). The general and special purpose government are the
two grounds on which the reporting model under GASB No. 34 is being prepared.
These two are completely different to the extent of their purpose and services. In terms of
general purpose; governments incorporate administrations which could incorporate law
requirement to street and road maintenance, whereas special purpose government are more
concentrated and are more engaged in , for instance, the Department of Housing and Urban
Development bargains solely with lodging needs, air housing openings and change and
improvement of the groups (Kim & Ebdon, 2017).
CONCLUSION
The present study shows that the internal and external users of government and commercial
businesses are completely different. Further, the study concludes that there are two perspectives
on which the reporting model under GASB No. 34 can be prepared.

REFERENCES
Bloch, R. (2016). Assessing the Impact of GASB Statement No. 34: The Perceptions of
Municipal Bond Analysts. Municipal Finance Journal, 37(2).
Granof, M. H., Khumawala, S. B., & Smith, D. L. (2016). Government and Not-for-profit
Accounting, Binder Ready Version: Concepts and Practices. John Wiley & Sons.
Kim, J., & Ebdon, C. (2017). HAVE THE GASB NO. 34 INFRASTRUCTURE REPORTING
REQUIREMENTS AFFECTED STATE HIGHWAY SPENDING?. Journal of Public
Budgeting, Accounting & Financial Management, 29(3).