What is the purpose of reporting fund balance in five classifications? What is the difference between restricted fund balance and assigned fund balance?
What is the purpose of reporting fund balance in five classifications? What is the difference between restricted fund balance and assigned fund balance?
Chapter1: Financial Statements And Business Decisions
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What is the purpose of reporting fund balance in five classifications? What is the difference between restricted fund balance and assigned fund balance?
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A fund balance refers to the difference between the assets and liabilities of a government fund. If the stakeholders have to make appropriate decisions using information about government funds, a fund balance is the main requisite. Thus, the GASB has intervened in preparing a standard way for reporting the fund balance. A part of this standard is introducing the five classifications for the fund balance. The five classifications are: non-spendable balance, restricted balance, committed balance, assigned balance, and unassigned balance.
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