US'S GOVERNMENT

FINANCIAL REPORT
GROUP 8
 Contents
Qualifications and Regulations in Accounting Characteristics of Accounting and Reporting Of
Governmental Entities.
Financial Accounting Standards (SAK)
Mechanism of Allocation of Financial Resources
Development of GAAP (Generally Accepted
Accounting Principles)
Components of Financial Statements in the United
States
 Qualifications and Regulations in
Accounting
In the United States, practicing accountants are called Certified Public
Accountants (CPA), Certified Internal Auditors (CIA) and Certified
Management Accountants (CMA). The difference in the types of
certification is in terms of the types of services offered, although it is
possible for one person to have more than one certificate. In addition,
a lot of accounting work is done by someone without a certification
but under the supervision of a certified accountant
 CPA certification is issued in the state of residence in the form of a license to offer auditing services to
the public, although most accounting firms also offer accounting, taxation, litigation assistance and other
financial consulting services. Requirements for obtaining a CPA certificate vary from state to state, but
the Uniform Certified Public Accountant exam is required in each state. This exam was created and
reviewed by the American Institute of Certified Public Accountants.

The CIA certification is issued by the Institute of Internal Auditors (IIA), which is awarded to candidates
who pass the four sections of the exam. The CIA mostly provides its services to direct employers rather
than to the public.

The CMA certification is awarded by the Institute of Management Accountants (IMA), which is given to
candidates who pass the four test sections and fulfill certain practical experience based on the IMA's
requirements. CMA mostly provides its services to direct employers rather than to the public. CMA's
can also offer their services to the public, but to a lesser extent than CPAs.
 Financial Accounting Standards
(SAK)

in America it is known as GAAP (General Accepted Accounting Principal).

GAAP are the accounting rules used to prepare, present, and report financial
reports for a variety of entities, including publicly traded and privately held
corporations, non-profit organizations, and governments. This standard is the
benchmark or guide for the process of accounting records in a company.
 Development of GAAP (Generally
Accepted Accounting Principles)
Accounting Standards have historically been set by the American Institute of Certified Public
Accountants (AICPA) subject to Securities and Exchange Commission regulations. The AICPA first
created the Accounting Procedures Committee in 1939, and replaced that with the Accounting
Principles Council in 1951. In 1973, the Accounting Principles Board was replaced by the Financial
Accounting Standards Board (FASB) under the auspices of the Financial Accounting Foundation
with the Financial Accounting Standards Advisory Council serving to advise and provide input on
accounting standards. Other organizations involved in setting United States accounting standards
include the Governmental Accounting Standards Board (GaSb), formed in 1984, and the Public
Company Accounting Oversight Board (PCAOB). As international and US GAAP standards have
converged, the International Accounting Standards Board which produces International Financial
Reporting Standards (IFRS) has become important.
 Components of Financial
Statements in the United States
There are 8 Types of Components of Financial Statements in
America
Management Report
Independent Auditor's Report

Primary Financial Statements

selected quarterly data
Management discussion and analysis of
operational results and financial
condition
An explanation of the accounting policies with the
most critical impact on the financial statements
Notes to the financial statements
Comparison of financial data for 5 or 10 years
 The main objective of government activities is to provide
goods and services (public goods & services) needed by the
community, either through payments by users or not (free).
Financial sources for government organizations that can be used to fund their

Characteristics of activities can come from:

Accounting and Compulsory tax (involuntary)

Reporting Of
Governmental Retribution (Service charges)
Entities.Characteri Licensing fees (License & permit fees)
stics of Accounting
and Reporting Of Results of fines (Fines), and
Governmental
Entities. Grants and subsidies from higher
government (Intergovernmental
revenues)
 Mechanism of Allocation of Financial Resources

The allocation of financial resources to various uses must be adapted to

the requirements of the providers of funds. For example, the grantor
may require the use of funds only for certain purposes, such as the
construction of capital facilities (roads, bridges, government buildings,
etc.), the taxes charged are limited to specific purposes, such as roads,
education or debt repayment, and the proceeds from bonds are limited to
special purposes, for example the construction of capital facilities.
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