Which group of financial statements is prepared using the "modified accrual accounting" approach?
A) GAAP-Based Financial Statements.
B) Fund Financial Statements.
C) Cost-Based Financial Statements.
D) Government-Wide Financial Statements.
E) General Purpose Financial Statements.

Question

Quizplus · Accepted Answer

Fund Financial Statements are prepared using the modified accrual accounting approach, which recognizes revenue when measurable and available to finance current period expenditures, and recognizes expenditures when they result in a current obligation to the government that is expected to be paid with expendable available financial resources. This differs from the full accrual accounting approach used in GAAP-Based and Government-Wide Financial Statements. Cost-Based Financial Statements and General Purpose Financial Statements are not specific financial statement types used in government accounting.

Which Group of Financial Statements Is Prepared Using the "Modified