Regarding external financial reporting for governmental units, a Statement of Cash Flows is required only at the fund-based reporting level for Proprietary Funds.

Question

Quizplus · Accepted Answer

Proprietary funds, which include enterprise and internal service funds, are the only types of funds in governmental accounting that require a Statement of Cash Flows. This requirement is because proprietary funds operate in a manner similar to private sector businesses, and the Statement of Cash Flows provides important information about the liquidity and financial flexibility of these funds.

Regarding External Financial Reporting for Governmental Units, a Statement of Cash