Investment trust funds and pension trust funds should be accounted for in the same manner as permanent funds.

Question

Quizplus · Accepted Answer

Investment trust funds and pension trust funds are accounted for differently than permanent funds because they serve different purposes and have different accounting requirements. Investment trust funds are used to report the external investment pools managed by a government, while pension trust funds account for resources required to be held in trust for the payment of employee pensions. Permanent funds are used to report resources that are legally restricted to the extent that only earnings, and not principal, may be used for purposes that support the reporting government’s programs.

Investment Trust Funds and Pension Trust Funds Should Be Accounted