Question

Respond to the following in a minimum of 175 words:

Discuss the differences in financial reporting for public and private colleges and universities. Which of the two—public or private—follow the same reporting guidelines as nongovernmental not-for-profit organizations? Which may have taxing authority?

Answer 1

Answer:

Costs are commonly ordered on a useful basis by both private and public educational institutions. To be in consistence with FASB(Financial accounting standards board) norms, private universities and colleges need to unveil program and bolster costs in the notes to the fiscal statements if excluded from the essence of the statement. FASB principles demonstrate that private universities and colleges are to set up a balance sheet, an statement of activities, and an statement of cash flows. Like for- profit driven entities, private universities and colleges are permitted a lot of adaptability in preparing statements. For instance, private entities can utilize a multi-or single-step statement of activities and they can utilize the direct and indirect strategy for setting up the statement of cash flows.

GASB( Governmental accounting standards board) guidelines show that public universities and colleges are to set up an statement of net position or an statement of financial position; an statement of incomes, costs, and changes in net position; and an statement of cash flows . In spite of the fact that the GASB allows adaptability in planning or preparing of the financial summaries it gives more structure than the FASB. For instance public entities are required to distinguish working and nonoperating activities on the statement of incomes, costs, and changes in net position. Moreover, public entities are required to utilize the direct strategy while setting up the statement of revenues.

15-2.Restricted gifts and grants are those dependent upon confinements put on them by people or associations outside the establishment in nonexchange transactions. Normally limited gifts and grants of a universities or colleges are confined for research, grants and fellowships, debts, obligation administration, or securing of capital resources. public universities and colleges recognize limited gifts and awards as confined net position. Confined net position is additionally separated to distinguish nonexpendable or expendable resources. GASB principles give extra direction in accounting to nonexchange transactions.

The FASB requires private universities and colleges to write about the progressions in unlimited, temporarily limited, and forever confined net resources of the entity in general, equivalent to the nongovernmental not-for - profit driven associations depicted in Chapter 13.

Costs or expenses are recorded on the accural reason for both private and public universities and colleges and so on.

In our nation education was non beneficial and non profitable. So no taxes applied for both public and private universities and colleges.