Reporting Requirements for Annual Financial Reports of State Agencies and Universities

General Accounting

Fund Balance/Net Position
Proprietary Funds

Enterprise Funds/Internal Service Funds

Use the following accounts to report net position for enterprise and internal service funds (for entry into USAS, use the GL accounts with the same titles):

Net Position, Net Investment in Capital Assets (GL 2505) – This component of net position is the difference between assets, deferred outflows, deferred inflows and liabilities of proprietary funds that consists of capital assets (both tangible and intangible) less:

• Accumulated depreciation
• Accumulated amortization (except for accretion on capital appreciation bonds)
• The outstanding balance of debt directly attributable to the acquisition, construction or improvement of those assets
• Lease liabilities, subscription-based information technology arrangement (SBITA) liabilities and public-private/public-public partnership (PPP) arrangement liabilities
• Deferred outflows and deferred inflows of resources attributable to the acquisition, construction or improvement of those assets or related debt

The portion of debt or deferred inflows of resources attributable to the unspent amount of related debt proceeds or deferred inflows of resources at the end of the fiscal year is included in the same net position component (restricted or unrestricted) as the unspent amount — not in the calculation of net position, net investment in capital assets.

Net investment in capital assets for governmental activities and business-type activities is difficult to trace through notes and schedules on financial reports. For example, part of accounts payable may be capital accounts payable, but are not separately displayed in financial statements. For this reason, the agency must submit the Net Investment in Capital Assets working paper to show the calculation of the net investment in capital assets. Use the working paper’s PG# column to reference the source of the line item from the agency’s annual financial report.

Restricted Net Position – This component of net position is the difference between assets, deferred outflows, deferred inflows and liabilities of proprietary funds that consists of assets with constraints placed on their use by either:

• Externally imposed by creditors, grantors, contributors or laws/regulations of other governments.
  –OR–
• Imposed by law through enabling legislation or constitutional provisions.

Restricted Net Position:

• GL 2550 – Net position restricted for veteran/land housing programs
• GL 2555 – Net position restricted for unemployment trust fund
• GL 2700 – Net position restricted for debt retirement
• GL 2705 – Net position restricted for capital projects
• GL 2715 – Net position restricted for transportation
• GL 2795 – Net position restricted for other

Funds Held as Permanent Investments:

Unrestricted Net Position – This component of net position is the difference between the assets, deferred outflows, deferred inflows and liabilities of proprietary funds not reported as net position, net investment in capital assets or restricted net position.

Include the amortized balance of accretion on capital appreciation bonds as part of unrestricted net position unless a sinking fund was established, in which case the balance is reported as part of the restricted net position balance.

• GL 2900 – Net position unrestricted for permanent health fund
• GL 2950 – Unrestricted net position