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Glenn Hegar  ·  Texas Comptroller of Public Accounts

Reporting Requirements for Annual Financial Reports of State Agencies and Universities

General Accounting

The Financial Reporting Entity

The financial reporting entity of the state of Texas includes not only the primary government (state agencies and universities), but also outside organizations the primary government is financially accountable for. Also included are other organizations where the nature and significance of their relationships with the primary government are such that exclusion would cause the state’s financial statements to be misleading.

An agency may determine an outside organization to be a:

  • Component unit
  • Related organization
  • Joint venture
  • Jointly governed organization
  • Related party

Depending on the type of relationship, the financial activities of the legally separate organization may need to be included in the financial statements of the primary government and in the notes to the financial statements — or a note disclosure may be the only requirement.

Glenn Hegar
Texas Comptroller of Public Accounts
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