Noncash Activities
GASB Statement No. 9, paragraph 37, requires that a government disclose any information about investing, capital, and financing activities of a governmental enterprise during a period that affect recognized assets or liabilities but do not result in cash receipts or cash payments.
Disclosure of noncash information is required if a transaction meets all three of these characteristics:
Is the transaction noncash?
Some transactions are part cash and part noncash. Only the cash portion must be reported in the statement of cash flows. The noncash portion must be evaluated further.
Does the transaction affect assets or liabilities?
Changes in the balances of noncash assets and liabilities must be reviewed. If balances in these assets or liabilities change due to transactions that are not considered cash transactions, the transactions are considered noncash.
Is the transaction an investing, capital or financing activity?
A noncash transaction should only be disclosed when the transaction, if it had been a cash transaction, would have been categorized as a capital and related financing, investing or noncapital related financing activity.
Only a transaction that meets all three of these criteria can be considered a noncash transaction and must be disclosed in the agency's annual financial statement.