GAO urges better government financial reports.
To improve government financial reporting, Bowsher said a new reporting model should include accountability information that is important and comprehensible to a broad range of users and should provide governmentwide consolidated financial statements. He also said government financial statements need to reflect economic reality.
The Governmental Accounting Standards Board is working on an improved financial reporting model with a dual perspective--an entity-wide perspective that includes a balance sheet and a statement of activities, and a fund-based perspective. "Many of the concerns raised in Bowsher's letter will be addressed by the new financial reporting model," said Morris. "That does not mean all of his suggestions will be adopted. I don't know of any financial reporting model that can answer every question, but the comptroller general's letter calls for disclosure that is understandable to a broad range of users. That kind of disclosure will be addressed in the new model"
Dianne K. Mitchell, member of the GASAC and technical manager in the Division of State Audit in Nashville, Tennessee, said the difficulty of drafting a uniform financial reporting model rests in meeting th needs of the diverse users of govern mental financial reports. "GASB's pro posed financial reporting model dual perspective approach comes closer to achieving that objective than the current model because it is more comprehensive than a single reporting perspective," said Mitchell. "Regardless, government, like the private sector, needs uniform accounting standards."
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|Title Annotation:||US General Accounting Office|
|Publication:||Journal of Accountancy|
|Article Type:||Brief Article|
|Date:||Jul 1, 1995|
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