“Capital Projects, Debt Service, and Long Term Obligations” Please respond to the following:
- Go to the Government Finance Officers Association (GFOA) Website to read the best practice article “Capital Project Monitoring and Reporting,” located at http://www.gfoa.org/capital-project-monitoring-and-reporting.
- Identify two (2) policies or processes recommended in the article that will alleviate accounting problems or issues in the capital projects and debt service funds. Provide examples to support the policies and procedures selected and a rationale for your selections.
- Discuss the significance of arbitrage transactions in the issuance of debt by state ad local governments. Analyze the restrictions on arbitrage transactions imposed by federal regulations and potential consequences for violation of the regulations.
- References include
- separate page for this question
“Consolidated Financial Statements – Intra-Entity Asset Transactions” Please respond to the following:
- Per the textbook, no official FASB guidance exists on the assignment of income effects on non-controlling interest in the consolidation process, when either the parent transfers a depreciable asset to the subsidiary or vice versa. Suggest one (1) method of accounting for the income effects on the non-controlling interest that you consider most appropriate. Provide a rationale for your response.
- Assume that company P (parent) uses the equity method to account for its investment in company S (subsidiary). Company P purchases inventory items from company S. According to FASB’s guidance, the accountant must remove the inter-company profit from Company S’s net income. Determine if the process permanently eliminates the profit from the non-controlling interest or merely shifts the profit from one period to the next. Provide support for your rationale.
- references included
- separate page