A governmental entity reports its utility services provided to the citizens in a proprietary fund.Which of the following best represents an acceptable election of accounting standards for the proprietary fund? Unless the FASB pronouncement conflicts with or contradicts a GASB pronouncement, a propriety fund must adhere to
A)All FASB pronouncements.
B)All FASB pronouncements issued prior to November 30, 1989, as well as any post-November 30, 1989 pronouncements specifically adopted by GASB.
C)It must apply only GASB standards.
D)It may elect either a or b.

Question

Quizplus · Accepted Answer

According to GASB Statement No. 20, unless otherwise required by GASB, a proprietary fund may elect to follow either GASB standards or FASB pronouncements issued on or before November 30, 1989, and any subsequent pronouncements specifically adopted by GASB. Therefore, the best choice is (D), as it correctly reflects the options available to a government entity reporting utility services provided in a proprietary fund.

A Governmental Entity Reports Its Utility Services Provided to the Citizens