If state law requires that local governments prepare General Fund and special revenue fund budgets on a basis that differs from the basis of accounting required by GAAP, then the budgetary comparison schedule or statements should
A) Not be included as part of the basic financial statements.
B) Be included with the actual figures presented on the budget basis and then reconciled to the GAAP basis.
C) Be included with budget figures and actual figures adjusted to the GAAP basis.
D) Be included as part of management's discussion and analysis (MD&A).

Question

Quizplus · Accepted Answer

The budgetary comparison schedule should be included with the actual figures presented on the budget basis and then reconciled to the GAAP basis. This allows the reader to understand the differences between the two accounting methods and the impact on the financial statements. The budgetary comparison schedule should be presented as required supplementary information (RSI) to the basic financial statements.

If State Law Requires That Local Governments Prepare General Fund