The State prepares financial statements on three bases of accounting: cash, modified accrual and accrual.

Financial statements prepared in accordance with generally accepted accounting principles (GAAP) require that revenues and expenditures be recorded on the modified accrual basis for the governmental funds (those through which most governmental functions are financed). Under GAAP, the accrual basis of accounting shall be used for the government-wide financial statements, proprietary funds, component units and fiduciary funds.

The cash basis of accounting is used for budgetary purposes.

For additional information on the basis of accounting, see Chapter XVI, Section 3.D - Basis of Accounting/Measurement Focus of this Guide.

Guide to Financial Operations

REV. 01/01/2017