Academic journal article Journal of Accountancy

GAO Urges Better Government Financial Reports

Academic journal article Journal of Accountancy

GAO Urges Better Government Financial Reports

Article excerpt

Charles A. Bowsher, comptroller general of the United States, said standard setting for state and local governments has failed to meet the needs of potential users of government financial reports. In a letter to Earle E. Morris Jr., chairman of the Governmental Accounting Standards Advisory Council (GASAC) and co general for South Carolina, Bowsher said comprehensive annual financial reports (CAFRs) have become technical accounting reports, prepared by chief financial officers, rather than broad, more useful accountability reports prepared by government management for laypeople.

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. …

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