FINANCIAL STATEMENT REPORTING REQUIREMENTS - 8670.2-OCT-2020

(New: 10/2020)

(New and renumbered from 8660)

Capital assets will be included in year-end financial reports. Accounting units must work closely with the property controller to ensure the inventory and the property register tie to the capital asset accounts in the general ledger. Agency/department heads are required to certify the real property balances reported for the prior calendar year to the Statewide Property Inventory (SPI) are correct by the July 1st of each year per Government Code section 11011.15.

Proprietary funds will report capital assets and accumulated depreciation/amortization within the fund.

Fiduciary funds will report capital assets and accumulated depreciation/amortization within the fund.

Agencies/departments which acquire capital assets/property with governmental fund resources will prepare a Statement of Changes in Capital Assets Group of Accounts–Report 18 and a Statement of Capital Assets Group of Accounts–Report 19.

Preparing Report 18

The Statement of Changes in Capital Assets Group of Accounts must be prepared for each governmental fund with capital asset records. This report will detail the changes from the prior-year ending period to the current period capital asset account balances.

Report 18 contains the following information:

1. Asset account beginning balances listed in General Ledger Account Number order (e.g., land, buildings, computer software, etc.). Asset account beginning balances must agree with the prior year ending balances. Any variances must be documented and explained in the Statement of Changes in Capital Assets Group of Accounts-Report 18, Beginning Balance Differential Report. See SAM section 7977 Illustration 2.
2. Asset additions.
3. Asset deductions.
4. Asset ending balances.
5. A footnote that any differences between the beginning asset balances and prior year ending balances are documented and explained in the Statement of Changes in Capital Assets Group of Accounts–Report 18, Beginning Balance Differential Report.
6. A footnote that the asset ending balances equal the debit balances on Report 19 for each asset type.
7. Capital assets previously unreported or transferred in from another state agency/department, should be reported as a restatement of the beginning balance, not as an addition. A description of the adjustment and the amount of the adjustment should be included in the differential report.

See SAM section 7977 Illustrations 1 and 2 for the required report format.

Preparing Report 19

The Statement of Capital Assets Group of Accounts–Report 19 must be prepared for each agency/department. This report consolidates the information in each Report 18 and contains the following:

1. Asset account ending balances in General Ledger Account Number order (e.g., land, buildings, computer software, etc.).
2. The Investment in Capital Assets detail of funds used to acquire capital assets.
3. A footnote that inventories of property were conducted in accordance with SAM section 8652.
4. A footnote that inventory and property register records of capital assets are in agreement with the capital asset accounts. See SAM section 8650.4, Accounting and Reconciling Capitalized Property Records.
5. A footnote stating that all real property has been reported to the Statewide Property Inventory (SPI) system per Government Code section 11011.15 and SAM section 1310.7.

See SAM section 7978 Illustration for the required report format.