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Governmental and Non-for-Profits AccountingThe entity United States’ accounting system is formatted by GAAP, the Generally Accepted Accounting Principles. In addition to GAAP, governmental organizations, nongovernmental non-for-profit organizations, and federal governmental and its agencies are regulated by different governing authorities. Different organization has different requires for financial statements.Nongovernmental Non-for-Profit OrganizationsNongovernmental non-for-profit organizations are ruled by FASB, the Financial Accounting Standards Board. For normal business organizations, the three main financial statements are statement of cash flows, income statement, and balance sheet.  Different with the normal business organizations, non-for-profit organizations and governments requires statement of activities, statement of cash flows, and statement of financial position. The statement of financial position is similar to balance sheets which is also reports the assets, liabilities, and equity of a company on a given date. Similar with the income statement, the statement of activities explains the loss and profit after organizations’ activities. The loss and profit also relate to the net assets on the statement of financial position. Maybe some non-for-profit organizations have nothing to sale for business profit, those organizations still need to fill the statement of cash flows to explain where, when, and how those organizations use their budgets. Under the Financial Accounting Standards Board, there is a topic ASC 235. This topic ASC 235 complements the requirement of notes to annual reports. ASC 235 is used to improve the effectiveness of disclosures. The accounting policies and object entities need to be explained in the notes. In the financial reports, the notes should include the  Otherwise, omitting a disclosure of immaterial information would not be an accounting error.Governmental OrganizationsStates and local governmental organizations and non-for-profits are ruled by GASB, the Governmental Accounting Standards Board.Governmental financial reporting focuses on stewardship and accountability for how public resource are raised and used to provide service. Governmental organizations have two type of financial statements. The first one is government-wide statements, which includes  statement of activities, statement of cash flows, and statement of net assets for financial reporting. Beside of those statements, governmental organizations also need to complete the fund statements. Normal businesses operate the organizations by sale income from customers. For governments and its agencies, the only resource is the fund from treasury department. And most of the funds are limited by the budgetary plan at the beginning of the fiscal year. After the budget accounts close, government and its agencies have the responsibility to complete the governmental fund statements (including balance sheet and statement of revenues and expenses), the proprietary fund statements (including statement of net assets, statement of revenues and expenses, and statement of cash flows), and/or fiduciary fund statements (including statement of fiduciary net assets and statement of changes in fiduciary net assets). To help users of the financial statements in understanding the financial position or inflows and outflows of resources, The notes to the financial statements provide the following information that are required by GASB. First, the explanation of accounting methods, policies and options that are used in the financial statements. Second, the details,evidences, or explanation of the highlining numbers in the financial statements. Third, the amounts provided will meet the definition of financial statement information but will not meet all criteria that need confirmation (for example, because the amounts can not be measured reliably enough).Federal Governmental and Its AgenciesFederal governmental and its agencies are rules by the Federal Accounting Standards Advisory Board. The FASAB created for both external users and internal users, is founded to support public accountability. The FASAB requires that Federal financial reports should be useful in assessing the government’s accountability and its efficiency and effectiveness, and the economic, political, and social consequences, whether positive or negative, of the allocation and various uses of federal resources. Under the FASAB, federal government of the United States requires to report the statements of net cost, the statements of operations and changes in net positions, the reconciliations of net operating cost and unified budget deficit,the statements of changes in cash balance from unified budget and other activities, the balance sheet, and the statements of social insurance and changes in social insurance amounts. Those statements help users to evaluate the budgetary integrity, operating performance, stewardship, and adequacy of systems and controls. Similar with the states and local governments, federal government is required to explain the reporting entity, accounting system, and more in notes. For example, in 2011, the federal government notes to the financial statements for the years has 27 parts. In note 1- summary of a significant accounting policies, the notes explains This Financial Report includes the financial status and activities of the executive branch, the legislative branch (the U.S. Senate and the U.S. House of Representatives report on a cash basis), and the judicial branch (which also reports on a cash basis) of the Government. More than that, the notes for federal government financial statements are the supplements for items’ and objects’ description and details.

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