DEFINITION OF THE REPORTING ENTITY

This chapter provides detailed requirements of Government Accounting Standard Board (GASB) statement 14 and includes some practical guidance on applying its principles. It also describes the provision of GASB Statement No. 39 (GASBS 39), Determining Whether Certain Organizations Are Component Units—An Amendment of GASB Statement No. 14. The chapter addresses GASB Statement No. 80 (GASBS 80), Blending Requirements for Certain Component Units—An Amendment of GASB Statement No. 14. It also provides guidance on the accounting and financial reporting for government mergers, acquisitions, and transfers of operations of GASB Statement No. 69 Government Combinations and Disposals of Government Operations. Governments often create separate legal entities to perform some of the functions normally associated with or performed by government. The chapter also addresses a few examples of the types of entities and areas of responsibility that the financial statement preparer and auditor are likely to encounter.