What is Capital assets in government financial statements?
In short
Governments report capital assets, including infrastructure such as roads and bridges, in the government-wide statements at historical cost (or acquisition value if donated), less depreciation. Governmental funds report them only as expenditures.
Key takeaways
- Infrastructure can use the modified approach instead of depreciation if condition is maintained at a set level.
- Land and construction in progress aren't depreciated.
- Capital assets are disclosed by major class with beginning and ending balances.
Where it's tested
BAR: Government-Wide Statements & the Annual Comprehensive Financial Report — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
A government has capital assets, net of depreciation, of $10,000,000 and outstanding debt of $6,000,000 that was used entirely to acquire those assets. What is reported as net investment in capital assets?