In short
A capital projects fund is a governmental fund for resources restricted, committed or assigned to spending on capital outlays, such as building a new school, other than those financed through proprietary funds.
Key takeaways
- Bond proceeds are reported as an other financing source, not as revenue or a liability.
- Construction costs are expenditures in the fund; the capital asset appears only in the government-wide statements.
- Encumbrances are often used to control spending on contracts.
Where it's tested
FAR: Governmental Accounting — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
A city issues general obligation bonds at par to finance construction of a new library. How are the proceeds reported in the capital projects fund?