DEFINITIONS OF ACCOUNTING TERMS

To view this page ensure that Adobe Flash Player version 9.0.124 or greater is installed.

Please login or register to make a comment!

DEFINITIONS OF ACCOUNTING TERMS Excess of expenditures over revenues on operations for the year (or Operating Deficit): An operating deficit occurs when, at the end of a fiscal year, operating revenues received during the year are less than the operating expenditures made. An operating deficit can be cbalanced d if one-time funds are available (e.g., from Operating Reserves). A deficit is not a debt.

Excess of revenue over expenditures on operations for the year (or Operating Surplus): An operating surplus occurs when, at the end of a fiscal year, operating revenues received during the year are greater than the operating expenditures made. Grant received for capitalized Infrastructure Maintenance Renewal (IMR) projects: The IMR grants are utilized for maintenance and improvement projects throughout the District. When a project meets the criteria of an improvement project, the amounts spent on the project are added to the value of the asset, rather than being recorded as an expenditure.

This is what is known as capitalizing a project. Capital assets purchased with operating funds, net of disposals: The accounting required for cCapital assets purchased with operating funds d is to show these transactions, as a use of operating funds after the Operating Deficit/Surplus has been determined. ... more. less.

Capital assets purchased with operating funds include items such as administrative computer servers and software, photocopiers, LCD projectors, paving projects, and other capital projects not funded by Alberta Education. Depreciation on assets purchased with operating funds: The accounting treatment required for cDepreciation on assets purchased with operating funds d in prior years is to show these transactions, as an increase in operating funds available after the Operating Deficit/Surplus has been determined. Transfers to (from) Reserves (or Operating Reserves): Operating Reserves are funds set-aside in previous years due to under-expenditures. Operating Reserves are considered to be crestricted d funds set-aside for a specific or crestricted d purpose. An example of a crestricted d use Operating Reserve is the Administration Operating Reserve. Alberta Education Funding Framework rules only allow the creation of an Administration Operating Reserve in the years where Administration expenditures are less than 4% of expenditures. Change in unrestricted operating surplus (or Accumulated Surplus): The cChange in unrestricted operating surplus d represents the impact for the fiscal year 9s results on the unrestricted operating surplus, or Accumulated Surplus. If this figure on the audited financial statements is in the negative (a deficit), the Accumulated Surplus will be reduced by this amount. If the amount is a surplus, the Accumulated Surplus will be increased by this amount. Net Deficit: The cNet d Deficit is equal to the Operating Surplus or Deficit plus the Grant received for capitalized IMR (formerly Infrastructure Maintenance Program - IMP) projects minus Capital assets purchased with operating funds plus Depreciation on assets purchased with operating funds. To fund a Net Deficit, a transfer of funds from Operating Reserves or Accumulated Surplus is required. The Net Deficit is not a line on the Statement of Revenue and Expenditures and Change in Unrestricted Operating Surplus, but is the net of the cTransfer from (to) Reserves d line and cChange in unrestricted operating surplus d line. Net Surplus: The cNet d Surplus is equal to the Operating Surplus or Deficit plus the Grant received for capitalized IMR (formerly IMP) projects minus Capital assets purchased with operating funds, net of disposals plus Depreciation on assets purchased with operating funds. A Net Surplus is transferred to increase Reserves or Accumulated Surplus. The Net Surplus is not a line on the Statement of Revenue and Expenditures and Change in Unrestricted Operating Surplus, but is the net of the cTransfer from (to) Reserves d line and cChange in unrestricted operating surplus d line. Debt: A Debt is made up of net deficits that have occurred over a number of years that have not been funded from other sources (e.g., Operating Reserves). The District does not have a Debt. School districts are not allowed to incur debts without the approval of the Minister of Education.

less