N.J. Admin. Code § 5:31-7.1 - Accounting and financial reporting systems
(a)
The accounting system consists of the methods and records established to
identify, assemble, analyze, classify, record, and report an entity's
transactions and to maintain accountability for the related assets and
liabilities.
(b) An effective
accounting system shall include a double-entry accounting for all transactions
resulting in a general ledger, which shall be required for all authorities and
special districts.
(c) Any
accounting system adopted pursuant to (a) and (b) above must make it possible
to present fairly and with full disclosure the financial position and results
of financial operations of the funds and account groups of the reporting
entity, in conformity with generally accepted accounting principles (GAAP) as
promulgated by the Governmental Accounting Standards Board (GASB), 401 Merritt
7, P.O. Box 5116, Norwalk, CT 06856-5116, incorporated herein by reference, as
may be amended from time to time, and demonstrate compliance with
finance-related legal and contractual provisions, including applicable security
and financing agreements.
(d) GAAP
as it applies to proprietary funds of state and local governments, specifically
as it applies to enterprise funds shall be used to account for an authority's
ongoing activities, similar to those found in the private sector, where the
intent of the governing body is that the costs (expenses, including
depreciation) of providing services to the general public on a continuing basis
be financed or recovered primarily through user charges and/or where the
governing body has decided that periodic determination of revenue earned,
expenses incurred, and/or net income is appropriate for capital maintenance,
public policy, management control, accountability or other purposes.
(e) The financial statements of authorities
shall be prepared in accordance with GAAP applicable to enterprise funds.
Accordingly, revenues and expenses shall be recognized on the accrual basis.
Revenues shall be recognized in the accounting period in which they are earned
and become measurable; expenses shall be recognized in the period incurred, if
measurable.
(f) The financial
statements of special districts shall be prepared in accordance with GAAP
applicable to governmental funds of state and local governments. Accordingly,
revenues and expenditures shall be recognized on the modified accrual basis.
Revenues shall be recognized in the accounting period in which they become
available and measurable. Expenditures shall be recognized in the accounting
period in which the fund liability is incurred, if measurable, except for
unmatured interest on general long-term debt, which shall be recognized when
due.
Notes
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