A special revenue fund refers to the funds kept specifically for a special or particular project within a government entity. The usage of the fund is restricted to any mere activity. And it provides a different level of accountability and transparency to the people who by their tax, supported the project. The special funds are often used for building libraries and schools and others.
The special revenue fund can be processed and achieved by following certain stepwise methods that can maintain transparency and complete the project. The steps are the rules that a special revenue fund needs to follow:
The background of the special revenue fund states that the fund should be used as ‘account for the proceeds of specific revenue sources. The sources that it states are legally restricted one any sort of expenditure for several specified purposes. This rule monitors and studies three issues that are what revenue sources are constituted by, what binds the legal restrictions, and what is a specified purpose.
A special revenue is a fund that a governmental authority prepares and keeps ready for different special situations and cases. The government frequently supply the existing resources and fund to different arisen purposes for public welfare. According to the Governmental Accounting Standards Board, the term proceeds for specified revenue resources implies restricted revenues. It doesn’t mean or applies the transfer of the existing resources. It states that when the fund is established the authority is free for transferring resources to fund. Thus in the context of the total inflows of the fund the basic revenue source remains a substantial portion.
Different authority and regulatory bodies define this rule with their different words respectively. NCGA defines the fact of revenue as the resources which are legally restricted to expenditure whereas for GASB restriction means the external legal limitations. But GASB also believed in using special funds is appropriate for sources that are subjected to self-imposed legal limits and commitments.
The governmental body or the authorities use specific revenue resources that help in funding the stabilized arrangements. This stabilization limits certain condition and situation that allows the usage of the resources rather than the expenditure. According to GASB the specified purpose that can get the support of the special fund is identified by limiting the situation in which resources can be extended. Thus for stabilization arrangements, a government can use special revenue funds.
The rules designed under GASB are required and directed by the government to be implemented within the fiscal year.
The special revenue funds are processed and operated by government authorities. The Authority regulates and manages the resource gathered from taxes and other revenue sources. Such resources are huge in amount and thus need to follow certain rules and regulations so as to be accountable and transparent to its taxpayers. If you want to know more about those rules following this special revenue fund template may help you to understand it more clearly!
Special revenue funds are kept and preserved for some specific circumstances that may probably ask for it. But the fund is confined with different regulatory statements that it is bound to be followed. The given sample of the template can be used to understand the way special funds can be used. This might also help you to prepare a special revenue fund financial statements. So have a look at it before you take the stress!
Special revenue funds are processed following certain rules and regulations, mostly specified in special revenue fund GASB statements. If you are dealing with such funds you might need to understand and state the sources the revenue is coming from. Or you can refer to this template and simplify your task and reduce your workload.
Special revenue funds are extracted from the different revenue-generating sources in a government entity that is used for specific purposes. This purpose has to have some common public interest. It also states different other specifications and statements. If you want to know more about it you can choose this template that can explain the process to you and you might be able to prepare special revenue fund accounting.