Question: For many years prior to the implementation of GASB 34, governments accounted for the operation of governmental activities solely through the governmental fund statements. As we have seen, these statements and modified accrual accounting in general are extremely useful for monitoring compliance with budgets and for measuring the liquidity and solvency of governmental funds. During this period, governments also tracked their long-term liabilities and reported them in the notes to their financial statements. GASB 34 basically added the accrual-basis Statement of Net Assets and Statement of Activities for Governmental Activities. Nothing really changed for Proprietary Funds. Governments must apply the criteria of GASB statement no. 14 (as amended) in determining whether and how to include an associated entity in its reporting entity. A city is considering whether and how it should include the following associated organizations in its reporting entity.
Do you think the added information provided by the new statements was worth the extra cost? Why or why not?