“Government and Institutional Accounting” ACG 4501

“Government and Institutional Accounting” ACG 4501

Paper details:

Name of the Class: “Government and Institutional Accounting” ACG 4501

INSTRUCTIONS:
1- Respond to the following Classmate’s Post which was based on the following instructions:
-What is the purpose of an internal service fund? What advantages and disadvantages do you see? What do you see as being compatible to for-profit companies in terms of financial reporting?

Classmate’s Post:
Internal service funds are accounts to track goods and services between departments on a cost reimbursement basis. An Example could be a maintenance department that provide services for other departments. A benefit to internal service funds could be efficiency. It allows agencies to share cost of staff across departments rather than duplicating efforts. This would also create more accurate accounting cost of a particular service. On the other hand, this more complicated to understand in financial reporting than an appropriated budget. Related transactions for a for-profit company would be something of a related party transaction and could be recorded as referral fees or contract cost.
References:
Cowan, Florance (1989). Journal of Accounting Public Policy, The effect of internal service fund on the comparability of government accounting numbers, Retrieved from: https://www.sciencedirect.com/science/article/pii/0278425489900197
She-Edmunds, Sam (2018, April). Azcentral, The Advantages of Internal Funding, Retrieved from: https://yourbusiness.azcentral.com/advantages-internal-funding-16749.html

2- On your response you must agree or disagree what your Classmate said on her post. You also need to add something new to the discussion. You MUST include In-Text Citation in order to add credibility to your assignment. Do not forget to cite your sources and In-Text Citations in APA Format.