ERIC Number: ED428594
Record Type: Non-Journal
Publication Date: 1998
Reference Count: N/A
Understanding Financial Statements. Financial Matters. Board Basics.
McCarthy, John H.; Turner, Robert M.
Association of Governing Boards of Universities and Colleges
This booklet for trustees of higher education institutions offers guidelines to help trustees understand the institution's financial statements. Individual sections describe the three major financial statements and cover topics such as: (1) standards of the Financial Accounting Standards Board; (2) the "statement of financial position," which summarizes assets, liabilities, and net assets; (3) the key strategic issue for trustees in evaluating the statement of financial position, which is determining whether existing resources will enable the institution to fulfill its mission; (4) the "statement of activities," which reviews changes in the institution's net worth; (5) the key strategic issue for trustees in evaluating the statement of activities, which is how effectively did the institution use its resources to provide services to its constituents; (6) the "statement of cash flow," which assesses the institution's ability to meet ongoing cash needs; and (7) the key strategic issue for trustees in evaluating the statement of cash flow, which is determining the institution's sources and uses of cash; and (8) assessing the external market in order to understand who is the audience for the institution's financial statements and what are its information needs. Examples of the three statements for a hypothetical institution are provided. (DB)
Descriptors: Accounting, Budgeting, Budgets, Data Interpretation, Decision Making, Educational Finance, Evaluation Methods, Financial Policy, Governing Boards, Higher Education, Money Management, Policy Formation, Resource Allocation, Standards
Association of Governing Boards of Universities and Colleges. 1133 20th Street NW Suite 300, Washington, DC 20036. Tel: 800-356-6317; Tel: 202-296-8400; Fax: 202-223-7053; Web site: http://www.agb.org
Publication Type: Guides - Non-Classroom
Education Level: N/A
Audience: Administrators; Policymakers; Practitioners
Authoring Institution: Association of Governing Boards of Universities and Colleges, Washington, DC.