You are the newly hired Comptroller for the City of Howard. The city has never had an audit and keeps its records on a cash basis and issues a budget v. actual statement as its only financial statement. It has one bank account and runs one fund – its general fund. The city has a $5 million bond outstanding with interest and principal due annually. It has three grants which require separately segregated accounts for use. Lastly, a retired parks employee died with an estate that he left to the City. The investment earnings on the funds may only be used to upkeep of the local park. The principal amount of the estate may not be touched.
Please comment on how you would change the accounting system in order to make it in compliance with GAAP and any legal requirements. Additionally, discuss any other changes you would implement in your new position. You must cite specific provisions from the GASB codification as you explain your changes.
Can anyone help me with this who is familiar with GASB codification.