Income arising from these agreements should also be reportedin the participating funds. If legal provisions require a different allocation, the income should be reported in the recipient fund. Governments must disclose whether the maturities of the investments made with the proceeds of reverse repurchase agreements generally are matched to the maturities of the agreements, as well as the extent of the matching on the balance sheet date. Only counties had statutory authority to participate in reverse repurchase agreements and that authority was revoked in S.B. 81, effective September27, 1996. Cities may invest in reverse repurchase agreements if permitted by charter.
Early application is encouraged.
The accounting treatment for capitalization contributions to risk pools depends on whether there is transfer of risk. Capitalization contributions made by governments to public entity risk pools with transfer of risk should be reported as deposits if a return of the contributions is probable upon dissolution of, or the approved withdrawal from, the pool. In governmental funds, fund balance would be reserved to indicate the amount is not available for appropriation. Otherwise the contributions should be reported as prepaid insurance and allocated over future periods, or, alternatively in governmental funds, as expenditures in the period made. Capitalization contributions made by governments to public entity risk pools without transfer of risk should be reported as deposits or reductions of claims liabilities.