Louisiana Administrative Code › Title 28 - EDUCATION › Part XLI - Bulletin 1929-Louisiana Accounting and Uniform Governmental Handbook › Chapter 6 - Measurement Focus and Basis of Accounting › Section XLI-605 - Types of Expenditures and Accounting Treatments

Current through Register Vol. 50, No. 6, June 20, 2024
A. The major types of expenditures are
				operating, capital, debt service and intergovernmental charges described as
				follows.
1. Operating expenditures for
				governmental agencies include a wide range of expenditures. Often, the largest
				portion relates to payroll and related employee benefits. The modified accrual
				basis of accounting requires that proper accruals be made for the amount of
				unpaid salaries and related benefits earned at year-end, because these
				liabilities will be paid early in the next reporting period. (The other types
				of operating expenditures should be accounted for in the same manner, with the
				recording of a liability when the goods or services are received and necessary
				accruals made at year-end.)
2.
				Capital expenditures relate to the acquisition of capital assets. Such
				expenditures may be recorded in the general fund, special revenue funds, or
				capital projects funds, depending on the source of funding. Purchases of
				personal property, such as furniture and equipment, are usually recorded as
				expenditures in the general fund if they are financed from operating budgets or
				in the general fund or special revenue funds if they are financed from grants.
				Major projects, such as the construction of a school building financed by the
				proceeds of debt, should be accounted for in a capital projects fund. Costs
				associated with acquiring capital assets in governmental funds are recorded as
				capital outlay expenditures when the liability is incurred, usually on receipt
				of the related asset.
3. Debt
				service expenditures represent the payment of principal and interest needed to
				service debt. Such payments are usually recorded as expenditures in the debt
				service fund on the due date. The general fund may also be used if a debt
				service fund is not required. The modified accrual basis of accounting provides
				that accruals for interest are not usually allowed. When funds have been
				transferred to the debt service fund in anticipation of making debt service
				payments shortly after the end of the period (no more than 30 days), it is
				acceptable to accrue interest and maturing debt in the debt service fund in the
				year the transfer is made. This option is available only if monies are legally
				required to be set aside in a debt service fund and if used on a consistent
				basis.
4. Intergovernmental charges
				relate to the transfer of resources from one school district to another, to or
				from other local governments, or to or from the state. Examples of such charges
				include contracted instructional services between public schools, other local
				governments, or state-operated schools and certain transfers of resources
				associated with state and local funding (e.g., incremental costs associated
				with wealth redistribution). Such expenditures are accounted for in the general
				fund using the modified accrual basis of accounting. Payments between school
				districts and fiscal agents of cooperative services arrangements (e.g., joint
				instructional or servicing agreements) are also considered intergovernmental
				charges.