Business Procedures Manual

Essential business procedural components for University System of Georgia institutions.

1.1 GAAP Complilance

(Last Modified on February 25, 2016)

The USG adheres to the GASB GAAP hierarchy as defined in GASB Statement No. 76, The Hierarchy of Generally Accepted Accounting Principles for State and Local Governments, which sets forth what constitutes GAAP for all state and local governmental entities. It establishes the order of priority of pronouncements and other sources of accounting and financial reporting guidance that a governmental entity should apply. The sources of authoritative GAAP are categorized in descending order of authority as follows:

  • Officially established accounting principles - Governmental Accounting Standards Board (GASB) Statements (Category A)
  • GASB Technical Bulletins; GASB Implementation Guides; and literature of the AICPA cleared by the GASB (Category B).

Authoritative GAAP is incorporated periodically into the Codification of Governmental Accounting and Financial Reporting Standards (Codification), and when presented in the Codification, it retains its authoritative status.

If the accounting treatment for a transaction or other event is not specified by a pronouncement in Category A, the USG considers whether the accounting treatment is specified by a source in Category B.

If the accounting treatment for a transaction or other event is not specified within Category A or B authoritative GAAP, the USG considers accounting principles for similar transactions or other events within Category A or B authoritative GAAP. In addition, the USG may also consider nonauthoritative accounting literature from other sources that does not conflict with or contradict authoritative GAAP.

Sources of non-authoritative accounting literature may include GASB Concepts Statements; pronouncements and other literature of the Financial Accounting Standards Board, Federal Accounting Standards Advisory Board, International Public Sector Accounting Standards Board, and International Accounting Standards Board, and AICPA literature not cleared by the GASB; practices that are widely recognized and prevalent in state and local government; literature of other professional associations or regulatory agencies; and accounting text- books, handbooks, and articles.

In evaluating the appropriateness of non-authoritative accounting literature, the USG considers the consistency of the literature with the GASB Concepts Statements, the relevance of the literature to particular circumstances, the specificity of the literature, and the general recognition of the issuer or author as an authority.

Summaries of GASB Statements, Concepts Statements and Interpretations, including instructions for obtaining the full text, can be found on the GASB website: Additional non-authoritative accounting literature utilized by the USG includes the following:

  • The National Association of College and University Business Officers (NACUBO), Financial Accounting and Reporting Manual for Higher Education Released (FARM) manual; and
  • The Statewide Accounting Policy & Procedure manual issued by the State Accounting Office.
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