• Forms
• NCAS
• CAFR Year-End
• CMCS/Central Compliance
• E-Commerce/ SECP
• Central Payroll
• Statewide Foreign Nationals Compliance Program
• Policies
• Account Classification
• Accounts Receivable
• Capital Assets
• Cash Management
• Central Payroll (Universities)
• Electronic Commerce
• Federal and State Compliance
• Foreign Nationals
• Human Resources Accounting
• Internal Controls
• Long-term Liabilities
• Payment
• Procurement Card
• Records Retention and Reports Retention
• Revenues and Expenditures
• State Financial Reporting
• Tax Compliance
• Uniform North Carolina Accounting System

Prepaid Items Policy

Authority:
GASB Codification Section 1600.127
AICPA Audit and Accounting Guide, Audits of State and Local Governmental Units as of May 2006 paragraph 8.56

Effective Date:
7/1/95; Revised 3/1/07

References:
Refer to the Chart of Accounts: Prepaid Items 119100

Prepaid items that benefit more than one accounting period, such as insurance, rent, and subscriptions, should be treated as follows:

Policy:
In governmental funds (general, special revenue, capital projects, and permanent), which follow the modified accrual basis of accounting, prepaid items should be accounted for using the purchases method (i.e., considered expenditures when purchased). Balances of prepaid items in governmental funds should not be reported as assets.

Accounting Guidance:
In the government-wide, proprietary fund (enterprise and internal service), and fiduciary fund financial statements, which follow the accrual basis of accounting, prepaid items should be reported as assets and allocated to the period benefited.