Government Fund Accounting Guide
How to run GASB fund accounting in BizBooks Pro — from setting up your government entity and its funds through producing the fund-level statements and Budget vs Actual reports your board and auditor expect.
Who Government Edition Is For
Government Edition turns on when a company's reporting standard is set to GASB (Governmental Accounting Standards Board — the standard for US state and local governments). It's built for the small end of the public sector:
- Special districts — water, fire protection, cemetery, irrigation, mosquito abatement, library districts
- Small towns and villages — typically under a few thousand residents
- HOAs and community associations that keep fund-style books (Operating Fund + Reserve Fund)
- Public agencies and authorities that need GASB-formatted statements without an enterprise ERP
The core idea: a government is not one set of books. It's a collection of funds — each one a self-balancing ledger with legal restrictions on what its money can be spent on. BizBooks Pro models each fund as its own company file, joined together in a fund group so you can report on any single fund or the whole government at once.
Setting Up a Government Entity
- Create a new company (Settings → Companies → Add New Company, or the Setup Wizard on a fresh install)
- Enter your government's legal name and EIN
- For Reporting Standard, choose Government / Special District (GASB)
- Keep Create default chart of accounts checked — BizBooks Pro seeds the governmental chart (Fund Balance accounts, Revenues, Expenditures by function)
- Save — this company becomes your primary fund, usually the General Fund
- Open Funds in the sidebar and click Set Up Fund Structure to create the fund group
Understanding Fund Types
Every fund declares a GASB fund type when created. The type determines which chart of accounts template seeds and how the fund presents in reports:
| Category | Fund types | Accounting treatment |
|---|---|---|
| Governmental | General, Special Revenue, Capital Projects, Debt Service, Permanent | Tax-supported activities. Equity reports as Fund Balance (five GASB 54 classes); costs are Expenditures grouped by function (General Government, Public Safety, Highways & Streets…). |
| Proprietary | Enterprise, Internal Service | Business-like activities funded by user fees (a water utility, an internal motor pool). Equity reports as Net Position (Net Investment in Capital Assets / Restricted / Unrestricted); costs are Expenses including depreciation. |
| Fiduciary | Trust, Custodial | Money held on behalf of others — not the government's own resources. |
Example: a water district typically runs a General Fund (governmental — property tax revenue, admin expenditures) beside a Water Enterprise Fund (proprietary — water sales, operating expenses, Net Position). BizBooks Pro seeds a different chart of accounts for each and formats each one's reports correctly.
Adding Funds
- Open Funds from the sidebar (appears for GASB companies)
- Click + New Fund
- Name the fund (e.g. "Streets Fund," "Water Enterprise Fund") and pick its fund type
- Click Create Fund
BizBooks Pro creates the fund as its own company file with the fund-type-appropriate chart of accounts, joins it to your fund group, and inherits the fiscal year settings from your primary fund so every fund reports on the same calendar.
Switching Between Funds
The company switcher doubles as your fund switcher. Each fund shows a 🏛️ badge with its fund type, and a View Combined — All Funds entry jumps straight to the government-wide reports. Open any fund to work in its books — enter transactions, reconcile its bank account, run its reports. Everything you already know about BizBooks Pro works identically inside each fund.
GASB 54 Fund Balance Classifications
Governmental funds don't report "equity" or "retained earnings" — they report Fund Balance, classified per GASB Statement 54 by how constrained the money is:
| Classification | Default account | What belongs here |
|---|---|---|
| Nonspendable | 3000 | Amounts not in spendable form — inventory, prepaid items, long-term receivables. |
| Restricted | 3100 | Constraints imposed from outside — grantors, bondholders, enabling legislation, other governments. |
| Committed | 3200 | Constraints your governing board formally adopted (and only the board can undo). |
| Assigned | 3300 | Amounts intended for a purpose but not formally committed — often set by a finance officer. |
| Unassigned | 3900 | Everything else — the freely available residual of the General Fund. |
The seeded chart creates one account per classification. When you add your own equity accounts, the Fund Balance Classification dropdown on the account form tags each one so the Fund Balance by Classification report groups correctly. Proprietary funds instead pick from the three Net Position classifications.
Per-Fund Balance Sheet
From the Funds page, click Balance Sheet on any fund row. Governmental funds render as a Balance Sheet with the Fund Balance section; proprietary funds render as a Statement of Net Position. Unclosed current-year activity shows as an "Excess of Revenues Over Expenditures" line inside fund balance — the same way a standard Balance Sheet rolls year-to-date Net Income into Retained Earnings mid-year.
Balance Sheet by Fund
Open Government Reports → Balance Sheet by Fund. Every fund appears as its own column with a Total column at the right — the side-by-side presentation auditors use to see the whole government's position on one page. Accounts align across columns by account number, which is why the seeded templates share numbering.
Statement of Revenues, Expenditures, and Changes in Fund Balance
The GASB replacement for the Income Statement. For any fund and date range it shows Revenues by source, Expenditures by function, the Excess (Deficiency) of Revenues Over Expenditures, and the walk from Beginning to Ending Fund Balance.
Combined Statements
Government Reports → Combined Statement — All Funds rolls the Statement of Revenues, Expenditures, and Changes in Fund Balance across every fund: one column per fund, plus the government-wide total. Each fund keeps its own self-balancing books; this report is how the board sees the whole government at once. Beginning and ending fund balance rows tie to the Balance Sheet by Fund.
Fund Balance by Classification
The GASB 54 disclosure matrix: classifications down the side, funds across the top. Any unclosed current-year surplus shows as its own line so the report total ties to the Balance Sheet by Fund. Auditors request this schedule to support the fund balance note disclosure.
Budget vs Actual
Governments adopt budgets by law, so budget-versus-actual reporting is a first-class report, not an afterthought.
- Inside the fund, open Budgets and create a budget for the fiscal year (enter adopted amounts per revenue and expenditure account)
- Open Government Reports → Budget vs Actual, pick the fund and date range, and run
Each budgeted line shows Budgeted, Actual, Variance, Variance %, and a status flag:
- Expenditure lines — 🔴 red once actual spending exceeds budget, 🟡 yellow at 90% of budget, 🟢 green otherwise
- Revenue lines — 🔴 red when collections run more than 10% behind budget, 🟡 yellow within 10%, 🟢 green at or above budget
Export to CSV for board packets with the ⬇ CSV button.
Coming Next: Government Enterprise
Government Pro covers fund structure, GASB 54, fund statements, and Budget vs Actual. The Government Enterprise tier — in development now — adds the full GASB-34 audit stack:
- Encumbrance accounting — issuing a purchase order reserves the budget immediately, before the invoice arrives
- Budgetary GL entries — journalize the adopted budget (Estimated Revenues / Appropriations) with amendment tracking
- Modified accrual basis — measurable-and-available revenue recognition for governmental funds
- Government-wide statements — Statement of Net Position, Statement of Activities, and the reconciliation schedule
Want a heads-up when it ships? Register your interest.