Governmental Accounting Standards Board Statement Number 9

In September 1989, the Governmental Accounting Standards Board issued Governmental Accounting Standards Board Statement 9: Reporting Cash Flows of Proprietary and Nonexpendable Trust Funds and Governmental Entities That Use Proprietary Fund Accounting.

Summary

This Statement established standards for cash flow reporting. It required a statement of cash flows (instead of a statement of changes in financial position) as part of a full set of financial statements for all proprietary and nonexpendable trust funds and governmental entities that use proprietary fund accounting. It exempted public employee retirement systems and pension trust funds from the requirement to present either a statement of cash flows or a statement of changes in financial position.

This Statement required that a statement of cash flows classify cash receipts and payments according to whether they stem from operating, noncapital financing, capital and related financing, or investing activities, and it provides definitions of each category.

Governmental enterprises were encouraged to report cash flows from operating activities directly by showing major classes of operating cash receipts and payments (the direct method), although the indirect or reconciliation method may be used. If the direct method is used, a reconciliation of operating income to net cash flow from operating activities is required to be provided.

Information about investing, capital, and financing activities not resulting in cash receipts or payments in the period is required to be provided separately.

Status

Effective Date

December 15, 1989

Amends earlier standards

This Statement amended and superceeded several earlier pronouncements. Specifically, it supersedes NCGAS 1 requirements for proprietary fund reporting of statement of changes in financial position (principle 12; ¶128, ¶139, ¶143, ¶156, ¶167, and ¶170; and fn26 of ¶156). It also amended NCGAS 7, ¶8 and ¶25, NCGAI 2, ¶8, NCGAI 6, ¶2 and ¶4, and AICPA SOP 80–2, ¶4.

Amended by later statements

This Statement has been amended by GASB 25, GASB 31, GASB 34, and GASB 35. Specifically, paragraph 1 was amended by GASB 34, ¶15, ¶69, and ¶106, footnote 1 was superseded by GASB 34, ¶66 and ¶69, paragraph 4 was amended by GASB 34, ¶15, ¶69, and ¶106, paragraph 5 was amended by GASB 25, ¶14, GASB 31, ¶17, GASB 34, ¶15, ¶69, ¶106, and ¶138, and GASB 35, ¶5, footnote 4 was superseded by GASB 35, ¶5, paragraph 6 was amended by GASB 34, ¶91 and ¶138, paragraph 7 amended by GASB 34, ¶100, footnote 8 was superseded by GASB 34, ¶100 and ¶102, paragraphs 17, 18, 21, and 22 were amended by GASB 34, ¶112, paragraph 31 was amended by GASB 34, ¶105 and ¶112, paragraphs 32 through 34 were amended by GASB 34, ¶100 and ¶105, paragraph 36 was amended by GASB 34, ¶6, and ¶105, and footnote 12 was amended by GASB 34, ¶6.

Discussion