Statement of Net Assets
The statement of net assets summarizes a government’s total assets and liabilities in order to determine its net assets. Net assets are the assets that are left over after a government takes care of its liabilities. Studying the net assets of a government over a period of several years can give a sense of whether the government is financially healthy or not.
Assets are presented on the statement with the most liquid first, which means that the list of assets begins with cash and ends with assets that are meant to be held for the long-term, like property. Depreciation is factored into the value of capital assets, such as equipment and machinery.
Liabilities are presented beginning with what must be paid first and ending with the longest term debt commitments.
Net assets are what is left when liabilities are subtracted from assets. If a net asset is required to be used for a specific purpose, it is listed as restricted. Unrestricted assets can be used for any purpose.
Generally speaking, governmental activities are tax-supported, while business-type activities are supported by fees and other charges. The functions of utilities and hospitals are examples of business-type activities.
Component units, sometimes listed separately on the right side of the statement, are entities that are financially dependent on the government. Examples include school boards or park and wildlife foundations.
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Goodville Government-Wide Statement of Net Assets |
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Governmental Activities |
Business-Type Activities |
Total |
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Assets (in millions) |
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Cash |
$40 |
$20 |
$60 |
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