[Anonymous]

At the beginning of the year, Govt usually books a budgetary JE

let say they budget 1000, with appropriation 800.

(DR)Estimated Revenue Control 1000

(DR)Budgetary Fund Balance –

(CR)Appropriation Control 800

(CR)Budgetary Fund Balance 200

However the actual revenue of the year is actually 900 instead of 1000

I use the following JE.

(DR)Revenue Control 900

(DR)(plug???)

(CR)Estimated Revenue Control 1000

May I know what account name of the plug? My guess is the Budgetary Fund Balance.

[Futile]

Actually, the budgetary entries and the actual entries are entirely separate. You do not combine the two. The closing budget entry will be exactly the reverse of the opening entry.

Beginning of the year – Budget:

DR: Estimated Revenues Control 1000

…CR: Appropriations Control 800

…CR: Budgetary Fund Balance (difference) 200

End of year closing entry – Budget:

DR: Appropriations Control 800

DR: Budgetary Fund Balance 200

…CR: Estimated Revenues Control 1000

Actual Revenues:

DR: Cash / Receivables 900

…CR: Revenues Control 900

Actual Expenditures:

DR: Expenditures xx

…CR: Vouchers Payable / Cash xx

End of year closing entry – Actual

DR: Revenues control 900

DR or CR: Unassigned Fund Balance (difference) x

…CR: Expenditures xx

CPA exam: Done!

Thank You, Lord.

[LoveEventing]

I agree with Futile. The budget entry serves only as a measurement tool to determine how much is “left” in the account at any point in time. Essentially, the scenario you provided would show that the entity is 100 under budget for revenue until the budget accounts are closed at year-end. Then, you would just be left with actual revenue of 900.

BEC - 68, 76
AUD - 90, 91
FAR - 63, 83
REG - 55, 79

FINALLY DONE!

[niggy]

no matter what your actual expense it, you need to close out the budget you booked in the first place, which means completely reverse your budget JE. after that, you can book your actual expenditure.

AUD - 76 (May 2012)
BEC - 81 (July 2012)
REG - 61 (Aug 2012), rematch 83 (October 2012)
FAR - 85 (May 2013)

Based on Becker 2012 self-study.
Currently licensed PA CPA since July 2013.

[Anonymous]

Wikipedia actually has a pretty nice example of the budgetary journal entries.

https://en.wikipedia.org/wiki/Fund_accounting

I don't understand why the word “control” is added to some entries–is this just a syntax issue? Are “estimated revenue” and “estimated revenue control” the same thing?

Also, with encumbrances, are they just a temporary means to reclassify the fund balance from unassigned to assigned and then they are reversed for a split second to put the money back into unassigned to let the expenditure be recognized and the liability recognized?

I am trying to understand the concept of encumbrances..I believe it is almost like reclassifying equity in a for profit from retained earnings to addl pic. I don't think encumbrances are really an asset, liability, revenue or expense so I am trying to get a solid understanding of how I can relate them to other types of journal entries.

[Author]

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