Financial reporting provides insights to stakeholders that can help them determine an entity’s financial health and performance. Of course, there are still differences between proprietary funds and for-profit organizations in taking on costs. However, this kind of financial reporting is very different. Gee et al. (2022) note that compared with more conventional profit-seeking ventures, operative funds, which have long been a tool of governmental investments, exhibit a different pattern in presenting their financial statements.

Differences in Statement of Net Position

There is one crucial difference, however- a statement of net position accounts for what a non-profit organization receives and pays out. The sequence of liquidation in proprietary funds meets a unique set of circumstances. This differs from notorious for-profit groups that often lay out assets and liabilities by putting the most liquid items on top. For instance, the accounts for governmental securities proprietary funds would separate long-term capital assets from short-term investments into more highly defined parts, providing a much finer image of its overall state.

For example, in understanding social recommendations in a profit-making enterprise, the bottom line and general financial impact are critical (Rosko et al., 2020). Short-Term Liquidity Assets and liabilities are classified in such a way as to shine the spotlight on short-term liquidity so that stakeholders can test whether entities possess immediate capabilities. This is because proprietary funds are long-term assets for the employees themselves, and paying attention to management transparency helps steer clear of governmental entities’ unique financial obligations (Jones, 2019).

Differences in Statement of Revenues, Expenses, and Changes in Fund Net Position

Another difference between proprietary and for-profit organizations is the Statement of Revenues, Expenses, and Changes in Fund Net Position. Neither makes money or loses it–they report revenue and expenditure. The two organizations differ only in the emphasis they place on various sources. Gee et al. (2022) discuss how the states ‘proprietary funds, linked to government activity, take some of their income from taxes and fees. However, this does not necessarily mean that civil society organizations will have many opportunities for such sources since for-profit groups are sustained mainly by sales and business income (Gee et al., 2022).

In addition, many funds of proprietary organizations account for expenditures more by program and function than by nature. In other words, expenditures are broken down according to the function or activity they are intended for in showing an overall perspective of resource utilization and a collective understanding of how muster is provided to meet the mission. On the other hand, for-profit organizations mainly getely of nature in reporting expenses–cost of goods sold, selling from a profit and loss standpoint rather than merely to satisfy interests. This is a helpful tool for gauging the effectiveness of resource allocation in attaining organizational objectives (Press Smith, 2018).

Differences in Statement of Cash Flows

The cash flow statement shows the difference between resources and the for-profit organization. Funds can disclose business income in advance, including business-related activities with significant responsibilities (Gee et al., 2022). In contrast, for-profit organizations often list operating, investment, and financing income separately.

For example, self-employment budgets may include income from taxes and fees as part of business activities about the organization’s ability to generate revenue from income from its primary activities. In a revenue-oriented organization, operations focus on sales revenue and other profitable operations and provide excellent and valuable information about the company’s performance. This difference in importance reflects the different financial structures and importance of government institutions compared to commercial banks.

Part B:The Mountain County Sheriff’s Office fund

County Sheriff’s Office Funds received from inmates to provide services to inmates should be treated as government funds, mainly revenue. This classification is appropriate considering the nature of the budget and its intended use in the public sector.

Special purpose trusts are often used for resources held in trust to benefit a specific person or entity outside the Government (Morris, 2020). In contrast, private income is created to cover income from private sources restricted by law or used for a specific purpose, such as the income of prisoners in cells, in this case.

The main d