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- 20 Marks
Question
a) Below are items of transactions obtained from the financial records of Ganigani Municipal Assembly for the year ended 31 December 2022.
| Transaction Items | GH¢’000 |
|---|---|
| Share of District Assembly Common Fund received | 68,000 |
| Share of District Assembly Common Fund in arrears | 120,000 |
| District Development Facility | 60,000 |
| Clean Ghana grant (i) | 40,000 |
| Hawkers licenses | 5,000 |
| Dog licenses | 2,000 |
| Hotel and Restaurant licenses | 43,000 |
| Akpeteshie Distillers or sellers’ licenses | 9,000 |
| Non-established post salaries (Paid from Consolidated Fund) | 87,000 |
| Casual labour | 77,000 |
| Pensions contribution | 8,000 |
| Assembly members sitting allowances | 7,000 |
| Salary related allowances (ii) | 20,000 |
| Training, Seminar and Conferences (iii) | 45,000 |
| Travel and transport | 12,000 |
| Utility expenses (iv) | 1,000 |
| Consumables | 200 |
| Interest expense (v) | 500 |
| Consumption of fixed asset (Accumulated) | 44,000 |
| Consumption of fixed asset (charged for the year) | 4,800 |
| Purchase of motor vehicle (vi) | 30,000 |
| Premises (old premises revalued by experts) | 167,000 |
| Cash proceeds from auction of old furniture | 300 |
| Recoveries from loan and advances | 1,200 |
| Loans and advances granted during the year | 5,000 |
| Issue of Municipal Bonds | 100,000 |
| Redemption of Municipal Bonds | 28,000 |
| Bank loan borrowed during the year | 12,000 |
| Loan repayment | 3,400 |
| Investment income received | 100 |
| Property rates | 65,000 |
| Basic rate | 21,000 |
| Market tolls and fees | 12,400 |
| Fees and miscellaneous charges | 11,400 |
| Cash and cash equivalent at 31 December 2022 (Debit) | 70,000 |
| Accumulated Fund Balance (Debit) | 123,500 |
| Donation of Cement from Concerned Citizens | 3,500 |
Additional Information:
i) Clean Ghana grant of GH¢40,000 has a component of 40% in kind. ii) The Assembly paid 40% of the GH¢20,000 salary related allowances. iii) 60% of the GH¢45,000 representing Training, Seminar and Conferences expenses was funded by donors. iv) 25% of the GH¢1,000 representing utility expenses was in arrears. v) 90% of the GH¢500 representing interest expense has been paid. vi) 80% of the GH¢30,000 representing Motor Vehicle has been paid.
Required:
a) Prepare a Cash Flow Statement for the year ended 31 December, 2022 for Ganigani Municipal Assembly in compliance with the International Public Sector Accounting Standards 2: Cash Flow Statement and the current Chart of Accounts of Government of Ghana. (16 marks)
b) Explain FOUR (4) benefits of Cash Flow Information to the users of the financial statements of Ganigani Municipal Assembly. (4 marks)
Answer
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