Accounting Best Practices with Steve Bragg ABP #380 - Accounting for Water Authorities
Jul 17, 2025
Dive into the fascinating accounting landscape of water authorities, where unique frameworks meet enterprise fund accounting. Discover the critical role of asset management and record-keeping in safeguarding infrastructure investments. Unpack the intricate challenges, including revenue recognition from bonds and grants. Gain insights into the regulatory oversight necessary for precise financial tracking in the water sector. It's a whirlwind tour of a specialized field that keeps our essential resources flowing!
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Enterprise Fund Accounting Basics
- Water authorities operate as enterprise funds, charging fees to recover expenses like private businesses. - They have heavy infrastructure investments requiring capitalization and long-term depreciation.
Drought Causes Asset Impairment
- A drought drying up a reservoir can render a major pipeline useless, triggering a massive impairment charge. - This illustrates the vulnerability of water authority assets to environmental changes.
Track Financing and Grants
- Record principal and interest payments accurately when repaying revenue bonds financing infrastructure. - Ensure compliance with government grants, recognizing revenue and related asset properly.