3.4 Annual financial statements
3.4.1 Statements required by GAAP
Statutory requirement: Section 45B(1) of the PFA
A department's annual financial statements must be prepared in accordance with generally accepted accounting practice
The annual financial statements required under the PFA must be prepared in accordance with generally accepted accounting practice (GAAP), which is a defined term in the PFA. This will typically require a department to report:
- a statement of comprehensive income
- a statement of financial position
- a statement of movement in taxpayers funds
- a statement of cash flows
- a reconciliation of net cash flows from operating activities to the net surplus/(deficit) in the statement of financial performance, and
- notes, comprising a statement of significant accounting policies and other explanatory notes.
When preparing financial statements, departments should refer to the NZ IFRS compliant model financial statements prepared by Audit New Zealand. These are available at: http://www.auditnz.govt.nz/publications-resources/public-sector-auditing/model-financial-statements/government-departments
