Policies and Regulations

POLICY TITLE: Basis of Accounting

APPLIES TO: All Departments and Divisions

ADMINISTRATIVE AUTHORITY: Division of Finance and Administration Chief Financial Officer (CFO)

APPROVED BY: Kentucky State University Board of Regents

EFFECTIVE DATE: August 8, 2025

NEXT REVIEW DATE: August 8, 2028

POLICY STATEMENT:

In accordance with Kentucky Revised Statutes, Kentucky State University (KSU) maintains its financial records and prepares its financial statements using the accrual basis of accounting. This policy ensures conformity with Generally Accepted Accounting Principles (GAAP) as prescribed by the Governmental Accounting Standards Board (GASB) and other relevant authorities to ensure accurate and transparent financial reporting.

DEFINITIONS:

Accrual Basis of Accounting

A method of accounting where revenues are recognized when earned and expenses are recorded when an obligation has been incurred, without regard to the date of the actual receipt or payment of cash.

Generally Accepted Accounting Principles (GAAP)

The common set of accounting principles, standards, and procedures that entities must follow when they