In governmental accounting, which event would trigger a debit to the Expenditures control account?

• A. A new encumbrance is created
• B. Purchases are ordered but not received
• C. Cash is paid for a purchase
• D. Supplies previously encumbered are received

Answer: (B)

In governmental accounting, expenditures are recorded when the government has incurred the liability for goods or services and the encumbrance is released, not when purchase orders are issued or when cash is paid. The system uses two budgetary controls: Encumbrances to track commitments and Expenditures to record actual spending. When a purchase is ordered, an encumbrance is created (no expenditure is recorded yet). When the supplies that were encumbered are received, the encumbrance is liquidated and the actual expenditure is recognized by debiting Expenditures control and crediting Encumbrances control. Therefore, the event that triggers a debit to the Expenditures control account is the receipt of supplies that had been encumbered. Cash payment does not create a new expenditure; it pays for an obligation already recognized.