Which of the following accounts is a budgetary account of a governmental fund?

• A. Revenues
• B. Expenditures
• C. Deferred inflows of resources
• D. Appropriations

Answer: (D)

Budgetary accounting in a governmental fund centers on the legal controls placed on the appropriation of resources. Appropriations represent the authority granted by the legislative body to incur expenditures, so they’re tracked as a budgetary account to monitor compliance with the adopted budget. Revenues and expenditures are actual operating accounts that reflect real inflows and outflows under the fund’s modified accrual accounting, not budgetary controls. Deferred inflows of resources relate to when revenues are recognized for reporting purposes, not to the budget process. Because appropriations are the budgetary control item that details legal spending authority, they are the budgetary account here.