Which statement is NOT typically prepared by an internal service fund under GASB?

• A. Statement of Revenues, Expenses, and Changes in Fund Net Position
• B. Statement of Net Position
• C. Statement of Cash Flows
• D. Statement of Revenues, Expenditures, and Changes in Fund Balance

Answer: (D)

Internal service funds are proprietary funds, so they use accrual accounting and report in formats similar to private-sector or enterprise-type reporting. They prepare a Statement of Net Position, a Statement of Revenues, Expenses, and Changes in Fund Net Position, and a Statement of Cash Flows. The term “Revenues, Expenditures, and Changes in Fund Balance” belongs to governmental fund reporting, which uses the current financial resources measurement focus and emphasizes fund balances, not net position. Therefore, that statement is not typically prepared by an internal service fund. The other statements listed fit the standard proprietary fund presentations under GASB.