What is the GASB formula for the Statement of Net Position?

The Statement of Net Position reflects the financial position of a governmental entity at a specific point in time, and it is based on the accounting equation that establishes the relationship among assets, liabilities, and net position. The correct formula, represented as assets minus liabilities equals net position, captures the essence of the financial position.

In this context, assets represent the resources owned by the government, while liabilities represent obligations or debts that the government must settle. The difference between the two provides a measure of the net position, which indicates the residual interest in assets after deducting liabilities. This net position is crucial for stakeholders and users of financial statements as it shows the credibility of the government's financial standing.

Understanding this formula is foundational in governmental accounting. It lays the groundwork for assessing solvency and the overall financial health of governmental entities. Therefore, the formula that accurately characterizes the Statement of Net Position is that net position equals assets minus liabilities.