Gce Model Questions Vol1 2019 Financial Accounting Question 25

A local government authority prepares its annual financial statements on a modified accrual basis. The following figures (in \(\text{₦}\) thousands) are given:\n\n- Tax revenue: 120,000\n- Grants received: 30,000\n- Operating expenses (excluding depreciation): 100,000\n- Depreciation on capital assets (straight‑line): 8,000\n- Interest expense on borrowed funds: 5,000\n- Transfer to a special road‑maintenance fund: 15,000 (a reallocation, not an expense)\n\nAt the start of the year the capital fund reported a surplus of 20,000, and at the end of the year the surplus was 10,000. Determine the change in net assets (net financial position change) for the authority for the year, taking into account the special‑fund transfer and the change in the capital‑fund surplus.