Policy Reference:

GASB Codification Section 2100 – Defining the Financial Reporting Entity

Process and Document Preparation:

BACKGROUND

New York State is involved in providing a full range of services to its citizens. Many of these services are provided by various State agencies, whose activities are accounted for in numerous funds. Such agencies are logically part of the reporting entity due to the direct relationship between the agency and the State, and due to the high degree of their integration into the budgetary process and daily operations are generally known as the “primary government.”

Other services are provided by various quasi-state agencies and public benefit corporations whose activities and financial transactions are accounted for in separate, independent accounting and reporting systems and are generally known as “component units.” The existence of these organizations necessitates the use of a conceptual framework to determine New York State's reporting entity.

CRITERIA FOR ENTITY DETERMINATION

Entity determination is done in accordance with provisions of the Codification of the Governmental Accounting Standards Board at Section 2100 - "Defining the Financial Reporting Entity." The following is a comprehensive list of those public benefit corporations included within the New York State Reporting Entity as of April 1, 2020. Public benefit corporations are reported as component units and discretely presented in the financial statements.

• Aggregate Trust Fund
• Agriculture and New York State Horse Breeding Development Fund Corporation
• Albany Convention Center Authority
• Capital District Transportation Authority
• Central New York Regional Transportation Authority
• City University of New York - Senior College Supporting Organizations
• Dormitory Authority of the State of New York
• Governor Nelson A. Rockefeller Empire State Plaza Performing Arts Center Corporation
• Greenway Conservancy for the Hudson River Valley, Inc.
• Health Research, Inc.
• Homeless Housing and Assistance Corporation
• Housing Trust Fund Corporation
• Hudson River-Black River Regulating District
• Hugh L. Carey Battery Park City Authority
• Long Island Power Authority
• Metropolitan Transportation Authority (MTA):
  • New York City Transit Authority
    • Manhattan and Bronx Surface Transit Operating Authority
  • MTA Capital Construction Company
  • Staten Island Rapid Transit Operating Authority
  • The Long Island Rail Road Company
  • Triborough Bridge and Tunnel Authority
  • Metro-North Commuter Railroad Company
  • MTA Bus Company
  • First Mutual Transportation Assurance Company
• Municipal Bond Bank Agency
• Natural Heritage Trust
• New York Convention Center Operating Corporation
• New York Power Authority
• New York Racing Association, Inc.
• New York State Affordable Housing Corporation
• New York State Bridge Authority
• New York State Energy Research and Development Authority
• New York State Environmental Facilities Corporation
• New York State Health Foundation
• New York State Higher Education Services Corporation
• New York State Housing Finance Agency
• New York State Job Development Authority
• New York State Olympic Regional Development Authority
• New York State Thoroughbred Breeding and Development Fund Corporation
• New York State Thruway Authority
• Niagara Frontier Transportation Authority
• Ogdensburg Bridge and Port Authority
• Port of Oswego Authority
• Research Foundation for Mental Hygiene, Inc.
• Rochester-Genesee Regional Transportation Authority
• Roosevelt Island Operating Corporation
• Roswell Park Cancer Institute
• State Insurance Fund
• State of New York Mortgage Agency
• State University of New York Foundations and Auxiliary Corporations
• Urban Development Corporation

The New York Local Governmental Assistance Corporation and the Tobacco Settlement Financing Corporation are classified as component units but are blended into the Governmental Funds because they provide services exclusively to the State.

The following higher education related entities are included in the New York State reporting entity in the Enterprise Funds.

• City University of New York (CUNY) - Senior Colleges
• CUNY Construction Fund
• Research Foundation of CUNY
• State University of New York (SUNY) - State Operated Campuses
• SUNY Construction Fund
• Research Foundation of SUNY
• Statutory Colleges of Cornell and Alfred

JOINT VENTURES

Joint ventures are reported based on requirements contained in the Governmental Accounting Standards Board Codification Section 2100 – “Defining the Financial Reporting Entity.” To be classified as a joint venture, the State must retain either an ongoing financial interest or ongoing financial responsibility. Since the State does not currently record its equity in joint ventures, financial data for these entities is not presented on the face of the State's financial statements. However:

1. The footnotes to the basic financial statements include a general description of the entity’s operations and purpose including:
   1. Description of the State's ongoing financial interest; and
   2. Information that would allow the reader to evaluate whether the joint venture may cause additional future financial benefit/burden to the State.
2. Information about availability of separate financial statements and related party transaction is also included.

The only significant joint venture in which the State of New York participates is the Port Authority of New York and New Jersey.

JOINTLY-GOVERNED ORGANIZATIONS

Various laws have provided for the creation of regional governments or other multi-governmental arrangements that are governed by representatives from each of the governments that create the organization. These organizations may appear similar to joint ventures in that they provide goods or services to the citizenry of two or more governments but many do not meet the definition of a joint venture because there is no ongoing financial interest or responsibility by the State. Any transactions between a jointly-governed organization and State should be disclosed as related party transactions.

Jointly-governed organizations are identified as part of the reporting entity determinations and numerous such organizations have been identified but none that are significant or have significant related party transactions with the State.

RELATED ORGANIZATIONS

Organizations for which the State is accountable because that government appoints a voting majority of the board, but for which the State is not financially accountable, are classified as “related organizations.” The State is required to disclose in the notes to the financial statements the nature of its accountability for related organizations. Groups of related organizations with similar relationships with the primary government may be summarized for purposes of the disclosure. In addition, the State should disclose transactions between the State and the related organization as related party transactions.

Related organizations are identified as part of the reporting entity determinations and there have been numerous such organizations identified but none that are significant or have significant related party transactions with the State.

Guide to Financial Operations

REV. 01/05/2021