If a government includes other governments' resources in an investment pool, how should the external portion be reported?

When a government manages an investment pool that includes resources from other governments, the external portion of that investment pool should be reported in an investment trust fund. This type of fund is specifically designed for managing resources that belong to external parties, which allows for effective tracking and reporting of those assets.

Investment trust funds are utilized to account for the investment of funds by external entities, often in shared investment pools. This structure enables participating governments to invest their resources collectively, while still maintaining clarity and accountability in financial reporting. Through this categorization, the financial resources that belong to external investors are distinguished from the government's own funds, ensuring compliance with generally accepted accounting principles (GAAP) and proper fiduciary responsibility.

The other fund types listed are not suitable for this purpose: agency funds typically account for resources held temporarily on behalf of others, but do not consider the investment aspects; permanent funds are used to report resources that are intended to benefit the government or its constituents rather than pooled external investments; and enterprise funds pertain to government activities that operate like a business, focusing on user charges rather than investment pools.