Is a schedule of short-term debt required if none exists at fiscal year-end?

The correct answer indicates that a schedule of short-term debt is indeed required even if there are no outstanding debts at the fiscal year-end. This requirement aligns with the principle of providing a comprehensive view of an entity's financial situation. It is important to reflect all aspects of a jurisdiction's financial activities, including any short-term liabilities that might have been incurred during the reporting period, even if they have been settled by the end of the fiscal year.

Having a schedule of short-term debt allows for transparency and ensures that users of the financial statements can see the historical context and trends associated with the entity's borrowing practices. Moreover, this practice allows stakeholders to understand the organization’s financial behavior, which can be crucial for making informed decisions and for audit purposes.

The requirement can also be tied to best practices in governmental accounting and financial reporting, emphasizing the need for full disclosure to maintain accountability and integrity in financial reporting. This means that all financial activities must be accurately documented and reported, which aids in ensuring that the financial statements effectively communicate the entity's economic reality.

By contrast, if the statement suggested that it is necessary to include the schedule only when debt is currently outstanding, it would overlook the importance of showing past obligations that influence current financial standing. Thus, reflecting