Which fund type should be used for the separately issued report of a public-entity risk pool?

The correct fund type for a separately issued report of a public-entity risk pool is the enterprise fund. This is because an enterprise fund is utilized by governmental entities to account for activities that operate similarly to private businesses, meaning they are financed and operated in a manner akin to commercial enterprises.

Public-entity risk pools typically collect premiums or contributions from members and then use those funds to cover claims and related costs. This arrangement aligns with the enterprise fund’s distinguishing feature, which is generating revenue primarily through charges for services. Therefore, reporting under an enterprise fund allows the public risk pool to reflect economic resources and provide a more accurate portrayal of its financial standing and performance.

The other options—general fund, special revenue fund, and investment trust fund—do not align with the primary characteristics or the revenue-generating activities of a public-entity risk pool, making them unsuitable choices in this context. The general fund is meant for general government operations, a special revenue fund is designated for specific revenue sources, and an investment trust fund is intended for holding and managing investments on behalf of others.