Final answer:
Net assets related to capital assets at the government-wide level should be reported as Invested in capital assets, net of related debt. This reflects the investment in long-term resources less any associated debt, not including unrestricted financial assets.
Step-by-step explanation:
At the government-wide level, net assets related to capital assets should be reported as Invested in capital assets, net of related debt. This category on the balance sheet is used to show the net investment in capital assets, such as buildings, machinery, and equipment, less any outstanding debt that is related to the purchase of these assets. It's important to note that this net figure does not include unrestricted assets or those that can easily be converted into cash. Instead, it reflects the investment in long-term resources that are used in providing services.
Understanding the relationship between assets, liabilities, and net worth is key to analyzing a T-account or a bank's balance sheet. Assets must always equal the sum of liabilities and net worth to maintain balance. This concept applies to all entities, whether in the private sector, like banks, or in the public sector, such as government agencies.