CGFO Fin Rpt Part 3

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FSUmom
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246159
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CGFO Fin Rpt Part 3
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2013-11-14 20:10:51
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CGFO Financial Reporting
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GAAFR Guide questions
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  1. Which of the following groups took the lead in setting GAAP for business enterprises?
    A. Business themselves
    B. Federal governements
    C. Independent auditors?
    D. State governments
    C.  Independent auditors took the lead in the public sector
    (this multiple choice question has been scrambled)
  2. Which organization appoints the members of GASB?
    The FAF appoints members of FASB & GASB.
  3. Which is the following has the LOWEST authoritative status on the GAAP hierarchy?
    A.  Widely recognized & prevalent practives
    B.  NCGA Interpretations
    C.  GASB Concepts Statements
    D.  The AICPA's audit & acctg. guide State & Local Governments?
    C.  GASB Concepts Statements is not part of the GAAP hierarchy.
    (this multiple choice question has been scrambled)
  4. Which of the following statements is TRUE?
    A.  Both the FASB & GASB are supported in their work by advisory councils.
    B.  Both FASB & GASB have 7 members
    C.  Both FASB & GASB can approve pronouncements by a simple majority vote.
    D.  All of the above.
    D.  All of the above.
  5. Which of the following sets GAAP for non profit organizations?
    A. FAF
    B. FASB
    C. AICPA
    D. GASB
    B. FASB covers both private-sector business & non profit organizations.
    (this multiple choice question has been scrambled)
  6. Which of the following organizations has designated the GASB as the authoritative standard-setting body for state & local governments?
    A. FAF
    B. AICPA
    C. GAO
    D. SEC
    B. AICPA
    (this multiple choice question has been scrambled)
  7. T/F The appropriated budget of a government is essentially a financial plan.
    False,the appropriated budget of government is much more that just a financial plan.
  8. In accordance with the number of funds principle, when is it appropriate to use a fund other than the general fund.
    A.  When GAAP require the use of some other fund.
    B.  When sound financial administration supports the use of some other fund.
    C.  When the use of some other fund is legally required.
    D.  All of the above.
    D.  All of the above.
  9. In which of the following circumstances is the use of an agency fund appropriate?
    A. When assets are held for other governments in an investment pool
    B. When assets are held for third parties other than the reporting government
    C. When assets are held for Internal Revenue Code Section 457 deferred compensation plans
    D. When assets are held for other funds of the reporting government
    B. When assets are held for third parties other than the reporting government (OPM)
    (this multiple choice question has been scrambled)
  10. Which of the following fund types uses the economic resources measurement focus?
    A.  Agency Fund
    B.  Private-purpose trust fund
    C.  Permanent Fund
    D.  General Fund
    B.  Private-purpose trust fund

    General Fund & Permanent Fund use current financial resources measurement focus

    Agency Fund do not have a measurement focus
    (this multiple choice question has been scrambled)
  11. Which of the following fund types uses the current financial resources measurement focus?
    A. Investment trust fund
    B. Agency Fund
    C. Enterprise Fund
    D. Permanent Fund
    D. Permanent Fund

    Proprietary funds use economic focus
    Agency do not have measurement focus
    Trust use economic focus
    (this multiple choice question has been scrambled)
  12. The operating statement of a proprietary fund should answer which of the following questions?
    A.  What transactions and events during the period have increased or decreased the fund's total economic resources?
    B.  What transactions & events during the period have increased or decreased the resources available for spending in the near future?
    C.  Have current financial resources increased or decreased during the period?
    D. Have cash balances increased or decreased?
    A.  What transactions and events during the period have increased or decreased the fund's total economic resources?
    (this multiple choice question has been scrambled)
  13. Which of the following would be reflected in the operating statement of a proprietary fund?
    A. Issuance of debt
    B. Incurrence of interest (interest expense)
    C. Capital outlay
    D. Debt service principal pymts
    B. Incurrence of interest (interest expense)

    A, B or D neither affect net assets, which is the measure of economic resources that serves as the focus of proprietary funds.
    (this multiple choice question has been scrambled)
  14. Which of the following would always be reflected in the operating statement of a government fund?
    A.  Amortization expense
    B.  Capital outlay
    C.  Depreciation expense
    D.  All revenues earned during the period
    B.  Capital outlay are use of current financial resources. 

    Depreciation & Amortization expense affect net assets.

    Revenue is recognized in a gov't fund only to the extent that it is available to liquidate expenditures or the the current period.
    (this multiple choice question has been scrambled)
  15. Which of the following is a basic financial statement of a proprietary fund?
    A. Statement of revenues, expenditures & changes in net assets.
    B. Statement of revenues, expenditures & changes in retained earnings.
    C. Statement of revenues, expenses, & changes in net assets.
    D. Statement of revenues, expenses, & changes in retained earnings
    C. Statement of revenues, expenses, & changes in net assets.
    (this multiple choice question has been scrambled)
  16. What is the appropriate measurement focus & basis of accounting for trust funds?
    Economic resources measurement focus/accrual basis of accounting
  17. Which of the following is NOT a basic government-wide financial statement?
    A.  Statement of cash flows
    B.  Statement of net assets
    C.  Statement of activities
    D.  None of the above
    A.  Statement of cash flows
    (this multiple choice question has been scrambled)
  18. In which of the following situations would the use of an internal service fund be justified?
    A.  The cost of capital assets is recovered by setting charges based upon depreciation expense.
    B. The cost of capital assets is recovered by setting charges based om debt service requirements.
    C.  The cost of capital assets is recovered by setting charges based on the estimated replacement cost of the assets.
    D.  All of the above
    D.  All of the above
  19. Which of the following funds types should be used for restricted resources that are permanently invested?
    A.  Permanent Fund
    B.  Special Revenue Fund
    C.  General Fund
    D.  B or C
    D.  B or C
    (this multiple choice question has been scrambled)
  20. Which of the following uses of a capital projects fund would NOT be appropriate?
    A. To account for a major capital acquisition financed through contributions.
    B. To account for a major capital acquisition financed through borrowing.
    C. To accumulate resources for future capital improvements.
    D. None of the above
    C. To accumulate resources for future capital improvements.

    The focus of capital projects fund is on a construction & acquisition not used as a reserve account.
    (this multiple choice question has been scrambled)
  21. T/F Fund accounting is primarily intended to enhance operational accountability?
    False to demonstrate legal compliance.
  22. T/F Operational accountability is the responsibility of governments to justify that their actions in the current period have complied with public decisions concerning the raising and spending of public moneys in the short term.
    False - Operational accountability refers to governments responsibility to report the extent in which they have met their operating objectives efficiently & effectively, using all resources available for that purpose.
  23. T/F The principal of the permanent fund may not be spent.
    True
  24. T/F The use of an enterprise fund is required when the repayment of debt is backed solely by user fees & charges.
    True
  25. T/F GAAP permit, but NEVER require, the use of an internal service fund.
    True
  26. T/F The use of an internal service fund is only appropriate in situations where the government itself is the predominant participant in the activity.
    True
  27. T/F GAAP require the use of a separate trust fund for each individual pension plan.
    True
  28. T/F The government-wide financial statements use the economic resources measurement focus and the accrual basis of accounting, whereas all funds, regardless of type, use the current financial resources measurement focus and the modified accrual basis of accounting.
    False
  29. T/F All funds that use the modified accrual basis of accounting also sue the current financial resources measurement focus.
    True
  30. T/F The basic financial statements include both the government-wide financial statements and the fund financial statements.
    True also the notes to the F/S
  31. T/F Fund accounting is naturally well suited to achieving the goals of fiscal accountability.
    True - help to ensure & demonstrate legal compliance.
  32. T/F The various funds used by state & local governments can be classified into 4 broad categories.
    False - 11 fund types governmental (5), proprietary (2), & fiduciary funds (4)
  33. T/F Eventually, the net effect of either measurement focus on the operating statement is identical.
    True, Page 30 2005 GAAFR

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