Chapter 10

Question 0

endowment requires

Answer 0

that the principal is preserved forever

Question 1

nonexpendable

Answer 1

a donation with a stipulation that only earnings can be used, not the principal or corpus

Question 2

term endowment

Answer 2

is one that the principal can be expended after a specified period of years

Question 3

Expendable trust funds

Answer 3

can spend the principal and the interest earnings

Question 4

Permanent funds

Answer 4

are governmental funds used to account for nonexpendable resources that benefit activities of the government itself

Question 5

Fiduciary funds are

Answer 5

maintained to account for assets that governments hold as trustees or agents for individuals, private organizations or other governmental units

Question 6

Basis of accounting for fiduciary funds

Answer 6

full accrual

Question 7

Basis of accounting for permanent funds

Answer 7

modified accrual

Question 8

Types of Fiduciary funds

Answer 8

private purpose trust funds
investment trust funds
pension trust funds
Agency funds

Question 9

private-purpose trust funds

Answer 9

moneis held for the benefit of an entity, government or person outside of the governmental entity.

Question 10

investment trust funds

Answer 10

pooled investments for smaller governmental entities to take advantage of economies of scale

Question 11

pension trust funds

Answer 11

defined benefit-pension benefit is formula based

defined contribution-pension benefit is based on investment earnings

Question 12

Agency funds

Answer 12

the governmental enitity acts as an agent, transacting business on others behalf

Question 13

Fiduciary funds required Financial Statemtents

Answer 13

Statement of fiduciary net assets

Statement of changes in fiduciary net assets

Question 14

GASB Standards require note disclosures relating to (pension fund)

Answer 14

plan description and funding policy (including annual cost and components of annual cost)
trends in annual cost and NPO
Additional data that must be provided as part of required supplemental disclosures

Question 15

annual pension cost

Answer 15

calculated amount of the employers’periodic cost

Question 16

annual required contributions (arc)

Answer 16

employers required contribution to a defined benefit pension plan, calculated in accordance with certain parameters

Question 17

actuarial deficiencies (excesses)

Answer 17

difference between teh annual required contributions and the actual contributions

Question 18

Net Pension Obligation

Answer 18

NPO

Question 19

NPO

Answer 19

Vumulative difference measured from the effective date of the new statement between;
annual pension cost and employers contributions and any transition pension liabilitye and excluding
short term differences and unpaid contributions that have been converted to pension-related debt

Question 20

ARC

Answer 20

Annual Required Contribution

Question 21

Annual Required Contribution is calculated

Answer 21

each period and consists of the following 2 components

• actuarial PV of total projected benefits-normal costs
• amortization of unfunded actuarial accrued liability

Question 22

Employer pension expenditures/expense may include one or both of the

Answer 22

arc contributions and/or payments of pension-related debt

Question 23

Internal service funds account for

Answer 23

activities

Question 24

primary reason to use internal service fund

Answer 24

to gain efficiency in the governments operations

Question 25

Internal service fund basis of accounting

Answer 25

full acrrual basis

Question 26

Internal Service fund closes to ___account

Answer 26

excess of net billings to departments over costs (instead of income summary)

Question 27

are activities of internal funds on government wide statements

Answer 27

no they are elminated in the consolidation process