F6 - M5 - Governmental Accounting Overview

Question 1

For governments, what is a fund?

Answer 1

Fund are money that are set aside for a specific purpose, and they have their own fiscal and accounting entity. Think of the different bills for cities and villages, like water, sewer, electricity, etc.

They will have their own financials.

Question 2

What are the three main type of funds for governmental accounting?

Answer 2

Governmental funds

Proprietary funds

Fiduciary funds

Question 3

What is the acronym for the financial reporting characteristics for governments?

Answer 3

U R MICE

U - Understandability

R - Reliability

M - Make a difference

I - In timeliness

C - Consistent year over year

E - Entity to entity comparability