FAR 23

Question 1

How doe step general fund reports transfers to other funds

Answer 1

as “other financing uses” which is a form of expenditure

Question 2

How does the enterprise, internal service, and pension trust report transfers to other funds

Answer 2

They are reported as receivables

Question 3

What is a governmental fund

Answer 3

• A fund is the basic accounting unit and used to assist in ensuring fiscal compliance

Question 4

How much bond interest will be accrued on the statement of revenue, expenditures, and changes in fund balance

Answer 4

NONE - uses modified accrual so No accrual

Question 5

An enterprise fund is used when the governing body requires that

• user charger cover the cots s of general public services
• net income information be reported for an activity

Answer 5

• this is used for activities involving providing goods or services in exchange for voluntary payment s
• uses accrual accounting

Question 6

Services provided by one agency to otters governmental departments on a cost reimbursement basis are accounted for in an

Answer 6

internal service fund -

Question 7

How are loans made to commercial businesses by a development Agency classified on the statement of cashflows

Answer 7

• because it is the operational purpose of the governmental agency - it would be classified as operating activities

Question 8

What is property tax accounted for as a revenue sources

Answer 8

• imposed nonexchainge revenue source

resulting from assessments imposed on non governmental entities including individuals other than assessments on exchange transactions

Question 9

What are the JE when an AFS security is sold with unrealized gain /losses in OCI

Answer 9

The net amount of any unrealized gains an losses reported in OCI must be eliminated

If it was an unrealized loss - this would be a dr balance in AOCI this would be eliminated with a credit to OCI

dr AOCI 50
cr OCI 50

Question 10

What is the JE for recording property taxes with allowance for uncollectables

Answer 10

dr. Property tax receivable current 600,000
cr Property tax revenue 575,000
cr allowance for uncollectables 25,000

Question 11

What is required to be included in the RSI of CAFR

Answer 11

Budgetary comparison

• b Disclosure about infrastructure assets using the modified approach
• Other statistical data or schedules to provide additional info on significant elements of the government

Question 12

What is the modified approach to recording assets

Answer 12

• This is when an asset is not depreciated
• Instead maintenance costs are recorded
• The government must disclose and document that the asset is being preserved as a disclosed level

Question 13

How is interest revenue received by a gov. proprietary fund reported on statement of cashflows?

Answer 13

• In the investing sections

(this is different from GAAP) This is because there is a difference between the purpose and function between government and private

Question 14

What are all included in estimated revenues in a accordance with modified accrual accounting

Answer 14

• Property Taxes
• licenses and permits
• intergovernmental events

Transfers from otters funds are considered “operating transfers” and are debited as estimated other financial sources

Question 15

What basis of accounting is the Budgetary Comparison Schedule prepared under?

Answer 15

They are prepared under the same basis of accounting that was used to prepare the fund’s budget,

If the general funds budget was prepared on cash basis - the comparison would be on the cash basis

Question 16

If you enter into a capital lease for equipment during the year - how do you report the equipment on the government wide statements

Answer 16

• as a general capital asset -

gov wide are prepared on accrual basis - so the asset would reported just like GAAP

Question 17

What are the objectives of financial reporting of state and local governmental agencies

Answer 17

• fulfill their duty to be publicly accountable
• assist users in evaluating the operating results of the gov
• assist users in assessing the gov ability to meet its obligations as they come due

(determining the cost of providing the services is not an objective of GASB)

Question 18

An enterprise fund would be used when the governing body requires that

I. Accounting for the financing of an agency’s services to other government departments be on a cost-reimbursement basis.

II. User charges cover the costs of general public services.

III. Net income information be reported for an activity.

Answer 18

II

and

III

Question 19

How are employer contributions to a governmental pension fund recorded in the fund financial statements?

Answer 19

• They are recorded as current expenses
• so only the annual required contribution to the pension would be recorded - not benefits paid or any unfunded actuarial liability

Question 20

What is fund accounting

Answer 20

It segregates financial resources into set son self-balancing accounts with each set controlled by a government entity

• each has a specific mission and legal restrictions on the use of the resources