Governmental Accounting Overview

Question 1

What leads to the use of fund accounting by gov’t orgs?

Answer 1

Financial control and legal restrictions

Question 2

Why should separate fund FS be presented for governmental and proprietary funds?

Answer 2

To report additional and detailed info about the primary government

Question 3

What fund uses the current financial resources measurement focus and modified accrual basis of accounting the their fund FS?

Answer 3

Governmental funds

Question 4

What funds use the economic resources measurement focus and accrual basis of accounting?

Answer 4

Proprietary and fiduciary funds

Question 5

What are included in governmental funds?

Answer 5

General fund
Permanent fund
Capital projects fund

Question 6

Relevance

Answer 6

The info must bear a logical relationship with the needs for its purpose

Must be reliable

Question 7

Fund

Answer 7

Fiscal and accounting entity with self-balancing set of accounts recording cash and other financial resources, together with all related liabilities and residual equities or balances, and changes therin

Question 8

What is the measurement focus of governmental funds?

Answer 8

Current financial resources

Question 9

What should be reported on the statement of revenues and expenditures for governmental funds?

Answer 9

Resources received and consumed during the period

Question 10

What is the measurement focus for proprietary funds?

Answer 10

Net income and capital maintenance

Question 11

Governmental funds

GRaSPP

Answer 11

General fund
special Revenue fund
debt Service fund
capital Projects fund
Permanent fund

Question 12

Proprietary funds

SE

Answer 12

internal Service fund

Enterprise fund

Question 13

Fiduciary funds

PAPI

Answer 13

Pension
Agency
Private purpose
Investment trust

Question 14

Under what type of accounting basis are revenues recognized when they become availableand measurable?

Answer 14

Modified accrual basis

Question 15

How should compensated absence liability be calculated?

Answer 15

Based upon the pay or salary rates in effect at the BS date

Question 16

Restricted funds

Answer 16

Resources whose use has been limited by external sources such as creditors, contributors, other gov’ts, laws, constitutional provisions ro enabling legislation

Question 17

What is the only fund that should show a positive amount in its unassigned fund balance classification?

Answer 17

General fund

Question 18

Non-spendable fund balances

Answer 18

Resources in a form that cannot be spent (inventory) or are legally contractually required to remain whole (permanent fund principal)

Question 19

Committed fund balances

Answer 19

Internally limited by formal action of the government’s highest level of decision-making authority

Question 20

What is the paramount objective of financial reporting by state and local governments?

Answer 20

Accountability for the stewardship of the resources in their care