SEFA and Major Program Determination CPE - Terminology

Question 1

The methods and records established to identify, assemble, analyze, classify, record, and report a government’s transactions and to maintain accountability for the related assets and liabilities.

Answer 1

Accounting System

Question 2

The recording of financial effects on a government of transactions and other events and circumstances that have consequences for the government in the
periods in which those transactions, events, and circumstances occur, rather than only in the periods in which cash is received or paid by the government.

Answer 2

Accrual Basis of Accounting

Question 3

A tax based on value (such as a property tax).

Answer 3

Ad Valorem Tax

Question 4

An asset account used to record noncurrent portions of a long-term
debt owed by one fund to another fund within the same reporting entity.

Answer 4

Advance From Other Funds

Question 5

A legal authorization granted by a legislative body to make expenditures and to
incur obligations for specific purposes. An appropriation is usually limited in the amount and time it may be expended.

Answer 5

Appropriation

Question 6

A portion of fund balance that includes amounts that are constrained by
the government’s intent to be used for specific purposes, but that are neither restricted nor
committed.

Answer 6

Assigned Fund Balance

Question 7

A term used to refer to when revenues, expenditures, expenses, and transfers, and related assets and liabilities are recognized in the accounts and reported in the
financial statements. Specifically, it relates to the timing of the measurements made,
regardless of the nature of the measurement. See accrual basis of accounting, cash basis of accounting, and modified accrual basis of accounting.

Answer 7

Basis of Accounting

Question 8

A written promise to pay a specified sum of money (the face value or principal amount) at
a specified date or dates in the future (the maturity dates[s]), together with periodic interest
at a specified rate. Sometimes, however, all or a substantial part of the interest is included in
the face value of the security. The difference between a note and bond is that the latter is
issued for a longer period and requires greater legal formality.

Answer 8

Bond

Question 9

Those activities of a government carried out primarily to provide
specific services in exchange for a specific user charge.

Answer 9

Business Type Activities

Question 10

Grants restricted by the grantor for the acquisition or construction, or both, of
capital assets

Answer 10

Capital Grants

Question 11

A fund used to account for and report financial resources that are
restricted, committed, or assigned to expenditures for capital outlays, including the
acquisition or construction of capital facilities and other capital assets. Capital project funds
exclude those types of capital-related outflows financed by proprietary funds or for assets
that will be held in trust for individuals, private organizations, or other governments.

Answer 11

Capital Projects Fund

Question 12

A basis of accounting that requires the recognition of transactions
only when cash is received or disbursed.

Answer 12

Cash Basis Of Accounting

Question 13

A portion of fund balance that includes amounts that can only be used
for specific purposes pursuant to constraints imposed by formal action of the government’s
highest level of decision-making authority.

Answer 13

Committed Fund Balance

Question 14

A debt instrument issued in the name of a state or local government
(the issuer) that is for the benefit of a third party primarily liable for the repayment of the debt
instrument (the third-party obligor). A conduit debt obligation meets all the specific criteria.

Answer 14

Conduit Debt Obligation

Question 15

The method of accounting that requires the recognition of an
expenditure or expense as inventories are used.

Answer 15

Consumption Method

Question 16

It is created when a general capital asset is transferred to
a proprietary fund or when a grant is received that is externally restricted to capital
acquisition or construction. Contributions restricted to capital acquisition and construction
and capital assets received from developers are reported in the operating statement as a
separate item after nonoperating revenues and expenses.

Answer 16

Contritubuted Capital

Question 17

A fiduciary fund used to account for financial resources not administered
through a trust or equivalent arrangement meeting specified criteria, and that are not
required to be reported in a pension (and other employee benefit) trust fund, investment trust
fund, or private-purpose trust fund.

Answer 17

Custodian Fund

Question 18

A fund used to account for and report financial resources that are restricted,
committed, or assigned to expenditure for principal and interest. Debt service funds should
be used to report resources if legally mandated. Financial resources that are being
accumulated for principal and interest maturing in future years should also be reported as
debt service funds.

Answer 18

Debt Service Fund

Question 19

An acquisition of net assets by a government that is applicable to
a future reporting period

Answer 19

Deferred Inflow Of Resources

Question 20

A consumption of net asset by a government that is applicable
to a future reporting period

Answer 20

Deferred Outflow Of Resources

Question 21

(a) The excess of the liabilities of a fund over its assets. (b) The excess of expenditures
over revenues during an accounting period or, in the case of proprietary funds, the excess of
expenses over revenues during an accounting period.

Answer 21

Deficit

Question 22

A payment made in cash or by check. Expenses are only recognized at the time
physical cash is disbursed.

Answer 22

Disbursement