Government

Question 1

funds available = ?

Answer 1

budget - actuals - encumbrances

Question 2

net property tax for current year?

Answer 2

current year collections for property taxes + next year first 60 days collections

Question 3

minimum reporting requirements for general purpose external financial statements?

Answer 3

MD&A, government-wide and fund financial statements w/ notes to financial statements and RSI

Question 4

when can a government capitalize interest on construction of a capital asset for business purpose?

Answer 4

when it is a qualifying asset: when it is used for it’s own use

Question 5

what is a letter of transmittal?

Answer 5

it is the checklist for the introduction of a comprehensive financial annual report (CFAR)

Question 6

what method of accounting does government wide financial statements use?

Answer 6

accrual, not modified accrual. distinguish between government and business type. information about fiduciary funds should not be included.

Question 7

what is a major fund?

Answer 7

1. total assets, liabilities, revenues or expenditures are at least 10% of that category, government or capital fund
2. total assets, liabilities, revenues or expenditures at at least 5% of that category, government and capital fund together
3. general fund is always a major fund

Question 8

what are the 3 major state and local fund groups?

Answer 8

governmental, proprietary, fiduciary

Question 9

what are the 5 types of governmental funds?

Answer 9

general, special revenue, capital projects, debt service, special assessment

Question 10

what does modified accrual mean?

Answer 10

funds are not accrued unless available and measurable

Question 11

what is an encumbrance? journal entry?

Answer 11

it is a commitment of funds to an unperformed contract for goods and services. but not an expenditure

encumbrance xxx
fund balance – reserve for encumbrance xxx

Question 12

what info do governments need to disclose regarding debt and leases, according to GASB?

Answer 12

principal and interest recorded separately, for each of the following 5 years, followed by reports every 5 years after

Question 13

what does “balanced budget” mean?

Answer 13

a government or state cannot spend more than the budget.

Question 14

what does “interperiod equity” mean?

Answer 14

that taxpayers are not paying for deferred benefits – the taxes go to support currently enjoyed services.

Question 15

what does “current financial resources measurement focus” mean?

Answer 15

value and report fund balances as measure of available, spendable, or appropriable resources. only current assets and liabilities reported. no fixed assets.

Question 16

what does “economic resources measurement focus” mean?

Answer 16

focus on determining the costs of services and efficiency of invested capital. all assets and liabilities on balance sheet. net assets analyzed and reported separately as restricted, unrestricted, and invested in property and equipment (net of debt). fixed assets reported.

Question 17

what are the basic financial statements for a government?

Answer 17

government-wide financial statements, fund financial statements, and notes to the financial statements

Question 18

what does a government wide financial statement consist of?

Answer 18

statement of net position and statement of activities

Question 19

what situations is capitalization optional for government-wide accounting?

Answer 19

1 - held for public exhibition and not gain
2 - to be protected and preserved
3 - policy in place to use proceeds of sale to acquire other items

Question 20

what is the fund equity aka fund balance?

Answer 20

fund assets - fund liabilities. usually divided into existing restrictions, assignments, and commitments

Question 21

how are interfund transfers with no repayment recorded?

Answer 21

other financing uses

Question 22

what are the minimum requirements for a general purpose external government financial statement?

Answer 22

MD&A, government and fund financial statements w/ notes to the financial statements, and RSI