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CPA > FAR9 > Flashcards

FAR9 Flashcards

1
Q

Operational Accountability

A

Focus of government-wide f/s (met its operating objectives efficiently and effectively)

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2
Q

Fiscal Accountability

A

Focus on fund f/s (complied with public decisions concerning the raising and spending of public funds in the short term)

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3
Q

Required Reporting for General Purpose Gov’t Units

A 
1. Management's Discussion and Analysis
before F/S
2. Gov't-wide F/S
3. Fund F/S
4. Notes to F/S (2-4 is "basic F/S")
after F/S
5. Required Supplementary Info (RSI)
6. Other Supplementary Info (optional)
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4
Q

Optional Reporting

A

Comprehensive Annual Financial Report (CAFR)

  1. Intro Section (unaudited)
  2. Basic F/S and Required Supplementary Info (audited)
  3. Statistical Section (unaudited) - not part of basic F/S
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5
Q

Primary Gov’t Entities (SELF)

A
  1. Has a Separately-Elected governing body,
  2. Is Legally separate,
  3. Is Fiscally independent of other state and local gov’ts
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6
Q

Component Unit

A
  1. Blended Presentation
    - substantially the same as the primary gov’t
    - serves the primary gov’t exclusively
    - not a separate legal entity
  2. Discrete Presentation - default method (if does NOT meet blended requirements)
    - benefit, access, and significance standards
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7
Q

Management’s Discussion and Analysis (before f/s)

A

Description of F/S,
Identify of the Primary Gov’t and Discrete Component Units,
Economic Conditions and Outlook, and
Major Initatives

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8
Q

MD+A: Description of F/S

A

Easily readable analysis
condensed f/s info
analysis of overall financial position and results of operations
analysis of balances and transactions of individual funds
analysis of significant variations
a description of the significant assumptions
(No variance analysis OR reconciliation of fund f/s)

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9
Q

Gov’t-Wide F/S

A

Economic Resources Measurement Focus
Full Accrual Basis of Accounting (include all assets/liabilities)
Fiduciary funds excluded and Component Units included

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10
Q

Gov’t-wide F/S: Statement of Net Position

A

Assets - Liabilities = Net Position (restricted, unrestricted, net investment)

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11
Q

Gov’t-wide f/s - Government Activities

A 
General Fund (GRaSPP + S)
Special Revenue Fund
Debt Service Fund
Capital Project Fund
Permanent Fund + Internal Service Fund
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12
Q

Gov’t-wide f/s - Business-type Activities

A

Enterprise Fund

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13
Q

Categories of Program Revenue (“SOC”)

A

Services (charges for)
Operating grants and contributions
Capital grants and contributions

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14
Q

Gov’t Funds B/S

A

Major Fund Rules (both must be met)
1. 10% Test individual funds compared to either all gov’t/enterprise funds
2. 5% Test individual funds compared to both all gov’t/enterprise funds
(General Fund is always a major fund)

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15
Q

Reconciliation of Gov’t Fund to Gov’t Activities (B/S)

A

GALS BARE:

G Gov't fund balance
\+ A Assets (non-current)
-  L Liabilities (non-current)
\+ S Internal service fund net position
\+/- Adjustments for basis of accounting (Accrued, Revenue, Expense)
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16
Q

Reconciliation of Gov’t Fund to Gov’t Activities (Statements of Rev, Expenditures, and changes in fund balance)

A

GOES BARE:

G Gov’t fund balance
- O Other financial sources
+ E Expenditures-capital outlay (net of depreciation)
+ S Internal service fund net income
+/- Adjustments for basis of accounting (Accrued, Revenue, Expense)

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17
Q

Proprietary Funds: Statement of Cash Flows (differences)

A
  1. Direct method required
  2. Reconciliation of operating income (not NI)
  3. Four categories (Operating, Capital and Noncapital Financing, Investing Activities)
  4. Order of financing and investing activities reversed
  5. Interest income/cash receipts are Investing Activities
  6. Interest expense/cash payments are Financing
  7. Capital asset purchases are Financing activities
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18
Q

Notes to F/S

A

Description of gov’t-wide activities (exclusion of fiduciary)
Policies relating to elimination of internal activity
Description of the modified approach for infrastructure
Segment info on enterprise funds (meets segment def.),
Length of time used to define “available” 60 days
Actions taken to correct material noncompliance

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19
Q

Required Supplementary Info (after F/S)

A 
Budgetary Info (must show the original budget, final amended budget, and actual amounts),
Infrastructure Info (condition and estimated annual amount to maintain/preserve for each of past five years),
Pension Info (presented for each of 10 most recent years)
- sources of changes, info about components, significant methods and assumptions, annual money-weighted rate of return, and explanation of trends
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20
Q

Other Supplementary Info (optional)

A

Combining statements for nonmajor funds (gov’t funds = modified accrual)

21
Q

Interfund Activity: Reciprocal

A

Interfund Loans (unrealizable balances are reclassified as transfers), and Interfund Services Provided and Used

22
Q

Interfund Activity: Nonreciprocal

A 
Interfund Transfers (displayed as other financing sources and uses after nonoperating revenues and expenses),
Interfund Reimbursements (NOT displayed as interfund transactions)
23
Q

F/S display/disclosure between primary gov’t and its Fiduciary Funds

A

Reported as if between external parties

24
Q

Interfund receivables and payables between governmental and enterprise funds

A

Reported as internal balances

25
Q

Primary government’s general fund has an equity interest in a joint venture

A

Equity interest should be reported in the Government-wide statement of net position

26
Q

Donated Art work/painting

A

May be capitalized, but it is not required, and depreciation is not required (investing activities)

27
Q

Not-for-Profit

A

Uses FASB, full accrual

Classification of net assets: “PUT” - permanently restricted, unrestricted, temporarily restricted

28
Q

Not-for-Profit: Required F/S

A

Statement of Financial Position (B/S)
Statement of Activities (I/S)
Statement of Cash Flows
Statement of Functional Expenses - required for voluntary health and welfare organizations

29
Q

Not-for-Profit: Statement of Financial Position

A

Assets - Liabilities = Net Assets

  1. Unrestricted: not permanently or temporarily restricted (internally board-designated funds)
  2. Temporarily Restricted: donor-imposed stipulations either expire by time or can be fulfilled and removed by actions
  3. Permanently Restricted: limited by donor-imposed stipulations that NEITHER expire by time NOR can be fulfilled and removed by actions of the organization
30
Q

Expense Classification in the Statement of Activities

A

Reported as decreases in unrestricted net assets (either categorized as Program Services, Support Services, Combined Costs)

31
Q

Not-for-Profit: C/F Operating

A

Unrestricted Revenue later earmarked (board designation) for construction or purchase of long-lived assets, Agency transactions

32
Q

Not-for-Profit: C/F Financing

A

Cash transactions related to borrowing, include cash transactions related to certain restricted contributions (increases to endowment)

33
Q

Not-for-Profit: C/F Investing

A

Proceeds from sale of works of art, investment in equipment, proceeds from sale of assets received in prior periods (restricted)

34
Q

Contributions/Recognition

A

Cash Contributions: Received = Revenue
Unconditional Promises: Pledge = Revenue
Conditional Promises: Earned = Revenue
Multiyear Pledges: PV of Pledge (now = Rev., future = Temp. Restricted Rev.)
Allowance for uncollectible pledges = NRV (full accrual)

35
Q

Split-Interest Agreements

A

Measured at FV and displayed as temporarily restricted

36
Q

Donated Services

A

Recorded as contribution revenue and expense at FV if create/enhance a nonfinancial asset and
“SOME”: Specialized skill, Otherwise needed by organization, Measurable, Easily at FV

37
Q

Restricted Contributions

A

Spent it = Earned it (remove restriction)

38
Q

Contribution Revenue

A

Amount Transferred - FV of Dues/Purchases

39
Q

Recipient Accounting: Without Variance Power

A

Acts as agent, no benefit/power: Asset valued at FV and recognized as LIABILITY

40
Q

Recipient Accounting: Grant Variance Power

A

Acts as agent with power: Assets valued at FV and recognized as contribution Revenue (same for financially interrelated)

41
Q

Beneficiary Accounting: Financially Interrelated

A

DR: Asset
CR: Equity transaction (statement of activities)

42
Q

Beneficiary Accounting: Pool of Assets

A

DR: Beneficial interest
CR: Contribution revenue

43
Q

University/Colleges Revenue

A

Assessed Student Tuition and Fees
- Cancelled Classes
= Gross Revenue from Tuition and Fees (unrestricted net assets)

44
Q

Health Care Revenue

A 
Gross Patient Service Revenue
- Charitable Services
= Patient Service Revenue (1 of 3)
(2 of 3) Other operating revenue
(3 of 3) Non-operating revenue
45
Q

Donated Property

A

Valued at FV and recognized as support

46
Q

Quasi-endowment funds

A

Account for assets that have been internally designated by the institution for a specific purpose. Quasi-endowment funds would be displayed as unrestricted net assets on externally published financial statements

47
Q

Functional expense categories not-for-profit

A

Program services, management and general, and fund-raising

48
Q

Classify gains and losses

A

Unless explicitly restricted by donor or law, gains and losses should be reported in the statement of activities as increases or decreases in unrestricted net assets

CPA (11 decks)

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