Find the Lie, CMFO Exam Review

Question 1

Federal Income Tax, Social Security, Unemployment Insurance, Medicare, and Disability Insurance are all due to the IRS

Answer 1

Unemployment Insurance and Disability Insurance are due to the State of New Jersey

Question 2

The bid threshold for all municipalities with a QPA is $44,000.00

Answer 2

$44,000.00 is the maximum threshold allowed for municipalities with a QPA

Question 3

The (4) methods of down payment on a Capital Project are
1. Capital Improvement Fund
2. Capital Fund Balance
3, BANs
4. Developer’s Contribution

Answer 3

BANs are a way of temporary financing, NOT a liquid down payment

Question 4

A Supplemental Debt Statement shall be filed by the CFO by the adoption of any ordinance

Answer 4

Introduction of any ordinance

Question 5

“Operating & Maintenance Costs” for a Utility include Budgeted S/W, Budgeted O/E, Budgeted Statutory Expenses, Debt Service, while taking out Appropriations reserved at the end of the fiscal year

Answer 5

Operating & Maintenance Costs include…

Budgeted S/W
Budgeted O/E
Budgeted Statutory Expenses

Minus Cancelled expenses

Question 6

Like any revenue, Receipts from Delinquent Taxes can only be anticipated to the cash collected from the previous year

Answer 6

Estimated based on balances in PY Taxes Receivable and Tax Title Liens

AFS Sheet 26

Question 7

Technical Accounting Directive # 2 (NJAC 5:30-5.6) requires that each municipality must maintain a fixed assets accounting system. The threshold for fixed assets can be a maximum of $15,000 for each individual asset, but the threshold can be less if the municipality so desires

Answer 7

$5,000.00

Question 8

Technical Accounting Directive # 3 (NJAC 5:30-5.7) requires, to this day, that a municipality maintain a general ledger for at least the general ledger for the current fund.

Answer 8

Updated LFN CFO 2003-13 to include all funds

Question 9

The annual audit for a municipality or county must be completed within 2 months following the close of the fiscal year.

Answer 9

6 months

Question 10

A separate item of appropriation in the municipal budget is Stautory expenses. Which are to be budgeted in an amount not more than 3% of the total amount of the total operations.

Answer 10

Contingent Expenses

Question 11

In compliance with the Local Fiscal Affairs Law, every municipality must adopt a Financial Management Plan, which is subject to audit. This document will designate the municipality’s depositories and will confirm the desire to maximize interest earnings. If a new bank is added midyear, this document needs to be amended to contain the new depository

Answer 11

Cash Management Plan

Question 12

The length of a professional services contract under the Local Public Contracts Law should be for a period no greater than 24 months.

Answer 12

(12) months for Professional Service

Question 13

Emergency contracts can be awarded without public advertising for bids when it affects the wellbeing of the municipality; realized by a resolution by 2/3 affirmative vote of the governing body

Answer 13

Emergency contracts can be awarded without public advertising for bids when it affects the public health, safety, or welfare of public

Question 14

While bids cannot be held on Friday, December 26 because it falls the day after a State/Federal Holiday, the bid date can simply be moved to Monday, December 29 to make sure we are in compliance

Answer 14

No Mondays or Days After State/Federal Holidays

LFN 2008-1

Question 15

A contracting unit can’t reject a bid if it exceeds the contracting unit’s appropriation for the good or service, and must allocate the award to the lowest responsible bidder

Answer 15

You CAN reject a bid if it goes over the appropriation

Question 16

In accordance with NJSA 40A:4-9. Amendments to budgets required by the Director of the DLGS must be public advertised.

Answer 16

You don’t need to advertise these

Question 17

After intro + adoption of the budget, the Clerk has to give a copy of the budget to the County and electronically submit it on FAST within (7) days of either the intro or adoption occuring

Answer 17

CFO Files with County and FAST
Within 3 days

Clerk files w/ County Board of Taxation

Question 18

The Local Finance Board requires, while issuing refunding bonds, that the present value savings is at least 4.5%

Answer 18

3%

Question 19

The Local Finance Board requires, while issuing refunding bonds, the final maturity of the refunding bonds extend past the budget year in which such final maturity was originally scheduled to mature

Answer 19

The Local Finance Board requires, while issuing refunding bonds, the final maturity of the refunding bond DOES NOT extend past the budget year in which such final maturity was originally scheduled to mature

Question 20

Gross debt does not include Bonds Issued and Bonds ABNI

Answer 20

Well… yeah… it does

Question 21

A change order of more than 5% of the original ordinance must the Clerk report to the Director of the DLGS

Answer 21

20%

Question 22

If the municipality qualifies, they may self examine their budget every 3 of 4 consecutive years

Answer 22

2 of 3

Question 23

If the useful life of a Capital item is not specified in NJSA 40A:4-22, the governing body, by ordinance, may make the determination of the period of usefulness

Answer 23

Director of the DLGS makes determination

Question 24

If the Director determines useful life for item not in NJSA 40A:4-22, (15) years is the minimum useful life they can give

Answer 24

(15) years is the maximum

Question 25

RUT falls inside the Appropriations CAP

Answer 25

No it does not

Question 26

Generally, non-conforming debt schedules require Local Finance Board approval unless such schedules have been determined by the State of New Jersey, Division of Revenue

Answer 26

Generally, non-conforming debt schedules require Local Finance Board approval unless such schedules have been determined by the New Jersey Environmental Infrastructure Trust

Question 27

In accordance with NJSA 40A:11-4.5, a notice of availability of request for proposed documentation for competitive contracting proposals shall be published in an official newspaper of the contracting unit for at least 10 days prior to the date established for the submission of proposals

Answer 27

20 days prior to the date established for the submission of proposals

Question 28

If a financial officer of a municipality is not authorized to sell and award bonds, the authorization to sell and award bonds is the responsibility of Administration (BA, Twp Manager, City Director, etc.)

Answer 28

The responsibility falls on the Governing Body

Question 29

Within 60 many days after receipt of the audit, the governing body certify they have revised the General comments, recommendations, auditor’s opinions, and single audit findings

Answer 29

45 Days

Question 30

Compensated Absence liability calculations only include sick days and vacation days. Personal days, comp time, and other absence time is not included

Answer 30

All Accumulated Absence is Provided

Question 31

A local units net valuation of $3,250,000,000. The value of a tax point for that local unit is $32,500,000

Answer 31

$325,000 (1/10,000th)

Question 32

Local units do not have sole discretion as to whether or not to offer employees, that are eligible for coverage, payments to waive health benefits. Such payments are calculated based on what the employer saves and are capped at lesser of 25% of savings or $5,000

Answer 32

They do have sole discretion

Question 33

Per NJSA 40A:4-79, a governing body can, under certain circumstances, finally adopt a budget until a certification of approval by the Director has been received

Answer 33

No, they must get approval

Question 34

Liabilities = Assets + Fund Balance

Answer 34

Assets = Liabilities + Fund Balance

Question 35

The Annual Financial Statement, after it has been received and processed through FAST, is the permanent financial record of the municipality

Answer 35

General Ledger

Question 36

SKIP

Answer 36

SKIP

Question 37

A Capital Budget is introduced and adopted by a 2/3 vote of the governing body

Answer 37

Resolution, Full, Majority NJSA 40A:4-4 **NJAC 5:30-4.4(a)2**

Question 38

When closing out revenues at year end, the (4) accounts we close to operations are Surplus Anticipated, MRA, Receipts from Delinquent Taxes, and Amount to be Raised by Taxation

Answer 38

Surplus was already realized through an entry (probably) earlier in the year. (4) major revenue (groups) to close out - MRA - MRNA - Receipts from Delinquent Taxes - Amount to be Raised by Taxation

Question 39

There are 564 municipalities in the State of New Jersey

Answer 39

No one knows if this is right or wrong 564, 565, 566, 567 have **ALL** been heard

Question 40

The (4) major sources of revenue via the State of New Jersey include ETRs, CMPTRA, Transitional Aid Programs, and NJ Administrative Grants (Recycling Tonnage, etc.)

Answer 40

(4) major sources - ETR - CMPTRA - Transitional Aid Programs - Sr & Vet Deductions

Question 41

Because the temporary budget, which is passed in the first (30) days of the year, is meant to cover a municipality from the start of the fiscal year until budget adoption, appropriations are only allowed for 26.25% for each line item of appropriation

Answer 41

*via NJSA 40A:4-19* “The total of the appropriations so made shall not exceed 26.25% of the total of the appropriations made for all purposes in the budget for the preceding fiscal year excluding, in both instances, appropriations made for interest and debt redemption charges, capital improvement fund and public assistance.”