GOV-GOV WIDE F/S

Question 1

Which of the following should be included in the introductory section of a local government’s comprehensive annual financial report?
A.
Auditor’s report

B.
Management letter

C.
Engagement letter

D.
Letter of transmittal

Answer 1

The comprehensive annual financial report (CAFR) has a template specified by the GASB. While not a “fill in the blank” type of template, it does specify by section what is to be included in each section. The letter of transmittal is specified as part of the introduction section. The other three items listed are not part of the introduction.

Question 2

Which of the following are included in a local government’s government-wide financial statements?

Answer 2

The government-wide financial statements consist of a statement of net position and a statement of activities. A statement of revenues, expenditures, and changes in fund balances is a required financial statement for the governmental funds, but not a government-wide financial statement.

Question 3

In the government-wide financial statements, what is the correct revenue classification of fines and forfeitures?

Answer 3

The GASB has prescribed that fines and forfeitures are included in charges for services. They result from direct charges to those who are directly affected by a program or service, even though they receive no benefit.

Question 4

What are program revenues? How are grant revenues classified as?

Answer 4

Program revenues are derived directly from the program itself or from parties outside the reporting government’s taxpayers or citizenry, as a whole; they reduce the net cost of the function to be financed from the government’s general revenues. Grants and contributions are considered program revenues if restricted to a specific or to several specific programs. Otherwise, they are reported as general revenues.

Question 5

When revenues are received from all types of taxes, these revenues are classified as:

Answer 5

General Revenue

Question 6

The statement of activities of the government-wide financial statements is designed primarily to provide information to assess which of the following?

A.
Operational accountability

B.
Financial accountability

C.
Fiscal accountability

D.
Functional accountability

Answer 6

Thus, the statement of activities is designed primarily to promote the assessment of operational accountability.

Question 7

State and local governments have various sources of revenue. When revenues are received from charges to users for services provided, these revenues are classified as:

Answer 7

Program revenues because revenue is derived from a specific program

Question 8

State and local governments have various sources of revenue. When revenues restricted to a particular function are derived from parties outside the reporting government’s constituency, these revenues are classified as:

Answer 8

Programs are financed with program revenues and general revenues.Financing from outside parties that is restricted to a specific program or programs is considered program revenue.