Governmental 2

Question 1

All proprietary funds must present

Answer 1

A statement of cash flows

Question 2

Depreciation expense

Answer 2

Is not recorded in the governmental funds but is recorded in the proprietary funds

Question 3

Reduction in a liability

Answer 3

Results in a deferred INFLOW

Question 4

For an investment trust fund the required financial statements are

Answer 4

Statement of fiduciary net position (balance sheet)
Statement of changes in fiduciary net position
(Income statement)

Question 5

Governmental wide financial statements are presented using the

Answer 5

Economic resources measurement focus using the accrual basis

Statement of net position
And statement of activities

Question 6

A CAFR (comprehensive annual financial report) is divided into 3 sections

Answer 6

Introductory
Financial
Statistical

Question 7

Blended presentation

Answer 7

used when component unit is so intertwined with the primary government that it is a substance the same as the primary government.
Entities that are not legally separate entities are blended with the primary government

Question 8

The basic financial statements and required supplementary information should consist of

Answer 8

Managements discussion and analysis (MDA)
Basic financial statements
And required supplementary information (RSI)

Question 9

The reporting status of a governmental unit is determined by whether it can stand alone by its SELF

Answer 9

S- separately
E- elected governing body
L- legally separate entity
F- financially independent status

Question 10

What is included in the introductory section of a local governments cafr

Answer 10

Letter of transmittal

Question 11

Discrete presentation

Answer 11

Most common/ default method
Used when blended criteria not met.
Displays component units in separate columns

Question 12

Government wide financial statements should classify net assets as

Answer 12

Net investment in capital assets
Restricted
Unrestricted

Question 13

Under modified approach, infrastructure expenditures are respected as expenses except for

Answer 13

Outlays that result in addition sir improvements, which would be capitalized

Question 14

Net position format

Answer 14

Assets and deferred outflows of resources

- liabilities and deferred inflows of resources

Question 15

Categories of program revenue (SOC)

Answer 15

S- services (Charges for)
O- operating (grants and contributions )
C- capital (grants and contributions)

Question 16

A governmental entity’s cash flow cash flow statement is only prepared for

Answer 16

Proprietary funds

Question 17

BS adj. - net position from governmental activities (CANS)

Answer 17

Total gov. Fund bal
\+ cap assets 
- accumulated depreciation 
- non-current liabilities (existing)
-reduce deferred inflows 
- accrued interest payable 
\+ internal service fund net position

Question 18

Operating statement adj. - change in net position of governmental activities (CPAS RIDES)

Answer 18

Net change in fund bal-total gov fund
\+ capital outlay 
\+principal pmts on non current debt
- assets disposals (net BV) 
- sources 
\+revenue (measurable but unavailable)
- interest expense 
- depre exp
\+ internal Service fund net rev

Question 19

nfp services rendered

Answer 19

Only recognized SOMe if the time. services must meet 3 criteria

S specialized skill
O otherwise needed that can be
M measured
e easily

Question 20

Government wide financial statements focus on

Answer 20

OPERATIONAL ACCOUNTABILITY

Question 21

Proprietary funds must use what method ?

Answer 21

Direct method when preparing their statement of cash flows

Question 22

Statement not required for NFPs

Answer 22

Statement of retained earning s

Question 23

Cash contributions restricted by the donor for long-term purposes must be reported as

Answer 23

a cash inflow in the financing activities section