Question 1

The "Hierarchy of GAAP" is established by the:

Accepted Answer

A)  Financial Accounting Standards Board 
B)  Securities and Exchange Commission 
C)  American Institute of Certified Public Accountants 
D)  Financial Accounting Standards Board and the Governmental Accounting Standards Board, acting jointly

Question 2

Which of the following funds is used to account for the payment of principal and interest of general long term debt of a government?

Accepted Answer

A)  General Fund 
B)  Debt Service Fund 
C)  Agency Fund 
D)  Capital Projects Fund

Question 3

Which of the following is an environmental difference between governments and for-profit business enterprises?

Accepted Answer

A)  Relationship with stakeholders 
B)  Donor restricted assets 
C)  Fiduciary responsibilities 
D)  Private inurement of residual earnings

Question 4

A fund represents part of the activities of an organization which is separated from other activities in the accounting records to more easily demonstrate compliance with legal restrictions or limitations.

Accepted Answer

A) True 
 B)False

Question 5

Under GASB Statement 34, modified accrual accounting would be found in the:

Accepted Answer

A)  Government-wide financial statements only 
B)  Governmental fund financial statements only 
C)  Governmental and fiduciary fund financial statements only 
D)  Governmental, proprietary and fiduciary fund financial statements but not in the government-wide financial statements

Question 6

Although certain supplementary information may not be required, if presented, it must follow GASB guidance regarding its format and content.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is not an environmental difference between governments and for-profit business enterprises?

Accepted Answer

A)  Organizational purposes 
B)  Sources of revenue 
C)  Role of the budget 
D)  Donor restrictions

Question 8

According to GASB standards relating to Budgetary Accounting, the budget, when adopted according to procedures specified by state laws is binding upon the administrators of a governmental unit.

Accepted Answer

A) True 
 B)False

Question 9

The _______ sets the accounting and financial reporting standards for both state and local governments and public not-for-profits.

Accepted Answer

A)  FASAB 
B)  FASB 
C)  GASB 
D)  AICPA

Question 10

Measurement focus refers to those items, such as current and long-term assets, that are being reported on the financial statements.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is most correct with regard to Management's Discussion and Analysis (MD&A)?

Accepted Answer

A)  State and local governments are required to provide an MD&A 
B)  Federal agency financial reports are required to provide an MD&A 
C)  Both state and local governments and federal agencies are encouraged, but not required to provide an MD&A 
D)  Both state and local governments and federal agencies are required to provide an MD&A

Question 12

The GASB recently published a white paper outlining prohibited transactions for not-for-profit organizations.

Accepted Answer

A) True 
 B)False

Question 13

Notre Dame University, a private institution, has level "A" GAAP established by the:

Accepted Answer

A)  American Institute of Certified Public Accountants 
B)  Governmental Accounting Standards Board 
C)  Financial Accounting Standards Board 
D)  National Association of College and University Business Officers

Question 14

The term "proprietary funds" applies to:

Accepted Answer

A)  Enterprise funds only 
B)  All funds that use accrual accounting 
C)  Enterprise, internal service and private-purpose trust funds 
D)  None of the above

Question 15

Which of the following funds is considered a Fiduciary Fund?

Accepted Answer

A)  Debt Service Fund 
B)  Enterprise Fund 
C)  Internal Service Fund 
D)  Agency Fund

Question 16

All funds of a governmental unit use the current financial resources measurement focus and modified accrual basis of accounting

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is not a fiduciary fund type?

Accepted Answer

A)  Agency 
B)  Expendable trust 
C)  Private-purpose trust 
D)  Investment trust

Question 18

Contrast the economic resources measurement focus and the current financial resources measurement focus with regard to the accounting treatment of long-term debt.

Accepted Answer

The answer of Contrast the economic resources measurement focus and...

Question 19

Long-term debt that is to be paid with tax revenues is reported both in the government-wide statements and in the governmental fund statements

Accepted Answer

A) True 
 B)False

Question 20

GASB and FASB Concept Statements establish accounting standards that must be complied with to receive an unqualified audit opinion.

Accepted Answer

A) True 
 B)False

Exam 2: Overview of Financial Reporting for State and Local Governments

The "Hierarchy of GAAP" is established by the:

Which of the following funds is used to account for the payment of principal and interest of general long term debt of a government?

Which of the following is an environmental difference between governments and for-profit business enterprises?

A fund represents part of the activities of an organization which is separated from other activities in the accounting records to more easily demonstrate compliance with legal restrictions or limitations.

Under GASB Statement 34, modified accrual accounting would be found in the:

Although certain supplementary information may not be required, if presented, it must follow GASB guidance regarding its format and content.

Which of the following is not an environmental difference between governments and for-profit business enterprises?

According to GASB standards relating to Budgetary Accounting, the budget, when adopted according to procedures specified by state laws is binding upon the administrators of a governmental unit.

The _______ sets the accounting and financial reporting standards for both state and local governments and public not-for-profits.

Measurement focus refers to those items, such as current and long-term assets, that are being reported on the financial statements.

Which of the following is most correct with regard to Management's Discussion and Analysis (MD&A) ?

The GASB recently published a white paper outlining prohibited transactions for not-for-profit organizations.

Notre Dame University, a private institution, has level "A" GAAP established by the:

The term "proprietary funds" applies to:

Which of the following funds is considered a Fiduciary Fund?

All funds of a governmental unit use the current financial resources measurement focus and modified accrual basis of accounting

Which of the following is not a fiduciary fund type?

Contrast the economic resources measurement focus and the current financial resources measurement focus with regard to the accounting treatment of long-term debt.

Long-term debt that is to be paid with tax revenues is reported both in the government-wide statements and in the governmental fund statements

GASB and FASB Concept Statements establish accounting standards that must be complied with to receive an unqualified audit opinion.