Government Financial Management Flashcards

What is the primary purpose of a government's Comprehensive Annual Financial Report (CAFR), now called Annual Comprehensive Financial Report (ACFR)?

Answer: To provide a complete audited picture of a government's financial position and results

The ACFR provides a complete, audited financial overview of a state or local government, including financial statements, notes, and statistical data.

Under GASB standards, which measurement focus and basis of accounting applies to governmental funds?

Answer: Current financial resources / modified accrual

Governmental funds use the current financial resources measurement focus and modified accrual basis of accounting under GASB standards.

Which type of government fund accounts for activities financed by user fees and intended to be self-supporting?

Answer: Enterprise Fund

Enterprise funds (a type of proprietary fund) account for government business-type activities that are financed primarily through user charges.

What does a government's 'fund balance' in the General Fund primarily represent?

Answer: Difference between current financial resources and current liabilities

Fund balance is the difference between governmental fund assets/deferred outflows and liabilities/deferred inflows, reflecting available current financial resources.

Which federal act requires agencies to produce audited financial statements and links performance to budget?

Answer: Chief Financial Officers Act of 1990

The Chief Financial Officers Act of 1990 requires 24 major federal agencies to produce annual audited financial statements and establishes CFO positions.

What is 'interperiod equity' in government financial reporting?

Answer: The concept that current-year revenues should finance current-year services

Interperiod equity means that today's taxpayers pay for today's services rather than deferring costs to future generations.