CGFM Flashcards

Under GASB standards, which fund type uses the economic resources measurement focus?

Answer: Proprietary funds

Proprietary funds use the economic resources measurement focus and accrual basis of accounting, similar to business enterprises.

Which of the following is NOT a component of the federal government's Comprehensive Annual Financial Report (CAFR)?

Answer: Program budget justification

Program budget justifications are budget documents submitted to Congress, not components of a CAFR.

The Single Audit Act requires audits of federal award recipients that expend at least how much in federal awards in a fiscal year?

Answer: $750,000

The 2016 OMB threshold requires a single audit when federal expenditures reach $750,000 or more in a fiscal year.

A government agency estimates it will receive $2 million in tax revenue but only $1.8 million is actually collected. The $200,000 variance is best described as:

Answer: A budget shortfall

A budget shortfall occurs when actual revenues fall below estimated revenues, resulting in a negative variance.

Which internal control component in the COSO framework addresses the organization's response to identified risks?

Answer: Control activities

Control activities are the policies and procedures that help ensure management's risk responses are carried out effectively.

In governmental accounting, an 'encumbrance' represents:

Answer: A commitment of funds for a future obligation

Encumbrances represent commitments related to unperformed contracts or purchase orders that reserve budget authority.

Which federal act established the Chief Financial Officers (CFO) Act requirements for federal agencies?

Answer: Chief Financial Officers Act of 1990

The CFO Act of 1990 established CFO positions in 24 major federal agencies and required audited financial statements.