MCQ Flashcards

Under the Antideficiency Act, a federal agency that obligates funds in excess of its appropriation must:

Answer: Report the violation to the President and Congress

The Antideficiency Act requires agencies to report violations to the President and Congress and take corrective action.

Which financial statement is unique to state and local governments and presents the fiscal accountability of governmental activities?

Answer: Statement of Revenues, Expenditures, and Changes in Fund Balances

The Statement of Revenues, Expenditures, and Changes in Fund Balances is a governmental fund statement that shows fiscal accountability.

The primary purpose of the Single Audit Act is to:

Answer: Provide for audits of non-federal entities expending federal awards

The Single Audit Act requires non-federal entities (states, local governments, nonprofits) expending $750,000+ in federal awards to undergo a single organization-wide audit.

In government budgeting, an 'allotment' is best described as:

Answer: A subdivision of an apportionment used by an agency to control expenditures

An allotment is an agency's internal subdivision of an apportionment, used to further control the rate of spending within the agency.

Which GASB concept requires governments to report infrastructure assets using the modified approach as an alternative to depreciation?

Answer: The infrastructure preservation system under GASB 34

GASB 34 allows governments to use the modified approach for eligible infrastructure assets if they maintain an asset management system and preserve assets at a condition level.

A federal agency's 'budget authority' is best defined as:

Answer: The legal authority to incur financial obligations that will result in outlays

Budget authority is the legal authority provided by Congress for an agency to incur obligations that will require payment of government funds.

Under GASB standards, which of the following would be reported as a special item in a government's financial statements?

Answer: A significant transaction that is within management's control and unusual or infrequent

Special items are significant transactions within management's control that are either unusual in nature or infrequent in occurrence, but not both.