Financial Management & Budgeting Flashcards
7 cards from real CSA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Financial Management & Budgeting flashcards as text
A vendor invoice arrives in December but the services won't be delivered until February. Under accrual accounting, when should this expense be recognized?
Answer: February, when the services are actually delivered
Under accrual accounting, expenses are recognized when the goods or services are received, not when invoiced or paid.
Which of the following best describes an IT 'cost center'?
Answer: A department whose costs are tracked but which does not directly generate revenue
A cost center tracks expenses for a department (like IT) that supports the business but doesn't directly generate revenue, unlike a profit center.
An organization negotiates a 3-year Enterprise Agreement (EA) with a software vendor. What financial risk does this introduce?
Answer: The organization is locked into a fixed cost commitment regardless of actual usage changes
Enterprise Agreements commit organizations to fixed payments for the contract term, creating risk if usage drops or technology needs change.
What is the purpose of an IT financial 'contingency reserve' in a project budget?
Answer: To address identified risks and unforeseen cost overruns
A contingency reserve is a planned budget allocation to manage identified risks and unexpected costs within the project scope.
A sysadmin compares the cost of hosting on-premises versus using a managed cloud service. The on-premises option requires paying staff salaries, power, and cooling. These are examples of:
Answer: Both direct and indirect costs that must be captured in a full cost comparison
A complete TCO comparison must include both direct costs (hardware, licenses) and indirect costs (staff time, power, cooling) for an accurate picture.
Which procurement strategy involves purchasing IT hardware through a leasing arrangement rather than outright ownership to preserve capital?
Answer: Operating lease / hardware-as-a-service
Operating leases and HaaS models let organizations use equipment without ownership, preserving capital and converting CapEx to predictable OpEx.
At the end of Q2, IT spending is at 60% of the annual budget. What does this suggest, and what should be investigated?
Answer: Spending may be ahead of schedule; investigate whether projects are accelerating or costs are misclassified
At midyear (50% of the year), spending 60% of the budget suggests the pace is faster than planned, warranting a review of acceleration causes or reclassification issues.