CSET Financial Management & Budgeting 3

Question 1

Under GASB standards, what basis of accounting do governmental funds use?

Accepted Answer

Modified accrual basis

Answer

Governmental funds use the modified accrual basis, recognizing revenues when measurable and available, and expenditures when the liability is incurred.

Question 2

Which of the following best describes 'categorical funding' in K-12 education finance?

Accepted Answer

Funding designated for a specific program or population

Answer

Categorical funding is restricted to specific programs or student populations, such as special education or English learner services.

Question 3

A district is considering issuing general obligation bonds to fund a new school building. Who must typically authorize this borrowing?

Accepted Answer

Voters in the district

Answer

General obligation bonds backed by property taxes typically require voter approval in a bond election.

Question 4

What is the primary purpose of an internal audit function in a school district?

Accepted Answer

Independently evaluating internal controls and compliance

Answer

Internal auditing independently evaluates the adequacy and effectiveness of a district's internal controls, risk management, and governance processes.

Question 5

Which expenditure classification identifies costs by the nature of goods or services purchased, such as salaries, benefits, or supplies?

Accepted Answer

Object classification

Answer

Object classification categorizes expenditures by the type of item or service purchased, such as personnel services, supplies, or capital outlay.

CSET Test Practice Test

CSET Test Practice Test

CSET Financial Management & Budgeting 3