CSS CSS Budget & Financial Management 2 — Questions and Answers
Question 1: Which federal law requires agencies to maintain internal controls to safeguard assets and ensure accurate financial reporting?
- The Federal Managers' Financial Integrity Act (FMFIA) (Correct answer)
- The Government Performance and Results Act (GPRA)
- The Chief Financial Officers Act
- The Inspector General Act
Correct answer: The Federal Managers' Financial Integrity Act (FMFIA)
The Federal Managers' Financial Integrity Act (FMFIA) requires federal agencies to establish and maintain effective internal controls to safeguard assets and ensure accurate, reliable financial reporting.
Question 2: What is a 'reprogramming' action in federal budget management?
- The act of rewriting agency budget software
- Shifting funds within an appropriation from one purpose to another (Correct answer)
- Requesting Congress to rescind an existing appropriation
- Transferring funds between two different appropriation accounts
Correct answer: Shifting funds within an appropriation from one purpose to another
Reprogramming refers to the shifting of funds within a single appropriation account from one purpose or program to another, often requiring notification or approval from Congress.
Question 3: What is the role of an agency's Chief Financial Officer (CFO) under the CFO Act of 1990?
- To approve all procurement awards over $1 million
- To oversee financial management systems and produce audited financial statements (Correct answer)
- To represent the agency before the Congressional Budget Office
- To manage the agency's human capital and payroll functions
Correct answer: To oversee financial management systems and produce audited financial statements
Under the CFO Act of 1990, an agency's Chief Financial Officer is responsible for overseeing financial management systems, improving financial reporting, and ensuring the production of audited financial statements.
Question 4: What does 'cost-benefit analysis' help civil servants determine when evaluating a program or policy?
- Whether total benefits justify the total costs of an action or program (Correct answer)
- How to allocate payroll across departmental units
- Which vendors offer the lowest contract price
- When to transfer surplus equipment between agencies
Correct answer: Whether total benefits justify the total costs of an action or program
Cost-benefit analysis helps civil servants determine whether the total anticipated benefits of a program or policy are sufficient to justify its total costs.
Question 5: What is 'sequestration' in the context of the federal budget?
- The process of locking classified budget documents
- Automatic, across-the-board spending cuts triggered by budget law provisions (Correct answer)
- A Treasury action to freeze agency bank accounts
- A GAO audit of agency spending practices
Correct answer: Automatic, across-the-board spending cuts triggered by budget law provisions
Sequestration is the automatic, across-the-board reduction of federal spending triggered when certain budget thresholds are exceeded, as established by laws such as the Budget Control Act.
Question 6: In federal budgeting, what does 'baseline' refer to?
- The minimum staffing level an agency must maintain
- A projection of future spending based on current law and existing programs (Correct answer)
- The starting salary scale for federal civil servants
- The approved spending ceiling set by the appropriations committee
Correct answer: A projection of future spending based on current law and existing programs
The budget baseline is a projection of future federal revenues and spending based on current law and existing programs, used as a benchmark for measuring the effects of proposed policy changes.
CSS CSS Budget & Financial Management 2
Which federal law requires agencies to maintain internal controls to safeguard assets and ensure accurate financial reporting?