CPFO COMPREHENSIVE STUDY GUIDE
2026 GOVERNMENT FINANCE
MANAGEMENT SOLUTIONS VERIFIED A+
◉ Commercial Paper
Answer: Short term debt instruments that mature with them 270
days
◉ Conduit Financing
Answer: The issuance of securities by a government agency to
finance a project of a third-party. Issuer does not secure bonds with
any of its own revenues or resources.
◉ Incrementalism
Answer: A budgetary pattern where resources dedicated to
programs increase or decrease a small amount each year.
Used for operating budgets, but not feasible for capital budgets, thus
the risk increases with capital budgets
◉ Debt Margin
, Answer: The difference between the amount of debt issued and the
amount of debt legally allowed to be issued
◉ Direct Debt
Answer: Long term obligations directly supported and backed by
general revenue and taxes; excludes enterprise fund and component
unit debt revenue bonds; includes non-GO debt such as TIF bonds,
special assessment bonds, and COPs, accrued pension liability, and
landfill closure costs.
◉ Defeasance
Answer: Termination of the rights and interests of the bondholder
under the terms of the bond documents
◉ Net Interest Cost Calculation
Answer: Total debt service payment plus discount minus premium
divided by bond years
◉ Bond Years
Answer: The total number of bonds in $1000 increments x the
number of years from the date interest begins to accrue to the
maturity date
◉ Dated Date
2026 GOVERNMENT FINANCE
MANAGEMENT SOLUTIONS VERIFIED A+
◉ Commercial Paper
Answer: Short term debt instruments that mature with them 270
days
◉ Conduit Financing
Answer: The issuance of securities by a government agency to
finance a project of a third-party. Issuer does not secure bonds with
any of its own revenues or resources.
◉ Incrementalism
Answer: A budgetary pattern where resources dedicated to
programs increase or decrease a small amount each year.
Used for operating budgets, but not feasible for capital budgets, thus
the risk increases with capital budgets
◉ Debt Margin
, Answer: The difference between the amount of debt issued and the
amount of debt legally allowed to be issued
◉ Direct Debt
Answer: Long term obligations directly supported and backed by
general revenue and taxes; excludes enterprise fund and component
unit debt revenue bonds; includes non-GO debt such as TIF bonds,
special assessment bonds, and COPs, accrued pension liability, and
landfill closure costs.
◉ Defeasance
Answer: Termination of the rights and interests of the bondholder
under the terms of the bond documents
◉ Net Interest Cost Calculation
Answer: Total debt service payment plus discount minus premium
divided by bond years
◉ Bond Years
Answer: The total number of bonds in $1000 increments x the
number of years from the date interest begins to accrue to the
maturity date
◉ Dated Date
