CPFO Operating and Capital Budgeting
Sample Exam 100% Accurate!!
Which of the following is an essential feature of a good budget process, as defined by
the National Advisory Council on State and Local Budgeting (NACSLB)?
a) Focuses budget decisions on results and outcomes
b) Involves and promotes effective communication with stakeholders
c) Establishes linkages to broad organizational goals
d) All of the above - ANSWERSd) All of the above
Which of the following is a true statement regarding the advantages of line-item
budgeting?
a) It obscures tradeoffs
b) It is easy to understand
c) It is effective at reducing waste
d) It is focused on results - ANSWERSb) It is easy to understand
Which of the following is an advantage of locating the budget function under the chief
executive?
a) Better coordination with the finance function
b) More involvement in day-to-day crises
c) Staff with more financial expertise
d) None of the above - ANSWERSd) None of the above
When setting program goals, which of the
following should be the primary concern?
a) The required service level(s)
b) The likelihood of the program's budget
request being approved
c) The results of citizen surveys
d) The amount of resources required - ANSWERSa) The required service level(s)
A well-conceived and executed budget classification structure:
a) incorporates direct reference to the chart of accounts
b) should be succinct and limited to fund, organizational unit, and activity,
c) must include information regarding the programmatic nature of the proposed
spending
d) provides information in a format and at a level of detail to facilitate budget analysis
and decision making - ANSWERSA well-conceived and executed budget classification
structure:
d) provides information in a format and at a level of detail to facilitate budget analysis
and decision making
, The National Advisory Council on State and Local Government Budgeting identified a
principal entitled, "Develop a Budget Consistent with Approaches to Achieve Goals."
Which of the following was not called for in establishing linkage?
a) Conduct long-range planning
b) Evaluate the effect of changes to revenue source rates and bases
c) Develop a capital improvement plan
d) Prepare a debt affordability analysis - ANSWERSd) Prepare a debt affordability
analysis
Which of the following time periods are commonly used as a basis for the operating
budget cycle?
a) One year
b) Two years
c) Five years
d) Either a or b - ANSWERSd) Either a or b
In preparing the annual budget, the finance officer should consider the overall fiscal
capacity of the entity. Fiscal capacity is:
a) the ability of a jurisdiction to generate taxes and other revenues from its own sources
b) the ability of a jurisdiction to generate taxes and other revenues from its own sources,
as well as issue debt
c) the key consideration when a jurisdiction issues debt as part of its capital
improvement program
d) a reflection of both the local and regional economy - ANSWERSa) the ability of a
jurisdiction to generate taxes and other revenues from its own sources
The National Advisory Council on State and Local Government Budgeting
recommended adoption of which of the following policies?
a) Policies to guide the creation, maintenance, and use of resources for financial
stabilization purposes
b) Policy on the maximum amount of debt and debt service that should be outstanding
at any one time
c) Policies to facilitate attainment of program and financial goals
d) Both a and b - ANSWERSd) Both a and b
Which of the following is true about reporting a budget to actual statement or schedule
in a government's basic financial statements?
a) The reports are optional
b) Required for the general fund
c) Should be reported for all governmental funds
d) Should only be reported for the general fund and major special revenue funds with
annual enacted budgets - ANSWERSd) Should only be reported for the general fund
and major special revenue funds with annual enacted budgets
Which of the following is not an advantage of the pay-as-you-go method for financing
capital projects?
Sample Exam 100% Accurate!!
Which of the following is an essential feature of a good budget process, as defined by
the National Advisory Council on State and Local Budgeting (NACSLB)?
a) Focuses budget decisions on results and outcomes
b) Involves and promotes effective communication with stakeholders
c) Establishes linkages to broad organizational goals
d) All of the above - ANSWERSd) All of the above
Which of the following is a true statement regarding the advantages of line-item
budgeting?
a) It obscures tradeoffs
b) It is easy to understand
c) It is effective at reducing waste
d) It is focused on results - ANSWERSb) It is easy to understand
Which of the following is an advantage of locating the budget function under the chief
executive?
a) Better coordination with the finance function
b) More involvement in day-to-day crises
c) Staff with more financial expertise
d) None of the above - ANSWERSd) None of the above
When setting program goals, which of the
following should be the primary concern?
a) The required service level(s)
b) The likelihood of the program's budget
request being approved
c) The results of citizen surveys
d) The amount of resources required - ANSWERSa) The required service level(s)
A well-conceived and executed budget classification structure:
a) incorporates direct reference to the chart of accounts
b) should be succinct and limited to fund, organizational unit, and activity,
c) must include information regarding the programmatic nature of the proposed
spending
d) provides information in a format and at a level of detail to facilitate budget analysis
and decision making - ANSWERSA well-conceived and executed budget classification
structure:
d) provides information in a format and at a level of detail to facilitate budget analysis
and decision making
, The National Advisory Council on State and Local Government Budgeting identified a
principal entitled, "Develop a Budget Consistent with Approaches to Achieve Goals."
Which of the following was not called for in establishing linkage?
a) Conduct long-range planning
b) Evaluate the effect of changes to revenue source rates and bases
c) Develop a capital improvement plan
d) Prepare a debt affordability analysis - ANSWERSd) Prepare a debt affordability
analysis
Which of the following time periods are commonly used as a basis for the operating
budget cycle?
a) One year
b) Two years
c) Five years
d) Either a or b - ANSWERSd) Either a or b
In preparing the annual budget, the finance officer should consider the overall fiscal
capacity of the entity. Fiscal capacity is:
a) the ability of a jurisdiction to generate taxes and other revenues from its own sources
b) the ability of a jurisdiction to generate taxes and other revenues from its own sources,
as well as issue debt
c) the key consideration when a jurisdiction issues debt as part of its capital
improvement program
d) a reflection of both the local and regional economy - ANSWERSa) the ability of a
jurisdiction to generate taxes and other revenues from its own sources
The National Advisory Council on State and Local Government Budgeting
recommended adoption of which of the following policies?
a) Policies to guide the creation, maintenance, and use of resources for financial
stabilization purposes
b) Policy on the maximum amount of debt and debt service that should be outstanding
at any one time
c) Policies to facilitate attainment of program and financial goals
d) Both a and b - ANSWERSd) Both a and b
Which of the following is true about reporting a budget to actual statement or schedule
in a government's basic financial statements?
a) The reports are optional
b) Required for the general fund
c) Should be reported for all governmental funds
d) Should only be reported for the general fund and major special revenue funds with
annual enacted budgets - ANSWERSd) Should only be reported for the general fund
and major special revenue funds with annual enacted budgets
Which of the following is not an advantage of the pay-as-you-go method for financing
capital projects?
