CGFM Test 2: 2025 Questions and
Answers
General Purpose Financial Reporting - --Answer --Assists users in assessing
accountability and in making economic, social and political decisions
Interperiod Equity - --Answer --A term coined by the GASB indicating the
extent to which current-period revenues are adequate to pay for current-period
services.
Accural Basis Accounting - --Answer --reporting income when it is earned
and expenses when they are incurred
Modified Accural Basis - --Answer --
Primary users of Financial Reports - --Answer --public, legislative bodies,
grantor agencies, the media, investors and creditors, and internal financial
managers .
Governmental Accounting Standards Board (GASB) - --Answer --
Established by the Financial Accounting Foundation to develop guidelines for
financial accounting and reporting by state and local governmental units.
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 1
,Federal Accounting Standards Advisory Board (FASAB) - --Answer --is the
standard setting body for federal agencies and the federal government
Due Process Procedures - --Answer --
Types of Reports Produced By Governments - --Answer --
user fees - --Answer --Charges levied by governments in exchange for
services.
fringe benefits - --Answer --Any financial extras beyond the regular pay
check, such as health insurance, life insurance, paid vacation and/or retirement
Budget Process - --Answer --the method by which government allocate
scarce resources and set forth policy objectives
line item budget - --Answer --it set froths the specific character or object
class of spending
baseline budget - --Answer --project the amount needed in the future to
maintain the same level of services, taking into account changes in inflation rates
and demographics
Program Budget - --Answer --focus on specific functions or services
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 2
, Zero Budget - --Answer --Setting budgets to zero each year and starting over
justifying each new budget
Performance budget - --Answer --uses performance measures as the means
to determine the level of funding
capital budget - --Answer --budget for major capital, or investment,
expenditures
Expenditure - --Answer --
encumbrance - --Answer --state version of obligation
Phases of the Budget Process - --Answer --preparation, legislative, execution
operating budget - --Answer --budget for day-to-day expenses
Debt Service - --Answer --money spent by the state to pay off debt; includes
interest and principal payments
discretionary spending - --Answer --Federal spending on programs that are
controlled through the regular budget process
General Purpose Financial Reports - --Answer --Provide information on the
financial position and operating results of a government entity to users
Economic Resources - --Answer --
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 3
Answers
General Purpose Financial Reporting - --Answer --Assists users in assessing
accountability and in making economic, social and political decisions
Interperiod Equity - --Answer --A term coined by the GASB indicating the
extent to which current-period revenues are adequate to pay for current-period
services.
Accural Basis Accounting - --Answer --reporting income when it is earned
and expenses when they are incurred
Modified Accural Basis - --Answer --
Primary users of Financial Reports - --Answer --public, legislative bodies,
grantor agencies, the media, investors and creditors, and internal financial
managers .
Governmental Accounting Standards Board (GASB) - --Answer --
Established by the Financial Accounting Foundation to develop guidelines for
financial accounting and reporting by state and local governmental units.
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 1
,Federal Accounting Standards Advisory Board (FASAB) - --Answer --is the
standard setting body for federal agencies and the federal government
Due Process Procedures - --Answer --
Types of Reports Produced By Governments - --Answer --
user fees - --Answer --Charges levied by governments in exchange for
services.
fringe benefits - --Answer --Any financial extras beyond the regular pay
check, such as health insurance, life insurance, paid vacation and/or retirement
Budget Process - --Answer --the method by which government allocate
scarce resources and set forth policy objectives
line item budget - --Answer --it set froths the specific character or object
class of spending
baseline budget - --Answer --project the amount needed in the future to
maintain the same level of services, taking into account changes in inflation rates
and demographics
Program Budget - --Answer --focus on specific functions or services
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 2
, Zero Budget - --Answer --Setting budgets to zero each year and starting over
justifying each new budget
Performance budget - --Answer --uses performance measures as the means
to determine the level of funding
capital budget - --Answer --budget for major capital, or investment,
expenditures
Expenditure - --Answer --
encumbrance - --Answer --state version of obligation
Phases of the Budget Process - --Answer --preparation, legislative, execution
operating budget - --Answer --budget for day-to-day expenses
Debt Service - --Answer --money spent by the state to pay off debt; includes
interest and principal payments
discretionary spending - --Answer --Federal spending on programs that are
controlled through the regular budget process
General Purpose Financial Reports - --Answer --Provide information on the
financial position and operating results of a government entity to users
Economic Resources - --Answer --
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 3
