CGFM Exam 3 - Financial Management
Functions 2025 Questions and Answers
Prompt Payment Act - ANSWER-A federal law that requires federal agencies to
pay interest to companies on bills not paid within 30 days of invoice or completion
of work.
Cash Management Improvement Act - ANSWER-passed to improve the transfer
of federal funds between the federal government and the states, territories, and the
District of Columbia
31 CFR Part 2018 Management of Federal Agency Disbursements - ANSWER-
requires federal agencies to disburse payments via electronic funds transfer, with
few exceptions
Lockbox - ANSWER-An arrangement whereby receipts are mailed directly from
payers to a post office box that is serviced by a designated bank
float - ANSWER-the period between the time the check is issued and the time it is
presented for payment at the payer's bank
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 1
, Zero Balance Account (ZBA) - ANSWER-account into which cash from a master
account is transferred at the close of the banking day to cover checks and debits
presented for payment
Concentration Bank Services - ANSWER-expediting the consolidation of
geographically dispersed deposits into a central account
Collection services - ANSWER-includes over the counter collection for tax and
utility bills, processing paper checks, operating a lockbox
Payment Services - ANSWER-includes the processing paper checks as well as
providing for electronic payments through the automated clearing house or via
wire transfers
short-term borrowings - ANSWER-lines of credit or revolving credit facilities or as
loans to fund short term cash needs
compensating balance - ANSWER-A requirement by some banks requiring
depositors to maintain minimum cash balances in their bank accounts.
external shared services providers - ANSWER-departments/ agencies who provide
services to organizations outside of their own
internal shared services providers - ANSWER-larger agencies that decided to
consolidate, standardize and streamline financial and other business processes
within their own department, and leverage a service center approach to provide
system hosting
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 2
Functions 2025 Questions and Answers
Prompt Payment Act - ANSWER-A federal law that requires federal agencies to
pay interest to companies on bills not paid within 30 days of invoice or completion
of work.
Cash Management Improvement Act - ANSWER-passed to improve the transfer
of federal funds between the federal government and the states, territories, and the
District of Columbia
31 CFR Part 2018 Management of Federal Agency Disbursements - ANSWER-
requires federal agencies to disburse payments via electronic funds transfer, with
few exceptions
Lockbox - ANSWER-An arrangement whereby receipts are mailed directly from
payers to a post office box that is serviced by a designated bank
float - ANSWER-the period between the time the check is issued and the time it is
presented for payment at the payer's bank
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 1
, Zero Balance Account (ZBA) - ANSWER-account into which cash from a master
account is transferred at the close of the banking day to cover checks and debits
presented for payment
Concentration Bank Services - ANSWER-expediting the consolidation of
geographically dispersed deposits into a central account
Collection services - ANSWER-includes over the counter collection for tax and
utility bills, processing paper checks, operating a lockbox
Payment Services - ANSWER-includes the processing paper checks as well as
providing for electronic payments through the automated clearing house or via
wire transfers
short-term borrowings - ANSWER-lines of credit or revolving credit facilities or as
loans to fund short term cash needs
compensating balance - ANSWER-A requirement by some banks requiring
depositors to maintain minimum cash balances in their bank accounts.
external shared services providers - ANSWER-departments/ agencies who provide
services to organizations outside of their own
internal shared services providers - ANSWER-larger agencies that decided to
consolidate, standardize and streamline financial and other business processes
within their own department, and leverage a service center approach to provide
system hosting
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 2
