CGFM EXAM 2 2026 QUESTION COLLECTION
GOVERNMENT AUDITING AND COMPLIANCE
MODULE SOLVED ITEMS AND RESPONSE KEY
◉ In financial reporting, consistency of communication means.
Answer: if accounting principles have changed or if the financial
reporting entity has changed, the nature and reason for the change,
as well as the effect of the change, should be disclosed.
◉ Budgeting is an element of which policy?. Answer: fiscal
◉ Another term for the federal government baseline budget is.
Answer: a current level of service budget.
◉ As described by FASAB, the four groups of people to whom the
government is accountable and are, therefore, potential users of
federal financial statements are. Answer: citizens, Congress,
executives, and program managers.
◉ When establishing an allowance for doubtful accounts, the journal
entry required is a debit to. Answer: Bad Debts Expense and a credit
to the Allowance for Doubtful Accounts.
,◉ Street resurfacing is a type of which budget element?. Answer:
program
◉ Which of the following sources of accounting principles is at the
top of the GASB hierarchy?. Answer: Generally Accepted Accounting
Principles
◉ The role of the International Public Sector Accounting Standards
Board is to. Answer: set standards for the general purpose financial
statements of international public sector entities.
◉ Non-exchange revenue includes inflows of resources arising from.
Answer: taxes, fines and penalties from the private sector.
◉ A group of activities within a function are known as. Answer: a
program
◉ The organizations that establish the standards used by their
constituents for external reporting purposes include FASB, FASAB,
GASB and. Answer: International Public Sector Accounting
Standards Board
◉ Which of the following terms describes costs an agency incurs on
behalf of another agency?. Answer: inter-entity
, ◉ State and local governments need cost information to receive
reimbursements for allowable costs for federal grants, while federal
agencies are required to have cost accounting concepts in the
preparation of what type of statements?. Answer: financial
statements
◉ State and local governments use encumbrances as the major
budgetary control tool to ensure availability of funds prior to
entering agreements, while the federal government instills
budgetary control using. Answer: commitments and obligations.
◉ Apportionments and allotments are used by agencies to ensure.
Answer: that outlays do not exceed appropriations.
◉ Departments and agencies submit their apportionment requests
for future expenditures during which budget phase?. Answer:
execution
◉ Which element of the budget structure is represented by license
and permit revenue?. Answer: category or source
◉ Agencies generally submit their budget requests during the.
Answer: budget preparation phase.
GOVERNMENT AUDITING AND COMPLIANCE
MODULE SOLVED ITEMS AND RESPONSE KEY
◉ In financial reporting, consistency of communication means.
Answer: if accounting principles have changed or if the financial
reporting entity has changed, the nature and reason for the change,
as well as the effect of the change, should be disclosed.
◉ Budgeting is an element of which policy?. Answer: fiscal
◉ Another term for the federal government baseline budget is.
Answer: a current level of service budget.
◉ As described by FASAB, the four groups of people to whom the
government is accountable and are, therefore, potential users of
federal financial statements are. Answer: citizens, Congress,
executives, and program managers.
◉ When establishing an allowance for doubtful accounts, the journal
entry required is a debit to. Answer: Bad Debts Expense and a credit
to the Allowance for Doubtful Accounts.
,◉ Street resurfacing is a type of which budget element?. Answer:
program
◉ Which of the following sources of accounting principles is at the
top of the GASB hierarchy?. Answer: Generally Accepted Accounting
Principles
◉ The role of the International Public Sector Accounting Standards
Board is to. Answer: set standards for the general purpose financial
statements of international public sector entities.
◉ Non-exchange revenue includes inflows of resources arising from.
Answer: taxes, fines and penalties from the private sector.
◉ A group of activities within a function are known as. Answer: a
program
◉ The organizations that establish the standards used by their
constituents for external reporting purposes include FASB, FASAB,
GASB and. Answer: International Public Sector Accounting
Standards Board
◉ Which of the following terms describes costs an agency incurs on
behalf of another agency?. Answer: inter-entity
, ◉ State and local governments need cost information to receive
reimbursements for allowable costs for federal grants, while federal
agencies are required to have cost accounting concepts in the
preparation of what type of statements?. Answer: financial
statements
◉ State and local governments use encumbrances as the major
budgetary control tool to ensure availability of funds prior to
entering agreements, while the federal government instills
budgetary control using. Answer: commitments and obligations.
◉ Apportionments and allotments are used by agencies to ensure.
Answer: that outlays do not exceed appropriations.
◉ Departments and agencies submit their apportionment requests
for future expenditures during which budget phase?. Answer:
execution
◉ Which element of the budget structure is represented by license
and permit revenue?. Answer: category or source
◉ Agencies generally submit their budget requests during the.
Answer: budget preparation phase.
