Governmental Accounting questions
with correct answers.
Public organizations ANS -are owned or controlled by government
Private organizations ANS -are not owned or controlled by the governments
non-profit organizations ANS -lack residual ownership claim and its purpose is something other than to
provide goods and services at a profit
Five environmental differences between governments and for-profit business: ANS -1. organizational
purposes
2. sources of revenue
3. potential longevity
4. relationship with stakeholders
5. role of the budget
governmental practices are not ANS -focused on the measurement of net income for the purpose of
measuring return to investors, rather they are intended to satisfy the information needs of a variety of
users
Fund accounting ANS -represents part of the activities of an organization that is separated from other
activities in the accounting records to more easily demonstrate compliance with legal restrictions or
limitations
Government Budgets ANS -are expressions of public policy and often carry the authority of the law,
preventing public officials from spending outside their budgetary authority. reported on the
governmental financial reports.
Governments and non-profit similarities ANS -do not have a residual owner, receive resources with
donor-imposed restrictions
,Is not an effective measure of governments performance ANS -revenues over expenses
GASB standards are set forth in documents called ANS -Statements of Financial Accounting Standards.
no longer used are interpretations..
The sources of authoritative GAAP ANS -for state and local governments are:
1. GASB statements
2. GASB implementations Guides, GASB Technical Bulletins and Literature of the AICPA
(if an accounting treatment is not specified in Category A, consider category B)
Governments may use non-authoritative sources for guidance including ANS -GASB concepts statements
FASB, FASAB, ISB pronouncements
AICPA literature not cleared by GASB
Other sources and prevalent practices
Codifications ANS -versions of standards are presented together any superseded segments of standards
have been removed. represented in two parts
1. identifies the topic
2. paragraph within the codifications
FASAB ANS -accounting and financial reporting standards for the federal government
GASB ANS -accounting and financial reporting for state and local governments in the United States, also
governmentally related non-for-profits ex. colleges & universities.
FASB ANS -accounting and financial reporting for profit-seeking businesses and for nongovernmental
not-for-profit ogranization are set by...
Who oversees GASB and FASB? ANS -Financial Accounting Foundation (FAF)
, GASB and FASB are referred to as ANS -independent standards-setting bodies
standards set by FASAB, GASB, and FASB are primary sources of ANS -GAAP.
FASB and GASB definition of governmental organizations ANS -Public corporations and bodies corporate
and politic are governmental organization. other organizations are considered if they have one or more
of the following:
a. popular election of officers or appointment of a controlling majority of the members of the
organizations governing body by officials of one or ore state or local governments
b. the potential for unilateral dissolution by a government with the net resources reverting to a
government
c. the power to enact or enforce a tax levy
.. and if they have the ability to issue directly debt that pays interest exempt from federal taxation
GASB Concept 1:three primary user groups of government accounting information ANS -creditors,
citizens and oversight boards (including granting agencies and the legislature)
GASB Concept 2 & 5: reporting of nonfinancial measures ANS -called service efforts and
accomplishments reporting. ex. schools reporting students advancing, graduation rates... etc.
GASB Concept 3: defines the methods of presenting information in financial reports: ANS -1. when A, L,
and SE can be measured with sufficient reliability, they should be reported in the basic financial
statements
2. notes to the financial statement is used to enhance understanding of items
3. additional information to provide context and understanding of information. require RSI
4. other supplementary information that is not required by GASB
Required Supplementary information (RSI) ANS -Managements Discussion and Analysis is an example.
comes in form of schedules or tables
with correct answers.
Public organizations ANS -are owned or controlled by government
Private organizations ANS -are not owned or controlled by the governments
non-profit organizations ANS -lack residual ownership claim and its purpose is something other than to
provide goods and services at a profit
Five environmental differences between governments and for-profit business: ANS -1. organizational
purposes
2. sources of revenue
3. potential longevity
4. relationship with stakeholders
5. role of the budget
governmental practices are not ANS -focused on the measurement of net income for the purpose of
measuring return to investors, rather they are intended to satisfy the information needs of a variety of
users
Fund accounting ANS -represents part of the activities of an organization that is separated from other
activities in the accounting records to more easily demonstrate compliance with legal restrictions or
limitations
Government Budgets ANS -are expressions of public policy and often carry the authority of the law,
preventing public officials from spending outside their budgetary authority. reported on the
governmental financial reports.
Governments and non-profit similarities ANS -do not have a residual owner, receive resources with
donor-imposed restrictions
,Is not an effective measure of governments performance ANS -revenues over expenses
GASB standards are set forth in documents called ANS -Statements of Financial Accounting Standards.
no longer used are interpretations..
The sources of authoritative GAAP ANS -for state and local governments are:
1. GASB statements
2. GASB implementations Guides, GASB Technical Bulletins and Literature of the AICPA
(if an accounting treatment is not specified in Category A, consider category B)
Governments may use non-authoritative sources for guidance including ANS -GASB concepts statements
FASB, FASAB, ISB pronouncements
AICPA literature not cleared by GASB
Other sources and prevalent practices
Codifications ANS -versions of standards are presented together any superseded segments of standards
have been removed. represented in two parts
1. identifies the topic
2. paragraph within the codifications
FASAB ANS -accounting and financial reporting standards for the federal government
GASB ANS -accounting and financial reporting for state and local governments in the United States, also
governmentally related non-for-profits ex. colleges & universities.
FASB ANS -accounting and financial reporting for profit-seeking businesses and for nongovernmental
not-for-profit ogranization are set by...
Who oversees GASB and FASB? ANS -Financial Accounting Foundation (FAF)
, GASB and FASB are referred to as ANS -independent standards-setting bodies
standards set by FASAB, GASB, and FASB are primary sources of ANS -GAAP.
FASB and GASB definition of governmental organizations ANS -Public corporations and bodies corporate
and politic are governmental organization. other organizations are considered if they have one or more
of the following:
a. popular election of officers or appointment of a controlling majority of the members of the
organizations governing body by officials of one or ore state or local governments
b. the potential for unilateral dissolution by a government with the net resources reverting to a
government
c. the power to enact or enforce a tax levy
.. and if they have the ability to issue directly debt that pays interest exempt from federal taxation
GASB Concept 1:three primary user groups of government accounting information ANS -creditors,
citizens and oversight boards (including granting agencies and the legislature)
GASB Concept 2 & 5: reporting of nonfinancial measures ANS -called service efforts and
accomplishments reporting. ex. schools reporting students advancing, graduation rates... etc.
GASB Concept 3: defines the methods of presenting information in financial reports: ANS -1. when A, L,
and SE can be measured with sufficient reliability, they should be reported in the basic financial
statements
2. notes to the financial statement is used to enhance understanding of items
3. additional information to provide context and understanding of information. require RSI
4. other supplementary information that is not required by GASB
Required Supplementary information (RSI) ANS -Managements Discussion and Analysis is an example.
comes in form of schedules or tables
