Governmental Accounting Overviewed
questions & answers.
What is the cornerstone of governmental financial reporting? ANS -Accountability, with Interperiod
Equity (balancing the budget) as a major component of accountability
Governmental funds are accounted for using the: ANS -modified accrual basis of accounting, and the
current financial resources measurement focus
Propriety and Fiduciary funds are accounted for using the: ANS -full accrual basis of accounting, and the
economic resources measurement focus
Governmental fund types include: ANS -GRaSPP:
- General Fund
- Special Revenue Fund
and
- Debt Service Fund
- Capital Projects Fund
- Permanent Fund
Proprietary fund types include: ANS -SE:
- Internal Service Fund
- Enterprise Fund
Fiduciary Funds include: ANS -PAPI:
- Pension Trust Fund
- Agency Trust Fund
- Private Purpose Trust Fund
, - Investment Trust Fund
What is the major difference between the Current Financial Resources measurement focus and the
economic resources measurement focus? ANS -the current financial resources measurement focus does
NOT report fixed assets or non-current liabilities on the balance sheet
Under the modified accrual basis of accounting, when are revenues and expenditures recorded? ANS -
Revenues are recognized when measurable and available (during the year + 60 days).
Expenditures are recorded when the related fund liability is incurred
Budgetary accounting is used to: ANS -control spending
Activity accounting emphasizes: ANS -the flow of current financial resources
Encumbrance accounting is used to: ANS -record purchase orders and aid in the control of spending
Sources of Governmental resources: (1) Revenue and (2) Other Financing Sources ANS -(1). Revenue:
Taxes- income and sales, Taxes- property and real estate, Fines and Penalties
(2). Other Financing sources: Debt proceeds (bonds and notes), Interfund transfers
Non-exchange revenues include: ANS -1. Derived tax revenues (sales, income)
2. Imposed Non-exchange Revenues (fines, property taxes)
3. Government mandated non-exchange transactions
4. Voluntary non-exchange transactions
Examples of Function governmental expenditures: ANS -public safety, highways, education, health and
welfare, and general governmental services
Examples of Program governmental expenditures include: ANS -programs for the elderly, drug
addiction, and education
questions & answers.
What is the cornerstone of governmental financial reporting? ANS -Accountability, with Interperiod
Equity (balancing the budget) as a major component of accountability
Governmental funds are accounted for using the: ANS -modified accrual basis of accounting, and the
current financial resources measurement focus
Propriety and Fiduciary funds are accounted for using the: ANS -full accrual basis of accounting, and the
economic resources measurement focus
Governmental fund types include: ANS -GRaSPP:
- General Fund
- Special Revenue Fund
and
- Debt Service Fund
- Capital Projects Fund
- Permanent Fund
Proprietary fund types include: ANS -SE:
- Internal Service Fund
- Enterprise Fund
Fiduciary Funds include: ANS -PAPI:
- Pension Trust Fund
- Agency Trust Fund
- Private Purpose Trust Fund
, - Investment Trust Fund
What is the major difference between the Current Financial Resources measurement focus and the
economic resources measurement focus? ANS -the current financial resources measurement focus does
NOT report fixed assets or non-current liabilities on the balance sheet
Under the modified accrual basis of accounting, when are revenues and expenditures recorded? ANS -
Revenues are recognized when measurable and available (during the year + 60 days).
Expenditures are recorded when the related fund liability is incurred
Budgetary accounting is used to: ANS -control spending
Activity accounting emphasizes: ANS -the flow of current financial resources
Encumbrance accounting is used to: ANS -record purchase orders and aid in the control of spending
Sources of Governmental resources: (1) Revenue and (2) Other Financing Sources ANS -(1). Revenue:
Taxes- income and sales, Taxes- property and real estate, Fines and Penalties
(2). Other Financing sources: Debt proceeds (bonds and notes), Interfund transfers
Non-exchange revenues include: ANS -1. Derived tax revenues (sales, income)
2. Imposed Non-exchange Revenues (fines, property taxes)
3. Government mandated non-exchange transactions
4. Voluntary non-exchange transactions
Examples of Function governmental expenditures: ANS -public safety, highways, education, health and
welfare, and general governmental services
Examples of Program governmental expenditures include: ANS -programs for the elderly, drug
addiction, and education
