CGFO Accounting and Financial
Reporting Question and answers rated
A+
What are the two most important financial documents in both public and
private organizations? - correct answers Budget and annual financial report.
What is the purpose of the accounting system? - correct answers To provide a
record-keeping framework in which to record (in journals) the transactions
authorized by the budget and to reconcile (in ledgers) their cumulative
financial impact.
What are the six goals of accounting? - correct answers Provide financial
information that is: Understandable, reliable, relevant, comparable, consistent,
and timely.
What are generally accepted accounting principles (GAAP)? - correct answers
Standards adopted by the accounting profession for recording and reporting
transactions.
What is the role of the Governmental Accounting Standards Board (GASB)? -
correct answers To provide standards, interpretations, and technical bulletins
for state and local governments.
What are some topics of discussion concerning GAAP? - correct answers
Basis of accounting, treatment of fixed assets, and long-term debt.
What is one benefit of standardizing the accounting system? - correct answers
Comparisons can be made across governments and conclusions drawn on
the relative financial health of each.
,What is another benefit of standardizing the accounting system? - correct
answers Users can interpret financial reports more easily.
What is the most important benefit of standardizing the accounting system? -
correct answers Assuring users that a common set of rules is being applied to
reporting financial operations.
What is the purpose of the operating budget? - correct answers To plan for
spending and expected revenues.
What is the purpose of the capital budget? - correct answers To plan for
spending on long-term assets.
What is the purpose of the accounting system? - correct answers To record
financial transactions authorized by the budget.
What is the purpose of journals in the accounting system? - correct answers
To record transactions.
What is the purpose of ledgers in the accounting system? - correct answers
To reconcile the cumulative financial impact of transactions.
What is the role of generally accepted accounting principles (GAAP)? - correct
answers To guide the recording, reconciling, and reporting of transactions.
What is GAAP? - correct answers Generally Accepted Accounting Principles
,What are the goals of GAAP? - correct answers Accuracy, reliability, and
consistency in reporting
How do businesses and governments report their results differently? - correct
answers Businesses consolidate results, governments report by funds
What is a fund in governmental accounting? - correct answers A fiscal and
accounting entity with a self-balancing set of accounts
How do funds function in governmental accounting? - correct answers Like
self-contained businesses with their own accounts and financial reports
What is Principle #1 of governmental accounting? - correct answers Maintain
accounts on a GAAP basis and comply with finance-related legal
requirements
What is Principle #2 of governmental accounting? - correct answers Funds
must be the basis for maintaining accounting records
What is Principle #3 of governmental accounting? - correct answers Identify
and define the eleven basic types of funds used in governmental accounting
What is Principle #4 of governmental accounting? - correct answers Maintain
a minimum number of funds and only those required by law
What is Principle #5 of governmental accounting? - correct answers Maintain
a distinction in accounting records among capital assets of different funds
What is Principle #6 of governmental accounting? - correct answers Maintain
historical cost of capital assets and long-term debt in accounting records
, What is Principle #7 of governmental accounting? - correct answers Record
depreciation of capital assets in accounting records
What is Principle #8 of governmental accounting? - correct answers Maintain
a clear distinction between long-term liabilities of specific funds and the
general government
What is Principle #9 of governmental accounting? - correct answers Use
accrual basis for government-wide financial statements and modified accrual
basis for fund-specific financial statements
What is Principle #10? - correct answers Annual budget adoption and
comparison with actual results.
What is Principle #11? - correct answers Recognition and reporting of
interfund transfers depending on reciprocity.
What is Principle #12? - correct answers Use of common terminology and
classification system.
What is Principle #13? - correct answers Preparation of interim financial
reports and CAFR follows specified format.
What is the difference between accounting methods in government and
private sector? - correct answers Government uses modified accrual method
for certain funds.
Reporting Question and answers rated
A+
What are the two most important financial documents in both public and
private organizations? - correct answers Budget and annual financial report.
What is the purpose of the accounting system? - correct answers To provide a
record-keeping framework in which to record (in journals) the transactions
authorized by the budget and to reconcile (in ledgers) their cumulative
financial impact.
What are the six goals of accounting? - correct answers Provide financial
information that is: Understandable, reliable, relevant, comparable, consistent,
and timely.
What are generally accepted accounting principles (GAAP)? - correct answers
Standards adopted by the accounting profession for recording and reporting
transactions.
What is the role of the Governmental Accounting Standards Board (GASB)? -
correct answers To provide standards, interpretations, and technical bulletins
for state and local governments.
What are some topics of discussion concerning GAAP? - correct answers
Basis of accounting, treatment of fixed assets, and long-term debt.
What is one benefit of standardizing the accounting system? - correct answers
Comparisons can be made across governments and conclusions drawn on
the relative financial health of each.
,What is another benefit of standardizing the accounting system? - correct
answers Users can interpret financial reports more easily.
What is the most important benefit of standardizing the accounting system? -
correct answers Assuring users that a common set of rules is being applied to
reporting financial operations.
What is the purpose of the operating budget? - correct answers To plan for
spending and expected revenues.
What is the purpose of the capital budget? - correct answers To plan for
spending on long-term assets.
What is the purpose of the accounting system? - correct answers To record
financial transactions authorized by the budget.
What is the purpose of journals in the accounting system? - correct answers
To record transactions.
What is the purpose of ledgers in the accounting system? - correct answers
To reconcile the cumulative financial impact of transactions.
What is the role of generally accepted accounting principles (GAAP)? - correct
answers To guide the recording, reconciling, and reporting of transactions.
What is GAAP? - correct answers Generally Accepted Accounting Principles
,What are the goals of GAAP? - correct answers Accuracy, reliability, and
consistency in reporting
How do businesses and governments report their results differently? - correct
answers Businesses consolidate results, governments report by funds
What is a fund in governmental accounting? - correct answers A fiscal and
accounting entity with a self-balancing set of accounts
How do funds function in governmental accounting? - correct answers Like
self-contained businesses with their own accounts and financial reports
What is Principle #1 of governmental accounting? - correct answers Maintain
accounts on a GAAP basis and comply with finance-related legal
requirements
What is Principle #2 of governmental accounting? - correct answers Funds
must be the basis for maintaining accounting records
What is Principle #3 of governmental accounting? - correct answers Identify
and define the eleven basic types of funds used in governmental accounting
What is Principle #4 of governmental accounting? - correct answers Maintain
a minimum number of funds and only those required by law
What is Principle #5 of governmental accounting? - correct answers Maintain
a distinction in accounting records among capital assets of different funds
What is Principle #6 of governmental accounting? - correct answers Maintain
historical cost of capital assets and long-term debt in accounting records
, What is Principle #7 of governmental accounting? - correct answers Record
depreciation of capital assets in accounting records
What is Principle #8 of governmental accounting? - correct answers Maintain
a clear distinction between long-term liabilities of specific funds and the
general government
What is Principle #9 of governmental accounting? - correct answers Use
accrual basis for government-wide financial statements and modified accrual
basis for fund-specific financial statements
What is Principle #10? - correct answers Annual budget adoption and
comparison with actual results.
What is Principle #11? - correct answers Recognition and reporting of
interfund transfers depending on reciprocity.
What is Principle #12? - correct answers Use of common terminology and
classification system.
What is Principle #13? - correct answers Preparation of interim financial
reports and CAFR follows specified format.
What is the difference between accounting methods in government and
private sector? - correct answers Government uses modified accrual method
for certain funds.
