CPFO Accounting Exam Questions with Correct Answers 2025/2026

CPFO Accounting Exam Questions with Correct Answers 2025/2026 Which of the following groups normally would NOT be considered a primary user of state or local government's general-purpose external financial statements? A. Citizens B. Legislative and oversight bodies C. Management D. Investors and creditors - Correct Answer C - The primary users of general-purpose external financial statements are those who, unlike management, do not have direct access to accounting information. (page 6) (Chapter 1) Which of the following groups took the lead in setting generally accepted accounting principles (GAAP) for business enterprises? A. Businesses themselves B. State governments C. Federal government D. Independent auditors - Correct Answer D - Independent auditors took the lead in codifying GAAP in the private sector, whereas financial statement preparers took the lead in codifying GAAP in the public sector. (page 6) (Chapter 1) Which organization appoints the members of the Governmental Accounting Standards Board (GASB) A. Financial Accounting Foundation (FAF) B. Governmental Accounting Standards Advisory Council (GASAC) C. American Institute of Certified Public Accountants (AICPA) D. Securities and Exchange Commission (SEC) - Correct Answer A - The FAF appoints the members of both the FASB and the GASB (page 7) (Chapter 1) Which of the following has the LOWEST authoritative status on the GAAP hierarchy? A. Widely recognized and prevalent