CGFM TEST 3 2025 QUESTIONS
AND ANSWERS
Three Broad Government Spending Purposes - ANSWER-1) Current Operations
2) Capital Outlays
3) Debt Service
Present Value Analysis - Three Components - ANSWER-Determines what $$
Rec'd in Future is Worth Today
1) inflation component - year over year loss in value
2) enterprise component - inherent risk
3) unique component -
Budget Accounting and Procedures Act of 1950 - ANSWER-Requires the head of
each federal agency to establish and maintain I/C's.
Federal Managers Financial Integrity Act of 1982 (FMFIA) - ANSWER-requires
the head of each agency to evaluate controls on an annual basis, reporting any
weakness along with a corrective action plan
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,** (resulted in the "green book") **
Single Audit Act of 1984 (amended in 1996) - ANSWER-requires the audit of state
and local governments and npo's receiving federal funding
Sarbanes Oxley Act of 2002 - ANSWER-Placed restrictions on publicly traded
companies following Enron scandal. Requires mgmt to report on I/C's for
financial reporting in its annual report.
(ICOFR) - ANSWER-Internal Controls Over Financial Reporting
Chief Financial Officers Act of 1990 (CFO Act): - ANSWER-required 10 federal
agencies to produce audited annual financial reports that included a report on
internal control.
expanded in 1994 by GMRA
INTERNAL CONTROLS - ANSWER-systems and techniques managers use to
provide reasonable assurance that agency objectives met in an effective/efficient
manner, in compliance with laws/regulations, and to safeguard assets.
Implemented to accomplish certain results, prevent problems, or detect problems
that have occurred.
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,Some controls can both detect and prevent problems (but only if their existence is
known).
TIME VALUE OF MONEY - ANSWER-Used in consideration of capital
budgeting
1) Present Value Analysis
2) Future Value Analysis
3) Payback Analysis
Flowcharting - ANSWER-Iterative process requiring changes throughout
development, each step represents a decision, also used to evaluate processes for
effective internal controls
Earned Value Management (EVM) - ANSWER-project mgmt system that weighs
both schedule and cost performance to determine if a project is delivering
expected results on time and within budget
Regression Analysis - ANSWER-Predicts the relationship between variables:
1) Direct Linear Regression
2) Indirect Linerar Regression
3) Non-linear Regression
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, 4) No Relationship
** See Limits of Regression Analysis
Correlation Coefficient - ANSWER-Determines the degree of accuracy the analysis
(variables) can be used to predict results (1=perfect correlation
.85 considered reliable for forecasting)
Multiple Regressions - ANSWER-analyzes multiple IV's and look for items with
the highest correlation coefficient as being the most like predictors
Limits of Regression Analysis - ANSWER-Data ranges must be relevant (e.g.,
sample size might be too small to project on a larger population)
Difficult to find data sets with high correlation coefficients
Bad data = bad results (garbage in, garbage out)
Correlation is not Causation, have to be able to explain how one set of data would
influence another
Data Analytics - ANSWER-inspecting, cleaning, transforming, and modeling data
to find useful information, conclusions, and support decision making
Data Mining - ANSWER-(Predictive) sorting through large data sets and using
filters and algorithms to pick out relationships
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 4
AND ANSWERS
Three Broad Government Spending Purposes - ANSWER-1) Current Operations
2) Capital Outlays
3) Debt Service
Present Value Analysis - Three Components - ANSWER-Determines what $$
Rec'd in Future is Worth Today
1) inflation component - year over year loss in value
2) enterprise component - inherent risk
3) unique component -
Budget Accounting and Procedures Act of 1950 - ANSWER-Requires the head of
each federal agency to establish and maintain I/C's.
Federal Managers Financial Integrity Act of 1982 (FMFIA) - ANSWER-requires
the head of each agency to evaluate controls on an annual basis, reporting any
weakness along with a corrective action plan
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 1
,** (resulted in the "green book") **
Single Audit Act of 1984 (amended in 1996) - ANSWER-requires the audit of state
and local governments and npo's receiving federal funding
Sarbanes Oxley Act of 2002 - ANSWER-Placed restrictions on publicly traded
companies following Enron scandal. Requires mgmt to report on I/C's for
financial reporting in its annual report.
(ICOFR) - ANSWER-Internal Controls Over Financial Reporting
Chief Financial Officers Act of 1990 (CFO Act): - ANSWER-required 10 federal
agencies to produce audited annual financial reports that included a report on
internal control.
expanded in 1994 by GMRA
INTERNAL CONTROLS - ANSWER-systems and techniques managers use to
provide reasonable assurance that agency objectives met in an effective/efficient
manner, in compliance with laws/regulations, and to safeguard assets.
Implemented to accomplish certain results, prevent problems, or detect problems
that have occurred.
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 2
,Some controls can both detect and prevent problems (but only if their existence is
known).
TIME VALUE OF MONEY - ANSWER-Used in consideration of capital
budgeting
1) Present Value Analysis
2) Future Value Analysis
3) Payback Analysis
Flowcharting - ANSWER-Iterative process requiring changes throughout
development, each step represents a decision, also used to evaluate processes for
effective internal controls
Earned Value Management (EVM) - ANSWER-project mgmt system that weighs
both schedule and cost performance to determine if a project is delivering
expected results on time and within budget
Regression Analysis - ANSWER-Predicts the relationship between variables:
1) Direct Linear Regression
2) Indirect Linerar Regression
3) Non-linear Regression
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 3
, 4) No Relationship
** See Limits of Regression Analysis
Correlation Coefficient - ANSWER-Determines the degree of accuracy the analysis
(variables) can be used to predict results (1=perfect correlation
.85 considered reliable for forecasting)
Multiple Regressions - ANSWER-analyzes multiple IV's and look for items with
the highest correlation coefficient as being the most like predictors
Limits of Regression Analysis - ANSWER-Data ranges must be relevant (e.g.,
sample size might be too small to project on a larger population)
Difficult to find data sets with high correlation coefficients
Bad data = bad results (garbage in, garbage out)
Correlation is not Causation, have to be able to explain how one set of data would
influence another
Data Analytics - ANSWER-inspecting, cleaning, transforming, and modeling data
to find useful information, conclusions, and support decision making
Data Mining - ANSWER-(Predictive) sorting through large data sets and using
filters and algorithms to pick out relationships
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 4
