ACC 460 Wk 1 – Practice: Wk 1 Knowledge Check

Which of the following statements is correct?

Multiple Choice

Governmental funds must prepare a Statement of Revenue, Expenditures and Changes in Fund Balance, Statement of Fund Balance and Statement of Cash Flows. RSI is optional.

Fiduciary funds must prepare a Statement of Fiduciary Net Assets, Statement of Changes in Fiduciary Net Assets, Statement of Cash Flows and RSI.

Government-wide statements include data from Fiduciary and Proprietary Funds.

Proprietary funds must prepare a Statement of Revenues, Expenses and Changes in Fund Net Position, Statement of Net Position and Statement of Cash Flows.

Multiple Choice

Debt service funds account for and report financial resources that are restricted, committed or assigned to expenditure for principle and interest for governmental debts except debt of proprietary and fiduciary funds who account for their own interest and principle payments.

Debt service funds report the balance of governmental debts except debt of proprietary and fiduciary funds.

Debt service funds must accrue interest on long-term debt at year end.

Debt service funds account for and report financial resources that are restricted, committed or assigned to expenditure for principle and interest for all governmental long-term debt.

The GASB sets accounting standards for all of the following except:

Multiple Choice

Component units owned or controlled by governments.

Private not-for-profit hospitals.

State and local governments.

Governmentally related not-for-profit universities.

Which of the following statements is correct with respect to Fiduciary Funds?

Multiple Choice

Fiduciary funds use the current financial resources measurement focus and accrual accounting.

Fiduciary funds include Pension trust funds, Internal service funds, Private-purpose trust funds, and Investment trust funds.

Custodial funds are fiduciary funds which are used when resources are held by a government in a trustee capacity but no trust agreement is in place.

Fiduciary funds must be adjusted when preparing the government-wide statements.

Governmental funds use the:

Multiple Choice

current financial resources measurement focus and accrual basis of accounting.

economic resources measurement focus and accrual basis of accounting.

economic resources measurement focus and modified accrual basis of accounting.

current financial resources measurement focus and modified accrual basis of accounting.

Which of the following statements is correct with respect to the Statement of Cash Flow for a Proprietary Fund on the CAFR?

Multiple Choice

Non-cash investing and financing transactions are not reported in the statement.

The reconciliation of income to cash flows begins with total change in net position.

GASB permits the statement to be prepared using the indirect method.

The statement has four sections; Operating, Noncapital-related financing activities, Capital and related financing and Investing activities.

Which of the following is incorrect with respect to the Balance Sheet for Governmental funds?

Multiple Choice

The excess of assets and deferred outflows over liabilities and deferred inflows is labeled fund balance.

The total fund balance must be reconciled to total net position in the governmental activities column of the government-wide statement of Net Position.

The statement is prepared using the current financial resources measurement focus and the modified accrual basis of accounting

Governmental funds report capital assets net of depreciation.

Which of the following sections of the CAFR is/are audited?

Multiple Choice

Introductory section.

Financial section.

Statistical section.

All of the choices are correct.

Which of the following is correct with respect to the governmental fund Statement of Revenues, Expenditures and Changes in Fund Balance?

Multiple Choice

Revenues are reported by source, and expenditures are reported by character such as current, debt service and capital outlay.

Reconciliation of the change in net position to the balance sheet is recommended but not required.

Other financing sources are reported with revenues and other financing uses are reported with expenditures.

The statement is prepared using the current financial resources measurement focus and the accrual basis of accounting.

Which of the following is true with respect to the General Fund?

Multiple Choice

The General Fund is considered to be a major fund only if the total of assets, liabilities, revenues, or expenditures exceeds 10% of the total of all governmental funds.

The General Fund is considered to be a major fund when preparing fund basis financial statements only if the total assets, liabilities, revenues, or expenditures of that individual governmental or enterprise fund are 5% of the total of the governmental and enterprise categories, combined.

The General Fund is always considered a major fund.

Both the General Fund is considered to be a major fund only if the total of assets, liabilities, revenues, or expenditures exceeds 10% of the total of all governmental funds and the General Fund is considered to be a major fund when preparing fund basis financial statements only if the total assets, liabilities, revenues, or expenditures of that individual governmental or enterprise fund are 5% of the total of the governmental and enterprise categories, combined are required.