29 Questions
Who were the forerunners of the FASB formed in 1973?
The Accounting Principles Board (1959—73) and The Committee on Accounting Procedure (1938—59) of the American Institute of Certified Public Accountants.
Which bodies are responsible for establishing Generally Accepted Accounting Principles (GAAP) for state and local governments, the federal government, and business organizations?
GASB, the FASAB, and the FASB.
Who are the major external users of financial reports for government and not-for-profit entities?
Resource providers (taxpayers, donors, potential donors, investors, potential investors, bond-rating agencies, and grant-providing organizations).
Which groups make up the internal users of financial information in entities?
Managers and employees.
What do the acronyms GASB, FASAB, and FASB stand for?
Governmental Accounting Standards Board, Federal Accounting Standards Advisory Board, Financial Accounting Standards Board.
What is one similarity between Government & Not for Profit entities and Business entities?
Both need resources to operate
What is one key difference between Government & Not for Profit entities and Business entities?
Organizational objective
Which body sets standards for state and local governments, including governmental not-for-profit organizations?
GASB
What is the role of the Federal Accounting Standards Advisory Board (FASAB)?
Recommend accounting principles and standards for the federal government and its agencies
What are the forerunners of the GASB, formed in 1984?
The National Council on Governmental Accounting, The National Committee on Governmental Accounting, The National Committee on Municipal Accounting
What term is used to describe the GASB and the FASB in relation to standard-setting?
Independent standards-setting boards in the private sector
What are the four major groups of users of federal financial reports identified by FASAB?
Citizens, Congress, executives, and program managers
What do the Government-wide Financial Statements provide an overview of?
The entire government entity as a whole
What is the purpose of Government-wide Financial Statements?
To present a comprehensive view of the government's financial position and results of operations
What information does the Statement of Net Position provide?
Information about the government's assets, liabilities, and net position (equity)
What does the Statement of Activities present?
Revenues and expenses of the government entity, including both operating and non-operating activities
What is the purpose of the Financial section of the Comprehensive Annual Financial Report (CAFR)?
To report the basic financial statements
What is the basis of accounting that has evolved for governmental funds?
Modified accrual
When are revenues recorded under the modified accrual basis?
If they are measurable and available for paying current period obligations
When are expenditures generally recognized under the modified accrual basis?
When incurred
Why are expenditures reported in the governmental fund statement of revenues, expenditures, and changes in fund balances?
Outlays to acquire goods or services are more relevant than expenses in measuring the outflow of current financial resources
At the government-wide level, what is more relevant in measuring the cost of services provided?
Expenses
What do proprietary fund financial statements present financial information for?
Enterprise funds and internal service funds
What do Fiduciary Funds account for?
Resources held by the government in a trustee or agency capacity
What does the Statement of Fiduciary Net Position show?
Assets, liabilities, and net position (equity) of the fund
Why are Government fund statements important?
They focus on the flow of current financial resources available for expenditure
What is the purpose of Fund financial statements?
To provide detailed information about inflows and outflows of specific funds
What is the focus of Government-wide financial statements?
Overall financial health and results of the government entity
Why are long-term obligations and noncurrent assets not reported in governmental funds?
They do not have to be paid in the current budgetary period
Learn about the major groups of users of federal financial reports according to FASAB, and how its standards focus on cost accounting, service efforts, accomplishment measures, financial accounting, and reporting. Explore the contents of Comprehensive Annual Financial Reports (CAFR), including the basic financial statements.
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