Accounting and Reporting for the Federal Government
True / False Questions
Responsibility for setting accounting and reporting standards for federal agencies rests primarily with the Federal Accounting Standards Advisory Board.
By law, federal agencies must incorporate the accounting standards (GAAP) established for the federal government into their financial management systems.
The objectives of federal financial reporting are to assist report users in evaluating budgetary integrity, operating performance, stewardship, and adequacy of systems and controls.
Federal departments and agencies should utilize the U.S. Government Standard General Ledger as the account structure for their accounting systems.
Current FASAB standards distinguish intragovernmental assets from governmental assets and entity assets from nonentity assets.
Fund balances of a federal agency's various funds are reported in the fund equity section of the agency's balance sheet.
Federal government accounting standards require the measurement of expenses rather than expenditures.
Unexpended appropriations is the component of net position in a federal agency balance sheet that represents the amount of appropriations still available for obligation, or which has been obligated but not yet expended.
Cumulative results of operations is the component of net position in a federal agency balance sheet that represents the amount of appropriations still available for obligation, or which has been obligated but not yet expended.
The federal budgetary term "commitment" is synonymous with "appropriations" as used in state and local government terminology.
The financial statements of the U.S. government are prepared using generally accepted accounting principles promulgated by the Governmental Accounting Standards Board.
Federal government agencies prepare a management's discussion and analysis (MD&A) to be included in their general purpose federal financial report.
Under SFFAS No. 2, all federal agencies are defined as separate reporting entities for financial statement preparation and reporting purposes.
Objectives that are identified by SFFAS No. 1 for federal financial reporting include budgetary integrity, operating performance, transparency, and stewardship.
Heritage assets are defined as beneficial investments of the federal government in items such as nonfederal physical property, human capital, and research and development.
At the present time, the conceptual framework for the federal government and its agencies does not provide definitions of the basic elements of the financial statements.
Multiple Choice Questions
Which of the following is not a part of the FASAB due process for establishing a federal financial accounting standard?
Public comment on a discussion memorandum.
Issuing an exposure draft.
Unanimous approval by the FASAB.
Support (or lack of opposition) of the standard by the three principals (Comptroller General, Secretary of the Treasury, and Director of the Office of Management and Budget).
FASAB has identified four major user groups of federal financial reports, they are
Congress, executives, program managers, and citizens.
Congress, executives, citizens, and bond rating agencies.
Congress, program managers, foreign governments, and citizens.
Congress, program managers, bond rating agencies, and political parties.
The "net position" of a federal agency may include all of the...
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