Chapter 2 - Test Bank2 graded A+ study guide

1. A Comprehensive Annual Financial Report (CAFR) would include an introductory section, management's discussion and analysis, basic financial statements, required supplementary information other than MD&A, combining a ...

1. A Comprehensive Annual Financial Report (CAFR) would include an introductory section, management's discussion and analysis, basic financial statements, required supplementary information other than MD&A, combining and individual fund statements, narrative explanations, and statistical section. True False 2.The three major sections of a CAFR are the Introductory, Financial, and statistical sections. True False 3.The introductory and statistical sections of a CAFR are not audited. True False 4. State and local governments are required to prepare a CAFR. True False 5. Combining statements are required whenever a non-major column is used in one of the fund financial statements. True False 6.A complete CAFR includes combining financial statements to reflect major funds. True False 7. In addition to the government-wide statements, governments are required to prepare fund financial statements for governmental funds only. True False 8. In addition to the government-wide statements, governments are required to prepare fund financial statements for governmental, proprietary and fiduciary funds. True False 9. The General Fund is always considered to be a major fund when preparing fund basis financial statements. True False 10. With respect to fund basis financial statements, governmental funds are considered to be a major fund when total assets, liabilities, revenues and expenditures combined are at least 10% of the total for the governmental funds category. True False 11. With respect to fund basis financial statements, a government may only designate a fund to be a major fund if it meets the size thresholds established by GASB. True False 12. With respect to fund basis financial statements, a government may designate any fund to be a major fund if reporting that fund separately would be useful. True False 13. When preparing fund basis financial statements, any funds not reported separately are aggregated and reported in a single column under the label non-major funds. True False 14. When preparing fund basis financial statements, any funds not reported separately are reported individually by function. Essentials of Accounting for Governmental and Not-for-Profit Organizations Copley 11th Edition Test Bank 15. Fiduciary fund statements are prepared using the current financial resources measurement focus and modified accrual basis of accounting. True False 16. Governmental fund statements are prepared using the current financial resources measurement focus and modified accrual basis of accounting. True False 17. According to GASB, a primary government can only be a state or a general-purpose local government, such as a city or county. True False 18. Blending of financial information is done only when component units and the primary government are so intertwined that they are essentially the same. True False 19. The statistical section of the CAFR contains the combining schedules of non-major funds. True False 20. The government-wide financial statements present the government as a whole, including component units and excluding fiduciary activities. True False 21. The basic financial statements of a state or local governmental unit include the MD&A, governmentwide statements, fund statements, and the notes. True False 22. Governmental fund financial statements include the Balance Sheet and the Statement of Revenues, Expenditures, and Changes in Fund Balances. True False 23. Governmental fund financial statements include a Statement of Cash Flows. True False 24. Governmental fund financial statements include columns for the General Fund and all other "major" governmental funds. True False 25. The total fund balances reported in the total column of the fund basis statements must be reconciled to the total Net Assets (or Net Position) presented in the governmental activities column of the governmentwide Statement of Net Assets (or Net Position) True False 26. Entities which are determined to be component units of state and local governmental units must be discretely presented in the financial statements. True False 27. The government-wide financial statements are prepared using the economic resources measurement focus and accrual basis of accounting. True False 28. The government-wide financial statements include a Statement of Cash Flows. True False 29. Prior-year data is required for government-wide financial statements. True False 30. The governmental fund statements are prepared using the current financial resources measurement focus and modified accrual basis of accounting. True False Essentials of Accounting for Governmental and Not-for-Profit Organizations Copley 11th Edition Test Bank 31. The fiduciary fund financial statements are prepared using the current financial resources measurement focus and modified accrual basis of accounting. True False 32. The General Fund is always a major fund for purposes of financial reporting. True False 33. Notes to the financial statements must distinguish between the primary government and discretely presented component units. True False 34. Special-purpose governments engaged in business type activities only are required to prepare both proprietary fund and government-wide financial statements. True False 35. The Government-wide financial statements include separate columns for discretely presented component units. True False 36. Governmental accounting standards do not require the statistical section. True False 37. The Government-wide financial statements include a separate column for fiduciary fund information. True False 38. Management's Discussion and Analysis (MD&A) in The Comprehensive Annual Financial Report (CAFR) is part of the Introductory Section True False 39. Government-wide statements are to be prepared using the economic resources measurement focus and accrual basis of accounting. True False 40. Government-wide statements are to be prepared using the current financial resources measurement focus and modified accrual basis of accounting. True False 41. Prior-year data may be presented but are not required on government-wide statements True False 42. Prior-year data are required to be presented on government-wide statements True False 43. Fiduciary funds are required to prepare a Statement of Cash Flows using the direct method. True False 44. Government-wide financial statements use the economic resources measurement focus and the accrual basis of accounting. True False 45. A Comprehensive Annual Financial Report for a state or local governmental unit should contain an introductory section, a financial section, and a statistical section True False 46. A government may designate any fund to be a major fund if reporting the fund separately would be useful. True False Essentials of Accounting for Governmental and Not-for-Profit Organizations Copley 11th Edition Test Bank 47. The Comprehensive Annual Financial Report (CAFR) contains four major sections: introductory, financial, supplementary, and statistical.