Whenever a tax or other significant revenue source is authorized by a legislative body to be used for a specified purpose only,a special revenue fund should be established.

Question

Quizplus · Accepted Answer

When a tax or other revenue source is specified for a particular operating purpose, creating a special revenue fund enhances accountability reporting. Nevertheless, governmental officials have the option of not creating a special revenue fund if one is not required by law or, in their judgment, by sound financial management.

Whenever a Tax or Other Significant Revenue Source Is Authorized