GASB Codification Section 2200.106-107 makes which of the following statements regarding Management's Discussion and Analysis?
A) MD&A is required only for Proprietary Fund Financial Statements.
B) MD&A is required for all state and local government financial statements.
C) MD&A is only required for comprehensive annual financial reports.
D) MD&A for state and local government financial statements must include an analysis of potential, untapped revenue sources.
E) MD&A is an optional inclusion for state and local government financial statements.

Question

Quizplus · Accepted Answer

GASB Codification Section 2200.106-107 states that Management's Discussion and Analysis (MD&A) is required for all state and local government financial statements. This includes financial statements for governmental funds, proprietary funds, and fiduciary funds, as well as the comprehensive annual financial report (CAFR). Therefore, option B is the correct statement. Option A is incorrect because MD&A is required for all financial statements, not just Proprietary Fund Financial Statements. Option C is inaccurate because MD&A is required for all financial statements, including interim financial reports. Option D is also incorrect because there is no specific requirement to analyze potential, untapped revenue sources in MD&A. Finally, option E is not correct because MD&A is mandatory and not optional.