Which of the following is a true statement about a government financial reporting entity?
A)if it includes discrete component unit(s)it cannot also include blended component unit(s)
B)if it includes blended component unit(s)it cannot also include discrete component unit(s)
C)it cannot include more discrete component units than blended component units
D)it can include both blended and discrete component units

Question

Quizplus · Accepted Answer

A government financial reporting entity can include both blended and discrete component units. Blended component units are entities that are so closely related to the primary government that their financial information can be included in the primary government's financial statements. Discrete component units, on the other hand, are entities that are legally separate from the primary government but are financially significant enough to require separate reporting. Therefore, a government financial reporting entity can include both types of component units.

Which of the Following Is a True Statement About a Government