Question 1

The GASB Concept Statement on Service Efforts and Accomplishments Reporting encourages state and local governments to include inputs of nonmonetary resources in their financial reporting.

Accepted Answer

Governments have difficulty in meeting the information needs of citizens. Traditional financial statements, which measure events in dollars, are not well designed to evaluate a government's effectiveness in delivering services. Nonfinancial measures are better indicators of performance. GASB's Concept Statements No. 2 and No. 5 address service efforts and accomplishments.

Question 2

FASAB, GASB and FASB standards are set forth primarily in documents called statements.

Accepted Answer

GASB standards are set forth in documents called Statements of Financial Accounting Standards.

Question 3

The GASB does not require supplementary information to be reported with its financial statements even if it is essential to establish appropriate context for the financial statements and notes.

Accepted Answer

Occasionally, the GASB determines that additional information is necessary to provide context and understanding of information in the statements or notes. In such cases, the GASB requires the presentation of required supplementary information RSI.

Question 4

The FASAB was established to recommend accounting and financial reporting standards for the federal government.

Accepted Answer

Accounting and financial reporting standards for the federal government are published by the FASAB. The standards are technically "recommendations" since, as a sovereign nation, the federal government cannot relegate authority to an independent board.

Question 5

The Financial Accounting Standards Board sets financial reporting standards for profit-seeking businesses and nongovernmental, not-for-profit organizations.

Accepted Answer

Accounting and financial reporting standards for profit-seeking businesses and for nongovernmental not-for-profit organizations are set by the FASB.

Question 6

An organization is presumed to be governmental if it has the ability to issue directly debt that is exempt from federal taxes.

Accepted Answer

Organizations are presumed to be governmental if they have the ability to issue directly rather than through a state or municipal authority debt that pays interest exempt from federal income taxes.

Question 7

The Governmental Accounting Standards Board sets financial reporting standards for all units of government: federal, state, and local.

Accepted Answer

The GASB sets standards for state and local governments but not the federal government. GASB also sets standards for governmentally related not-for-profit organizations, health care entities, museums, libraries, and performing arts organization owned or controlled by governments.

Question 8

Governments must have as many funds as necessary to fulfill legal requirements and sound financial administration but must have at a minimum a General Fund.

Accepted Answer

Every government will have a single General Fund but may have multiple funds in each of the other categories.

Question 9

Although certain supplementary information may not be required, if presented, it must follow GASB guidance regarding its format and content.

Accepted Answer

The GASB requires required supplementary information RSI) if such information is necessary to provide context and understanding. Concepts Statement No.3 defines the methods of presenting RSI.

Question 10

The Federal Accounting Standards Advisory Board requires less extensive reports than does the FASB or GASB.

Accepted Answer

FASAB requires more financial statements than are typically required of state and local governments, public and private not-for-profits and investor-owned businesses.

Question 11

A Management's Discussion and Analysis is required for state and local governmental units, and the federal government.

Accepted Answer

The GASB requires MD&A for state and local governments and the FASAB requires MD&A for the federal government.

Question 12

Fund accounting exists primarily to provide assurance that resources are used according to legal or donor restrictions.

Accepted Answer

Fund accounting allows governments to segregate resources that have restrictions or limitations on the use of those resources. Each fund can account for the receipt and use of resources to provide assurance of compliance with legal restrictions or limitations.

Question 13

The GASB Concept Statement on Service Efforts and Accomplishments Reporting requires state and local governments to include inputs of nonmonetary resources in their financial reporting.

Accepted Answer

Occasionally the GASB determines that additional information is necessary to provide context and understanding of information in the statements or notes. In such cases, the GASB requires the presentation of required supplementary information RSI

Question 14

The only objective of the Governmental Accounting Standards Board is to help users determine compliance with finance-related laws, rules, and regulations.

Accepted Answer

The GASB has multiple objectives and has issued six concept statements to assist in meeting these objectives which addresses the needs of users of government: accounting information, service efforts and accomplishments, presentation of financial information, required supplementary information and disclosures, definitions and asset measurement.

Question 15

The Financial Accounting Standards Board and the Governmental Accounting Standards Board are parallel bodies under the oversight of the Financial Accounting Foundation.

Accepted Answer

The GASB and FASB are parallel bodies under the oversight of the Financial Accounting Foundation FAF. The FAF appoints members of the two boards and provides financial support to the boards.

Question 16

FASAB, GASB and FASB standards are set forth primarily in documents called concept statements.

Accepted Answer

Standards are set forth in documents called "Statements", not concept statements.

Question 17

The Financial Accounting Standards Board sets financial reporting standards for private not-for-profits and investor-owned businesses.

Accepted Answer

Accounting and financial reporting standards for profit-seeking businesses and for nongovernmental not-for-profit organizations are set by the FASB.

Question 18

The format and content of supplementary information which is not required by GASB is up to the discretion of the reporting entity

Accepted Answer

GASB Concepts Statement #3 defines methods of presenting information in financial reports including supplementary information that is not required by GASB.

Question 19

The FASAB requires more financial statements than are typically required of state and local governments.

Accepted Answer

The Federal Accounting Standards Advisory Board requires a greater number of financial statements than does the FASB or GASB

Question 20

GASB and FASB Concept Statements establish accounting standards that must be complied with to receive an unqualified audit opinion.

Accepted Answer

Concept statements do not establish accounting standards but primarily serve to guide standard setting bodies. Governments must comply with GAAP as established by Statements to receive unqualified audit opinions.

Quiz 1: Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

The GASB Concept Statement on Service Efforts and Accomplishments Reporting encourages state and local governments to include inputs of nonmonetary resources in their financial reporting.

FASAB, GASB and FASB standards are set forth primarily in documents called statements.

The GASB does not require supplementary information to be reported with its financial statements even if it is essential to establish appropriate context for the financial statements and notes.

The FASAB was established to recommend accounting and financial reporting standards for the federal government.

The Financial Accounting Standards Board sets financial reporting standards for profit-seeking businesses and nongovernmental, not-for-profit organizations.

An organization is presumed to be governmental if it has the ability to issue directly debt that is exempt from federal taxes.

The Governmental Accounting Standards Board sets financial reporting standards for all units of government: federal, state, and local.

Governments must have as many funds as necessary to fulfill legal requirements and sound financial administration but must have at a minimum a General Fund.

Although certain supplementary information may not be required, if presented, it must follow GASB guidance regarding its format and content.

The Federal Accounting Standards Advisory Board requires less extensive reports than does the FASB or GASB.

A Management's Discussion and Analysis is required for state and local governmental units, and the federal government.

Fund accounting exists primarily to provide assurance that resources are used according to legal or donor restrictions.

The GASB Concept Statement on Service Efforts and Accomplishments Reporting requires state and local governments to include inputs of nonmonetary resources in their financial reporting.

The only objective of the Governmental Accounting Standards Board is to help users determine compliance with finance-related laws, rules, and regulations.

The Financial Accounting Standards Board and the Governmental Accounting Standards Board are parallel bodies under the oversight of the Financial Accounting Foundation.

FASAB, GASB and FASB standards are set forth primarily in documents called concept statements.

The Financial Accounting Standards Board sets financial reporting standards for private not-for-profits and investor-owned businesses.

The format and content of supplementary information which is not required by GASB is up to the discretion of the reporting entity

The FASAB requires more financial statements than are typically required of state and local governments.

GASB and FASB Concept Statements establish accounting standards that must be complied with to receive an unqualified audit opinion.