Please see my attachment.
ACC460 - GOVERNMENT AND NON-PROFIT ACCOUNTING
1. The PCAOB has authority over both public corporations and not-for-profit.
2. Pledges can have either time or purpose imposed restrictions but not both.
3. Fiduciary activities should be reported in fund statements, but should be excluded from the government-wide statements.
4. Per GASB standards, governments do not report general capital assets or depreciation in government funds.
5. When accounting for inventory items in a governmental fund, a reservation of fund balance is always required when the consumption method is used.
6. A government may report some of its funds on a full accrual basis.
7. The main objective of a typical governmtal or not-for-profit entity is to earn a profit.
8. The Governmental Accounting Standards Board establishes generally accepted accounting principles for all state and local government entities, as well as all not-for-profit entities.
9. GASB Statement #33 imposes both time limitations and purpose restrictions.
10. Governments and not-for-profits may never engage in business-type activities.
1. A primary characteristic that distinguishes not-for-profit entities from business entities is
a) The need to generate revenues equal to or in excess of expenditures/expenses
b) The importance of the budget in the governing process
c) The need to provide goods or services
d) The correlation between revenues generated and demand for goods or services
2. The primary standard-setting body for accounting and financial reporting by a state-supported college or university is:
d) All of the above
3. Which if the following objective is considered to be the cornerstone of financial reporting by a governmental entity?
b) Budgetary Compliance
c) Interperiod Equity
d) Service efforts and accomplishments
4. Which of the following funds is a proprietary fund?
a) Internal Service fund
b) Special Revenue fund
c) Capital Project fund
d) Permanent fund
5. The state collects a gasoline tax that must be used to support highway construction and maintenance. The gasoline tax revenue should be accounted for in which of the following funds?
a) General fund
b) Special Revenue fund
c) Debt Service fund
d) Internal Service fund
6. Which of the following statements is not true of the Sarbanes-Oxley Act?
a) The Act prohibits auditors from performing many non-audit services
b) One purpose of the Act is to improve corporate governance
c) Some funding foundations have announced that compliance with the Act will be a factor in the granting of grants to not-for-profit organizations
d) The Act applies directly to governments and not-for-profit organizations
7. A private organization receives a gift of $10,000 that must be used to fund a conference on not-for-profit accounting. When the organization conducts the conference, which of the following accounts should be debited in a temporarily restricted fund?
a) Resources released from restrictions
b) Program expense
c) Deferred revenue
d) Deferred program expense
8. An unfunded actuarial accrued liability can result from several circumstances except for which of the following?
a) Transition losses
b) Actuarial losses
c) Inter-fund transfers
d) Improvements in pension benefits
9. The objective of the Single Audit Act of 1984 is to ensure which of the following?
a) Financial statements are reliable
b) Entities adhere to federal laws and regulations
c) Entities are satisfying the laws, regulations, and provisions
d) All of the above
10. How would a governmental entity recognize a gain or loss from its proprietary funds?
a) A government is prohibited from recognizing any gains or losses
b) Losses are recognized in governmental funds, whereas gains are recognized in the Debt Service Fund
c) A gain or loss from a governmental proprietary fund is reported only on the fund statements
d) A governmental entity would recognize a gain or loss from its proprietary funds in the government-wide statements.
See the attached file.
These were a difficult set of questions, and I encourage you to ...
The problem includes 10 T-F and 10 MCQ all of which are high level questions. The solution includes explanations and references as applicable to explain the responses, but the OTA had questions on 4 of the problems (2 T-F and 2 MCQ). For those four, the OTA included sufficient information to make an informed judgment of the proper response.