Exam (elaborations)
CGFM Exam 2 - Section 1.
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CGFM Exam 2 - Section 1.
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CGFM Exam 2 - Section 1Taxes -
Resources for gov are derived primarily from
Grants and shared revenues -
Gobs receive revenue from other levels of gov through
Budget -
Primary control device in gov
Financial reporting -
Primary mechanism to demonstrate accountability
Financial reports -
Shows how much was raised, how it was spent, and whether spending followed the
budget
Performance reports -
Inform users how well gov is operating and whether it is achieving goals in
effective/efficient manner
10th Amendment - Reserve Clause -
Establishes two levels of gov - federal and state based on delegation of powers
Interperiod Equity -
Current period taxpayer's are paying current period's services
Accountability -
Cornerstone of financial reporting
Gov accountability -
Based on belief that gov has responsibility to report, public has right to know, and
ultimate power belongs to people
Ballot box, referendum, initiatives -
How people exercise power
Legal accountability -
Need to comply with laws, rules, regulations
Performance accountability -
Ensuring government act in efficient, effective, or economic manner
Fiscal accountability -
Associated with raising of resources and allocation of those resources accomplish
objectives
Operational accountability -
, Associated with stewardship of public resources. Public officials must ensure resources
are used appropriately
Performance measures and performance reporting -
Ways to address operational accountability
Executive branch -
Accountable to legislative branch and the public
Operating in efficient and effective manners, collecting and using revenues -
How is executive branch accountable to public
Using resources in accordance with legislative mandates within fiscal constraints imposed by
legislative branch -
How is executive branch accountable to legislative branch
Legislative branch -
Accountable to public for raising of resources and for determining how those resources
are to be used
Debt ceiling -
Accountability mechanism that allows congress to monitor financial effects of spending
and tax policies
Determine compliance with contractual agreements related to debt issues -
How do investors and creditors use financial reports
Assess accountability and help make social, economic, and political decisions -
How do financial reports assist users
Financial reporting -
Primary communication device for assessing accountability
GASB Concept Statement No 1 -
Contains hierarchy of objectives of financial operations and how the operations focus on
accountability
Accountbaility -
Overall goal listed in GASB Concept Statement No 1
Raising resources and for determining how resources are to be used -
Public officials are responsible for
Enactment of budget -
Primary responsibility of public officials involves
Results of operations -
Financial reporting should provide info about
Point in time reports and period reports -
Two types of financial reports
, Point in time reports -
Provides current info as of date of the report (balance sheet)
Period reports (flow reports) -
Covers entire FY (operating statement, cash flow statement)
General purpose external financial reports (GPEFR) -
Consist primarily of audited financial statements, including notes, RSI, and other info
Basic or principal financial statements -
Another name for audited financial statements
Summary/Popular reports -
Reports that are shorter and contain narrative, pictures, graphs
AGAs Citizen Centric Report -
Example of summary/popular report
Understandability, reliability, relevance, timeliness, consistency, comparability -
Characteristics of financial reports
Expressed as simple as possible, include explanations and interpretations -
Understandability of reports
Should be verifiable, free from bias, and faithfully represent what it purports to represent. Nothing
material omitted. Needs to be comprehensive to be reliable. -
Reliability of reports
Timely and reliable -
Relevance of reports
Reported in time frame that enables users to base decisions on it. Precise detail may be sacrificed -
timely estimate more useful than precise amount -
Timeliness of reports
Once accounting principle is used, it is presumed that future info is reported used same principle. If
change is necessary, nature and reason of change should be disclosed as well as effect of change -
Consistency of reports
Like entities should report same info in same way -
Comparability of reports
Recovery.gov -
Created to allow citizens to monitor progress in awarding funding intended to stimulate
economy and create jobs
Recovery.gov -
Catalyst in expanding access to disaggregated gov financial info
Open Gov Initiative -
Effort by fed gov to create level of openness in gov
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