ACCY 161 Exam 3 (2009_2007).txt

    • An audit of a government, conducted in accordance with generally accepted governmental auditing standards (GAGAS), includes:
    • a. A determination of efficiency and effectiveness
    • b. An examination of financial statements guided by standards set by the AICPA
    • c. Test for compliance with laws and regulations
    • d. Both b and c
    • e. All of the above

    d. Both b and c
  2. The single audit concept refers to:

    C. Audits following the OMB Circular A-133
  3. A typical objective of a performance audit is for the auditor to:

    A. Make recommendations for improving performance
  4. In single audit, the federal government's representative is the:

    D. Cognizant agency
  5. The Comptroller General of the United States is the head of the:

    C. Governmental Accountability Office
  6. The first step in the flow of budgetary authority through the budgetary accounts of a federal agency is:

    D. appropriation
  7. Federal capital heritage assets possess _________ qualities:

    D. a and b
  8. Which of thee following systems of cost allocate is most common in governmental accounting?

    C. Step-down method
  9. Responsibility for promulgating generally accepted accounting principles for nongovernmental, not-for-profit entities rests with the:

    D. FASB
  10. Statement of Financial Accounting Standards (SFAS) No. 117 requires the following financial reporting perspective for not-for-profit organizations:

    C. Aggregate
  11. A good reason for a not-for-profit organization to adopt fund accounting is that:

    C. Restrictions have been placed on the use of certain of its assets by donors
  12. Charity service and bad debts in a public hospital that follows business-type accounting are reported:

    D. Differently, charity service is merely disclosed in the notes to the financial statements, and bad debts are reported as a deduction from revenue
  13. Fixed dollar amount of fees per person paid periodically by a third-party payor to a health care provider:

    D. Capitation fee
  14. A case-mix classification scheme in the Medicare program to determine reimbursement for inpatient services:

    C. DRG fee
  15. The federal retirement plan (the pension plan):

    D. Is unfunded
  16. The Nonprofit Integrity Act of 2004 has a requirement(s) for:

    E. a and b and c
  17. The cornerstone of accounting and financial reporting for not-for-profit organizations is:

    C. Visibility
  18. The public generally has access to the following records of a tax-exempt not-for-profit organization:

    B. a and b and c
  19. The value of the books in a college library is:

    D. Both a and b are correct
  20. For colleges and universities, the expense categories, to be in compliance with accounting reporting standards, include:

    D. a and b
  21. The state agency that monitors not-for-profit organizations is the:

    D. Registry of Charitable Trusts
  22. GAGAS is ______ in scope than GAAS:

    C. Broader
  23. If a tax-exempt not-for-profit organization dissolves and goes out of business, it:

    D. Must distribute the net assets to similar organizations in its geographic area
  24. Oversight of the tax-exempt organizations (NPOs) is done primarily by:

    D. State attorney generals
  25. SFAS 117 requires a(an) ___________ of the nonprofit entity's finances:

    B. Aggregate view
  26. A budget in which each activity and the amounts of resources requested for each activity must be justified each year:

    A. Zero-based budget
  27. The use of net assets by not-for-profit organizations is stipulated in:

    D. SFAS 117
  28. Revenue for a hospital is reported as:

    B. Net revenue
  29. The board of directors of a not-for-profit entity are elected by:

    D. The members
  30. Contractual allowances include:

    A. a and b
  31. For the IRS, tax-exempt organizations need to pass:

    D. Both a and b
  32. Net assets for a not-for-profit include classification of:

    D. both b and c
  33. Fair value accounting for investment in not-for-profits is stipulated by:

    C. SFAS 124
  34. Service capacity includes:

    A. a and b only
  35. The ________ performs the performance audits for the City and County of San Francisco:

    C. City Services Auditor
  36. GAGAS is found in:

    D. The yellow book
  37. The single audit is administered by:

    D. The OMB
  38. The total package for the single audit includes:

    D. Financial audit, internal controls audit, program specific audit
  39. Which of the following best describes the relationship between generally accepted auditing standards (GAAS) and government auditing standards (GAS)?

    B. Audits conducted in conformity with the yellow book may also require the auditor to conform to GAAS
  40. Which of the following accounts used in state and local government accounting is most like the federal budgetary account "Undelivered Orders"?

    B. Encumbrance
  41. The Comptroller General of the United States is the head of the:

    A. Government Accountability Office
  42. Which of the following describes the usual flow of budgetary authority through the budgetary accounts of a federal agency?

    D. Appropriation, apportionment, allotment, commitment, obligation, expended appropriation
  43. Depreciation expense in a not-for-profit organization should be:

    C. Allocated to the functions to which it relates
  44. A good reason for an NPO to adopt fund accounting even though FASB standards do not require it is that:

    C. Restrictions have been placed on the use of certain of its assets by donors
  45. Accounting standards for NPOs require:

    B. Full accrual accounting
  46. The purpose of a statement of functional expenses is to:

    B. Report on program expenses and supporting expenses
  47. Which of the following is a reason why an NPO might fail to qualify for tax-exempt status?

    B. Its officers are paid excessive wages
  48. A good measure of whether the NPO is spending too much on overhead, such as general and administrative expenses, is:

    C. Percentage of total expenses spent on the program function as opposed to supporting the programs
  49. Federal capital assets that possess educational, cultural, or natural characteristics are:

    C. Heritage assets
  50. Federal departments have their financial audits performed by:

    A. Public accounting firms
  51. An internal control structure that is so weak that it does not reduce the risk of material noncompliance to an acceptably low level
    is called a(an): 

    B. Material weakness and reportable condition
  52. An auditor would not render an opinion on a(an): 

    B. Performance audit
  53. The GASB "Budgeting Principle" states that an annual budget should be adopted by (for) every:

    B. Government
  54. Which of the following might appropriately be termed an outcome indicator for a police department that reports service efforts and accomplishments (SEA) indicators? 

    A. Value of property lost due to crime
  55. A cost that can be identified specifically with a particular cost objective is termed a(an): 

    D. Direct cost
  56. A budget that is derived form the current year budget by multiplying a factor across all line-items:

    D. Incremental budgeting
  57. A budgeting approach popular in the 1960s that integrates various elements of the activity:

    C. Program budgeting
  58. Statement of Financial Accounting Standards (SFAS) No. 116 on contributions received and contributions made describes measurement and reporting rules for: 

    B. Nonexchange transactions, such as unrestricted and restricted gifts
  59. Which of the following is a not a true statement about tax-exempt organizations? 

    D. They must be organized to serve the charitable needs of the public at large
  60. The income most likely to be considered unrelated business income of a human service organization that provides immunizations to
    children in the community is: 

    A. Rental of extra space in the building
  61. The incorporating documents that have an external focus and describe the purpose of
    the organization without being too restrictive are called: 

    C. Articles of incorporation
  62. A single audit would be done by:

    B. b and c
  63. Which of the following statements is true regarding generally accepted accounting principles (GAAP) for colleges and universities? 

    D. The FASB has set standards for private colleges and universities
  64. Are public and private colleges and universities required to report depreciation expense in their financial statements?

    D. Public: Yes; Private: Yes
  65. Which of the following is a typical classification of a functional expense in a college or university? 

    B. Academic support
  66. Contractual adjustments are properly characterized as:

    C. A deduction from revenues
  67. The difference between the gross patient service revenue and the negotiated payment by third-party payors in arriving at net patient service revenue is:

    C. Contractual discount
  68. The tax exempt status for a not-for-profit organization means that:

    E. b and c are correct
  69. The majority of the federal taxes comes from:

    A. Individual taxes
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ACCY 161 Exam 3 (2009_2007).txt
ACCY 161 Exam 3 (2009_2007).txt