Question 1

A revenues to expenditures ratio of over 0.90 is considered acceptable.

Accepted Answer

A) True 
 B)False  False

Question 2

Which of the following is not a typical reason for evaluating a government's financial condition?

Accepted Answer

A)  Help identify and prevent financial crises from developing. 
B)  Hold management accountable for complying with laws and regulations. 
C)  Determine if the government can continue to offer the needed level of services. 
D)  Determine whether residents will receive dividends. 
A)  Help identify and prevent financial crises from developing. 
B)  Hold management accountable for complying with laws and regulations. 
C)  Determine if the government can continue to offer the needed level of services. 
D)  Determine whether residents will receive dividends. D

Question 3

Service-level solvency is the government's ability to meet its current budget by expending no more resources than were appropriated.

Accepted Answer

A) True 
 B)False  False

Question 4

Environmental factors facing a government have little impact on a city's fiscal policy.

Accepted Answer

A) True 
 B)False

Question 5

Identify the following factors that affect financial condition as environmental factors (E) or financial factors (F).
 $$\begin{array} { | l | l | l } 
\hline &  { \text { Factor } } & \text { E or } \mathrm { F } \
\hline 1 . & \text { Community needs and resources } & \
\hline 2 . & \text { Disaster risk } & \
\hline \text { 3. } & \text { Revenues } & \
\hline 4 . & \text { Intergovernmental constraints } & \
\hline 5 . & \text { External economic conditions } & \
\hline 6 . & \text { Expenditures } & \
\hline 7 . & \text { Debt structure } & \
\hline 8 . & \text { Political culture } & \
\hline 9 . & \text { Unfunded liabilities } & \
\hline 10 . & \text { Condition of capital plant } & \
\hline 11 . & \text { Operating position } & \
\hline
\end{array}$$

Accepted Answer

1. E
 2. E
3. F
4. E

Question 6

A recognizable signal of fiscal stress is:

Accepted Answer

A)  Total revenues from own sources increasing as a percent of total revenues for all sources. 
B)  Increasing population. 
C)  Declining property values. 
D)  A decreasing ratio of total operating expenditures to population. 
A)  Total revenues from own sources increasing as a percent of total revenues for all sources. 
B)  Increasing population. 
C)  Declining property values. 
D)  A decreasing ratio of total operating expenditures to population.

Question 7

Political culture, one of the environmental factors affecting financial condition, includes such factors as form of government and the entity's economic, political, and social history.

Accepted Answer

A) True 
 B)False

Question 8

A tax watchdog group is an example of an intermediary that represents citizen interests.

Accepted Answer

A) True 
 B)False

Question 9

Distinguish and describe key financial performance concepts, such as financial position, financial condition, and economic condition.

Accepted Answer

Financial position represents a focus on

Question 10

Internal managers and credit analysts evaluate financial condition of a government in the same way.

Accepted Answer

A) True 
 B)False

Question 11

Discuss how despite significant improvements in the quality of government financial reporting over the years there are still serious, high profile public sector financial crises. How does the quality of financial reporting affect the ability to evaluate financial condition?

Accepted Answer

Government financial reporting has impro

Question 12

Failure to achieve interperiod equity may negatively impact a government's financial condition.

Accepted Answer

A) True 
 B)False

Question 13

"Benchmarking is a simple method for comparing one government to another." Do you agree or disagree with this statement? Explain.

Accepted Answer

Disagree. Benchmarking is not simple, bu

Question 14

Which of the following ratios would be considered favorable if it was low?

Accepted Answer

A)  Total revenues to population. 
B)  Debt service to total revenues. 
C)  Capital outlay from operating funds to operating expenditures. 
D)  Cash and short-term investments to current liabilities. 
A)  Total revenues to population. 
B)  Debt service to total revenues. 
C)  Capital outlay from operating funds to operating expenditures. 
D)  Cash and short-term investments to current liabilities.

Question 15

For which of the following is a low or decreasing value of the item associated with a stronger financial condition of a government entity?

Accepted Answer

A)  Unfunded pension liability. 
B)  Property values. 
C)  Home ownership. 
D)  Employment rate. 
A)  Unfunded pension liability. 
B)  Property values. 
C)  Home ownership. 
D)  Employment rate.

Question 16

Which of the following financial capability indicators is a measure of a government's capacity to issue bonded debt?

Accepted Answer

A)  Revenue dispersion. 
B)  Property taxes per capita. 
C)  Bonded debt per capita. 
D)  Available legal debt limit. 
A)  Revenue dispersion. 
B)  Property taxes per capita. 
C)  Bonded debt per capita. 
D)  Available legal debt limit.

Question 17

Describe how financial performance is related to the operating performance of a government entity.

Accepted Answer

Good financial performance, measured by

Question 18

The financial condition of a government is easily determined by calculating a set of financial ratios.

Accepted Answer

A) True 
 B)False

Question 19

Explain the importance of evaluating government financial performance.

Accepted Answer

It is important for taxpayers, creditors

Question 20

FitchRatings, Thomson Municipal Market, Standard & Poor's, and Kroll Bond Rating Agency are the four major agencies that provide credit ratings for state and local government debt.

Accepted Answer

A) True 
 B)False

A revenues to expenditures ratio of over 0.90 is considered acceptable.

Which of the following is not a typical reason for evaluating a government's financial condition?

Service-level solvency is the government's ability to meet its current budget by expending no more resources than were appropriated.

Environmental factors facing a government have little impact on a city's fiscal policy.

A recognizable signal of fiscal stress is:

Political culture, one of the environmental factors affecting financial condition, includes such factors as form of government and the entity's economic, political, and social history.

A tax watchdog group is an example of an intermediary that represents citizen interests.

Distinguish and describe key financial performance concepts, such as financial position, financial condition, and economic condition.

Internal managers and credit analysts evaluate financial condition of a government in the same way.

Discuss how despite significant improvements in the quality of government financial reporting over the years there are still serious, high profile public sector financial crises. How does the quality of financial reporting affect the ability to evaluate financial condition?

Failure to achieve interperiod equity may negatively impact a government's financial condition.

"Benchmarking is a simple method for comparing one government to another." Do you agree or disagree with this statement? Explain.

Which of the following ratios would be considered favorable if it was low?

For which of the following is a low or decreasing value of the item associated with a stronger financial condition of a government entity?

Which of the following financial capability indicators is a measure of a government's capacity to issue bonded debt?

Describe how financial performance is related to the operating performance of a government entity.

The financial condition of a government is easily determined by calculating a set of financial ratios.

Explain the importance of evaluating government financial performance.

FitchRatings, Thomson Municipal Market, Standard & Poor's, and Kroll Bond Rating Agency are the four major agencies that provide credit ratings for state and local government debt.

Introduction to Accounting and Financial Reporting for Government and Not-for-Profit Entities

Principles of Accounting and Financial Reporting for State and Local Governments

Governmental Operating Statement Accounts; Budgetary Accounting

Accounting for Governmental Operating Activities–Illustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for the Business-type Activities of State and Local Governments

Accounting for Fiduciary Activities—Custodial and Trust Funds

Financial Reporting of State and Local Governments

Auditing of Government and Not-for-Profit Organizations

Budgeting and Performance Measurement

Not-for-Profit Organizations—Regulatory, Taxation, and Performance Issues

Accounting for Not-for-Profit Organizations

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government

Filters

Exam 10: Analysis of Government Financial Performance

A revenues to expenditures ratio of over 0.90 is considered acceptable.

Which of the following is not a typical reason for evaluating a government's financial condition?

Service-level solvency is the government's ability to meet its current budget by expending no more resources than were appropriated.

Environmental factors facing a government have little impact on a city's fiscal policy.

A recognizable signal of fiscal stress is:

Political culture, one of the environmental factors affecting financial condition, includes such factors as form of government and the entity's economic, political, and social history.

A tax watchdog group is an example of an intermediary that represents citizen interests.

Distinguish and describe key financial performance concepts, such as financial position, financial condition, and economic condition.

Internal managers and credit analysts evaluate financial condition of a government in the same way.

Discuss how despite significant improvements in the quality of government financial reporting over the years there are still serious, high profile public sector financial crises. How does the quality of financial reporting affect the ability to evaluate financial condition?

Failure to achieve interperiod equity may negatively impact a government's financial condition.

"Benchmarking is a simple method for comparing one government to another." Do you agree or disagree with this statement? Explain.

Which of the following ratios would be considered favorable if it was low?

For which of the following is a low or decreasing value of the item associated with a stronger financial condition of a government entity?

Which of the following financial capability indicators is a measure of a government's capacity to issue bonded debt?

Describe how financial performance is related to the operating performance of a government entity.

The financial condition of a government is easily determined by calculating a set of financial ratios.

Explain the importance of evaluating government financial performance.

FitchRatings, Thomson Municipal Market, Standard & Poor's, and Kroll Bond Rating Agency are the four major agencies that provide credit ratings for state and local government debt.

Introduction to Accounting and Financial Reporting for Government and Not-for-Profit Entities

Principles of Accounting and Financial Reporting for State and Local Governments

Governmental Operating Statement Accounts; Budgetary Accounting

Accounting for Governmental Operating Activities–Illustrative Transactions and Financial Statements

Accounting for General Capital Assets and Capital Projects

Accounting for General Long-Term Liabilities and Debt Service

Accounting for the Business-type Activities of State and Local Governments

Accounting for Fiduciary Activities—Custodial and Trust Funds

Financial Reporting of State and Local Governments

Auditing of Government and Not-for-Profit Organizations

Budgeting and Performance Measurement

Not-for-Profit Organizations—Regulatory, Taxation, and Performance Issues

Accounting for Not-for-Profit Organizations

Accounting for Colleges and Universities

Accounting for Health Care Organizations

Accounting and Reporting for the Federal Government

Filters