Examine the CAFR Download a copy of the most recent comprehensive annual financial report (CAFR) for the City and County of Denver from its Web site http www denvergov org controller (click on Financial Reports ), or that of another city or county if you wish Familiarize yourself with the organization by scanning the report and reread the section in this chapter entitled Financial Reporting of State and Local Governments Be prepared to discuss in class the items suggested below a Introductory Section Read the letter of transmittal or any narrative that accompanies the financial statements Does this material define the governmental reporting entity and name the primary government and all related component units included in the report (Note The reporting entity may be discussed in the notes to the financial statements rather than in the transmittal letter ) Does the introductory section discuss the financial condition of the reporting entity at the balance sheet date Does it discuss the most significant changes in financial condition that occurred during the year Does it alert the reader to forthcoming changes in financial condition that are not as yet reflected in the financial statements Do the amounts reported in the letter of transmittal or other narrative agree with amounts in the statements and schedules in the financial section Does the introductory section include a list of principal officials An organization chart A reproduction of a Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association (GFOA) Assuming the government follows GASBS 34, compare the information in the letter of transmittal with that in the management discussion analysis (MD A) b Financial Section (1) Audit Report Are the financial statements in the report audited by an independent CPA, state auditors, or auditors employed by the government being audited Does the auditor indicate who is responsible for preparing the financial statements Does the auditor express an opinion that the statements are in accordance with generally accepted accounting principles applicable to governmental entities in the United States or some other phrase Is the opinion qualified in some manner, disclaimed, or adverse Does the auditor indicate that the opinion covers the basic financial statements or that plus combining statements (2) Basic Financial Statements Does the CAFR contain the two government wide financial statements and seven fund statements and required reconciliation (3) Notes to the Financial Statements How many notes follow the required basic financial statements Is there a phrase at the bottom of the basic financial statements indicating that the notes are an integral part of the financial statements (4) Individual Fund and Combining Statements Following the notes to the financial statements, does the CAFR provide combining and individual fund statements Do these combining statements aggregate all the funds of a given fund type or all the nonmajor funds (5) Management s Discussion and Analysis (MD A) Does the CAFR contain an MD A If so, where is it located and what type of information does it contain c Statistical Tables Examine these tables so that you can refer to them in discussions accompanying subsequent chapters For example, is multiyear information provided about financial trends, revenue capacity, debt capacity, demographic and economic trends, and operating activities 1 2 Multiple Choice Choose the best answer 1 Special purpose governments differ from general purpose governments in that special purpose governments a Provide a single function or limited range of functions b Do not have the power to levy taxes c Derive their power from state governments d All of the above 2 Which of the following is a true statement about accounting standard setting bodies a The Financial Accounting Standards Board (FASB) sets accounting and reporting standards for all not for profit organizations, but the Governmental Accounting Standards Board (GASB) may also prescribe standards for governmental not for profit organizations provided they do not conflict with FASB standards b The GASB sets accounting and reporting standards for all governmental organizations the FASB sets standards for all business and not for profit organizations c Only the FASB and GASB enjoy AICPA Ethics Rule 203 coverage as recognized standard setting authoritative bodies, not the FASAB d The FASB and GASB are administratively supported by the Financial Accounting Foundation the FASAB draws its support from the federal government 3 A distinguishing difference between governments and not for profit organizations is a Lack of a profit motive b Absence of owners c Taxation as a significant source of funding d Receipt of significant amounts of funding through nonexchange transactions (i e , resource providers do not get proportional benefits for what they pay to the organization) 4 Which of the following organizations would most likely meet the criteria to be classified as a governmental not for profit organization a A religion affiliated university b A privately founded museum c A public school district d A city administered community service agency 5 The concept of interperiod equity refers to whether a Revenues equaled or exceeded expenditures for the year b Current year revenues were sufficient to pay for current year services c Total assets (current and noncurrent) were sufficient to cover total liabilities (current and noncurrent) d Future taxpayers can expect to receive the same or higher level of services as current taxpayers 6 Which of the following is (are) included in the minimum requirements for general purpose external financial reporting of a government a Comprehensive Annual Financial Report b Management s Discussion and Analysis (MD A) and basic financial statements c Combining fund financial statements d Statistical section 7 The basic financial statements of a state or local government include all of the following except a An MD A b Government wide financial statements c Fund financial statements d Notes to the financial statements 8 The modified accrual basis of accounting is used to account for revenues and expenditures reported in the financial statements of a Governmental activities at the government wide level b Business type activities at the government wide level c Governmental funds d Proprietary funds 9 Separate columns for individual major funds should be provided in which of the following financial statements a Statement of net assets government wide balance sheet governmental funds statement of net assets proprietary funds b Statement of net assets government wide balance sheet governmental funds statement of fiduciary net assets fiduciary funds c Statement of net assets government wide statement of net assets proprietary funds statement of fiduciary net assets fiduciary funds d Balance sheet governmental funds statement of net assets proprietary funds 10 Under GASBS 34, financial information related to fiduciary activities is reported in which financial statements Government wide Financial Statements Fund Financial Statements No Yes Yes No Yes Yes No No 1 3 Matching Place the abbreviations corresponding to the appropriate reporting attribute(s) in the spaces provided for each financial statement Include all that apply Activities or Funds Governmental activities GA Business type activities BTA Governmental funds GF Proprietary funds PF Fiduciary funds FF Basis of Accounting Accrual A M odified accrual MA Measurement Focus Economic resources ER Current financial resources CFR 1 Examine the CAFR Download a copy of the most recent comprehensive annual financial report (CAFR) for the City and County of Denver from its Web site http www denvergov org controller (click on Financial Reports ), or that of another city or county if you wish Familiarize yourself with the organization by scanning the report and reread the section in this chapter entitled Financial Reporting of State and Local Governments Be prepared to discuss in class the items suggested below a Introductory Section Read the letter of transmittal or any narrative that accompanies the financial statements Does this material define the governmental reporting entity and name the primary government and all related component units included in the report (Note The reporting entity may be discussed in the notes to the financial statements rather than in the transmittal letter ) Does the introductory section discuss the financial condition of the reporting entity at the balance sheet date Does it discuss the most significant changes in financial condition that occurred during the year Does it alert the reader to forthcoming changes in financial condition that are not as yet reflected in the financial statements Do the amounts reported in the letter of transmittal or other narrative agree with amounts in the statements and schedules in the financial section Does the introductory section include a list of principal officials An organization chart A reproduction of a Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association (GFOA) Assuming the government follows GASBS 34, compare the information in the letter of transmittal with that in the management discussion analysis (MD A) b Financial Section (1) Audit Report Are the financial statements in the report audited by an independent CPA, state auditors, or auditors employed by the government being audited Does the auditor indicate who is responsible for preparing the financial statements Does the auditor express an opinion that the statements are in accordance with generally accepted accounting principles applicable to governmental entities in the United States or some other phrase Is the opinion qualified in some manner, disclaimed, or adverse Does the auditor indicate that the opinion covers the basic financial statements or that plus combining statements (2) Basic Financial Statements Does the CAFR contain the two government wide financial statements and seven fund statements and required reconciliation (3) Notes to the Financial Statements How many notes follow the required basic financial statements Is there a phrase at the bottom of the basic financial statements indicating that the notes are an integral part of the financial statements (4) Individual Fund and Combining Statements Following the notes to the financial statements, does the CAFR provide combining and individual fund statements Do these combining statements aggregate all the funds of a given fund type or all the nonmajor funds (5) Management's Discussion and Analysis (MD A) Does the CAFR contain an MD A If so, where is it located and what type of information does it contain c Statistical Tables Examine these tables so that you can refer to them in discussions accompanying subsequent chapters For example, is multiyear information provided about financial trends, revenue capacity, debt capacity, demographic and economic trends, and operating activities 1 2 Multiple Choice Choose the best answer 1 Special purpose governments differ from general purpose governments in that special purpose governments a Provide a single function or limited range of functions b Do not have the power to levy taxes c Derive their power from state governments d All of the above 2 Which of the following is a true statement about accounting standard setting bodies a The Financial Accounting Standards Board (FASB) sets accounting and reporting standards for all notfor profit organizations, but the Governmental Accounting Standards Board (GASB) may also prescribe standards for governmental not for profit organizations provided they do not conflict with FASB standards b The GASB sets accounting and reporting standards for all governmental organizations the FASB sets standards for all business and not for profit organizations c Only the FASB and GASB enjoy AICPA Ethics Rule 203 coverage as recognized standard setting authoritative bodies, not the FASAB d The FASB and GASB are administratively supported by the Financial Accounting Foundation the FASAB draws its support from the federal government 3 A distinguishing difference between governments and not for profit organizations is a Lack of a profit motive b Absence of owners c Taxation as a significant source of funding d Receipt of significant amounts of funding through nonexchange transactions (i e , resource providers do not get proportional benefits for what they pay to the organization) 4 Which of the following organizations would most likely meet the criteria to be classified as a governmental not for profit organization a A religion affiliated university b A privately founded museum c A public school district d A city administered community service agency 5 The concept of interperiod equity refers to whether a Revenues equaled or exceeded expenditures for the year b Current year revenues were sufficient to pay for current year services c Total assets (current and noncurrent) were sufficient to cover total liabilities (current and noncurrent) d Future taxpayers can expect to receive the same or higher level of services as current taxpayers 6 Which of the following is (are) included in the minimum requirements for general purpose external financial reporting of a government a Comprehensive Annual Financial Report b Management's Discussion and Analysis (MD A) and basic financial statements c Combining fund financial statements d Statistical section 7 The basic financial statements of a state or local government include all of the following except a An MD A b Government wide financial statements c Fund financial statements d Notes to the financial statements 8 The modified accrual basis of accounting is used to account for revenues and expenditures reported in the financial statements of a Governmental activities at the government wide level b Business type activities at the government wide level c Governmental funds d Proprietary funds 9 Separate columns for individual major funds should be provided in which of the following financial statements a Statement of net assetsgovernment wide balance sheetgovernmental funds statement of net assetsproprietary funds b Statement of net assetsgovernment wide balance sheetgovernmental funds statement of fiduciary net assetsfiduciary funds c Statement of net assetsgovernment wide statement of net assetsproprietary funds statement of fiduciary net assetsfiduciary funds d Balance sheetgovernmental funds statement of net assetsproprietary funds 10 Under GASBS 34, financial information related to fiduciary activities is reported in which financial statements Government wide Financial Statements Fund Financial Statements No Yes Yes No Yes Yes No No 1 3 Matching Place the abbreviations corresponding to the appropriate reporting attribute(s) in the spaces provided for each financial statement Include all that apply Activities or Funds Governmental activitiesGA Business type activitiesBTA Governmental fundsGF Proprietary fundsPF Fiduciary fundsFF Basis of Accounting AccrualA M odified accrualMA Measurement Focus Economic resourcesER Current financial resourcesCFR 1

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Examine the CAFR. Download a copy of the most recent comprehensive annual financial report (CAFR) for the City and County of Denver from its Web

b. Financial Section. (1) Audit Report. Are the financial statements in the report audited by an independent CPA, state auditors, or auditors employed by the government being audited? Does the auditor indicate who is responsible for preparing the financial statements? Does the auditor express an opinion that the statements are ?in accordance with generally accepted accounting principles applicable to governmental entities in the United States? or some other phrase? Is the opinion qualified in some manner, disclaimed, or adverse? Does the auditor indicate that the opinion covers the basic financial statements or that plus combining statements? (2) Basic Financial Statements. Does the CAFR contain the two government-wide financial statements and seven fund statements and required reconciliation? (3) Notes to the Financial Statements. How many notes follow the required basic financial statements? Is there a phrase at the bottom of the basic financial statements indicating that the notes are an integral part of the financial statements? (4) Individual Fund and Combining Statements. Following the notes to the financial statements, does the CAFR provide combining and individual fund statements? Do these combining statements aggregate all the funds of a given fund type or all the nonmajor funds? (5) Management?s Discussion and Analysis (MD&A). Does the CAFR contain an MD&A? If so, where is it located and what type of information does it contain?

c. Statistical Tables. Examine these tables so that you can refer to them in discussions accompanying subsequent chapters. For example, is multiyear information provided about financial trends, revenue capacity, debt capacity, demographic and economic trends, and operating activities?

1?2 Multiple Choice. Choose the best answer. 1. Special purpose governments differ from general purpose governments in that special purpose governments: a. Provide a single function or limited range of functions. b. Do not have the power to levy taxes. c. Derive their power from state governments. d. All of the above.

2. Which of the following is a true statement about accounting standard-setting bodies?

a. The Financial Accounting Standards Board (FASB) sets accounting and reporting standards for all not-for-profit organizations, but the Governmental Accounting Standards Board (GASB) may also prescribe standards for governmental not-for-profit organizations provided they do not conflict with FASB standards.

b. The GASB sets accounting and reporting standards for all governmental organizations; the FASB sets standards for all business and not-for-profit organizations.

c. Only the FASB and GASB enjoy AICPA Ethics Rule 203 coverage as recognized standard-setting authoritative bodies, not the FASAB.

d. The FASB and GASB are administratively supported by the Financial Accounting Foundation; the FASAB draws its support from the federal government.

3. A distinguishing difference between governments and not-for-profit organizations is:

a. Lack of a profit motive.

b. Absence of owners.

c. Taxation as a significant source of funding.

d. Receipt of significant amounts of funding through nonexchange transactions (i.e., resource providers do not get proportional benefits for what they pay to the organization).

4. Which of the following organizations would most likely meet the criteria to be classified as a governmental not-for-profit organization?

a. A religion-affiliated university.

b. A privately founded museum.

c. A public school district.

d. A city-administered community service agency.

5. The concept of interperiod equity refers to whether:

a. Revenues equaled or exceeded expenditures for the year.

b. Current year revenues were sufficient to pay for current year services.

c. Total assets (current and noncurrent) were sufficient to cover total liabilities (current and noncurrent).

d. Future taxpayers can expect to receive the same or higher level of services as current taxpayers.

6. Which of the following is (are) included in the minimum requirements for general purpose external financial reporting of a government?

a. Comprehensive Annual Financial Report.

b. Management?s Discussion and Analysis (MD&A) and basic financial statements.

c. Combining fund financial statements.

d. Statistical section.

7. The basic financial statements of a state or local government include all of the following except:

a. An MD&A.

b. Government-wide financial statements.

c. Fund financial statements.

d. Notes to the financial statements.

8. The modified accrual basis of accounting is used to account for revenues and expenditures reported in the financial statements of:

a. Governmental activities at the government-wide level.

b. Business-type activities at the government-wide level.

c. Governmental funds.

d. Proprietary funds.

9. Separate columns for individual major funds should be provided in which of the following financial statements?

a. Statement of net assets?government-wide; balance sheet?governmental funds; statement of net assets?proprietary funds.

b. Statement of net assets?government-wide; balance sheet?governmental funds; statement of fiduciary net assets?fiduciary funds.

c. Statement of net assets?government-wide; statement of net assets?proprietary funds; statement of fiduciary net assets?fiduciary funds.

d. Balance sheet?governmental funds; statement of net assets?proprietary funds.

10. Under GASBS 34, financial information related to fiduciary activities is reported in which financial statements?

Government-wide Financial Statements Fund Financial Statements No Yes Yes No Yes Yes No No

1?3. Matching. Place the abbreviations corresponding to the appropriate reporting attribute(s) in the spaces provided for each financial statement. Include all that apply. Activities or Funds Governmental activities?GA Business-type activities?BTA Governmental funds?GF Proprietary funds?PF Fiduciary funds?FF Basis of Accounting Accrual?A M odified accrual?MA Measurement Focus Economic resources?ER Current financial resources?CFR

Examine the CAFR. Download a copy of the most recent comprehensive annual financial report (CAFR) for the City and County of Denver from its Web site: http://www.denvergov.org/controller (click on \"Financial Reports\"), or that of another city or county if you wish.* Familiarize yourself with the organization by scanning the report and reread the section in this chapter entitled \"Financial Reporting of State and Local Governments.\" Be prepared to discuss in class the items suggested below. a. Introductory Section. Read the letter of transmittal or any narrative that accompanies the financial statements. Does this material define the governmental reporting entity and name the primary government and all related component units included in the report? (Note: The reporting entity may be discussed in the notes to the financial statements rather than in the transmittal letter.) Does the introductory section discuss the financial condition of the reporting entity at the balance sheet date? Does it discuss the most significant changes in financial condition that occurred during the year? Does it alert the reader to forthcoming changes in financial condition that are not as yet reflected in the financial statements? Do the amounts reported in the letter of transmittal or other narrative agree with amounts in the statements and schedules in the financial section? Does the introductory section include a list of principal officials? An organization chart? A reproduction of a Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association (GFOA)? Assuming the government follows GASBS 34, compare the information in the letter of transmittal with that in the management discussion & analysis (MD&A). b. Financial Section. (1) Audit Report. Are the financial statements in the report audited by an independent CPA, state auditors, or auditors employed by the government being audited? Does the auditor indicate who is responsible for preparing the financial statements? Does the auditor express an opinion that the statements are \"in accordance with generally accepted accounting principles applicable to governmental entities in the United States\" or some other phrase? Is the opinion qualified in some manner, disclaimed, or adverse? Does the auditor indicate that the opinion covers the basic financial statements or that plus combining statements? (2) Basic Financial Statements. Does the CAFR contain the two government-wide financial statements and seven fund statements and required reconciliation? (3) Notes to the Financial Statements. How many notes follow the required basic financial statements? Is there a phrase at the bottom of the basic financial statements indicating that the notes are an integral part of the financial statements? (4) Individual Fund and Combining Statements. Following the notes to the financial statements, does the CAFR provide combining and individual fund statements? Do these combining statements aggregate all the funds of a given fund type or all the nonmajor funds? (5) Management's Discussion and Analysis (MD&A). Does the CAFR contain an MD&A? If so, where is it located and what type of information does it contain? c. Statistical Tables. Examine these tables so that you can refer to them in discussions accompanying subsequent chapters. For example, is multiyear information provided about financial trends, revenue capacity, debt capacity, demographic and economic trends, and operating activities? 1-2 Multiple Choice. Choose the best answer. 1. Special purpose governments differ from general purpose governments in that special purpose governments: a. Provide a single function or limited range of functions. b. Do not have the power to levy taxes. c. Derive their power from state governments. d. All of the above. 2. Which of the following is a true statement about accounting standard-setting bodies? a. The Financial Accounting Standards Board (FASB) sets accounting and reporting standards for all notfor-profit organizations, but the Governmental Accounting Standards Board (GASB) may also prescribe standards for governmental not-for-profit organizations provided they do not conflict with FASB standards. b. The GASB sets accounting and reporting standards for all governmental organizations; the FASB sets standards for all business and not-for-profit organizations. c. Only the FASB and GASB enjoy AICPA Ethics Rule 203 coverage as recognized standard-setting authoritative bodies, not the FASAB. d. The FASB and GASB are administratively supported by the Financial Accounting Foundation; the FASAB draws its support from the federal government. 3. A distinguishing difference between governments and not-for-profit organizations is: a. Lack of a profit motive. b. Absence of owners. c. Taxation as a significant source of funding. d. Receipt of significant amounts of funding through nonexchange transactions (i.e., resource providers do not get proportional benefits for what they pay to the organization). 4. Which of the following organizations would most likely meet the criteria to be classified as a governmental not-for-profit organization? a. A religion-affiliated university. b. A privately founded museum. c. A public school district. d. A city-administered community service agency. 5. The concept of interperiod equity refers to whether: a. Revenues equaled or exceeded expenditures for the year. b. Current year revenues were sufficient to pay for current year services. c. Total assets (current and noncurrent) were sufficient to cover total liabilities (current and noncurrent). d. Future taxpayers can expect to receive the same or higher level of services as current taxpayers. 6. Which of the following is (are) included in the minimum requirements for general purpose external financial reporting of a government? a. Comprehensive Annual Financial Report. b. Management's Discussion and Analysis (MD&A) and basic financial statements. c. Combining fund financial statements. d. Statistical section. 7. The basic financial statements of a state or local government include all of the following except: a. An MD&A. b. Government-wide financial statements. c. Fund financial statements. d. Notes to the financial statements. 8. The modified accrual basis of accounting is used to account for revenues and expenditures reported in the financial statements of: a. Governmental activities at the government-wide level. b. Business-type activities at the government-wide level. c. Governmental funds. d. Proprietary funds. 9. Separate columns for individual major funds should be provided in which of the following financial statements? a. Statement of net assetsgovernment-wide; balance sheetgovernmental funds; statement of net assetsproprietary funds. b. Statement of net assetsgovernment-wide; balance sheetgovernmental funds; statement of fiduciary net assetsfiduciary funds. c. Statement of net assetsgovernment-wide; statement of net assetsproprietary funds; statement of fiduciary net assetsfiduciary funds. d. Balance sheetgovernmental funds; statement of net assetsproprietary funds. 10. Under GASBS 34, financial information related to fiduciary activities is reported in which financial statements? Government-wide Financial Statements Fund Financial Statements No Yes Yes No Yes Yes No No 1-3. Matching. Place the abbreviations corresponding to the appropriate reporting attribute(s) in the spaces provided for each financial statement. Include all that apply. Activities or Funds Governmental activitiesGA Business-type activitiesBTA Governmental fundsGF Proprietary fundsPF Fiduciary fundsFF Basis of Accounting AccrualA M odified accrualMA Measurement Focus Economic resourcesER Current financial resourcesCFR 1