Problem 5: True or False questions. 1. The combining financial statements of nonmajor governmental funds disclose the detailed amounts that total to the aggregate amounts reported in the nonmajor fund column on the governmental funds' financial statements. 2. Management's discussion and analysis is required supplementary information. 3. According to the GASB, there should not be less than 3 and no more than 5 major governmental funds reported on the financial statements of governmental funds. 4. If a blended component unit reports only governmental funds, its financial statements will be reported in both the governmental fund financial statements as well as in the governmental activities' column on the government-wide financial statements of the primary government. 5. Like the letter of transmittal found in a CAFR, the auditor's opinion is addressed to the citizens residing in the government. 6. If a component unit is reported discretely, its fund financial statements are also reported in the fund financial statements of the primary government. 7. The 10% and the 5% tests to determine major funds are referred to as "fiat measurements" which relieve CPAs from having to make subjective decisions on whether individual funds are major or nonmajor. 8. The City of Rockford reports its mass transit district as a blended component unit. 9. The City of Rockford reports its public library as a discretely presented component unit. 10. A local government has the discretion to report a governmental fund or an enterprise fund as a major fund even if the fund fails all four-line item tests.