The Board of Aldermen of Fitchburg approved the appropriations budget for its General Fund for the year ending December 31, as shown below: General Government Public Safety Public Works Health & Welfare Cultural & Recreation Contribution & Retirement Fund Total General Fund Appropriation $600,000 - 3,100,000 1,400,000 800,000 400,000 700,000 $7,000,000 + 1) Explain the legal significance of an appropriation and why auditors engaged for a financial need to know the meaning of the term. 2) It is illegal for a government to spend money for any purpose unless a valid appropriatione for that purpose exists. Does this legal rule assure good financial management for each government? Why or why not? |