GFOAT Accounting & Financial
Reporting Exam-Glossary Questions and
Answers Graded A+
Accounting Standards - Correct answer-The generally accepted accounting
principles (GAAP) promulgated by the Governmental Accounting Standards Board
that guide the recording and reporting of financial information by state and local
governments.
Accrual Basis - Correct answer-Under this accounting basis, revenues are
recognized when they are earned and measurable.
ACFR - Correct answer-See Annual Comprehensive Financial Report.
Actuarial Opinion - Correct answer-A review of a pension plan with regard to the
sufficiency of funds to cover liabilities.
Amortization - Correct answer-The process of paying the principal amount of a
debt in periodic payments.
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, Annual Comprehensive Financial Report - Correct answer-Usually called the
ACFR, this report summarizes financial data for the previous fiscal year in a
standardized format.
Arbitrage - Correct answer-The practice of investing proceeds from a tax-exempt
instrument in higher-yielding investments.
Blended Statements - Correct answer-The practice of including the financial
reports of component units of government with those of the primary government.
Budgetary Comparison Schedules - Correct answer-This report, required by GASB
34 compares the originally adopted budget, the final budget, and actual activity
(revenues and expenditures).
Capitalized Interest - Correct answer-A portion of the proceeds of a bond issue that
is designated to pay interest on the bonds for a specified period, often the
qualifying period.
Component Unit - Correct answer-As legally separate organizations for which the
elected officials of the agency are financially accountable.
Contributed Capital - Correct answer-Cash or other assets transferred from one
fund to another in order to startup the enterprise fund's operations, or assets
provided from the private sector (usually infrastructure).
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
Reporting Exam-Glossary Questions and
Answers Graded A+
Accounting Standards - Correct answer-The generally accepted accounting
principles (GAAP) promulgated by the Governmental Accounting Standards Board
that guide the recording and reporting of financial information by state and local
governments.
Accrual Basis - Correct answer-Under this accounting basis, revenues are
recognized when they are earned and measurable.
ACFR - Correct answer-See Annual Comprehensive Financial Report.
Actuarial Opinion - Correct answer-A review of a pension plan with regard to the
sufficiency of funds to cover liabilities.
Amortization - Correct answer-The process of paying the principal amount of a
debt in periodic payments.
©COPYRIGHT 2025, ALL RIGHTS RESERVED 1
, Annual Comprehensive Financial Report - Correct answer-Usually called the
ACFR, this report summarizes financial data for the previous fiscal year in a
standardized format.
Arbitrage - Correct answer-The practice of investing proceeds from a tax-exempt
instrument in higher-yielding investments.
Blended Statements - Correct answer-The practice of including the financial
reports of component units of government with those of the primary government.
Budgetary Comparison Schedules - Correct answer-This report, required by GASB
34 compares the originally adopted budget, the final budget, and actual activity
(revenues and expenditures).
Capitalized Interest - Correct answer-A portion of the proceeds of a bond issue that
is designated to pay interest on the bonds for a specified period, often the
qualifying period.
Component Unit - Correct answer-As legally separate organizations for which the
elected officials of the agency are financially accountable.
Contributed Capital - Correct answer-Cash or other assets transferred from one
fund to another in order to startup the enterprise fund's operations, or assets
provided from the private sector (usually infrastructure).
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
