CMFO Exam Questions and Answers
Graded A+
Local Bond Law (Statute #) - Correct answer-NJSA 40A:2
Local Budget Law (Statute #) - Correct answer-NJSA 40A:4
Local Fiscal Affairs Law (Statute #) - Correct answer-NJSA 40A:5
Local Public Contracts Law - Correct answer-NJSA 40A:11
Encumbrance System (TAD#) - Correct answer-TAD 85-1
Fixed Assets (TAD#) - Correct answer-TAD 85-2
General Ledger (TAD#) - Correct answer-TAD 85-3
Annual Audit Must be Conducted by a: - Correct answer-Registered Municipal
Accountant
Accounting Formula(s) - Correct answer-Assets = Liabilities + Fund Balance
or
Assets - Liabilities = Fund Balance
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,Balance Sheet Accounts - Correct answer-Assets, Liabilities & Fund Balance
OCBOA - Correct answer-Other Comprehensive Basis of Accounting
The Local Budget Law, NJSA 40A:4-3.1(b) requires any municipality deciding to
convert to a State Fiscal Year from a Calendar Fiscal Year to: - Correct answer-
Apply to the Local Finance Board
When converting to a State Fiscal Year calendar from a Calendar Year a
municipality may do so by: - Correct answer-Ordinance
All budgets shall be introduced, approved, amended and adopted by what vote and
by which action of the governing body? - Correct answer-By resolution passed by
not less than a majority vote of the full membership of the governing body.
N.J.S.A. 40A:4-5 sets the introduction dates for the municipal budget for both a
Calendar Year and State Fiscal Year community. The statutory introduction dates
are as follows: - Correct answer-Calendar Year - February 10
State Fiscal Year - August 10
A municipal governing body has introduced their town budget on Thursday,
February 6 and will hold a public hearing on said budget on Thursday, March 6 (a
non-leap year). The advertisement giving notice of the public hearing shall not be
published later than which date? - Correct answer-February 24
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,A municipal governing body has introduced their town budget on Thursday,
February 6 and will hold a public hearing on said budget on Thursday, March 6 (a
non-leap year). Would the minimum number of days required between approval
and adoption been satisfied as stipulated in the Local Budget Law, 40A:4-7? -
Correct answer-Requirement satisfied
T/F - According to N.J.S.A. 40A:4-9, concerning amendments to an introduced
budget. An increase or decrease to any item of appropriation by more than five
percent (5%) would require a public hearing on said amendment. - Correct answer-
False
The amount to be raised by taxes for school purposes, required to be certified to
the governing body of a municipality for inclusion in its budget, shall set forth in
the separate section of the budget upon adoption and shall be added to the amount
to be raised by taxes by: - Correct answer-School tax rate
The governing body may by resolution authorize temporary budget appropriations
to provide for the period between the beginning of the fiscal year and the adoption
of the budget. The resolution shall be adopted within how many days of the
beginning of the fiscal year? - Correct answer-Thirty-days
Nothing in the Local Budget Law, specifically as stated in N.J.S.A 40A:4-19, shall
prevent or relieve the governing body from making appropriations during the last
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, 10 days of the year preceding the beginning of the fiscal year for all capital
improvement fund purposes. - Correct answer-False
When emergency temporary appropriations are adopted after the introduction and
approval of the budget and were not included in the budget as approved, the
temporary emergency appropriation shall be included by amendment. - Correct
answer-True
Which of the following is known as, in the current section of accounts shall consist
of the excess of quick assets such as cash, investments, State or other public aid
receivable, and deferred charges over legal and demand liabilities. - Correct
answer-Surplus
Which of the following is known as; revenue amounts that may reasonably be
expected to be realized in cash during the fiscal year from known and regular
sources, or from sources reasonably capable of anticipation. - Correct answer-
Miscellaneous Revenues Anticipated
Miscellaneous revenues when being anticipated in the municipal budget are
regulated by N.J.S.A 40:4-26. This section of the statue limits anticipated revenues
to the amount : - Correct answer-Actually realized in cash from the same source in
the next preceding fiscal year
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Graded A+
Local Bond Law (Statute #) - Correct answer-NJSA 40A:2
Local Budget Law (Statute #) - Correct answer-NJSA 40A:4
Local Fiscal Affairs Law (Statute #) - Correct answer-NJSA 40A:5
Local Public Contracts Law - Correct answer-NJSA 40A:11
Encumbrance System (TAD#) - Correct answer-TAD 85-1
Fixed Assets (TAD#) - Correct answer-TAD 85-2
General Ledger (TAD#) - Correct answer-TAD 85-3
Annual Audit Must be Conducted by a: - Correct answer-Registered Municipal
Accountant
Accounting Formula(s) - Correct answer-Assets = Liabilities + Fund Balance
or
Assets - Liabilities = Fund Balance
©COPYRIGHT 2025, ALL RIGHTS RESERVED 1
,Balance Sheet Accounts - Correct answer-Assets, Liabilities & Fund Balance
OCBOA - Correct answer-Other Comprehensive Basis of Accounting
The Local Budget Law, NJSA 40A:4-3.1(b) requires any municipality deciding to
convert to a State Fiscal Year from a Calendar Fiscal Year to: - Correct answer-
Apply to the Local Finance Board
When converting to a State Fiscal Year calendar from a Calendar Year a
municipality may do so by: - Correct answer-Ordinance
All budgets shall be introduced, approved, amended and adopted by what vote and
by which action of the governing body? - Correct answer-By resolution passed by
not less than a majority vote of the full membership of the governing body.
N.J.S.A. 40A:4-5 sets the introduction dates for the municipal budget for both a
Calendar Year and State Fiscal Year community. The statutory introduction dates
are as follows: - Correct answer-Calendar Year - February 10
State Fiscal Year - August 10
A municipal governing body has introduced their town budget on Thursday,
February 6 and will hold a public hearing on said budget on Thursday, March 6 (a
non-leap year). The advertisement giving notice of the public hearing shall not be
published later than which date? - Correct answer-February 24
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
,A municipal governing body has introduced their town budget on Thursday,
February 6 and will hold a public hearing on said budget on Thursday, March 6 (a
non-leap year). Would the minimum number of days required between approval
and adoption been satisfied as stipulated in the Local Budget Law, 40A:4-7? -
Correct answer-Requirement satisfied
T/F - According to N.J.S.A. 40A:4-9, concerning amendments to an introduced
budget. An increase or decrease to any item of appropriation by more than five
percent (5%) would require a public hearing on said amendment. - Correct answer-
False
The amount to be raised by taxes for school purposes, required to be certified to
the governing body of a municipality for inclusion in its budget, shall set forth in
the separate section of the budget upon adoption and shall be added to the amount
to be raised by taxes by: - Correct answer-School tax rate
The governing body may by resolution authorize temporary budget appropriations
to provide for the period between the beginning of the fiscal year and the adoption
of the budget. The resolution shall be adopted within how many days of the
beginning of the fiscal year? - Correct answer-Thirty-days
Nothing in the Local Budget Law, specifically as stated in N.J.S.A 40A:4-19, shall
prevent or relieve the governing body from making appropriations during the last
©COPYRIGHT 2025, ALL RIGHTS RESERVED 3
, 10 days of the year preceding the beginning of the fiscal year for all capital
improvement fund purposes. - Correct answer-False
When emergency temporary appropriations are adopted after the introduction and
approval of the budget and were not included in the budget as approved, the
temporary emergency appropriation shall be included by amendment. - Correct
answer-True
Which of the following is known as, in the current section of accounts shall consist
of the excess of quick assets such as cash, investments, State or other public aid
receivable, and deferred charges over legal and demand liabilities. - Correct
answer-Surplus
Which of the following is known as; revenue amounts that may reasonably be
expected to be realized in cash during the fiscal year from known and regular
sources, or from sources reasonably capable of anticipation. - Correct answer-
Miscellaneous Revenues Anticipated
Miscellaneous revenues when being anticipated in the municipal budget are
regulated by N.J.S.A 40:4-26. This section of the statue limits anticipated revenues
to the amount : - Correct answer-Actually realized in cash from the same source in
the next preceding fiscal year
©COPYRIGHT 2025, ALL RIGHTS RESERVED 4
