Aug 09, 2025 Detailed New GAFRB Exam Questions for Concept Clearance [Q42-Q61]

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Aug 09, 2025 Detailed New GAFRB Exam Questions for Concept Clearance

GAFRB Exam Preparation Material with New GAFRB Dumps Questions.

AGA GAFRB Exam Syllabus Topics:

Topic	Details
Topic 1	Federal Financial Accounting and Reporting: This section of the exam measures skills of government financial analysts and covers the roles of FASAB, OMB, Treasury, and GAO in federal accounting. It includes an understanding of federal budgetary terminology and the federal budgetary equation. The section differentiates between budgetary and proprietary accounting and outlines the structure and use of various federal fund types. It explains how to record key budgetary transactions like appropriations and obligations and proprietary transactions such as payroll and depreciation.
Topic 2	State and Local Financial Accounting and Reporting: This section of the exam measures skills of public sector accountants and focuses on applying GASB standards to define reporting entities and component units. It explores the structure and purpose of various fund types and the basis of accounting for each. Candidates must understand the format and content of the Annual Comprehensive Financial Report and the purpose of popular reports for public transparency.
Topic 3	Governmental Financial Accounting, Reporting and Budgeting: General Knowledge:This section of the exam measures skills of government financial analysts and covers the unique aspects of governmental accounting that distinguish it from private sector practices, such as service over profit and the critical role of the budget. It emphasizes the objectives of financial reporting in the public sector, the role of standard-setting bodies like GASB, FASB, FASAB, and IPSASB, and the due process for setting accounting standards. It also includes knowledge of interperiod equity, budgetary compliance, sustainability, and the characteristics of quality financial information.

NO.42 An independent school district completed construction on a new high school during the current fiscal year.
The amount paid to the construction manager was $900,000 and the amount paid to the architect was
$100,000. The entity depreciates buildings over 50 years, using the straight line, half-year depreciation method. What is the amount reported on the Statement of Activities in the current fiscal year?

$9,000

$10,000

$20,000

$1,000,000

NO.43 A government issues general obligation bonds at a premium. The associated amortization would be reported on the

Statement of Activities as a component of depreciation expense.

Statement of Activities as a component of interest expense.

Statement of Revenues, Expenditures, and Changes in Fund Balance as a component of interest expenditures.

Statement of Revenues, Expenditures, and Changes in Fund Balance as a component of depreciation expenditures.

NO.44 In an ACFR. the Independent Auditor’s Report should be included in the

financial section before the MD&A.

financial section before the basic financial statements.

introductory section after the Letter of Transmittal.

statistical section before the Information on Debt Capacity.

NO.45 A special-purpose government is considered a primary government when it has any of the following characteristics EXCEPT that it

relies on revenue projections from another government entity.

has the ability to levy taxes.

has a board determined via general election.

provides an ongoing financial benefit to another government entity.

NO.46 What must a federal agency receive from the U.S. Department of the Treasury before it can begin spending an appropriation?

an apportionment

an allotment

a warrant

an encumbrance

NO.47 What organization establishes GAAP for federal agencies?

FASAB

OMB

GAO

FASB

NO.48 GAAP requires that the ACFR be accompanied by separate financial statements documenting

statistical data on the population.

fiduciary and proprietary funds.

program goals and objectives.

annual appropriations.

NO.49 OMB Circular A-136 requires that all of the following be included in an AFR EXCEPT

a message from the head of the agency.

the MD&A.

the financial section.

the performance section.

NO.50 A specific operation of the government is funded by 60% from the general fund, 40% from specific revenues.
This should be reported in which fund?

general fund

special revenue fund

capital projects fund

internal service fund

NO.51 The Department of the Interior has the following costs associated with the development of a new visitor tracking system.
Research cost determining if system should be internally or externally developed $100,000 Software configuration and system development $750,000 Cost of testing the new system for fiscal usage $225,000 Converting data from old tracking system to new tracking system $500,000 How much should be capitalized as the cost of the asset?

$750,000

$975,000

$1,475,000

$1,575,000

NO.52 All the following are required financial statement reporting on governmental funds EXCEPT

the balance sheet.

the operating statement.

expenditures and changes in fund balance.

statement of cash flows.

NO.53 Which of the following federal collections are typically accounted for in a deposit fund?

general tax receipts funding government operations overall (e.g., personal income taxes)

taxes dedicated to a specific purpose (e.g., gasoline taxes funding highway projects)

funds held temporarily until ownership is determined (e.g., earnest money paid by bidders)

exchange revenues collected to finance a continuing cycle of business-type operations (e.g., revenue paid to service centers)

NO.54 Information is reported in the notes to the financial statements to support all of the following goals EXCEPT to

provide narrative information.

provide detailed information that is not described in the basic financial statements.

satisfy disclosure requirements.

provide information in a timely and comparable format.

NO.55 The process in the budget where OMB communicates to agencies what it will recommend to the president is called

pass back.

allotment

rescission.

apportionment.

NO.56 A federal agency submits its budget request to which of the following?

the U.S. Department of the Treasury

OMB

GAO

Congress

NO.57 State Medicaid caseloads have been exceeding projections for the past two months. Review of the data indicates the increase is likely to continue, leading to the need for significant supplemental appropriations before the end of the fiscal year. Based upon this information, what is the first action the state director of Medicaid should take?

Inform the governor of the situation and options for addressing the shortfall.

Inform the legislative counsel bureau about the potential over-expenditure.

Impose a hiring freeze and hold all spending approvals for contracts and purchases on the affected departments.

Confer with the chairmen or staff directors of the House and Senate appropriations committees concerning the need to call a legislative special session.

NO.58 The major difference in applying the accrual concept in governmental fund accounting, as opposed to private- sector accounting, is that revenues are

recognized in the accounting period in which they are received.

recorded when collectability occurs or can be reasonably estimated.

recognized when they become measurable and available.

recognized when an encumbrance order is prepared.

NO.59 A city utilizing a 60-day availability period has a June 30 year-end. It levies property taxes in January that are due in March, which are used to finance the general fund. The city levied S15 million in taxes in the current fiscal year, collecting $12 million during the fiscal year. In addition, the following amounts were collected in the months after year-end:
July $1,000,000
August $ 500,000
September $ 250,000
How much revenue should the general fund recognize for the fiscal year?

$12 million

$13 million

$13.5 million

$15 million

NO.60 The summary of significant accounting policies in the notes to the financial statements includes all of the following information EXCEPT

a description of the reporting entity and major components.

summary of accounting principles followed by the entity, and methods followed applying those principles.

disclosure of receipt of budget authority from the entity.

summary of changes to the GAAP impacting the financial statements.

NO.61 A state had problems with its cash reconciliation resulting in a difference between the total cash per books versus cash balance with banks. The possible loss could only be estimated within a range of $100 million to
$300 million with no amount within the range considered a better estimate than any other. The state should recognize a minimum liability of

$100 million and disclose in the notes the exposure to an additional $200 million loss.

$200 million and disclose in the notes the exposure to an additional $100 million loss.

$300 million with no additional disclosure required.

an amount to be determined by external auditors.