Ch. 12 - Nfp

The statement suggests that governmental budgets should be open to public scrutiny and that public hearings should be conducted to allow citizens to provide their input before the budget is adopted. This is important for ensuring transparency and accountability in the budgeting process, as it allows citizens to understand how their tax dollars are being allocated and to have a say in how public funds are spent.

The budgetary comparison schedule required of state and local governments under GASB standards can be presented as required supplementary information (RSI) or as a statement in the basic financial statements. This means that governments have the option to include the schedule either as part of the RSI section or as a separate statement within the basic financial statements. The flexibility allows governments to choose the most appropriate format for presenting the budgetary comparison schedule based on their specific reporting needs and requirements.

Activity-based costing is a useful tool for measuring the cost of key administrative office activities in a government. By accurately allocating costs to specific activities, it helps identify lower cost alternatives and aids in reducing the overall cost of service outcomes. Therefore, all of the above statements are correct.

The correct answer is "All of the above" because public sector budgets are indeed integrated with the financial accounting system, which allows for effective management and tracking of funds. Additionally, these budgets enable governments to demonstrate compliance with laws and regulations, ensuring transparency and accountability. Finally, public sector budgets are adopted by governments after required public hearings, allowing for public input and ensuring that the budget aligns with the needs and priorities of the community.

Zero-based budgeting is an approach to budgeting that requires each program's existence and the amount of resources requested to be justified each year. Unlike incremental budgeting, which assumes the previous year's budget as a baseline and makes adjustments, zero-based budgeting starts from scratch and requires a thorough evaluation of each program's costs and benefits. This approach ensures that resources are allocated based on the program's current needs and priorities, promoting efficiency and accountability in budgeting decisions. Performance budgeting and planning-programming-budgeting are different budgeting approaches that focus on evaluating program performance and aligning budgeting decisions with organizational goals.

The budgeting process involves the preparation of budget requests by heads of operating departments, review and adjustments by central administrators, and holding public budget hearings. The final step in the process is the formal adoption of the budget by the chief executive, which gives it the force of law. Therefore, this step is usually part of the budgeting process.

The correct answer is "All of the above". This means that all three statements are true and are part of the budgeting principle in generally accepted accounting principles (GAAP) for state and local governments. The accounting system should provide the basis for appropriate budgetary control, budgetary comparison schedules should be presented for the General Fund and major special revenue funds, and annual budgets should be adopted by each government. These principles ensure proper financial management and transparency in the budgeting process.

Efficiency measures in the service efforts and accomplishments (SEA) literature refer to measures that relate the quantity or cost of resources used to units of output. This means that efficiency measures focus on determining how effectively resources are utilized in producing a certain level of output. By measuring the quantity or cost of resources used in relation to the units of output, organizations can assess their efficiency in utilizing resources and identify areas for improvement. This measure helps in evaluating the effectiveness of a program or process in achieving its desired outcomes while minimizing resource wastage.

The correct answer suggests that there are actually many examples of successful improvements in budgeting processes that have resulted in higher quality and performance of governments. This contradicts the statement that there are few examples.

Incremental budgeting is an often used approach to budgeting where the subsequent year's budget is derived from the current year's budget. This means that the budget for the next year is based on making incremental changes or adjustments to the current budget, rather than starting from scratch or re-evaluating every expense. This approach is often used when there is a need for stability and continuity in budgeting, as it allows for small adjustments and improvements over time without significant disruptions.

The schedule of legally required events in the budgeting process is commonly known as the budget calendar. This calendar outlines important dates and deadlines for budget-related activities such as hearings, reviews, and approvals. It helps ensure that all necessary steps in the budgeting process are followed in a timely manner and allows stakeholders to plan and prepare accordingly.

The GASB's "Budgeting, Budgetary Control, and Budgetary Reporting Principle" does not require that an annual budget be adopted using generally accepted accounting principles.

The budget officer is typically responsible for providing department heads with technical support such as clerical assistance with budget computation and maintenance of document files relating to the budget. This role involves assisting in budget planning, monitoring expenditures, and ensuring compliance with financial regulations. The budget officer works closely with department heads to provide guidance and support in managing their budgets effectively.

Zero-based budgeting is a type of budgeting that requires all expenses to be justified for each new budget period, regardless of whether they were included in the previous budget or not. It does not specifically relate the input of resources to the output of services. Therefore, the given statement is false.

Under GASB standards, every government is not instructed to prepare a cash budget for each month of the fiscal year. The statement is false because GASB standards do not require governments to prepare a cash budget for each month. While it is encouraged for governments to have a budgeting process in place, the specific frequency and format of the budget is not mandated by GASB.

The value of property lost due to crime can be appropriately termed as an outcome indicator for a police department that reports service efforts and accomplishments (SEA) indicators because it reflects the impact of the department's efforts in preventing and solving crimes. This indicator provides information about the effectiveness of the department's strategies and interventions in reducing the financial losses experienced by the community due to criminal activities.

State and local governments and nonprofit organizations that receive grants or contracts from the federal government should charge costs of these grants or contracts in conformity with the Office of Management and Budget cost circulars. This means that they should follow the guidelines and regulations set forth by the Office of Management and Budget when it comes to accounting for the costs associated with these grants or contracts. These cost circulars provide specific instructions on how to allocate and track costs, ensuring that the funds are used appropriately and in accordance with federal regulations.

The GASB "Budgeting Principle" states that an annual budget should be adopted by every government. This means that all levels of government, whether it be federal, state, or local, should have a budget in place for each fiscal year. This budget helps to outline the government's financial plans and priorities, ensuring that resources are allocated effectively and transparently. It also allows for accountability and oversight, as the budget can be used as a tool to track and monitor the government's financial performance and adherence to its goals and objectives.

OMB Circular A-122, "Cost Principles for Non-Profit Organizations," provides guidance to government managers and auditors in determining appropriate and allowable costs chargeable to federal grants and contracts for not-for-profit organizations. This circular specifically outlines the cost principles that govern the use of federal funds and helps ensure that costs charged to grants and contracts are reasonable, necessary, and comply with federal regulations. It provides detailed guidance on direct costs, indirect costs, cost allocation, and other cost-related considerations for non-profit organizations.

Governments that choose to report service efforts and accomplishments (SEA) have the option to refer to guidance provided by the GASB, the AGA, or other professional organizations. This means that they are not required to adhere to GASB SEA guidance exclusively, nor are they required to follow the guidance provided by the AGA. They have the flexibility to choose the guidance that best suits their needs and preferences.