Which of the Following Is NOT a Criterion for a Federal

question 69

Multiple Choice

Which of the following is NOT a criterion for a federal government "component" to be considered a reporting entity and therefore required to issue a financial report?

• A) There is a management responsible for controlling and deploying the component's outputs and outcomes and for executing its budget. It is held accountable for its performance.
• B) The component is of sufficient size and significance that its financial statements would provide a meaningful representation of its operations and financial condition.
• C) The component is of sufficient cohesiveness of operations that its financial statements would provide a meaningful representation of a specific program or type of activity.
• D) Users are interested in the information to be reported in its financial statements and could use it to make resource allocation and related decisions.

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Definitions:

Petty Cash

A small fund kept on hand used for minor, miscellaneous expenses of a business.

Misc. Expense

Miscellaneous Expense refers to small, infrequent costs that are not categorized under a specific heading in financial statements.

Misc. Revenue

Miscellaneous revenue refers to income generated from activities not central to a business’s main operations.

Change Fund

Fund made up of various denominations that are used to make change for customers.