A Common Reason Why a Government Might Receive a "Modified

question 45

Multiple Choice

A common reason why a government might receive a "modified opinion" from the external auditors is:

• A) A violation of generally accepted accounting principles was noted that does not cause material misstatement of the financial statements.
• B) A fund balance deficit in the General Fund.
• C) Poor internal controls such that the accounting records could not be audited.
• D) Expenditures exceeded appropriations in the General Fund.

---

Definitions:

Direct and Indirect Labor Costs

Expenses related to the wages of workers directly involved in production and those who support the production process.

Job-Order Costing

An accounting method that tracks costs individually for each job, suitable for bespoke or custom work.

Job-Order Costing

An accounting method that assigns costs to specific batches or job orders, tracking the expenses of each job separately.

T-Account

This is an informal term for a ledger account that depicts the credit and debit sides of transactions, used in accounting to organize financial data.