Which of the Following Is True Regarding Financial Reporting of Special-Purpose

question 98

Multiple Choice

Which of the following is true regarding financial reporting of special-purpose entities?

• A) Special purpose entities might include park districts, school districts, and public colleges and universities.
• B) Special-purpose entities, in some cases, have more limited reporting requirements than general-purpose entities.
• C) Both of the above are true.
• D) Neither of the above is true.

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Definitions:

Required Reserves

Funds that banks must hold in reserve and cannot lend out, either as cash in their vaults or as deposits with a central bank.

Excess Reserves

Excess reserves are the funds that banks hold over and above the required reserve ratio set by the central bank, representing additional liquidity that can be used for lending.

Checkable Deposits

Bank accounts against which checks can be drawn. These include checking accounts, demand deposits, and any other deposit accounts from which checks can be written.

Discount Rate

The interest rate charged to commercial banks and other depository institutions on loans they receive from their regional Federal Reserve Bank's lending facility.