Which of the Following Is True Regarding GASB's Definition of the Financial

question 127

Multiple Choice

Which of the following is true regarding GASB's definition of the financial reporting entity?

• A) The financial reporting entity might include a primary government, component units, joint ventures, or a jointly governed organization.
• B) Primary governments may be general-purpose governments such as states, cities, and countiesor special-purpose governments that have separately elected governing bodies, are legally separate and are fiscally independent of other state or local governments.
• C) Blending is used to incorporate component units when those component units are, in substance, part of the primary government.
• D) All of the above are true.

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Definitions:

Lease Receipts

Income received from leasing out an asset to a lessee under a lease agreement.

Finance Lease

A lease agreement that transfers substantially all the risks and rewards incidental to ownership of an asset. Title may or may not eventually be transferred.

AASB 16

An accounting standard issued by the Australian Accounting Standards Board specifying the principles for recognition, measurement, presentation, and disclosure of leases.

IFRS 16

The International Financial Reporting Standard issued by the IASB which specifies how an IFRS reporter will recognize, measure, present, and disclose leases.