NAME:

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COURSE/SECTION: _________________________

ASSESSMENT AND EVALUATION TEST

PART 1: TRUE/FALSE Directions (2 POINTS EACH)

Read each statement below carefully. Write your FIRST NAME on the space if
you think the statement is TRUE and write your FAMILY NAME on the space if
you think the statement is FALSE.

1. The principles used in the financial reporting of government entities are

very
unique that only a very few of these principles are similar to those that are
Applied to business entities.
2. The principles in the GAM for NGAs are similar to the principles in the
PFRSs
3. A unique financial reporting requirement of government entities is the
use of fund cluster accounting. Under fund cluster accounting, separate
books and reports are prepared for each type of fund held by a
government entity.
4. Currently, the financial reporting of government entities is based on
NGAs.
5. Compared to the accounting for business entities, government
accounting
places greater emphasis on the sources and utilization of government
Funds and the management's stewardship over government resources
6. Other sources of funds of the government include fees, borrowings, and
Grants from other governments and international bodies.
7. An item is recognized as an asset if it meets both the "probable" future
Economic benefits" and "reliable measurement" criteria, regardless of
Whether the item is a resource controlled arising from
past events.
8. The GAM for NGAs is promulgated by the Philippine Congress under the
Authority conferred to it under the Philippine Constitution.
9. Taxes are the main source of funds for the government.
10. The GAM for NGAs is promulgated primarily to harmonized government
Accounting standards with the U.S. GAAP.
PART 2: MULTIPLE CHOICE 1 – 15 (2 POINTS EACH)
READ THE QUESTIONS CAREFULLY AND CHOOSE THE CORRECT ANSWER.

1. Which of the following is tasked with keeping the general

accounts of the government, supporting vouchers, and other
documents?
a. COA
b. DBM
c. NGAs
d. Congress

2. The Bureau of Treasury (BTR) is responsible for

a. promulgating accounting and auditing rules and regulations.
b. the formulation and implementation of the national budget with the
goal of attaining the nation’s socio-economic objectives
c. receiving and keeping national funds and managing and
controlling the disturbances thereof.
d. directly implementing the projects of the government.

3. Which of the following is a unique requirement of government

accounting that is not required in the accounting for business entities?
a. The use of a double-entry recording system
b. The use of a single-entry recording system
c. The use of accrual basis of accounting
d. The presentation of budget information in the financial statements

4. The transfer of government funds from one officer to another requires the
prior authorization of the
a. Commission on Audit
b. Head of Agency
c. The President of the Republic of the Philippines
d. Bureau of Treasury

5. What is the legal basis of the COA in promulgating the GAM for NGAs?
a. PD 1445 State Audit Code of the Philippines
b. The Philippine Constitution
c. RA 9298 The Philippine Accountancy Act of 2004
d. Philippine Public Sector Accounting Standards
6. Government resources must be utilized efficiently and effectively in
accordance with the law. According to P.D. No. 1445, who is directly
responsible in implementing this policy?
a. All employees who are entrusted with the possession of government
resources.
b. The head of the government agency.
c. The COA.
d. All elected officials.

7. According to the GAM for NGAs, the basis of accounting to be applied

by government entities is the
a. Cash basis
b. Accrual basis
c. Modified accrual basis
d. Any of these as a policy choice

8. These refer to the attributes that make information useful to users.

a. Usefulness characteristics
b. Quantitative characteristics
c. Qualitative characteristics
d. Fundamental principles

9. Which of the following qualitative characteristics would an entity

most likely need to make some tradeoffs?
a. Faithful Representation and Substance Over Form
b. Materiality and Relevance
c. Relevance and Reliability
d. Understandability and Comparability

10. To achieve a proper balance between relevance and reliability, the

overriding considerations
a. how users’ needs are best satisfied.
b. relevance is always more important that reliability.
c. reliability is always more important than relevance.
d. greater weight shall be given to relevance compared to reliability.
 MODULE NO. 1

11. Which of the following is not one of the fund clusters of a government entity?
a. Regular Agency Fund
b. Foreign Assisted Projects Fund
c. Special Account-Locally Funded/Domestic Grants Fund
d. Business Related Funds
e. Petty Cash Fund

12. An entity recognizes an estimated loss from the decline in value of a

property. Which of the following is most likely the qualitative characteristic
being applied by the entity?
a. Reliability
b. Substance over Form
c. Faithful representation
d. Prudence

13. Mr. Mendoza, a government employee entrusted with the custody of

government funds, has lost the government funds entrusted to him in a
force majeure. What should Mr. C do to relieve him from liability?
a. Mr. C should immediately notify the Head of Agency within 30 days
b. Mr. C should immediately notify COA within 30 days
c. Mr. C should immediately notify the Bureau of Treasury within 30 days

14. Mr. Lee should keep the event a secret and wait for the Information to lose this
qualitative characteristic if it is not reported on a timely basis.
a. Relevance
b. Reliability
c. Neutrality
d. Materiality
e. next funds to arrive

15. Mr. Dee, a government employee entrusted with the custody of government
funds, was instructed by Mr. B, a politician to release funds for the acquisition
of a car as a birthday gift for Mr. B's daughter who will be having her 18 th
birthday next week. To relieve Mr. A from any liability, what should Mr. A do?
a. Mr. A shall not release the fund but rather notify Mr. B, in
writing, that his instruction is illegal.
b. Mr. A shall release the fun and then notify Mr. B, in writing, that his
instruction is illegal.
c. Mr. A shall release the fund but retains 20% commission.
d. Mr. A shall release the fund but requires Mr. B to promise, in writing, that
the car shall be returned to the government after his daughter's birthday.
MODULE NO. 1