Cgfm Governmental Environment

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Principle that in a democracy, government operates at the consent of the peole. Therefore, it must answer to the people for its actions and results, including the taking and using of the people's resources.

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Accountability

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In the federal government, an agency's distribution of apportioned budgetary authority to various components within the agency. After the executive agency receives its apportionments, it allots budgetary authority to specific components within the agency.

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Allotments

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At the federal level, a law stating that officials can be fined and/or jailed if they obligate the government to spend funds beyond the legally authorized purpose, time or amount.

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Anti-Deficiency Act

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Definitions may vary at different levels of government. At the federal level, OMB's approval to use a portion of the legislatively approved budgetary authority.

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Apportionments

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Budget that has been passed by the legislative branch; has effect of law.

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Appropriated Budget

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A legislative enactment (law, statute or ordinance) that creates spending authroity; the legal authority to incur expenses and spend money

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Appropriation

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Engagement primarily concerned with examing or performing agree-upon procedures on a subject matter, or an assertion about a subject matter, and reporting ont he results. The subject matter may be financial or nonfinancial and can be part of a financial audit or performance audit. Possible subjects include reporting on an entity's internal controls, compliance with law or performance measures.

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Attestaton Engagements

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Legislative enactment that approves programs; prescribes what activities an agency may pursue if funding is available.

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Authorization

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Intergovernmental provision of resources for broadly defined purposes. Contrasts with category grants.

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Block Grants

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Forecast and controls spending for "big ticket" items that are acquired and used over a period of several years, such as construction projects and major equipment purchases. Used at state and local levels.

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Capital Budget

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Capital lease is a lease of real property that meets defined criteria requiring the government to report the property as it purchased long-term debt.

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Capital Leases

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Forecasts the timing as well as amount of cash flows for the year. Used to project required cash levels.

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Cash-flow Budget

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Intergovernmental provision of resources to be used for activities in a specific category of purpose. May be further classified as discretionary grants or formula grants. Contrasts with block grants.

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Category Grants

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Government agencies that provide central management services to other components. Example would be a state government human resources office (that serves all state agencies) or the Office of Management and Budget at the federal level.

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Central Management Agencies

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An AGA program that helps federal agencies and their components to produce effective, high-quality Performance and Accountability Reports.

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Certificate of Excellence in Accountability Reporting (CEAR)

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Form of shared government financing. In a typical form, several financial institutions share in a loan arrangement with a government entitiy.

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Certificate of Participation

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Local government version of a constitution. States may provide for the establishment of local governments through charters.

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Charter

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Process by which one branch of government (legislative, executive or judicial) can constrain actions of the other branches. Flows from separation of powers.

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Checks and Balances

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1990 law that, among other provisions, requires the federal government's major executive branch agencies to have a Chief Financial Officer. Prescribes duties and reporting requirements, and requires audited financial statements.

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Chief Financial Officers (CFO) Act

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Government components established by law, statute or ordinance. May be permanent or temporary. Because they are established by law, may have greater autonomy and authority that government components that are administratively established. Example: Federal Communications Commission.

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Commissions

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Organized units of government such as agencies, offices and departments. Found in all branches of government at all levels. Examples: U.S. Fish & Wildlife Services is a component of the Department of the Interior.

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Components

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Arises when one has a personal interest in matters relating to official duties or activities. Such conflicts can destroy objectivity and independence and prevent the exercise of due care.

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Conflict of Interest

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Broad category of tax that includes sales, use, excise and value-added taxes.

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Consumption Taxes

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Refers to the efforts to ensure the organizations can sustain essential operations regardless of planned or unplanned incidents or discruptions.

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Continuity of Operations

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Legal requirements pertaining to a specific bond issue. Typically define the maturity date, revenue stream that will be used to repay the debt, interest rate and repayment schedule. May require a sinking fund and may specify conditions that must be met before new debt can be issued.

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Covenant (bond)

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Independent organizations that assess the credit worthiness of debt. Three major rating agencies are Standar & Poors, Moody's Investor Servces and Fitches Ratings.

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Credit-Rating Agencies

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Using special, computer-based techniques such as filters and algorithms to extract meaningful information from large bodies of data.

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Data Mining

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Money owed by the entity to individuals or organizational creditors, usually as a result of planned short- or long-term borrowing to finance government objectives.

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Debt

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Taxes levied to finance a specific activity. Proceeds are deposited into an account restriced to that activity. Also referred to as earmarked or restricted taxes.

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Dedicated Tax

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Occurs when government expenditures for a specific fiscal period exceed revenues and/or financial resource inflows.

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Deficit

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Pursuing an event, action or assignment to a timely and sufficient end or close.

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Diligence

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Form of category grant. Transfers funds between governments for a specific purpose; whether a grant is awarded and the amount of the award depends on discretion of the entity providing the funds.

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Discretionary Grants

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Voluntary contributions that confer no rights or benefits on the giver.

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Donations

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To discharge professional responsibilities with competence and diligence, to the best of one's ability, and with the same level of ability and skill as others in similar positions. It also means to act in the best interest of those served.

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Due Care

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Variation on use of special funds. Revenue from specific taxes or other sources is set aside for specific activities. One example is the earmarking of gasoline taxes for highway improvements.

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Earmarking

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Major "end-to-end" computer system that links many functions and departments. Used to simplify and streamlne financial management, and to integrate operation with financial mangement.

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Enterprise Resource Planning (ERP) System

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Form of wealth tax. Levied on the estate of the deceased person before assets are distributed to heirs.

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Estate Tax

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A set of moral principles and values; the principles of conduct governing an individual or a (professional) group. A complex system of discipline that civilized societies impose on themselves through laws, customs, standards, social etiquette and other rules to govern moral conduct.

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Ethics

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Forms of consumption tax. Levied on the consumption of a particular type of good or particitation in a certain type of activity. Whereas general sales taxes are broad-based, excise taxes are more narrowly targeted.

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Excise Tax

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Orders issued by the president, governor or a local governmnet's chief executive that do not violate laws or statutes and have substantial impact on policy and procedures of government. They carry less weight than laws because the legislature or next chief executive may overturn the previous order.

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Executive Orders

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Free from self-interest, prejudice or favoritism. Implies an elimination of one's own feelings, prejudices and desires so as to achieve a proper balance of conflicting interests.

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Fair

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Defines GAAP for entities of the federal government this includes the national government as a whole plus disticnt components.

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Federal Accounting Standards Advisory Board (FASAB)

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Principle that government authority and responsibility is shared among different levels of government. (In practice, people often use the term "federal" when referring to the national level of govenment.)

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Federalism

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Defned GAAP for private sector entities. Occasionally, GASB and GASAB make FASB standards applicable to national, state or local government.

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Financial Accounting Standards Board (FASB)

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Organized means for the collection, processiong, transmission and dissemination of finacial inforamtion. Includes policies and procedures and trained personnel as well as any applicable computer hardware and software.

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Financial Mangement Systems

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Examination of financial statements, accomplished by an independent auditor. Results in an opinion on whether the financial statements are presented fairly in accordance with GAAP (Generaly Accepted Accounting Principles) or another comprehensive basis of accounting.

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Financial Statement Audit

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External reports that depict financial position and financial results of operations of the entity.

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Financial Reports

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Form of category grants. The amount of the intergovernmental transfer is based on a formula contained in law or regulations, which determines the total amont recipients will receive if basic eligibility requirements are satisfied.

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Formula Grants

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"Forensic" implies that the results will be admissible as legal evidence. Forensic auditing combines the skills of auditors and accountants with investigative techniques, useful for both detection and prevention of fraud.

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Forensic Auditing

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Name often applied to the legislative branch at the state level.

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General Assembly

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Form of government debt that is backed by the full faith and credit of the government. Contrasts with revenue bonds.

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General Obligation Bonds

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Entities at the national, state or local level that provide a broad range of services.

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General-Purpose Government

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Defines GAAP for state and local government entities.

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Governmental Accounting Standards Board (GASB)

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Quasi-government entities formed to support businesslike functions where most, if not all, operating expenses are expected to be covered through revenues and fees, rather than from appropriated budget authority.

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Government Corporations

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U.S. law passed in 1993; requires federal agencies to create long-term strategic plans. The strategic plans are followed by annual performance plans (currently performance budgets), performance measures and performance reports.

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Government Performance and Results Act

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Funds transferred from one level of governmnet to another for specific or broad purposes.

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Grants

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Lack of favoritism. The absence of favor or prejudice. Not partial or biased. Treating or affecting all equally.

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Impartial

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Tax based on income and levied on individuals or corporations. Used most often at national and state levels, though some states allow local governments to impose income taxes.

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Income tax

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Free of relationships that may inpair, or appear to inpair, one's ability to act with objectivity. Independence is the quality of being free of any obligation to particular parties or interests.

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Independence

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Form of wealth tax. Levied on the person receiving the bequest.

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Inheritance tax

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Process that enables citizens to present their view of a problem and a proposed solution, rather then depending on a solution devised and enacted by the legislative branch. Allows direct citizen action to affect laws.

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Initiative

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Form of wealth tax. Applied to intangible assets such as stocks and bonds, savings accounts, trademarks, and accounts receivable (in the case of a business).

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Intangibles tax

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Activites designed to ensure programs achieve their intended results; resources are used efficiently and effectively; programs and resources are protected from waste, fraud and mismanagement; laws and regulations are followed; and reliable and timely information is obtained, maintained and reported.

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Internal Controls

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Principle by which the judicial branch may review actions by the legislative and executieve branches and if appropriate, declare them unconstitutional or illegal. Flows from the separation of powers.

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Judicial review

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Practice by which a government entity assumes a long-tem lease on a capital asset and at the end of the lease period, the asset may transfer to the government. Usually, these long-term obligations do not require voter approval.

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Lease-Purchase

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Fee paid to the government for a specific privilege, often related toan activity. Ranges from recreation (fishing license) to business (real estate license).

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License Fee

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Authority that allows the chief executive, such as a governor or mayor, to strike individua line items from the budget eithout vetoing the entire budget bll. U.S. presidents do not have line-item veto authority.

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Line-Item Veto

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State-Controlled gambling, used by many states as a source of revenue.

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Lottery

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Stes in the continuous government management cycle include planning, programming, budgetng, operationgs, accounting, reporting and auditing.

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Management Cycle

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Form of conflict resolution that involves an objective, third party mediator who tries to bring the disputants closer together. Unlike arbitration, meditation is usually voluntary and nonbinding.

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Mediation

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Personality assessment based on the psychologi cal theory of Carl Jung and the diagnostic instrument developed by Isabel Briggs-Myers and her mother, Kathering Briggs.

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Myers-Briggs Type Analysis

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Form of government debt used as a short-term financing source. Due to the short maturity period, the principle and interest for a note are usually retired simultaneously upon maturity (that is, no periodic interest payments).

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Notes

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A budget or accounting catefory that defines the resources to be applied to specific types of inputs such as personnel, travel, tools or supplies.

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Object Class

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Imposes the obligation to be impartial, intellectually homest, and free of conflicts of interest. Public officials are objective when they uphold the expectations of fairness, make decisions on merit, and do not allow prejudice or bias to influence their decisions or behavior.

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Objectivity

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Defines level of resources to be applied in providing government programs and services; usually covers periods of one to two years.

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Operating Budget

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Law enacted by a legislative body below the state level, such as a county, city or town.

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Ordinance

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Ultimate results of government programs, such as number of gainfully employed graduates or reduction in road accidents. May take many months or years to achieve. Outcomes are often more difficult to measure than outputs.

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Outcome

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The goods or services produced, such as number of students trained or number of road miles repaired.

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Output

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A single report that combines financial results and performance reslts. Recent requirement for federal executive agencies, but may be practiced at other levels of government.

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Performance and Accountability Report

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Examiniations of the performance and management of a program against objective criteria, Contrasts with a financial audit, which is limited to financial information and results.

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Performance Audits

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External reports that indcte what has been accomplished with the resources consumed by a government.

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Performance Reports

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Form of wealth tax. Personal property differs from real property in that it is mobile and can be transferred from one location to another.

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Personal Property Tax

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Condensed form of external financial reports that provide basic financial information and other performance data in a short, easy-to-read format.

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Popular Reports

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Principle that while governments ar sovereigh entities, in a democracy, ultimate sovereignty rests with the people.

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Popular Sovereignty

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Entities that blend characteristics of governments and private sector.

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Quasi-Government Entities

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Process that enables voters to remove elected officials from office. Usually involves collecting signatures on a petition. If enough legitimate signatures are collected, proposals is put to the vote.

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Recall

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Process by which cerain legislative actions are presented to voters before taking effect. Alternatively, legislation can take effect immediately an dthen be overturned in the event of a successful referendum.

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Referendum

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Tenth Amendment to the U S Constitiution. "The powers not delegated to the United States by the Constitution, mor prohibited by it to the states, are reserved to the states respectiverly, or to the people."

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Reserved Clause

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Form of debt that is secured by a specific source of funancing, such as revenue from the project being funded. Contrasts with general obligation bonds, which are backed by the full faith and credit of goverment.

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Revenue Bonds

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Form of consumption tax based on individual sales transactions; usually collected at point of sale by the vendor who then remits the tax to the government.

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Sales Tax

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Principles that each branch of govenment (legislative, executive and judical) possess certain powers with regard tot he other branches and act in some ways to constrain the other branches. Check and balances and judicial review from from this principle.

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Seperation of Powers

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A bond issue featuring maturities every year over a period of several years. Contrasts with term bons in which the entire issue matures on the same date or near the same date.

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Serial Bonds

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Refers to inputs to government programs (such as financial resources, work hours and supplies) and the outputs and outcomes achieved through application of those resources (such as number of students graduated or the number of students moving to the next level).

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Service Efforts and Accomplishments (SEA)

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Usually associated with revenue sharing between the state and local governments. In most instances, shared revenue funds are provided with few constraints so that local entities can use the funds as needed.

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Shared Revenues

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Leadership model developed by Ken Blanchard and Paul Hersey. Encourages leaders to diagnose developmental level of employees and vary their leadership style accordingly.

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Situational Leadership

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Means "possessed of supreme power." One consequence of federal government sovereignty is that the federal government cannot be sued without its permission.

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Sovereignty

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Special purpose governments are organized for a single purpose or a few closely related purposes. Examples are school districts and conservation districts.

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Special-Purpose Government

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Principle that government is accountable for safeguarding assets and promoting long-term economic security of citizens.

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Stewardship

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Principle that taxes should treat taxpayers fairly. When applied to income taxes, horizontal equity means different taxpayers with the same income level pay the same amount of taxes, and vertical euity means taxpayers with differrent income levels pay different amounts of taxes.

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Tax Equity

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Provisions of tax laws and regulations that encourage cerain behavior by individuals or businesses. Called tax expenditures because they achieve throught the tax system politicl, economic or social goals that the government would otherwise have to expense monies to accomplish.

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Tax Expenditures

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A block of bonds in shich all bonds in the issue mature on the same date, usually many years after issuance. Contrast with serial bonds.

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Term Bonds

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Tax charged on goods purchased from out-of-state and used within the state. Tax is levied for the right to use the item in hte stae. One form of consumptions tax.

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Use Tax

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Fee imposed on the specific beneficiary of a good or service. User fees range from the admission charge for a museum to monthly tutuion at a municipal day-care.

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User Fee

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An indirect tax on consumption that resembles a sales tax, but is paid at each stage int he development, manufacturing or distribution process by the person or organization adding value to the product.

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Value Added Tax (VAT)

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An order by authorized executive officials that directs the treasury to pay a specific sum to order or to bearer.

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Warrant

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Category of taxation that includes real property, personal property, intangibles, estate and inheritance taxes.

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Wealth Tax

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AGA

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Association of Government Accountants

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CEAR

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Certificate of Excellence in Accountability Reporting

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CFO

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Chief Financial Officer

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CGFM

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Certified Government Financial Manager

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ERP

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Enterprise Resource Planning

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FASAB

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Federal Accounting Statndards Advisory Board

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FASB

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Financial Accounting Standards Board

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FSIO

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Financial Systems Intergration Office (within the General Services Administration)

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GAAP

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Generally Accepted Accounting Principles

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GAO

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Government Accountability Office

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GASB

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Governmental Accounting Standards Board

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GPRA

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Government Performance and Results Act

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OMB

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Office of Management and Budget

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PAR

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Performance and Accountability Report

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SEA

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Service Efforts and Accomplishments