Examination One—Governmental Environment

115 questions
Two hours and 15 minutes

I: Organization, Structure and Authority of Government (15%)

 

A. Demonstrate an understanding of the levels of government, including:

  1. The three levels of government: federal, state and local.

  2. The interrelationships among the three levels of government: federal, state and local.

B. Demonstrate an understanding of the branches of government – legislative, executive, judicial – including:

  1. The roles of the three branches.

  2. The interrelationships among the three branches.

  3. The checks and balances through separation of powers among the three branches.

C. Demonstrate an understanding of the components of federal, state and local governments (for example, departments, agencies, bureaus, commissions, divisions).

D. Demonstrate an understanding of the authorities and responsibilities of the government (government-wide and departmental), including:

  1. The federal government, its hierarchy and constraints (for example, U.S. Constitution, federal laws, executive orders, rules and regulations).

  2. The state governments, their hierarchies and constraints (for example, U.S. Constitution, state constitutions, state laws, executive orders, rules and regulations).

  3. The local governments, their hierarchies and constraints (for example, state constitutions, state laws, local charters, local ordinances, executive orders, rules and regulations).

  4. Tribal government sovereignty.

E. Demonstrate an understanding of the authorities and responsibilities of special-purpose governments and quasi-governmental entities, including:

  1. The differentiation among general-purpose governments, special-purpose governments and quasi-governmental entities (for example, federal, states, cities, counties, authorities, school districts, government corporations, government-sponsored enterprises).

  2. The interrelationships among general-purpose governments, special-purpose governments and quasi-governmental entities.

  3. The role of jointly-governed organizations (for example, cooperating school districts).
     

II: Legally-Based Implications of the Government Financial Environment (20%)

 

A. Demonstrate an understanding of the implications of sovereignty in the levels of government, including:

  1. The meaning, application and limitations of sovereign authority.

  2. The power of governments to tax and borrow.

  3. The power of the federal government to establish monetary policy. 

B. Demonstrate an understanding of the budget, including:

  1. The role and significance of the budget in government.

  2. The objectives of the budget (for example, policy document, operations guide, financial plan, communications device).

  3. The objectives of the budget process (for example, define priorities, debate policy, allocate resources, identify revenue sources).

  4. The legal aspects of the government budget (for example, control levels, spending limits, fund types, balanced budgeting).

  5. The principles of legislative control over governmental finance (for example, appropriating funds, establishing spending levels, establishing spending conditions).

  6. How the executive branch controls spending (for example, monitoring budget execution, planning for allocation of resources over time and among programs).

  7. How judicial decisions affect government spending.

  8. The role of other budget control devices (for example, apportionments, allotments, encumbrances/obligations, funds, function, department, activity, object). 

C. Demonstrate an understanding of how establishing special funds or dedicated revenues helps fulfill legal requirements.

D. Demonstrate an understanding of legislative “earmarking.”
 

III: Demonstrate an Understanding of the Government Management System (Cycle), Including: (18%)

A. The elements of the government management system, including strategic planning, programming, budgeting, operations, accounting, reporting and auditing. 

B. The interrelationships among the elements of the government management system.
 

IV: Governmental Financing Process (25%)

A. Demonstrate an understanding of the role of taxation, including:

  1. The elements of tax policy (for example, what to tax, who to tax, how much to tax, why to tax).

  2. The various types of taxes for each level of government and the roles and advantages of each type (for example, income, wealth, consumption).

  3. The nature and role of tax expenditures.

  4. Tax limitations.

B. Demonstrate an understanding of intergovernmental revenues, including:

  1. The differences among contracts, shared revenues and grants.

  2. The differences among the types of grants (for example, formula grants, discretionary grants, block grants).

  3. The requirements and expectations of the grantor and grantee.

C. Demonstrate an understanding of other forms of financing, including:

  1. Other forms of government revenues (for example, investment income, user fees, licenses, lotteries, donations).

  2. The rationales for establishing user fees (for example, recover costs, expand service capacity, encourage or limit use of services).

  3. The use of public-private partnerships.

D. Demonstrate an understanding of the role of debt, including:

  1. Purposes of entering into debt.

  2. Factors that should be considered before entering into debt (for example, ability to pay, purpose, interest rate, tax base).

  3. The types of debt limitations (for example, statutory, bond covenants).

  4. Factors that should be included in debt policies (for example, available tax base, debt maturities). 

  5. The various types of financing options (for example, notes, bonds, lease-purchase, certificates of participation).

  6. The sources and methods of repaying debt (for example, dedicated taxes, user fees, general revenues).

  7. The role of credit rating agencies in the debt issuance process.

  8. The role of insurance and guarantees in the debt issuance process. 
     

V. Identify the Concepts, Definitions and Notions of Public Accountability, Including: (10%)

 

A. The meaning and purpose of accountability in the government environment (for example, the CFO Act of 1990).  

B. The key attributes of accountability (for example, disclosure, organization structure, reporting).  

C. The role and interrelationships among key attributes of accountability (for example, disclosure, organization structure, reporting).  

D. Elements for which a government should be accountable (for example, performance, financial, compliance, efficiency and effectiveness, stewardship of assets).  

E. The primary stakeholders in accountability (for example, legislators, taxpayers, other governments, investors, creditors, underwriters, future generations).  

F. The groups that help to establish and maintain accountability (for example, legislative bodies, media, management, analysts, employees, taxpayers).  

G. The methods used to demonstrate and assess accountability and transparency (for example, audit reports, performance reports, oversight hearings, program evaluations, service efforts and accomplishment (SEA) reports, electronic reports).  

H. The techniques used to assess fiscal sustainability and solvency.  
 

VI: Demonstrate an Understanding of Ethics as Applied to the Government Environment, Including: (7%)

 

A. The key concepts related to ethical responsibility to the public, professional conduct (for example, actual or perceived conflicts of interest, independence, objectivity, due care) and the sources of guidance (for example, the AGA Code of Ethics).  

B. The steps a government financial manager needs to take to avoid a conflict of interest and to ensure objectivity and independence.  

C. The concept of due care in the performance of professional duties.  

D. Activities or situations that are inconsistent with the responsibilities of public officials and employees.  

E. The appropriate course of action to avoid the reality or the perception of improper use of one's office for personal gain.  
 

VII: Demonstrate an Understanding of Electronic Services in Government, Including: (5%)

 

A. Delivery of government services and e-government (for example, driver’s license renewal, online bill and tax payment).  

B. Stakeholder real-time access to information, including electronic financial reporting.  

C. The use of social media and mobile devices for communications and providing services (for example, Facebook, Twitter, RSS feeds).   

D. Security and privacy controls (for example, the requirements of the National Institute of Standards and Technology, encryption).