Chapter 13

Governmental Auditing Standards are published in a document commonly known as the .

Blank 1: Yellow Blank 2: Book

Under the Single Audit Act of 1984, governments and non-for-profit organizations that expend $50 million in federal awards are assigned CognizantBlank 1Blank 1 Cognizant , Correct Unavailable agencies, while those organizations receiving less are expected to use AgenciesBlank 2Blank 2 Agencies , Incorrect Unavailable agencies. (

Blank 1: cognizant Blank 2: oversight

Under the Single Audit Act of 1984, governments and non-for-profit organizations that expend $50 million in federal awards are assigned agencies, while those organizations receiving less are expected to use agencies.

Blank 1: cognizant Blank 2: oversight

True or false: Contributions to 501(c)(3) organizations are only deductible when computing federal income taxes. True false question. True False

False

Select all that apply Financial information required by Form 990 includes a ______. Multiple select question. Statement of Revenues Statement of Functional Expenses Balance Sheet Statement of Cash Flows

Statement of Revenues Statement of Functional Expenses Balance Sheet

Select all that apply 501(c)(3) entities ______. Multiple select question. are permitted to lobby for legislation can inure up to 10% of net earnings to the benefit of shareholders are the most common form of tax-exempt organization may be operated for religious purposes may be operated for educational purposes cannot be organized as corporations may not participate in political campaigns may provide athletic facilities or equipment

are the most common form of tax-exempt organization may be operated for religious purposes may be operated for educational purposes may not participate in political campaigns

If the IRS deems executive compensation to be excessive, intermediate sanctions may be imposed on ______. Multiple choice question. organizational managers who approved the compensation only the organization only individuals receiving the compensation only both managers who approved the compensation and individuals receiving it

both managers who approved the compensation and individuals receiving it

Select all that apply Form 990 disclosures include ______. Multiple select question. code-of-ethics whether the organization was audited compliance with Sarbanes-Oxley document retention policies

code-of-ethics whether the organization was audited document retention policies

IRS concerns over cost allocation for not for profit organizations arose when organizations reported ______. Multiple choice question. unreasonable staff compensation excessive fundraising expense relative to the amount of contribution revenue contribution revenue but no fund raising expense unreasonable executive compensation

contribution revenue but no fund raising expense

The Sarbanes-Oxley Act applies to ______. Multiple choice question. corporations and federal government organizations corporations that file with the SEC all federal government organizations all organizations that have financial statement audits

corporations that file with the SEC

Select all that apply Form 990 requires compensation schedules for ______. Multiple select question. directors independent contractors trustees officers all employees

directors independent contractors trustees officers

Select all that apply Legislative exemptions to UBIT exist for ______. Multiple select question. dividends and interest income from membership list rental annuities from controlled corporations all college bookstore sales

dividends and interest income from membership list rental

Select all that apply The Sarbanes-Oxley Act ______. Multiple select question. applies to all federal governmental agencies has provisions that exist in governmental auditing standards has influenced not-for-profit organizations

has provisions that exist in governmental auditing standards has influenced not-for-profit organizations

Under the Single Audit Act of 1984, ______ are required to monitor the audit process and resolve findings and questioned costs. Multiple choice question. only cognizant agencies both cognizant and oversight agencies only oversight agencies

only cognizant agencies

Under the Single Audit Act of 1984, ______ are required to monitor the audit process and resolve findings and questioned costs. Multiple choice question. only oversight agencies both cognizant and oversight agencies only cognizant agencies

only cognizant agencies

Select all that apply Section 501(c) status ______. Multiple select question. reduces the net cost of contributions to donors places restrictions on the organization's activities exempts the organizations from sales tax impose reporting requirements

reduces the net cost of contributions to donors places restrictions on the organization's activities impose reporting requirements

Select all that apply Conditions that exempt income from UBIT include ______. Multiple select question. the business is not regularly carried on operation for the convenience of employees donated merchandise is being sold most of the labor is performed by paid workers

the business is not regularly carried on operation for the convenience of employees donated merchandise is being sold

True or false: According to the Yellow Book, audits performed in accordance with GAGAS may use lower materiality levels than non-GAGAS audits. True false question. True False

true