Chapter 8 Not For Profit

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Chapter 8 Not For Profit Study online at https://quizlet.com/_5jdxid 1. What type of Pension Trust Fund account should be credited for contributions to the trust fund? Select one: a. A revenue account b. An expenditure account c. An additions account d. A net assets account C 2. Financial statements for a Pension Trust Fund Select one: a. Are not included in a sponsoring government's an- nual financial report. b. Are included in a separate column in the sponsor- ing government's government-wide financial state- ments. c. Are included with fiduciary funds in a sponsoring government's annual financial report. d. Are included with proprietary funds in the sponsor- ing government's annual financial report. C 3. Which of the following arrangements results in an em- ployer promising a former employee a fixed pension payment each month? Select one: a. Defined benefit plan b. Defined contribution plan c. Optional retirement plan d. Both a. and b. e. None of the above A 4. A government sponsors a defined benefit pension plan for which it accumulates resources in a Pension Trust Fund that meets GASB requirements. Which of the following should be reported in its proprietary fund statement of net position to report its pension obligation? B 1 / 5

Chapter 8 Not For Profit Study online at https://quizlet.com/_5jdxid Select one: a. Total pension liability b. Net pension liability c. Actuarially determined contribution liability d. Pension obligation e. None of the above 5. According to GAAP for Pension Trust Funds, which of the following is true? Select one: a. Revenues must be transferred to a third-party ad- ministrator. b. Payments of resources are recorded as deductions. c. There is no concept of fund balance or net position. d. All disbursements must be made to the General Fund. e. None of the above B 6. Because governments bear the risk of unknown eco- nomic factors when providing retirement benefits through defined benefit pension plans, more gov- ernments are shifting to providing pension benefits through defined contribution plans. Select one: True False True 7. A distinguishing characteristic of OPEB plans that are designed to provide healthcare benefits to retirees is that governments typically advance fund these plans so retirees can be assured that their health care needs during retirement will be met. Select one: True False False 2 / 5

Chapter 8 Not For Profit Study online at https://quizlet.com/_5jdxid 8. A liability is reported in fiduciary funds when an event occurs that compels a government to disburse fidu- ciary resources. Select one: True False True 9. Pension or OPEB plans typically have one of three structures: single-employer; agent multiple-employer; or commercial-supported government employer. Select one: True False False 10. With a defined contribution pension arrangement, a government typically contributes a certain percent- age of an employee's salary to an account in the employee's name. Select one: True False True 11. A government has a defined contribution plan for its General Fund employees. During the year, it con- tributed $1,080,000 to its employees' individual de- fined contribution retirement accounts. At its fiscal year-end, the government still owes $180,000 to its employees' individual defined contribution retirement accounts according to the benefit terms of the defined contribution plan. How much should the government report as expendi- tures for pensions for its current fiscal year? Select one: A. $1,080,000 NOT A 3 / 5

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Chapter 8 Not For Profit Study online at https://quizlet.com/_5jdxid B. $1,260,000 C. $0 D. $180,000 12. A government has a single-employer defined benefit pension plan for its firefighters. At its December 31, 2019 fiscal year-end, the government had a total pen- sion liability for the plan of $1,200,000 and accumulat- ed assets to pay the liability of $800,000. On December 31, 2020, the government had a total pension liability for the plan of $1,300,000 and accumulated assets to pay the liability of $780,000. The assets to pay the liability are reported as a part of the General Fund's committed fund balance. What amount will the government report as its pen- sion liability in its government-wide financial state- ments on December 31, 2020? Select one: A. $520,000 B. $1,300,000 C. $400,000 D. $1,200,000 B 13. Pension reporting for state and local governments that have established a qualifying irrevocable trust require that: Select one: A. The actuarial accrued liability is reported in an em- ployer's government-wide statement of net position. B. Governments have an option of reporting or not reporting the net pension liability in an employer's government-wide statement of net position. C. Changes in the net pension liability is reported as pension expense in an employer's government-wide statement of activities. D 4 / 5

Chapter 8 Not For Profit Study online at https://quizlet.com/_5jdxid D. A net pension liability is reported in an employer's government-wide financial statements. 14. Which of the following statements is true regarding an agent multiple-employer pension plan? Select one: A. A separate account is maintained for each em- ployer so that only an individual employer's share of pooled assets is available to pay the benefits of its retirees. B. Agent multiple-employer plans pool the administra- tive function for multiple employers. C. Plan assets from multiple participating employers are pooled for investment purposes. D. All of the above. E. None of the above. D 15. Which of the following types of pension arrangements result in a government bearing the risk that invest- ments do not yield an expected return? a. Defined Benefit - yes Defined Contribution - no b. Defined Benefit - no Defined Contribution - yes c. Defined Benefit - yes Defined Contribution - yes d. Defined Benefit - no Defined Contribution - no A 5 / 5