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Government-wide statements use accrual accounting with an economic resources focus, similar to corporate reporting. Modified accrual (Option A) applies to governmental funds. Cash (Option B) is not GAAP. Budgetary (Option D) is for legal compliance. Exam 2 emphasizes government-wide vs. fund basis. Option C is correct.

Requiring HR approval of new hires, terminations, and salary changes ensures payroll reflects valid, authorized transactions. Variance analysis (Option A) and reconciliations (Option D) are detective controls but less direct. Employee interviews (Option C) do not validate transactions. Exam 3 emphasizes authorization and approval controls. Option B is correct.

Fiduciary resources are held in trust for others and are not available for government programs. GASB requires they be excluded from government-wide statements. They are not capital-project restricted (Option C), nor are they recorded in enterprise funds (Option D). Option A is false because fiduciary funds cannot support operations. Exam 2 stresses fiduciary reporting. Option B is correct.

The Budget and Accounting Act of 1921 created GAO, strengthening congressional oversight by auditing federal spending. GPRA (Option A) requires performance reporting. CFO Act (Option B) mandates financial statements. Antideficiency (Option D) prohibits overspending. Exam 1 highlights foundational laws. Option C is correct.

Segregation of duties divides responsibilities so no one person controls all aspects of a transaction. This prevents fraud or error, such as an employee initiating and approving their own payment. Monitoring (Option B) checks effectiveness. Detective reviews (Option C) identify issues after. Reasonable assurance (Option D) is a general principle. Exam 3 highlights segregation of duties as essential. Option A is correct.