1. Governments must combine their blended component units into both the fund and government-wide statements. 2. Governments must combine their discretely presented component units into both the fund and the government-wide statements. 3. A related organization is a contractual arrangement whereby two or more participants agree to carry out a common activity and share its risks and rewards. 4. A primary government can impose its will on a potential component unit if it has the authority to modify or approve the unit’s budget. 5. The comprehensive annual financial report (CAFR) is divided into three main sections: the table of contents section the auditors’ report section and the financial section. 6. The typical audit is designed to cover all information included in the CAFR. 7. There are only two government-wide statements: the statement of net assets and the statement of activities. 8. Required notes are an essential element of the basic financial statements. 9. Required supplementary information (RSI) is considered part of the basic financial statements. 10. Public colleges and universities must adhere to the same GASB pronouncements as other types of governments.
