Subsidies are best defined as:
Subsidies are a form of government expenditure.
Accounting and Finance MCQs
IPSAS (International Public Sector Accounting Standards) are issued by:
The IPSASB, under IFAC, develops IPSAS for public sector entities.
Under the cash basis of accounting, transactions are recognized when:
Cash basis ignores receivables and payables until cash moves.
Under the accrual basis of accounting in the public sector, transactions are recognized when:
Accrual accounting records assets, liabilities, revenues and expenses as they arise.
Which of the following is an example of non-tax revenue?
Non-tax revenue includes fees, fines, profits of public enterprises, rents and royalties.
The Public Sector Development Programme (PSDP) mainly finances:
PSDP is the federal development budget for infrastructure and social projects.
Cost-benefit analysis of public projects compares:
It is used to decide whether a project is worth undertaking.
Financing a deficit by creating new money through the central bank is called:
It can lead to inflation.
Treasury bills (T-bills) are:
T-bills have maturities of one year or less.
Pakistan Investment Bonds (PIBs) are:
PIBs are issued with tenors such as 3, 5, 10, 15, 20 and 30 years.
The Public Account of the Federation under Article 78(2) includes:
Examples include trust funds, deposits and savings certificates collections.
Incremental budgeting means:
It is the most common traditional method but can perpetuate inefficiencies.
Zero-based budgeting (ZBB) requires that:
ZBB reviews all programs afresh.
A Medium Term Budgetary Framework (MTBF) is:
MTBF aligns spending with policy priorities across several years.
Tax-to-GDP ratio is calculated as:
It measures the tax effort of an economy.
A tax expenditure is:
Tax expenditures act like spending delivered through the tax system.
Sales tax in the form of a value added tax (VAT) is levied on:
VAT is collected at each stage with credit for tax paid on inputs.
Expenditure charged upon the Federal Consolidated Fund (Article 81) is:
Charged expenditure, such as remuneration of judges and the Auditor-General, is not put to vote.
Supplementary and excess grants in Pakistan are dealt with under:
Article 84 covers additional spending beyond the authorized budget.
The National Finance Commission (NFC) is constituted under:
The NFC recommends distribution of resources between the Federation and the provinces.
Horizontal distribution under the NFC award refers to the sharing of resources:
Vertical distribution is between Federation and provinces; horizontal is among provinces.
Performance-based (results-oriented) budgeting:
It focuses on what government achieves with the money allocated.
Line-item budgeting is a budget format that:
It is simple and good for control but weak in showing results.
The four main stages of the budget cycle are:
A typical budget cycle runs from preparation through approval and implementation to audit.
Under Article 80 of the Constitution of Pakistan, the Federal Government is required to:
Article 80 deals with the Annual Budget Statement.