Which of the following is a primary objective of financial reporting by state and local governments?
A) To provide information that can be used for capital allocation decisions made by external investors.
B) To report on the legal requirements imposed on the government by its elected officials.
C) To provide information that can be used to assess a government's accountability.
D) To fulfill the government's statutory duty to report on cash received and cash disbursed.

Question

Quizplus · Accepted Answer

The primary objective of financial reporting by state and local governments is to provide information that can be used to assess their accountability. While financial reporting may also provide information for capital allocation decisions made by external investors, this is not the primary objective of such reporting. Reporting on legal requirements imposed on the government by its elected officials and fulfilling the government's statutory duty to report on cash received and cash disbursed are also not primary objectives of financial reporting by state and local governments.

Which of the Following Is a Primary Objective of Financial