The financial data of the component units are included with the government entities reporting entity because of the significance of their operational or financial relationships with the government entity.

Question

Quizplus · Accepted Answer

This statement is true. The financial data of component units are included with the government entities reporting entity because of their significance in terms of operational or financial relationships with the primary government entity. Component units are legally separate organizations, but are financially dependent or accountable to the primary government entity. Therefore, their financial data is consolidated with the government entities reporting entity.

The Financial Data of the Component Units Are Included with the Government