Topic: Government Expenditure

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PSAF – May 2021 – L2 – Q6a – Fiscal Policy and Public Finance

Explanation of expenditure assignment principles and drawbacks in a multi-level government setting.

Question

Expenditure assignment deals with the division or sharing of expenditure, regulatory, and tax functions or responsibilities among multi-levels of government in a federation.

Required:

Explain THREE principles guiding expenditure assignment and highlight TWO of its drawbacks.

Answer

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Tags: Decentralization, Expenditure assignment, Fiscal Management, Government Functions, Public Sector
Level: Level 2

Topic: Fiscal Policy and Public Finance, Government Expenditure
Series: MAY 2021

PSAF – May 2021 – L2 – Q5a – Public Sector Financial Statements

Identification of inventory costs excluded under IPSAS 12 and disclosure requirements for financial statements.

Question

IPSAS 12 on Inventories deals with the valuation and presentation of inventories in the financial statements in the context of the historical cost system, the most widely adopted basis on which financial statements are presented.

Required:

In accordance with IPSAS 12, identify FOUR costs that are excluded from the cost of inventories and FOUR requirements to be disclosed in the financial statements.

Answer

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Tags: Disclosure Requirements, Exclusions, Financial Reporting, Inventory Valuation, IPSAS 12
Level: Level 2

Topic: Government Expenditure, Public Sector Financial Statements
Series: MAY 2021

PSAF – May 2021 – L2 – Q4a – The Budgeting Process in the Public Sector

Explanation of MTEF, Budget Call Circular, and their main differences for public sector budgeting.

Question

As the Accountant in charge of the expenditure division, you are to assist the Director of Finance in the ministry to set up a budget committee. You have also been asked to review the recently issued 2020 Budget Call Circular.

Required:

Explain briefly the following:

Medium Term Expenditure Framework (MTEF) including FOUR of its objectives (6 Marks)
Budget Call Circular (2 Marks)
The main difference between MTEF and Budget Call Circular (2 Marks)

Answer

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Tags: Budget Call Circular, Budgeting Process, Fiscal Policy, Government Expenditure, MTEF
Level: Level 2

Topic: Government Expenditure, Regulatory and Institutional Framework, The Budgeting Process in the Public Sector
Series: MAY 2021

PSAF – May 2017 – L2 – SC – Q7 – Government Expenditure

Identify and explain factors contributing to the rapid growth in Nigeria's government spending.

Question

A number of factors have been identified as inevitably leading to rapid growth in government spending in many countries over time.

Required:

Identify and explain FIVE of these factors as they apply to Nigeria.

Answer

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Tags: Economic Drivers, Fiscal Policy, Government Spending, Nigeria, Public Finance
Level: Level 2

Topic: Government Expenditure
Series: MAY 2017

PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure

Evaluation of investment projects using Profitability Index.

Question

a. Oyigbo Local Government is set to improve its internally generated revenue by venturing into the construction of an animal feedmill, which will cost N15 million. The mill, when constructed, is projected to generate a net cash inflow of N3.8 million annually and the useful life is 6 years. The cost of borrowing from a commercial bank for this purpose is 12%.

Required:
Advise the Chairman of Oyigbo Local Government whether or not to undertake the project using the Profitability Index (PI) technique of investment appraisal.

The cumulative discount factor formula to use is:

where $r =$ discount rate, $n =$ number of years. (10 Marks)

b. Identify THREE advantages and TWO disadvantages of the profitability index as a technique for project appraisal. (5 Marks)

Answer

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Tags: Investment Appraisal, Profitability Index, Public Sector Finance
Level: Level 2

Topic: Government Expenditure
Series: MAY 2024

PSAF – Nov 2016 – L2 – Q6b – Government Revenue

Requires calculation and comparison of benefit/cost and net benefit/cost ratios for five local government projects to advise on project selection.

Question

The following estimated costs and benefits relate to FIVE different divisible projects of Eleweran Local Government. The local government has budgeted the sum of N100,000,000 to undertake the following projects:

Project	A (N’000)	B (N’000)	C (N’000)	D (N’000)	E (N’000)
Estimated Costs of Investment	20,000	40,000	24,000	48,000	60,000
Estimated Benefits	50,000	44,000	40,000	52,000	72,000

You are required to:
i. Calculate the benefit/cost ratio of each of the five projects. (1 1/4 Marks)
ii. Compute the net benefit/cost ratio of each project. (3 3/4 Marks)
iii. Compare the results in (i) and (ii) and advise the chairman of the local government on the project to be undertaken. (5 Marks)

Answer

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Tags: Benefit/Cost Ratio, Local Government Projects, Net Benefit, Project Investment
Level: Level 2

Topic: Government Expenditure, Government Revenue
Series: NOV 2016

PSA&F – Nov 2019 – L2 – Q2b – Government Expenditure

Explains functional areas of public expenditure and their effects on the economy.

Question

Through functional classification of public expenditure, the economic effects of various government activities can be determined or measured, which would also be helpful for proper policy formulation.

Required:

Identify and explain TWO functional areas of public expenditure.
Discuss TWO effects on the economy.

Answer

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Tags: Economic Impact, Functional Classification, Policy formulation, Public Expenditure
Level: Level 2

Topic: Government Expenditure
Series: NOV 2019

PSAF – Nov 2016 – L2 – Q4b – Government Expenditure

This question distinguishes between the Board of Survey and Board of Enquiry, and discusses the conditions for constituting a Board of Enquiry.

Question

i. Distinguish between Board of Survey and Board of Enquiry.
(5 Marks)

ii. Under what conditions would a Board of Enquiry be constituted?
(6 Marks)

Answer

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Tags: Audit, Board of Enquiry, Board of Survey, Public Fund Loss
Level: Level 2

Topic: Government Expenditure
Series: NOV 2016

PSAF – Nov 2016 – L2 – Q4a – Government Expenditure

This question identifies various sources of loss of public funds in the public sector, focusing on misappropriation and fraud.

Question

Loss or shortage of public funds is depletion in government funds at a given time.

Enumerate SIX sources through which loss of funds may arise in the public sector.

Answer

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Tags: Financial management, Fraud, Losses in Public Sector, Misappropriation, Public Funds
Level: Level 2

Topic: Government Expenditure
Series: NOV 2016

PSAF – Nov 2020 – L2 – Q2b – Government Expenditure

Identify and explain reasons for the steady rise in public expenditure in Nigeria.

Question

Globally, there has been a steady increase in the level of government expenditure in different areas of activities. In Nigeria, there is a steady growth of expenditure over the years which requires explanation.

Required:
Identify and explain five reasons for the rise in public expenditure in Nigeria.
(10 Marks)

Answer

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Tags: Fiscal Policy, Government Spending, Public Expenditure
Level: Level 2

Topic: Government Expenditure
Series: NOV 2020

PSAF – May 2021 – L2 – Q6a – Fiscal Policy and Public Finance

Explanation of expenditure assignment principles and drawbacks in a multi-level government setting.

Question

Expenditure assignment deals with the division or sharing of expenditure, regulatory, and tax functions or responsibilities among multi-levels of government in a federation.

Required:

Explain THREE principles guiding expenditure assignment and highlight TWO of its drawbacks.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Decentralization, Expenditure assignment, Fiscal Management, Government Functions, Public Sector
Level: Level 2

Topic: Fiscal Policy and Public Finance, Government Expenditure
Series: MAY 2021

PSAF – May 2021 – L2 – Q5a – Public Sector Financial Statements

Identification of inventory costs excluded under IPSAS 12 and disclosure requirements for financial statements.

Question

Required:

In accordance with IPSAS 12, identify FOUR costs that are excluded from the cost of inventories and FOUR requirements to be disclosed in the financial statements.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Disclosure Requirements, Exclusions, Financial Reporting, Inventory Valuation, IPSAS 12
Level: Level 2

Topic: Government Expenditure, Public Sector Financial Statements
Series: MAY 2021

PSAF – May 2021 – L2 – Q4a – The Budgeting Process in the Public Sector

Explanation of MTEF, Budget Call Circular, and their main differences for public sector budgeting.

Question

Required:

Explain briefly the following:

Medium Term Expenditure Framework (MTEF) including FOUR of its objectives (6 Marks)
Budget Call Circular (2 Marks)
The main difference between MTEF and Budget Call Circular (2 Marks)

Answer

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Tags: Budget Call Circular, Budgeting Process, Fiscal Policy, Government Expenditure, MTEF
Level: Level 2

Topic: Government Expenditure, Regulatory and Institutional Framework, The Budgeting Process in the Public Sector
Series: MAY 2021

PSAF – May 2017 – L2 – SC – Q7 – Government Expenditure

Identify and explain factors contributing to the rapid growth in Nigeria's government spending.

Question

A number of factors have been identified as inevitably leading to rapid growth in government spending in many countries over time.

Required:

Identify and explain FIVE of these factors as they apply to Nigeria.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Economic Drivers, Fiscal Policy, Government Spending, Nigeria, Public Finance
Level: Level 2

Topic: Government Expenditure
Series: MAY 2017

PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure

Evaluation of investment projects using Profitability Index.

Question

Required:
Advise the Chairman of Oyigbo Local Government whether or not to undertake the project using the Profitability Index (PI) technique of investment appraisal.

The cumulative discount factor formula to use is:

where $r =$ discount rate, $n =$ number of years. (10 Marks)

b. Identify THREE advantages and TWO disadvantages of the profitability index as a technique for project appraisal. (5 Marks)

Answer

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Tags: Investment Appraisal, Profitability Index, Public Sector Finance
Level: Level 2

Topic: Government Expenditure
Series: MAY 2024

PSAF – Nov 2016 – L2 – Q6b – Government Revenue

Requires calculation and comparison of benefit/cost and net benefit/cost ratios for five local government projects to advise on project selection.

Question

Project	A (N’000)	B (N’000)	C (N’000)	D (N’000)	E (N’000)
Estimated Costs of Investment	20,000	40,000	24,000	48,000	60,000
Estimated Benefits	50,000	44,000	40,000	52,000	72,000

Answer

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Tags: Benefit/Cost Ratio, Local Government Projects, Net Benefit, Project Investment
Level: Level 2

Topic: Government Expenditure, Government Revenue
Series: NOV 2016

PSA&F – Nov 2019 – L2 – Q2b – Government Expenditure

Explains functional areas of public expenditure and their effects on the economy.

Question

Required:

Identify and explain TWO functional areas of public expenditure.
Discuss TWO effects on the economy.

Answer

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Tags: Economic Impact, Functional Classification, Policy formulation, Public Expenditure
Level: Level 2

Topic: Government Expenditure
Series: NOV 2019

PSAF – Nov 2016 – L2 – Q4b – Government Expenditure

This question distinguishes between the Board of Survey and Board of Enquiry, and discusses the conditions for constituting a Board of Enquiry.

Question

i. Distinguish between Board of Survey and Board of Enquiry.
(5 Marks)

ii. Under what conditions would a Board of Enquiry be constituted?
(6 Marks)

Answer

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Tags: Audit, Board of Enquiry, Board of Survey, Public Fund Loss
Level: Level 2

Topic: Government Expenditure
Series: NOV 2016

PSAF – Nov 2016 – L2 – Q4a – Government Expenditure

This question identifies various sources of loss of public funds in the public sector, focusing on misappropriation and fraud.

Question

Loss or shortage of public funds is depletion in government funds at a given time.

Enumerate SIX sources through which loss of funds may arise in the public sector.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Financial management, Fraud, Losses in Public Sector, Misappropriation, Public Funds
Level: Level 2

Topic: Government Expenditure
Series: NOV 2016

PSAF – Nov 2020 – L2 – Q2b – Government Expenditure

Identify and explain reasons for the steady rise in public expenditure in Nigeria.

Question

Required:
Identify and explain five reasons for the rise in public expenditure in Nigeria.
(10 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Fiscal Policy, Government Spending, Public Expenditure
Level: Level 2