Question

Governmental reporting entity

Which of the following entities is least likely to be included as a blended component unit in a county government’s financial statements?

Select one:

Tobacco settlement financing authority, whose board members are appointed by the country

County library, funded by general obligation bonds

County building authority, whose board members are appointed by the county

County water authority, funded by debt secured by water revenues

Answer 1

FROM THIS QUESTION COUNTRY LIBRARY IS LEAST LIKELY TO BE INCLUDED AS BLENDED COMPONENT UNIT.

COUNTRY LIBRARY IS FUNDED BY THE GENERAL OBLIGATION BOND. THESE TYPE OF BONDS ARE ISSUED WITH THE BELIEF THAT THE MUNICIPALITY WILL BE ABLE TO REPAY THE OBLIGATION FROM REVENUE OR TAX FROM THE PROJECT.

IN THREE OTHER CASES GOVERNMENT HAVE COMPLETE CONTROL OVER THE FINANCE SYSTEM. THAT IS IN TOBACCO SETTLEMENT FINANCING AUTHORITY AND BUILDING AUTHORITY , THE MEMBERS ARE APPOINTED BY THE COUNTRY AND IN WATER AUTHORITY DEBT FUND IS SECURED BY WATER REVENUE.

SO COUNTRY LIBRARY , FUNDED BY GENERAL OBLIGATION BONDS WHICH IS LIKELY TO BE THE LEAST POSSIBLE ONE.