NRPA Financial Management & Budgeting Flashcards

Which approach to budgeting requires every expense to be justified from scratch each fiscal year rather than using the prior year as a baseline?

Answer: Zero-based budgeting

Zero-based budgeting requires managers to justify every line item anew each cycle rather than simply adjusting previous allocations.

What is an enterprise fund in a public parks and recreation context?

Answer: A fund used for services that are primarily self-supporting through user fees

Enterprise funds account for operations that are intended to be self-supporting, such as golf courses or recreation centers that charge user fees.

Which of the following best describes a fixed cost in parks and recreation programming?

Answer: A cost that remains constant regardless of the number of program participants

Fixed costs such as facility rental or staff salaries do not change based on how many participants enroll in a program.

What is the primary purpose of a parks and recreation agency establishing a reserve fund?

Answer: To cover unexpected expenses or revenue shortfalls without disrupting operations

Reserve funds provide a financial buffer that allows agencies to manage emergencies or unexpected costs without cutting programs.

Which grant type requires a parks agency to match a portion of awarded funds with its own resources?

Answer: Matching grant

A matching grant requires the recipient to contribute a specified proportion of funds alongside the grant award.

What does GASB stand for, and why is it relevant to parks and recreation agencies?

Answer: Governmental Accounting Standards Board; it sets financial reporting standards for public agencies

GASB establishes generally accepted accounting principles (GAAP) for state and local government entities, including parks departments.