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Public Sector Financial Management, GFR & Audit Standards (Accounting & Finance) Solved Questions & Notes (2026) - Apex Rankers

Higher Education & Professional Technical Tests > Accounting & Finance > Public Sector Financial Management, GFR & Audit Standards

100 Total Solved Questions
~150 mins Estimated Reading Time
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Public Sector Financial Management, GFR & Audit Standards

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Q. 1 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q1: Under public financial governance (GFR Rules of Financial Propriety & Powers), what is the statutory requirement for gfr rule 10 mandates that publ?
A
GFR Rule 10 mandates that public officers exercise the same vigilance over public funds as a person of ordinary prudence over their own money.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: GFR Rule 10 mandates that public officers exercise the same vigilance over public funds as a person of ordinary prudence over their own money.
Q. 2 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q2: How is principal accounting officer (pao - enforced across government departments and public universities (GFR Rules of Financial Propriety & Powers)?
A
Principal Accounting Officer (PAO - Secretary of Ministry) is personally accountable for financial regularity, discipline, and budget propriety.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: Principal Accounting Officer (PAO - Secretary of Ministry) is personally accountable for financial regularity, discipline, and budget propriety.
Q. 3 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q3: Under GFR and PFM statutory rules (GFR Rules of Financial Propriety & Powers), which principle dictates no expenditure can be incurred w?
A
No expenditure can be incurred without sanctioned budget appropriation, competent authority approval, and strict adherence to rules.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: No expenditure can be incurred without sanctioned budget appropriation, competent authority approval, and strict adherence to rules.
Q. 4 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q4: In public sector audit and financial control (GFR Rules of Financial Propriety & Powers), what standard governs re-appropriation allows transf?
A
Re-appropriation allows transfer of savings between primary budget units within the same grant, subject to statutory limits.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: Re-appropriation allows transfer of savings between primary budget units within the same grant, subject to statutory limits.
Q. 5 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q5: How does a Principal Accounting Officer (PAO) ensure compliance with lapse of sanction dictates t in GFR Rules of Financial Propriety & Powers?
A
Lapse of Sanction dictates that financial sanctions for fresh charges lapse if no payment is made within 12 months.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: Lapse of Sanction dictates that financial sanctions for fresh charges lapse if no payment is made within 12 months.
Q. 6 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q6: Under PPRA and financial regulations (GFR Rules of Financial Propriety & Powers), what procedure applies to physical verification of all publ?
A
Physical verification of all public stores and assets must be conducted at least once annually under GFR Rule 158.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: Physical verification of all public stores and assets must be conducted at least once annually under GFR Rule 158.
Q. 7 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q7: In government treasury and accounting operations (GFR Rules of Financial Propriety & Powers), which rule specifies losses due to theft, fraud, or ?
A
Losses due to theft, fraud, or negligence must be formally investigated and reported to the PAO and Auditor-General.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: Losses due to theft, fraud, or negligence must be formally investigated and reported to the PAO and Auditor-General.
Q. 8 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q8: What is the accountability mandate regarding delegation of financial power under GFR Rules of Financial Propriety & Powers?
A
Delegation of Financial Powers specifies monetary spending thresholds for Heads of Departments and Subordinate Officers.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under GFR Rules of Financial Propriety & Powers: Delegation of Financial Powers specifies monetary spending thresholds for Heads of Departments and Subordinate Officers.
Q. 9 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q9: Under public financial governance (Public Procurement Regulatory Authority (PPRA 2004)), what is the statutory requirement for open competitive bidding is th?
A
Open Competitive Bidding is the mandatory principal procurement method for public sector goods, works, and services.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Open Competitive Bidding is the mandatory principal procurement method for public sector goods, works, and services.
Q. 10 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q10: How is single stage two envelope procedure enforced across government departments and public universities (Public Procurement Regulatory Authority (PPRA 2004))?
A
Single Stage Two Envelope procedure is used for complex technical procurement, evaluating technical bids before opening financial bids.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Single Stage Two Envelope procedure is used for complex technical procurement, evaluating technical bids before opening financial bids.
Q. 11 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q11: Under GFR and PFM statutory rules (Public Procurement Regulatory Authority (PPRA 2004)), which principle dictates minimum response time for nation?
A
Minimum response time for national competitive bidding tenders is 15 calendar days (30 days for international tenders).
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Minimum response time for national competitive bidding tenders is 15 calendar days (30 days for international tenders).
Q. 12 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q12: In public sector audit and financial control (Public Procurement Regulatory Authority (PPRA 2004)), what standard governs bid security (earnest money) t?
A
Bid security (Earnest Money) typically ranges from 1% to 5% of estimated tender value to ensure serious bidder commitment.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Bid security (Earnest Money) typically ranges from 1% to 5% of estimated tender value to ensure serious bidder commitment.
Q. 13 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q13: How does a Principal Accounting Officer (PAO) ensure compliance with performance guarantee (typic in Public Procurement Regulatory Authority (PPRA 2004)?
A
Performance guarantee (typically 5% to 10% of contract value) secures contractor fulfillment of contract terms.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Performance guarantee (typically 5% to 10% of contract value) secures contractor fulfillment of contract terms.
Q. 14 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q14: Under PPRA and financial regulations (Public Procurement Regulatory Authority (PPRA 2004)), what procedure applies to procuring agencies must publicly ?
A
Procuring agencies must publicly announce bid evaluation reports at least 10 days prior to contract award.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Procuring agencies must publicly announce bid evaluation reports at least 10 days prior to contract award.
Q. 15 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q15: In government treasury and accounting operations (Public Procurement Regulatory Authority (PPRA 2004)), which rule specifies blacklisting debars fraudulent ?
A
Blacklisting debars fraudulent or defaulting contractors from participating in public tenders for a specified period.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Blacklisting debars fraudulent or defaulting contractors from participating in public tenders for a specified period.
Q. 16 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q16: What is the accountability mandate regarding direct contracting (single so under Public Procurement Regulatory Authority (PPRA 2004)?
A
Direct contracting (Single Source) is permitted only under strict emergency, sole-source proprietary, or national security exemptions.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Procurement Regulatory Authority (PPRA 2004): Direct contracting (Single Source) is permitted only under strict emergency, sole-source proprietary, or national security exemptions.
Q. 17 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q17: Under public financial governance (Public Finance Management (PFM) Act 2019 & Controls), what is the statutory requirement for federal consolidated fund rece?
A
Federal Consolidated Fund receives all government revenues, loan proceeds, and loan repayment receipts under Article 78 of Constitution.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Federal Consolidated Fund receives all government revenues, loan proceeds, and loan repayment receipts under Article 78 of Constitution.
Q. 18 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q18: How is public account of the federation ho enforced across government departments and public universities (Public Finance Management (PFM) Act 2019 & Controls)?
A
Public Account of the Federation holds all other public moneys received by or deposited with the federal government (e.g. provident funds, trust deposits).
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Public Account of the Federation holds all other public moneys received by or deposited with the federal government (e.g. provident funds, trust deposits).
Q. 19 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q19: Under GFR and PFM statutory rules (Public Finance Management (PFM) Act 2019 & Controls), which principle dictates treasury single account (tsa) co?
A
Treasury Single Account (TSA) consolidates all government banking balances into a unified account at State Bank of Pakistan.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Treasury Single Account (TSA) consolidates all government banking balances into a unified account at State Bank of Pakistan.
Q. 20 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q20: In public sector audit and financial control (Public Finance Management (PFM) Act 2019 & Controls), what standard governs chief internal auditor reports?
A
Chief Internal Auditor reports directly to the PAO and Audit Committee to provide independent assurance on internal controls.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Chief Internal Auditor reports directly to the PAO and Audit Committee to provide independent assurance on internal controls.
Q. 21 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q21: How does a Principal Accounting Officer (PAO) ensure compliance with medium-term budgetary framew in Public Finance Management (PFM) Act 2019 & Controls?
A
Medium-Term Budgetary Framework (MTBF) aligns annual budget allocations with 3-year strategic multi-year policy priorities.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Medium-Term Budgetary Framework (MTBF) aligns annual budget allocations with 3-year strategic multi-year policy priorities.
Q. 22 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q22: Under PPRA and financial regulations (Public Finance Management (PFM) Act 2019 & Controls), what procedure applies to special drawing accounts (sda) an?
A
Special Drawing Accounts (SDA) and Assignment Accounts are specialized mechanisms for foreign donor and development project funds.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Special Drawing Accounts (SDA) and Assignment Accounts are specialized mechanisms for foreign donor and development project funds.
Q. 23 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q23: In government treasury and accounting operations (Public Finance Management (PFM) Act 2019 & Controls), which rule specifies controller general of accounts ?
A
Controller General of Accounts (CGA) prepares annual financial statements and maintains government accounting policies under NAM.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Controller General of Accounts (CGA) prepares annual financial statements and maintains government accounting policies under NAM.
Q. 24 Accounting & Corporate Finance
Difficulty: Medium (1 Mark)
Q24: What is the accountability mandate regarding auditor-general of pakistan ( under Public Finance Management (PFM) Act 2019 & Controls?
A
Auditor-General of Pakistan (AGP) conducts independent financial, compliance, and performance audits under Articles 168-171.
✓ Correct
B
Permitting verbal financial sanctions without written audit trails
C
Exempting commercial contractors from all performance guarantees
D
Depositing public revenues directly into private personal bank accounts
💡 Step-by-Step Explanation & Concept Rationale
Under Public Finance Management (PFM) Act 2019 & Controls: Auditor-General of Pakistan (AGP) conducts independent financial, compliance, and performance audits under Articles 168-171.
Q. 25 Accounting & Corporate Finance
Difficulty: Easy (1 Mark)
Q25: Under GFR public sector financial compliance #25, what is required for incurring public expenditure?
A
Sanctioned budget appropriation, competent authority approval, and strict compliance with procurement rules
✓ Correct
B
Verbal recommendation from a municipal councillor
C
Issuance of promissory notes without general ledger entry
D
Execution of an off-balance sheet currency swap
💡 Step-by-Step Explanation & Concept Rationale
Public expenditure strictly requires sanctioned budget appropriation, competent approval, and full compliance with financial rules.
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