What does component unit mean on the CPA exam?
Component unit. A legally separate organization for which the primary government is financially accountable. Reported either blended into the government's own funds or discretely in its own column.
Defined against GASB 61.
Which CPA exam sections use component unit?
Component unit appears in the BAR section of the CPA exam.
Related terms
- reporting unit: An operating segment or one level below it, and the level at which goodwill is tested for impairment.
- foreign key: A column, or set of columns, in one table whose values must correspond to a primary key in another table.
- primary key: The column or combination of columns that uniquely identifies each row in a relational table.
- governmental funds: The funds that account for tax-supported activity, reported on the modified accrual basis with a current financial resources focus.
- additional paid-in capital: Amounts received from shareholders above the par or stated value of the shares issued, reported as a separate equity caption.
- governmental activities: The part of a government's operations financed mainly by taxes rather than by fees, reported on the government-wide statements on the full accrual basis.