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Difficulty: EasyStructure of Government Funds

A state government credited a total of NGN 50,000,000\text{NGN } 50,000,000 into its Consolidated Revenue Fund (CRF) during a fiscal year. Out of this sum, NGN 32,000,000\text{NGN } 32,000,000 was disbursed for recurrent expenditure and NGN 10,000,000\text{NGN } 10,000,000 was transferred to the Capital Development Fund. What is the closing balance of the Consolidated Revenue Fund at the end of the fiscal year in NGN\text{NGN}?

Answer: 8000000 NGN

Answer

The closing balance of the Consolidated Revenue Fund at the end of the fiscal year is NGN 8,000,000\text{NGN } 8,000,000.
The Consolidated Revenue Fund (CRF) holds all general revenues of the government. Any recurrent expenditure disbursed and statutory transfers made to development funds are deducted from the CRF to determine its net closing balance.

Step-by-Step Solution

1
Calculate total deductions from the Consolidated Revenue Fund.
Total deductions equal NGN 42,000,000\text{NGN } 42,000,000.
Recurrent expenditure and statutory transfers to other government funds (like the Capital Development Fund) represent authorized payments drawn directly from the Consolidated Revenue Fund.
2
Deduct total expenditures and transfers from the fund's total revenue receipts.
Closing balance equals NGN 8,000,000\text{NGN } 8,000,000.
Subtracting total outflows from total inflows gives the net remaining fund balance.

Key Concept

Consolidated Revenue Fund Balance Determination
Estimated Time:1m 0s
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Topics

Structure of Government Funds

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