Free Practice Questions for CGFM

Exam-style questions and explanations by OpenExamPrep.

✓ No registration✓ No credit card

Exam pass rate: ~50%

244+ Questions

100% Free

Loading practice questions...

Exam Review

Key Facts: CGFM Exam

~50%

Overall Pass Rate

AGA

345

Total Questions

3 exams × 115

17,000+

CGFM Holders

AGA 2025

$450

Total Exam Fee

$150 per exam

500

Scaled Passing Score

200-700 scale

3 years

Exam Eligibility

Complete within 3 years

The CGFM certification requires passing three exams with 115 questions each (345 total). The exam has approximately 50% pass rate. Over 17,000 professionals hold the CGFM designation. CGFM holders work in federal, state, and local government, earning 10-20% more than non-certified peers. The certification requires a bachelor's degree or 24 semester hours in relevant coursework.

Sample CGFM Practice Questions

Try these sample questions to review concepts for the CGFM exam. Each question includes a detailed explanation. Start the interactive quiz above for the full 244+ question experience with AI tutoring.

1Under the U.S. federal system, which level of government has reserved powers that are neither delegated to the federal government nor prohibited to the states?

A.Federal government only

B.State governments

C.Local governments

D.Tribal governments

Explanation: The Tenth Amendment to the U.S. Constitution reserves powers not delegated to the federal government nor prohibited to the states to the states respectively, or to the people. This establishes the principle of reserved powers for state governments.

2Which branch of the federal government has the power to appropriate funds?

A.The Executive Branch

B.The Judicial Branch

C.The Legislative Branch

D.The Administrative Branch

Explanation: Article I, Section 9 of the U.S. Constitution states that "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law." This gives Congress (the Legislative Branch) the exclusive power to appropriate funds.

3What is the primary purpose of intergovernmental transfers in the federal system?

A.To reduce state tax rates

B.To achieve national objectives through state/local implementation

C.To eliminate local government autonomy

D.To centralize all government spending

Explanation: Intergovernmental transfers (grants) allow the federal government to achieve national policy objectives while leveraging state and local governments' implementation capacity and knowledge of local conditions. Examples include Medicaid, highway grants, and education funding.

4Under Dillon's Rule, local governments have:

A.Inherent sovereign powers

B.Only powers expressly granted by the state or necessarily implied

C.Complete autonomy from state control

D.Constitutional protection from state interference

Explanation: Dillon's Rule, established by Judge John Dillon, holds that local governments are creatures of the state and possess only those powers expressly granted by the state constitution or statutes, necessarily or fairly implied, or essential to the accomplishment of declared objects.

5Which constitutional clause gives Congress the power to regulate interstate commerce?

A.The Supremacy Clause

B.The Commerce Clause

C.The Necessary and Proper Clause

D.The Full Faith and Credit Clause

Explanation: The Commerce Clause (Article I, Section 8, Clause 3) grants Congress the power "to regulate Commerce with foreign Nations, and among the several States." This has been broadly interpreted to allow federal regulation of many economic activities affecting interstate commerce.

6The "power of the purse" refers to which government function?

A.The ability to print currency

B.The authority to raise revenue and authorize expenditures

C.The power to regulate banks

D.The ability to set interest rates

Explanation: The "power of the purse" refers to the legislative authority to raise revenue (through taxation and borrowing) and to authorize government expenditures through appropriations. This is a fundamental check on executive power.

7In a council-manager form of local government, who is typically responsible for day-to-day administration?

A.The elected mayor

B.The city council

C.The professional city manager

D.The county commissioners

Explanation: In the council-manager form, the city council sets policy and hires a professional city manager who is responsible for day-to-day administration, implementing council policies, managing personnel, and preparing the budget.

8Which of the following is a concurrent power shared by both federal and state governments?

A.Declaring war

B.Coining money

C.Taxation

D.Establishing post offices

Explanation: Taxation is a concurrent power - both federal and state governments have the authority to levy taxes. Declaring war, coining money, and establishing post offices are exclusive federal powers under Article I, Section 8.

9The Supremacy Clause of the Constitution establishes that:

A.State laws always take precedence over federal laws

B.Federal law is the supreme law of the land

C.Local governments have supremacy over state governments

D.Judicial decisions are non-binding on the executive branch

Explanation: Article VI, Clause 2 (the Supremacy Clause) establishes that the Constitution, federal laws made pursuant to it, and treaties made under its authority constitute the "supreme Law of the Land," taking precedence over conflicting state laws.

10Under the Anti-Deficiency Act, federal agencies are prohibited from:

A.Receiving gifts from foreign governments

B.Incurring obligations or making expenditures in excess of appropriations

C.Hiring contractors without congressional approval

D.Transferring funds between programs

Explanation: The Anti-Deficiency Act (31 U.S.C. §§ 1341-1342, 1511-1519) prohibits federal agencies from incurring obligations or making expenditures in excess of amounts available in appropriations or funds. Violations can result in administrative and criminal penalties.

About the CGFM Exam

The CGFM is a three-exam certification for government financial management professionals. Exams cover: (1) Governmental Environment - organization/structure, legal environment, management cycle, financing, ethics; (2) Governmental Accounting, Financial Reporting and Budgeting - GASB/FASAB standards, fund accounting, CAFR preparation; (3) Governmental Financial Management and Control - cash/debt management, internal controls, auditing, performance measurement.

Exam sponsor: Association of Government Accountants (AGA). The requirements and fees below concern the certification or admission exam, separate from our free practice resources.

Questions

345 questions

Time Limit

6h 45m total (2h 15m per exam)

Passing Score

500/700 (scaled)

Exam / Certification Fees

$450 ($150 per exam)

Exam sponsor website

Reported exam pass rate: ~50%. varies by exam and candidate background This describes exam candidates, not OpenExamPrep users or results from using our resources. Exam sponsor website

Fees, eligibility, and exam policies can change. Confirm them with the exam sponsor before applying or paying.

Official sources

Our practice resources: topics covered

We aim to reflect publicly available exam outlines and topic information in our study resources. Coverage, format, and difficulty may differ from the actual exam, and we cannot guarantee that every detail is accurate or current. Confirm exam requirements, fees, and policies with the official exam sponsor.

Exam 1 (115 Qs)

Governmental Environment (GE)

Organization/Structure (16%), Legal Environment (15%), Management Cycle (15%), Financing Process (20%), Public Accountability (16%), Ethics (10%), E-Government (8%)

Exam 2 (115 Qs)

Governmental Accounting, Financial Reporting and Budgeting (GAFRB)

General Knowledge (40%), State/Local Accounting (30%), Federal Accounting (30%)

Exam 3 (115 Qs)

Governmental Financial Management and Control (GFMC)

Financial Management Functions (22%), Analysis Techniques (20%), Internal Control (25%), Performance Measurement (13%), Auditing (20%)

Preparing for the CGFM Exam

What You Need to Know

Passing score: 500/700 (scaled)
Exam length: 345 questions
Time limit: 6h 45m total (2h 15m per exam)
Exam / certification fees: $450 ($150 per exam) Official sources

Using Our Practice Resources

Work through all 244 available questions
Review every answer and explanation
Track weak areas and revisit them
Use our AI tutor for tough concepts

CGFM: Suggested Study Strategy

1Focus on Exam 2 technical content - GASB standards, fund accounting, and CAFR preparation require the most study time

2Master the five governmental fund types and when each is used

3Know the differences between modified accrual and full accrual accounting

4Understand COSO internal control framework - the five components are heavily tested

5Study Yellow Book auditing standards - independence requirements are frequently tested

6Learn the three federal budget phases: formulation, congressional action, execution

7Understand intergovernmental relations - grants, mandates, and fiscal federalism

8Practice fund balance classifications under GASB 54

Frequently Asked Questions

What is the CGFM exam pass rate?

The CGFM exam pass rate is approximately 50% overall, though this varies by exam and candidate background. Exam 2 (Governmental Accounting) is typically considered the most challenging. Candidates with government accounting experience tend to perform better. The three-exam structure allows candidates to focus on one exam at a time.

How many exams are required for CGFM certification?

The CGFM requires passing three separate exams: Exam 1 covers Governmental Environment (organization, law, ethics), Exam 2 covers Governmental Accounting and Financial Reporting (GASB/FASAB standards, fund accounting), and Exam 3 covers Financial Management and Control (internal controls, auditing, performance measurement). Each exam has 115 questions.

What are the CGFM eligibility requirements?

To earn CGFM, you need: (1) a bachelor's degree from an accredited institution OR 24 semester hours in relevant coursework, (2) pass all three CGFM examinations, and (3) agree to abide by the AGA Code of Ethics. There is no experience requirement, though government financial experience is helpful.

How long should I study for the CGFM exams?

Most candidates study 60-100 hours per exam (180-300 hours total). Exam 1 may require less time if you have a strong government/political science background. Exam 2 typically requires the most preparation due to the technical accounting content. Plan to take exams sequentially rather than simultaneously.

Which CGFM exam is the hardest?

Most candidates find Exam 2 (Governmental Accounting, Financial Reporting and Budgeting) most challenging because it covers technical GASB standards, fund accounting, and CAFR preparation. Exam 3 (Financial Management and Control) is also demanding due to internal control frameworks (COSO) and Yellow Book auditing standards.

Is CGFM certification worth it?

The CGFM is highly valued in government financial management. CGFM holders typically earn 10-20% more than non-certified peers. The designation is recognized across federal, state, and local government. Many senior financial positions in government agencies list CGFM as preferred or required. The certification demonstrates specialized expertise in governmental accounting and financial management.