Certified Government Financial Manager (CGFM) Practice Exam 2025 – Your All-in-One Guide to Exam Success!

The Chief Financial Officers (CFO) Act is significant in the realm of federal financial management as it mandates that the 24 largest federal agencies are required to undergo annual audits. This legislation, enacted in 1990, aimed to improve the quality of financial management in the federal government. By requiring these agencies to be audited annually, the CFO Act established a framework for accountability and transparency, ensuring that federal financial statements are credible and can be utilized for decision-making. This requirement not only promotes better financial practices within federal agencies but also serves to enhance public trust in government operations.

Other acts mentioned in the choices focus on different aspects of government operations, such as performance outcomes and government accountability, but they do not impose the specific annual audit requirement mandated by the CFO Act. Thus, the identification of the CFO Act as the correct answer highlights its critical role in strengthening financial management practices among federal agencies.