Certified Research Administrator Practice Exam

What act led to the creation of OMB?

1. Davis Bacon Act of 1931

2. Budget and Accounting Act of 1921

3. Bayh-Dole Act of 1980

4. Federal Financial Assistance Management Improvement Act of 1999

The correct answer is: Budget and Accounting Act of 1921

The creation of the Office of Management and Budget (OMB) was a direct result of the Budget and Accounting Act of 1921. This legislation aimed to enhance the efficiency of the federal budget process and established a clearer framework for federal budgeting and financial management. The act centralized the budget preparation process under the executive branch and laid the groundwork for more effective fiscal control and oversight. By establishing the OMB, the act empowered the president to develop budgets, enforce spending controls, and ensure accountability in federal financial operations. The significance of the OMB in federal management cannot be overstated, as it plays a crucial role in the preparation and execution of the president’s budget and provides essential guidance across agencies regarding the implementation of federal policies. Thus, the association of the OMB with the Budget and Accounting Act of 1921 is pivotal in understanding its foundational role in the federal budgetary system.