explain the importance for evaluating governmental financial performance, and distinguish among and describe key financial performance concepts, such as: financial position, financial condition, and economic condition. Solution Solution: The importance of Governmental Financial Performace An earlr warning system of impending financial difficulty can serve to prevent disruption in critical government services. It will help taxpayers to have a close view on the workig of the government. Furhter, analytical tools have evolved to better track performance of governmental financial. Evaluation of financials help the government to provide its stakeholders a clear and fair view of its financials. Further, governmental financial performance would help the government to plab it budgted revenues, expenses, and would assist it by providing basis like past results. Financial position focuses on assets and liabilities that require cash or are normally converted to cash in the short term ( i.e. liquidity ) Financial Condition refers to a government\'s ability to meet its financial obligations to creditors and others as they become due, as well as its service obligation to constituents currently and in the future ( i.e., solvency) Economic Condition is a term Government Accounting Standards Board uses to capture a composite of the government\'s financial health and its ability and willingness to meet its financial obligations and service commitments .