Final answer:
The most suitable measurement focus for agency funds is the current financial resources focus, as it aligns with their role in holding and disbursing resources in the short-term for other entities.
Step-by-step explanation:
The most appropriate measurement focus for agency funds is the current financial resources focus. Agency funds are used to account for resources held by a government in a purely custodial capacity. These often include taxes, special assessments, and similar items that the government collects on behalf of others and subsequently passes on to other governments or entities. Unlike funds that are meant for government activities, agency funds do not support the government's own operations and therefore do not focus on the economic resources measurement focus, which includes all assets and liabilities.
The current financial resources measurement focus is more appropriate as it emphasizes funds available for near-term spending and only includes current assets and liabilities. This corresponds with the very nature of agency funds which only temporarily hold assets and are responsible for passing them through to the designated parties.