Book: Customized version of Accounting for Governmental and Not-for-profit
Entities
(ISBN: 9781307703382)
Analysis of reserves.
Are the levels of financial reserves (i.e., unrestricted, assigned,
committed, and restricted fund balances, contingency funds, and
unrestricted net position) adequate to meet unforeseen operational
requirements or catastrophic events?
Do total governmental fund revenues exceed total governmental fund
expenditures? Do General Fund revenues exceed General Fund expenditures?
What has been the trend in the ratio of revenues to expenditures?
Is an adequate amount of cash and securities on hand or could the city
borrow quickly to cover short-term obligations?
C. Analysis of expenditures and expenses
Do any components of expenditures and, at the government-wide level
expenses exhibit sharp growth?
How flexible are expenditures? That is are there large percentages of
nondiscretionary expenditures, such as for interest and public safety?
How does the growth pattern of operating expenditures and expenses over
the past 10 years compare with that of revenues?
What has the city (or the county) included in the introductory section
of its CAFR? ‘Financial Section’
– Audit Report: Are the financial statements in the report audited by an
independent CPA, state auditors, or auditors employed by the government
being audited? Does the audit indicate that the financial statements were
prepared in accordance with GAAP? Has the city (or the county) received an
unmodified audit report?
– Basic Financial Statements: Does the CAFR contain both government-wide
financial statements and fund statements? How many financial statement have
been included as part of the basic financial statements section of the CAFR?
– Notes to the Financial Statements: How many notes follow the required
basic financial statement? Is them a phrase at the bottom of the basic
financial statements indicating that the notes are an integral part of the
financial statements?
– Other Supplementary Information: Following the notes to the financial
statements, does the CAFR provide other supplementary information, such as
combining and individual fund statements?
– Management’s Discussion and Analysis (MD&A): Does the CAFR contain an
MD&A? If so, where is it located and what type of information does it
contain? ‘Statistical Tables’
– What information has been included in this section of the CAFR?
