State and Local Government Financial Reporting

1
State and Local Government Financial Reporting

• Reporting Unit
• Primary Government
• State, General Purpose or Special Purpose Local
  Government that is legally separate and fiscally
  independent of other state or local governments
• Component Unit
• Legally separate organizations for which elected
  officials and primary government are financially
  accountable
• Also, if exclusion would cause reporting entity
  financial statements to be misleading or
  incomplete

2
Reporting Component Units

• Blending
• When organizations financial transactions are so
  intertwined that in substance are the same as
  the primary government
• Discrete
• Most component units reported this way as a
  separate column following the Totals column

3
Comprehensive Annual Financial Report (CAFR)

• Introductory Section
• Financial Section
• MD A
• Basic Financial Statements
• Government-Wide (Level 1)
• Fund (Level 2)
• Notes to financial statements
• RSI
• Statistical Section

4
Government-Wide Financial Reporting

• Level One Financial Statements
• Accrual Basis of Accounting
• Economic Resources Measurement Focus
• General Government Fixed assets and general
  long-term debt are reported in these statements

5
Financial Statements-GW

• Statement of Net Assets
• Separate columns for Governmental Activities,
  Business-Type Activities, Totals, and Discretely
  Presented Component Units
• Statement of Activities
• Separate columns for expenses, program revenues,
  and net (expense) revenue for Governmental
  Activities, Business-Type Activities, Totals and
  Discretely Presented Component Units. (Pp. 32-33)

6
Financial Statements-Fund

• Governmental Type (Modified Accrual/Flow of
  Financial Resources)
• Balance Sheet
• Statement of R, Expenditures, and Changes in FB
• Proprietary Type (Accrual/Economic Resources)
• Statement of Net Assets (Balance Sheet)
• Statement of R, Expenses, and Changes in Net
  Assets
• Cash Flow Statement
• Fiduciary Funds (Accrual/Economic Resources)
• Statement of Net Assets
• Statement of Changes in Fund Net Assets

7
Financial Reporting and Accounting

• Reporting Peculiarities
• GFA and GLTD included and reported only on G-W
  financial statements and Proprietary Fund
  Statements
• Depreciation of GFA recorded in G-W Statement of
  Activities only
• Enterprise Fund activities flow through to
  business-type activities on GW Statements
• Internal Service Fund activities flow through to
  governmental activities on GW Statements

8
Reporting, Continued

• Internal Service Fund inter-fund transactions
  must be eliminated before put on GW financial
  statements
• If the government has only business-type
  activities, then they need to prepare only Fund
  financial statements
• Fiduciary Funds are not a part of GW Financial
  Statements

9
Reporting, Continued

• General Fixed Assets are reported as Capital
  Assets, net of Depreciation
• Net Asset breakdown is
• Invested in Capital Assets, Net of Related Debt
• Restricted (Covenants or Law)
• Unrestricted (Does not include internal
  designations)
• General LTD reported in GW Statement of Net
  Assets

10
Reporting, Continued

• Reconciliation items
• GFA and GLTD
• Deferred Revenue
• Unrecorded Liabilities (Unfunded Pension
  Liability)
• Special items such as sale of land
• What is reconciled
• Fund balances Govt Funds to Net Assets
• Ch in FB Govt Funds to Ch in Net Assets

11
Reporting, Continued

• Reconciliation Schedule is reported
• Face of Fund Financial Statements, or
• Notes to Financial Statements
• Infrastructure must be capitalized and reported
  with other fixed assets
• Retrospectively and Prospectively
• Prospectively only for Less than 10 million
  revenue

12
Reporting, continued

• Infrastructure must be depreciated unless the
  modified approach is elected
• Collections and Works of Art may or may not be
  capitalized
• Statistical Information
• Schedule of changed in LTD
• Annual DS requirements
• Legal Debt Margin Schedule