Prepare a written report based on the CAFR (financials will be obtained from the government website) of a government city that was selected.

Answer the following questions:

1) Introduce and explain the composition of the reporting entity you have selected.

A. Name the primary government and what, if any, component units are included in the cafr.

B. Give an overview of the history of the government.

C. What are the inclusive dates of the fiscal year?

D. What is the name and address of the independent auditor? Is the auditor’s opinion unqualified? If not, describe the qualification.

E. How many funds does the primary government use? Which funds are major?

F. From the governmental and enterprise funds statements, take one major fund (other than the general fund) and prove/show, using the 10 percent and 5 percent criteria, that the fund is required to be reported as a major fund.

2) Analyze the financial condition of the government.

A. From the management’s discussion and analysis in the report, write a summary of the financial condition of the government as described by the government.

B. Calculate the 10 financial ratios (see financial indicators worksheet) presented in a table format.

C. Analyze revenues and revenue sources

I. Is the revenue base well diversified, or does the city rely heavily on one or two major sources?

Ii. What percentage of total expenses of governmental activities is covered by program revenues? By general revenues?.

D. Analyze reserves

I. Are the levels of financial reserves (i.e., fund balances, contingency funds, and unrestricted net assets) adequate to meet unforeseen operational requirements or catastrophic events?

Ii. Do total governmental fund revenues exceed total governmental fund expenditures? Do general fund revenues exceed general fund expenditures?

Iii. Is an adequate amount of cash and securities on hand, or could the city borrow quickly to cover short-term obligations?

E. Analyze expenditures/expenses

I. Do any categories of expenditures (or expenses at the government-wide level) exhibit sharp growth?

Ii. How does the growth pattern of operating expenditures/expenses over the past 10 years compare with that of revenues?

F. Analysis of debt burden (see statistical section)

I. What has been the 10-year trend in general obligation long-term debt relative to trends in population and revenue capacity?

Ii. Are significant debts of other governments (e.g., a school district, a county) supported by the same taxable property? What has been the trend for this “overlapping” debt?

G. State your opinion on the financial condition of this governmental unit based on the information you gathered.

You should not just answer the questions. You should discuss your assessment of the financial condition of the government based on the information you have gathered in items as to f above