Comprehensive Annual Financial Report is a set of U S. government financial statements comprising the financial report of a state, municipal, or other government entity that complies with the accounting requirements promulgated by the GASB. A letter of transmittal is a short cover letter that accompanies a more complex document to explain the purpose .This letter the intent of the document or report so that recipients understand what they are reading and why it was sent to them.It is a part of the financial statements where the company's management provides a qualitative and quantitative analysis to help investors understand details that may not be readily available for analysis. The purpose is to give a reader the ability to look at the issuer through the eyes of management by providing both a historical and prospective analysis of the business of the issuer. Unlike other disclosures, it is written as a narrative, which allows it to offer key information in a more digestible way. This requires the registrant to discuss: liquidity and capital resources; financial results of operations, including unusual or infrequent events and any known trends or uncertainties; and critical accounting estimates, that is, estimates made in accordance with generally accepted accounting principles that involve a significant level of estimation uncertainty. the information contained within be can be duplicated, but it very important to avoid unnecessary duplication with the financial statements. Amendments can be made to eliminate duplicatedisclosures and modernize and enhance MD&A disclosures for the benefit of investors, while simplifying compliance efforts for registrants.