Typical transactions can often be identifed with specifc types of funds. A city maintains the following funds: 1. General 2. Special revenue 3. Capital projects 4. Debt service 5. Enterprise 6. Internal service 7. Permanent (trust) 8. Custodial For each of the following transactions, indicate the fund in which each transaction would most likely be recorded: a. The city collects $3 million of taxes on behalf of the county in which it is located. b. It spends $4 million to pave city streets, using the proceeds of a city gasoline tax dedicated for road and highway improvements. c. It receives a contribution of $5 million. Per the stipulation of the donor, the money is to be invested in marketable securities, and the interest from the securities is to be used to maintain a city park. d. It collects $800,000 in landing fees at the city-owned airport. e. It earns $200,000 on investments set aside to make principal payments on the citys outstanding bonds. The bonds were issued to fnance improvements to the citys tunnels and bridges. f. It pays $4 million to a contractor for work on one of these bridges. g. It pays $80,000 in wages and salaries to police offcers. h. It purchases from an outside supplier $40,000 of stationery that it will sell to its various operating departments. Review the Comprehensive Annual Financial Report (CAFR) that you obtained. 1. What are three main sections of the report? 2. Review the introductory section of the CAFR. a. Was the entitys annual report of the previous year awarded a certifcate of achievement for excellence in fnancial reporting by the Government Finance Offcers Association? What is the signifcance of this award? b. What are the key issues addressed in the letter of transmittal? 3. Review the fnancial section. a. Which, if any, independent audit frm performed an audit of the CAFR? b. Did the entity receive an unqualifed audit opinion? If not, why not? c. Does the report contain managements discussion and analysis (MD&A)? If so, what are the key issues addressed? CONTINUING PROBLEM Problems 83 d. Does the report provide a reconciliation between total governmental net position per the government-wide statement of net position and total governmental fund balances per the governmental funds balance sheet? If so, what are the main reconciling items? e. What are the major governmental funds maintained by the entity? Does the entitys fund structure conform to its organizational structure? f. Does the report include required supplementary information? If so, what are the main areas addressed? g. Does the report include combining statements? If so, what is the nature of these statements? h. Does the report include other supplemental information? If so, what types of information are in this section of the report? 4. Review the statistical section. a. What is the population of the entity being reported on? b. Who is the entitys major employer? c. What types of information are included in the statistical section?