continuation - municipal financial audits;

Before the Annual Audited Financial Statements 
 Audited Financial Statements come out once per year and usually between 1 to 7 months after
    year-end.
 Information received as a Finance Committee member during the year will do more to set
   expectations of what you will see in the audit
The Budgetary Process sets the most important stage for the audited results.
 The General, Enterprise and Stabilization are budgeted funds that with determine your overall
    financial position.
 Do you receive Interim Reports?
 How often?
 Is a management narrative attached?
 Are there many significant changes close to year-end?

How are the Financial Statements Prepared 
 Umas budgetary basis foundation is how the day-today accounting is maintained
 Using the budgetary numbers several adjustments are made to build to the Fund Based Modified
     Accrual Basis of Accounting GAAP Statements
 Using the Modified Accrual numbers long-term assets and liabilities are added to get to the Full
     Accrual Entity-wide Statements.
 Each layer is the foundation for the next level.

Financial Statement Components 
 Independent Auditor’s Report
 Management’s Discussion and Analysis
 Entity-wide Financial Statements
 Governmental Fund Based Financial Statements
 Proprietary Financial Statements
 Fiduciary Financial Statements
 Budgetary Financial Statements
 Notes to Financial Statements
 Required Supplementary Information

How Do I Start My Review?
 The best place to start the review is the financial statement that is most familiar to you
    The General Fund Budget to Actual Statement.
 The next statement is the General Fund within the Governmental Funds.
 Next is the Major and Non-major Governmental Funds
 Next is the Governmental Activities on the Entity-wide Statements
 To understand the changes between the modified accrual and full accrual governmental activities
     use the Reconciliation Statements.
 Move to the Internal Service Funds which most times is an Self-insured Health Trust fund.
 The last financial statement to review are the Enterprise funds (Water/Sewer etc.)
 Finally read the MD&A, Notes and Required Supplementary Information.

posted by Jeff Bennett