Comprehensive Annual Financial Report (CAFR) of Tucson, Arizona Case Study Help
As far as fiduciary funds are concerned, list the funds and indicate whether they are agency funds, investment trust funds, pension trust funds, a private-purposetrust funds, and indicate their basis of accounting.
The fiduciary funds are used with the intent of accounting those assets that are held by the city as an agent for the private organization, individual, other funds as well as other government. The fiduciary funds includes private-purpose trust funds,investment trust funds, pension trust funds as well as the agency funds. The pension trust funds are accounted for in the similar manner as the proprietary funds as they are accounted within the proprietary funds by capitalizing the acquired assets as well as recording the obligation of leases as a liability. On the other hand, the agency funds includes collection of payment of grant fiduciary, medical insurance premium as well as Pima Country sewer collection and does not take into consideration the measurement of the operation’s results.
Similar to proprietary funds, the financial statement of the fiduciary funds adhere to the full accrual basis of accounting in which, the expenditures are recorded when the business buy product or services regardless of expense paid and income received.
Review the notes to the financial statements and answer the following questions:
What significant accounting policies are discussed in the first note?
The first note discusses the significantaccountingpolicies in which it is highlighted that the financial statement of the City of Tucson, Arizona are presented in compliance with the GAAP (Generally Accepted Accounting Principles), and are fairly presented in appropriate manner without any unedified exceptions.
The investment are reported at the current market prices whereas the securities traded o international or nationalexchange are valued at last reported sales price at current rate of exchange. Thefinancial statements ofgovernment wide are reported on the accrual basis of accounting, whereas the modified accrual basis of accounting was used to report the financial statements of the governmental fund.
Are there any material violations or legal concerns?
The financial statements including both governmental fund financial statement and government wide financial statements are free from any material misstatement as the auditors had also given fair or unqualified opinion by stating that the financials are fair and the financial position of the business activities as well as the government activities and each major fund ended with the United States GAAP.
Are there any deficit fund balances or net assets?
The net assets of the governmental wide financial statement amounts $1912 million of the restricted net assets. Additionally, under the note 21, individual fund disclosure, the funds thatcarried the deficit fund balances or net assets includes regional transportation authority as well as 2020 GO parks / connection improvement amounts $(3924153) and (401373) respectively.
Review the statement of activities at the government-wide level and answer the following questions:
Are the government prepared statements in compliance with the GASBS 34 financial reporting model?
After reviewing the statement of activities at the government-wide level, it is analyzed and evaluated that the government prepared statements are in compliance with the generally accepted accounting principles (GAAP) rather than Governmental Accounting Standards Board (GASB).
What is the costliest government function of program operated by the government?
After reviewing the statement of activities at the government-wide level, it is analyzed and evaluated that the costliest government function of program operated by the government is the public safety and the justice services, which amounts $362537783. It is the largest user of resources, including:expenditures for the public defender, city court, public safety communication center, and fire and police departments.
How much of the cost of government activities was borne by the taxpayer’s in the form of general revenues?
The total amount of tax that is included in the general revenuesor the cost of government activities was borne by the taxpayer’s in the form of general revenues,includes: property tax of $(18830863), business privilege tax of (73154222), public utility of (319574138) and hotel/motel surcharge of (42630877), combining all these cost of government activities amounts to $(454190100).
Review the statement of revenues, expenditures, and changes in fund balances for governmental funds and answer the following questions:
List and discuss the three most important sources of the general fund revenues.
After reviewing the statement of revenues, expenditures, and changes in fund balances for governmental funds; the three most important sources of the general fund revenues includes taxes of $293212683, other agencies of $151816597 and charges for services of $57545531.
Does the reporting entity depend on any single source which is as much as one third of the general fund revenue?
The taxes is the only source that tends to account as much as one third of the general fund revenue.
What proportion of revenues is derived from property taxes?
The proportion of the revenues which is derived from the property taxes, is 0.469003608 of 46.9 percent.
List the three largest categories of the general fund expenditures and explain the function of each expense.
The three largest categories of the general fund expenditures are as follows:
Public safety and justice service:
The first largest category of the general fund expenditure is the public safety and justice serviceof $277303632. It is the largest user of the resources, including expenditures for the fire, police, city court, public safety communication center and public defender. The function of the Public safety and justice service is to increase safety and security of public.
Support service
The second largest category of the general fund expenditure is the supportservice of $82656605. It provides number of logistic management support services.
General government:
The third largest category of the general fund expenditure is the General government of $46197072. The General government services includes recreation, parks, transportation, fire and police.
Review the special revenue funds and answer the following questions:
What statements and schedules pertain to the special revenue funds?
The statement includes civic contribution, countrydevelopment block grants, miscellaneous housing grants, publichousing section HOME affordable housing grantsand other federal grants.
Discuss whether the current expenditures further their function.
The expenditures of the special revenue funds could be broken into functional categories, such as:intergovernmental and others. These functional categories could be used on the statement of activities, therefore both of these expenses could be rolled up into the statement of activities.
List three fiduciary funds and discuss their purpose.
The fiduciary funds are listed below along with their aim and purpose.
- The private-purpose trust funds is one of the fiduciary funds with the aim of reporting the trust arrangements other than investment and pension trusts under, which the income and principle benefiting the private organization, individuals or other government.
- Another fiduciary fund is the investment trust funds. It is the close end fund that makes investment in the financial assets or shares on the behalf of the investors or other organizations.
- In the pension trust fund, the resources are reported are heldfor the beneficiaries of the specified benefit pension plan and for the members.
In a couple of paragraphs explain as to whether you believe that the city being analyzed has substantial net assets for continuance of service or any concerns that the city being analyzed has substantial liabilities that may cause the city to have financial problems.
The financial highlights of the City of Tucson, Arizona shows that the long term liabilities of the city have reduced to 2.66 billion dollars, during the currentfiscal year. The reduced liabilities show that the city has paid off the debt obligations of previous year.
Additionally, the reports constitutes that the government wide financial statement of net assets are reported $1912 million, which demonstrates the profitable operations due to the reduction in liabilities.Hence, the city is not expected to face any financial problem.(City of Tucson, 2019).................................
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