Reference no: EM133935325

Government and Non-Profit Accounting

"The Comprehensive Annual Financial Report (CAFR) is a critical tool for transparency and accountability in governmental financial reporting."
Required: With reference to the CAFR assigned to your group,

Explain the key components of a CAFR and how they differ from a typical corporate annual report.

Analyze the importance of the Management's Discussion and Analysis (MD&A) section in a CAFR. How does it aid stakeholders in assessing a government's financial health?

Evaluate the role of fund accounting in governmental financial reporting, with reference to the CAFR. Discuss at least two types of funds (e.g., General Fund, Capital Projects Fund) and their significance.

Critically assess one major challenge in preparing a CAFR and suggest how governments can address it.

Question 1 (b): Government-wide Statements

The City of Greenfield provides the following financial information for the fiscal year ending December 31, 2024:

Expenses for public safety, education, and road maintenance $9,800,000
Sewer system capital assets (net) $4,300,000
Grants for education programs (restricted) $3,500,000
Public safety liabilities $1,600,000
Water utility user fees $3,600,000
Outstanding bonds for road construction $5,500,000
Water and sewer utility expenses $4,200,000
Depreciation on governmental capital assets $550,000
Sewer system service charges $2,300,000
General government assets $7,500,000
Water utility liabilities $2,000,000
Depreciation on water and sewer capital assets $350,000
Water utility assets $6,200,000
Property tax revenue for general government services $8,700,000
Long-term liabilities for sewer projects $2,800,000
Capital assets (net) for public infrastructure $11,000,000

Required:
Classify the financial data into Governmental Activities and Business-Type Activities based on government-wide financial reporting.
Prepare the Statement of Net Position for the City of Greenfield.  Get top-notch online assignment help now.

Prepare the Statement of Activities for the City of Greenfield assuming Beginning Net Position of $17,800,000.
Refer to the assigned CAFR for your group, identify and list all Governmental Activities and Business-Type Activities. Provide screenshot of where you find the information in the CAFR.

In not more than 1,000 words;

"Discuss the importance of capital assets in governmental accounting. How do governments account for the acquisition, depreciation, and disposal of capital assets, and what challenges arise in ensuring accurate financial reporting and accountability?" (15 marks)
Refer to the assigned CAFR for your group, summarize the reporting of Capital Assets in the CAFR. Provide screenshot of where you find the information in the CAFR.

The City of Riverview is a mid-sized municipality with a growing population and expanding infrastructure. The city has issued long-term debt to finance several capital projects, including park developments, public transportation upgrades, and library expansions. Below are key financial and demographic figures for the city:

Gross City Product (GCP): $3.8 billion
Total Outstanding Debt: $720 million
Population: 250,000 residents
Total Revenue: $600 million
Annual Debt Service Payments: $90 million
Assessed Property Value: $10 billion National Averages for U.S. Municipalities:
Debt-to-GDP Ratio: Approximately 15%
Debt per Capita: Approximately $2,500
Debt-to-Revenue Ratio: Approximately 1.0
Debt Service Coverage Ratio (DSCR): Typically around 2.0
Debt-to-Assessed Property Value Ratio: Approximately 5%

Note: These national averages are illustrative; actual figures can vary based on specific municipalities and economic conditions.

Required:
Using the provided information, answer the following questions:

Calculate the Debt-to-GCP Ratio for Riverview, compare it with the national average, and interpret its significance for Riverview 's financial health.

Determine the Debt per Capita for Riverview, compare it with the national average, and explain its implications for the residents.

Compute the Debt-to-Revenue Ratio for Riverview, compare it with the national average, and assess the city's ability to repay its outstanding debt.

Calculate the Debt Service Coverage Ratio for Riverview, compare it with the national average, and evaluate Brookdale's fiscal flexibility.

Find the Debt-to-Assessed Property Value Ratio for Riverview, compare it with the national average, and discuss its impact on taxpayers.

Refer to the assigned CAFR for your group, calculate all the possible above ratios. Provide screenshot of where you find the information in the CAFR.