Governmental Accounting GOALS Basic Understanding of Governmental Accounting Insight into Douglas County - Size and Services Dave Maxwell
Overview Differences between Business and Government Look at 3 Methods of Accounting Generally Accepted Accounting Principles (GAAP) Examine 2 Segments of Financial Reporting 1. Fund Accounting 2. Government-wide Financial Statements Where does Revenue come from? What is a Fund? CAFR – Comprehensive Annual Financial Report Dave Maxwell
The Difference Between Business and Government Customers are Purchasers of Specific Goods & Services Taxpayers are Involuntary Resource Providers for Community Services Generate Profits to stay in Business Receive Tax Revenues to continue Community Services Compete with each other for your patronage Generally hold a Monopoly on services they provide Dave Maxwell
3 Methods of Accounting Personal Business Government CHECK BOOK Current Year Income 10,000 Expenses -9,000 Under / Over Spent 1,000 NET WORTH Begin End Assets 50,000 51,000 Liabilities -20,000 -20,000 Net Worth 30,000 31,000 Business $1,000 Under in Checking Account INCOME STATEMENT Current Year Sales 10,000 Expenses -9,000 Profit / Loss 1,000 BALANCE SHEET Begin End Assets 50,000 51,000 Liabilities -20,000 -20,000 Share holder Equity 30,000 31,000 Government $1,000 Profit in Cash Account All FUNDS Current Year Revenues 10,000 Expenditures -9,000 Excess / Deficiency 1,000 NET POSITION Begin End Assets 50,000 51,000 Liabilities -20,000 -20,000 Net Position 30,000 31,000 Dave Maxwell $1,000 Net Change in Cash Account
Where Accounting Rules come from GAAP - Generally Accepted Accounting Principles Douglas County Government Business SEC Securities and Exchange Commission FAF Financial Accounting Foundation FASB Financial Accounting Standards Board GASB Government Accounting Standards Board GAAP For Publicly Traded Companies GAAP For Governments ✚ NRS Nevada Revised Statutes Dave Maxwell
2 Segments of Financial Reporting Douglas County 2 Segments of Financial Reporting Funds Financial Statements Government-wide Financial Statements Focus on current year Focus on Year-End $Millions $Millions July 1 June 30 2015 2016 Change Assets 325.4 327.4 2.0 Liabilities (142.0) (136.8) 5.2 Net Position 183.4 190.6 7.2 All Funds FY 2015-16 Revenues 107.2 Expenditures (100.0) Excess (Deficiency) 7.2 Funds, FY 2015-16 CAFR Page 15 (150 Funds See Fund Tree worksheet) Government-wide, FY 2015-16 CAFR Page 27&28 Dave Maxwell
Where does the Revenue come from? $Millions Douglas County Revenue Property Tax $38.0 Charges for Services * $26.4 Inter-Governmental Taxes ** $23.2 Grants $10.3 Room Taxes $ 7.0 Other $ 2.3 Total Revenue $107.2 ** Inter-Governmental Taxes Consolidated Taxes $13.6 Franchise Taxes $ 8.0 Sales Taxes $ 1.6 Total $23.2 *Charges for Services County Government $14.8 Business-type Activities $11.6 Total $26.4
2 Segments of Financial Reporting Douglas County 2 Segments of Financial Reporting Funds Financial Statements Government-wide Financial Statements Focus on current year Focus on Year-End $Millions $Millions July 1 June 30 2015 2016 Change Assets 325.4 327.4 2.0 Liabilities (142.0) (136.8) 5.2 Net Position 183.4 190.6 7.2 All Funds FY 2015-16 Revenues 107.2 Expenditures (100.0) Excess (Deficiency) 7.2 Funds, FY 2015-16 CAFR Page 15 (150 Funds See Fund Tree worksheet) Government-wide, FY 2015-16 CAFR Page 27&28 Dave Maxwell
What is a Fund? A separate accounting and financial reporting entity. $Millions Governmental Funds All Funds that are not Proprietary or Fiduciary Governmental Funds # Funds Expense General Fund 58 $40.0 Special Revenue Funds 33 $46.5 Capital Projects Funds 14 $ 5.5 Debt Service Funds 2 $ 2.2 Proprietary Funds Operate like a Business OR Provide goods & services to other departments Proprietary Funds # Funds Expense Enterprise Funds 9 $19.4 Internal Service Funds 3 $ 4.8 Fiduciary Funds, FY 2015-16 CAFR Page 185-188 (See Fund Tree worksheet) Fiduciary Funds Hold “Other People’s” Money in Trust Fiduciary Funds # Funds Assets Agency Funds 31 $ 3.1 Dave Maxwell
Governmental Funds What’s in the General Fund $Millions Governmental Funds # Funds Expense General Fund 58 $40.0 Special Revenue Funds 33 $46.5 Capital Projects Funds 14 $ 5.5 Debt Service Funds 2 $ 2.2 General Fund # Funds Expense Public Safety (Sheriff) * 13 $16.8 County Government ** 17 $10.3 Judicial Courts 19 $9.2 Community Development 4 $2.0 All Other 5 $1.7 General Fund Chief operating Fund of the County * Public Safety (Sheriff) Expense Sheriff Patrol Operations $5.3 Sheriff Jail $4.3 Sheriff General Investigation $1.7 General Fund, FY 2015-16 CAFR Pages 95-101 (See Fund Tree worksheet) ** County Government Expense General Services $1.8 Information Services $1.3 County Manager $1.2 Dave Maxwell
Governmental Funds What’s in the Special Revenue Funds Governmental Funds # Funds Expense General Fund 58 $40.0 Special Revenue Funds 33 $46.5 Capital Projects Funds 14 $ 5.5 Debt Service Funds 2 $ 2.2 $Millions Special Revenue Funds Expense East Fork Fire Protection $12.4 Promotional Room Tax $5.7 China Spring Youth Camp $4.6 Airport $2.7 Senior Services Program $2.3 Technology Services 911 $1.9 Social Services $1.8 Road Operating $1.7 Library $1.5 Parks Operations $1.3 Recreation $0.8 23 Other Funds $9.8 Special Revenue Funds Restricted or committed for purposes other than Capital Projects or Debt Service. Special Revenue Funds, FY 2015-16 CAFR Pages 104-105 + 116-120 + 106 (See Fund Tree worksheet) Dave Maxwell
Governmental Funds What’s in the Capital Project Funds Governmental Funds # Funds Expense General Fund 58 $40.0 Special Revenue Funds 33 $46.5 Capital Projects Funds 14 $ 5.5 Debt Service Funds 2 $ 2.2 $Millions Capital Project Funds Expense Regional Transportation $2.9 Redevelopment Agency $1.0 Douglas County Construction $0.9 11 Other Funds $0.8 Capital Project Funds Restricted or committed for Capital Projects Capital Projects Funds, FY 2015-16 CAFR Pages 153-154 (See Fund Tree worksheet) Dave Maxwell
Governmental Funds What’s in the Debt Service Funds Governmental Funds # Funds Expense General Fund 58 $40.0 Special Revenue Funds 33 $46.5 Capital Projects Funds 14 $ 5.5 Debt Service Funds 2 $ 2.2 $Millions Debt Service Funds Expense County Operation Resources $2.1 East Fork Fire $0.1 Debt Service Funds Restricted or committed for Making principal and interest payments on the County and East Fork Fire debts Debt Service Funds, FY 2015-16 CAFR Page 146 (See Fund Tree worksheet) Dave Maxwell
Proprietary Funds What’s in the Enterprise Funds Proprietary Funds # Funds Expense Enterprise Funds 9 $19.4 Internal Service Funds 3 $ 4.8 $Millions Enterprise Funds Expense Minden Wholesale Water Utility $11.4 Carson Valley Water Utility $2.1 Sewer Utility $1.9 Regional Water Utility $1.4 Gardnerville Health & Sanitation $1.0 Minden Water Company $0.8 3 Other Funds $0.8 Enterprise Funds Activities that are financed buy user fees and operated like a private business. General Fund, FY 2015-16 CAFR Pages 95-101 (See Fund Tree worksheet) Special Revenue Funds, FY 2015-16 CAFR Pages 104-105 + 116-120 + 106 (See Fund Tree worksheet) Capital Projects Funds, FY 2015-16 CAFR Pages 153-154 (See Fund Tree worksheet) Debt Service Funds, FY 2015-16 CAFR Page 146 (See Fund Tree worksheet) Dave Maxwell
Proprietary Funds What’s in the Internal Service Funds Proprietary Funds # Funds Expense Enterprise Funds 9 $19.4 Internal Service Funds 3 $ 4.8 $Millions Internal Service Funds Expense Risk Management $2.8 Motor Pool $1.6 Self Insurance Dental $0.4 Internal Service Funds Goods and Services provided by one department to another department of the same Government. Proprietary Funds, FY 2015-16 CAFR Pages 167-180 (See Fund Tree worksheet) Dave Maxwell
Fiduciary Funds What’s in the Agency Funds Fiduciary Funds # Funds Assets Agency Funds 31 $ 3.1 $Millions Agency Funds Assets Mosquito Abatement District $1.2 State of Nevada (Property Tax) $1.0 Douglas County School District $0.4 Genoa Lakes Assessment District $0.2 27 Other Funds (mostly GID) $0.3 Agency Funds Assets held solely in a custodial capacity. Fiduciary Funds, FY 2015-16 CAFR Page 185-188 (See Fund Tree worksheet) Dave Maxwell
2 Segments of Financial Reporting Review 2 Segments of Financial Reporting Funds Financial Statements Government-wide Financial Statements Focus on current year 150 Funds Focus on Year-End Governmental Funds # Funds General Fund 58 Special Revenue Funds 33 Capital Projects Funds 14 Debt Service Funds 2 Assets Cash Accounts Receivable Land & Buildings Construction in Progress Water & Sewer systems Funds, FY 2015-16 CAFR Page 15 (150 Funds See Fund Tree worksheet) Government-wide, FY 2015-16 CAFR Page 27&28 Proprietary Funds # Funds Enterprise Funds 9 Internal Service Funds 3 Liabilities Accounts Payable Accrued Salaries & Wages Pension Liability Bonds & Notes payable Fiduciary Funds # Funds Agency Funds 31 Dave Maxwell
Government-wide Financial Statements What’s in Assets July 1 June 30 2015 2016 Change Assets 325.4 327.4 2.0 Liabilities (142.0) (136.8) 5.2 Net Position 183.4 190.6 7.2 Assets $Millions Water & Sewer Systems 91.1 Cash & Investments 76.6 Buildings & Improvements 59.5 Infrastructure 36.6 Land 20.3 Unamortized Pensions 10.6 Machinery & Equipment 7.2 Construction in Progress 5.9 Water Rights 5.8 Accounts Receivable 4.0 Due from other Governments 3.8 Notes Receivable 1.8 Other Assets 1.3 Total Assets 327.4 Assets, FY 2015-16 CAFR Page 27 Government-wide, June 30, 2015 CAFR Page 25 Government-wide, June 30, 2016 CAFR Page 27&28 Dave Maxwell
Government-wide Financial Statements What’s in Liabilities July 1 June 30 2015 2016 Change Assets 325.4 327.4 2.0 Liabilities (142.0) (136.8) 5.2 Net Position 183.4 190.6 7.2 Liabilities $Millions Net Pension Liability 71.7 Bonds & Notes Payable 32.0 Amounts related to Pensions 9.4 Post-employment Benefits 7.1 Accounts Payable 3.7 Unearned Revenue 3.6 Accrued Salaries & Wages 3.4 Compensated Absences 3.1 Other Liabilities 2.9 Total Liabilities 136.8 Liabilities, FY 2015-16 CAFR Page 27 Dave Maxwell
Bring it all Together Top Level Douglas County As of June 30, 2016 All Funds Activity during FY 2015-16 $Millions Government-wide Year end Net Position $Millions July 1 June 30 2015 2016 Change Assets 325.4 327.4 2.0 Liabilities (142.0) (136.8) 5.2 Net Position 183.4 190.6 7.2 Revenues 107.2 Expenses (100.0) Excess (Deficiency) 7.2 Beginning Fund Balance 183.4 Change in Fund Balance 7.2 Ending Fund Balance 190.6 Dave Maxwell
Comprehensive Annual Financial Report (CAFR) Where does all this information come from? Comprehensive Annual Financial Report (CAFR) Nevada Revised Statutes require Douglas County to submit a “Complete set” of audited financial statements in accordance with GAAP. Introductory Section Letter of Transmittal (4 pages) Organization Chart (1 page) CAFR Has 4 Sections Financial Section Auditor’s Report (2 pages) Management Discussion & Analysis (14 pages) Basic Financial Statements (171 pages) Single Audit Information (43 pages) Independent Auditor’s Report Expenditures of Federal Awards Schedule of Findings Statistical Section (21 pages) County Demographics Property Tax Rates Principal Employers Dave Maxwell
Summary Differences between Business and Government Look at 3 Methods of Accounting Generally Accepted Accounting Principles (GAAP) Examine 2 Segments of Financial Reporting 1. Fund Accounting 2. Government-wide Financial Statements Where does Revenue come from? What is a Fund? CAFR – Comprehensive Annual Financial Report Dave Maxwell