Understanding the CAFR
The City's Comprehensive Annual Financial Report or CAFR provides detailed information on the City's financial status at the end of a fiscal year and reports on the City's activities and balances for each fiscal year. (The City's fiscal year runs from July 1 through June 30 the following year.) The CAFR is broken into four sections: introductory, financial, statistical and single audit.
The introductory section includes information on the City's principal officials, the organizational chart for the City government and the Finance Department's transmittal letter. The transmittal letter provides information about the City and its economy, the purposes and structure of the report, the City's financial policies and accounting procedures, the internal audit, etc.
The financial section includes the management's discussion and analysis; basic, fund, and component unit financial statements; notes to financial statements; budgetary comparison schedules; required supplementary information for public employee retirement systems, and other supplementary information as well as the independent auditors' report. The management's discussion and analysis provides a quick guide to using the financial section of the report and summarizes much of the data to be found therein, including the City's assets, debts, revenues, and expenditures. Through the budgetary comparison schedules, readers can get a quick view of how the City's actual revenues and expenditures compared to both the approved budget set out at the beginning of the fiscal year and the amended budget prepared during the fiscal year. (The budget is amended during the fiscal year as more information becomes available about trends affecting revenues and expenditures. For example, an unexpected dip in the economy will require the City to lower its revenue estimates in some categories.)
The statistical section includes selected financial and demographic information for the City, generally presented on a multi-year basis. This section assists readers in understanding how the City and its financial situation have changed over time, in determining the affordability of the City's current debt and its ability to issue debt in the future, and in understanding the various external factors (e.g. population changes, per capita income, and school enrollments) that affect the City's financial activities. It also helps readers understand how the City's financial information relates to the programs and activities the City performs.
The single audit section provides information on City and School programs that are financed by federal grants.