HomeMy WebLinkAbout12/12/2006, BW3 - COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR 2005-06 council W° °°ft
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C I TY OF SAN LU IS O B 1 S P 0
FROM: Bill Statler, Director of Finance & Information Technology %&`' ✓
Carolyn Dominguez, Finance Manager
SUBJECT: COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR 2005-06
CAO RECOMMENDATION
Review and discuss the Comprehensive Annual Financial Report and ending financial results for
2005-06.
DISCUSSION
The accompanying Comprehensive Annual Financial Report(CAFR)has been prepared in order to
present the City's financial condition and results of operations for the fiscal year ended June 30,
2006, as well as to provide statistical information of general interest about the San Luis Obispo
community.
Financial Results I3ighlighted in the Report
Included in the document is the Transmittal .Memorandum, which provides a comprehensive
analysis of the City's financial position as of June 30, 2006 as well as summaries of significant City
fiscal policies and practices. Key variances from projected ending balances for 2005-06 as
presented in the 2006-07 Financial Plan are highlighted in the Transmittal Memorandum,
summarized as follows..
The Very Short Story: As discussed in the General Fiscal Outlook presented to the Council on
November 16, 2006, the General Fund ended 2005-06 is better fiscal shape than our original
projections in the 2006-07 Financial Plan Supplement. Along with the passage of Measure Y in
November 2006 and the fact we have a structurally balanced budget, this stronger financial
condition contributes to our best fiscal outlook in many years.
Independent Audit
As required by the City Charter, the financial statements have been audited by an independent
certified public accountant (Glenn, Burdette, Phillips & Bryson) and their letter expressing an
unqualified (favorable) opinion regarding the City's financial position is also included in the report
document.
Report Organization
In accordance with generally accepted accounting principles for state and local governments, the
City's CAFR is organized into three major sections: introduction, financial reports and statistical
tables. The following is a brief summary of the contents of each of these sections.
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Comprehensive Annual Financial Report for 2005-06 Page 2
Introduction. The Transmittal Memorandum and other information of general interest are included
in this section, including: directory of officials and advisory bodies, organization chart, and awards
for excellence in financial reporting from the Government Finance Officers Association (GFOA)
and the California Society of Municipal Finance Officers(CSMFO).
Financial Reports. This section includes the primary financial statements of the City, and is
organized into five major parts:
1. Auditors' opinion regarding the financial statements.
2. Management's discussion and analysis providing a narrative overview of the government-wide
financial activities.
3. The basic financial statements presenting the government-wide statements which combines the
activities of the major funds (General, Capital Outlay and all Enterprise Funds) into
governmental and business-type categories; the fund financial statements; and the notes to the
financial statements.
4. Required supplementary information presenting the General Fund actual results with both the
original and final adjusted budgets.
5. Supplemental financial statements providing financial information for each of the City's non-
major governmental and agency funds.
Statistical Tables. This section provides demographic and financial tables showing current and
historical trend information for the City and is organized into six major parts:
1. Statistical overview. General information about the San Luis Obispo community.
2. General financial trends. Ten-year summary information on net assets, governmental
revenues and expenditures and fund balances.
3. Revenue capacity.Ten-year summary information on property and sales tax trends.
4. Debt capacity. Ten-year summary information on debt service requirements.
5. Economic and demographic trends. Ten-year summaries of taxable sales, building permits
and valuations,housing,population and other demographic trends.
6. Operating information.Ten-year trend information on operating indicators by function.
Recognition for Excellence in Financial Reporting
GFOA. Beginning in fiscal year 1983-84, all of the City's CAFRs have been awarded the
certificate of achievement for excellence in financial reporting from the Government Finance
Officers Association of the United States and Canada(GFOA). This is a prestigious national award
recognizing our use of the highest standards in preparing our annual financial report. We believe
our current report continues to meet their program requirements, and we are submitting it to them to
determine its eligibility for another award.
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Comprehensive Annual Financial Report for ZQ95-06 Page 3
CSMFO. The California Society of Municipal Finance Officers(CSMFO) has also awarded the
City its certificate of award for outstanding financial reporting for all of our CAFRs since 1990-91.
However, effective this year;the CSMFO has changed the focus of its award program and will no
longer accept applications from agencies that have received the comparable GFOA award and that
plan to continue their participation in the GFOA program. Accordingly, we are no longer eligible
for participation in the CSMFO program.
Participation in these programs has a number of benefits beyond simply receiving recognition for
our efforts. For example, by striving to meet program standards and goals, we produce better
reports. Additionally, as part of the review process, we receive comments for improvement from
other municipal finance professionals who review our reports from a "fresh" perspective. We
believe that this results in continuous improvements in reporting our financial results to elected
officials, staff and other interested parties such as bondholders, credit agencies and the public at-
large.
ENCLOSURE
Comprehensive Annual Financial Report for 2005-06
G:Audit Folders/Audit 2005-06/Council Agenda Report,2005-06