City of Alexandria, Virginia
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MEMORANDUM
DATE: NOVEMBER 20, 2013
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
FROM: RASHAD M. YOUNG, CITY MANAGER /s/
DOCKET TITLE:
TITLE
Receipt of the Comprehensive Annual Financial Report ("CAFR") for the fiscal year ended June 30, 2013.
BODY
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ISSUE: Consideration of the Comprehensive Annual Financial Report (CAFR) for the fiscal year
ended June 30, 2013
RECOMMENDATION: That City Council receive the Comprehensive Annual Financial
Report for the fiscal year ended June 30, 2013
BACKGROUND: N/A
DISCUSSION: Code of Virginia ยง15.2-2511 requires all local governments to have their books and records audited by an independent certified public accountant as of June 30 of each year.
The Code further requires that the independent certified public accountant present a written report to the local governing body at a public session by the following December 31.
The City's Comprehensive Annual Financial Report for the fiscal year ended June 30, 2013, can
be found on the City's website at alexandriava.gov/financialreports. This report, which follows a
format prescribed by the Governmental Accounting Standards Board (GASB), includes a
description of the significant financial events of the fiscal year, the City's audited financial
statements, and selected financial and demographic information.
The following are highlights of the report:
The City received a positive "clean opinion" from its independent certified public accountant,
CliftonLarsonAllen, LLP, of its financial statements for the fiscal year ended June 30, 2013 (CAFR, page 19). The auditors found that the City's financial statements "present fairly" the City's financial position and results of operations and that the City has complied with applicable
laws and regulations related to federal grants.
The CAFR includes a Management's Discussion and Analysis section that provides an
overview of the City's financial performance (CAFR, page 21).
On this entity-wide basis, the City government has recorded $428.9 million in net assets
(CAFR, Exhibit I, page 33), including the investment in capital assets of $329.5 million. The
City government's net assets increased by $31.0 million in fiscal year FY 2013 (CAFR,
Exhibit II, page 34).
General Fund revenues in FY 2013 totaled $591 million (CAFR, Exhibit IV, page 36). Final
General Fund expenditures and transfers totaled $608.5 million with expenditures totaling $534
million and transfers to other City funds totaling $74.5 million (CAFR, Exhibit IV, page 36).
Fund Balance, which includes all spendable and nonspendable resources, was $69.5 million at the end of FY 2013 (CAFR, Exhibit III, page 36). This compares to the Total General Fund Balance of $83.0 million at the end of FY 2012.
The Spendable Fund Balance of $59.6 million at the conclusion of FY 2013
represents 10.1 percent of General Fund revenues (unassigned fund of balance $32.9 million plus Commitments of $15.9 and Assignments of $10.8 million (page 55)). Spendable Fund Balance
is the portion of accumulated total of all prior years' actual General Fund revenues in excess of
expenditures that is available for appropriation by City Council. For FY 2013, this percentage is equal to the financial guideline of 10.0 percent.
The Unassigned General Fund Balance of $32.9 million at the conclusion of FY 2013
(CAFR, page 9) represents 5.65 percent of General Fund revenues. Unassigned General Fund
Balance is the accumulated total of all prior years actual General Fund revenues in excess of
expenditures, less nonspendable balances (such as inventory), and amounts
committed or assigned for specific uses (such as operating and capital budgets, self-insurance,
other post-employment benefits, ongoing projects and extraordinary events, such as natural disasters or other emergencies). This percentage is slightly higher than the percentage at the end of FY 2012 and remains close to the City's financial policy target of 5.5 percent and above the floor of 4.0 percent.
Separate financial information for the Potomac Yard Metrorail Station Fund is provided. The Fund ended FY 2013 with a $1.9 million fund balance (CAFR, page 120). The balances in this fund will be used in for the Potomac Yard Metrorail project.
The City continues to comply with all debt and fund balance related financial targets and limits (CAFR, page 9).
Federal grant expenditures of $49.6 million included $6.0 million in ARRA stimulus expenditures. The expenditures are subject to very stringent audit and accounting requirements.
The CAFR cover continues a City practice of showcasing capital projects completed in the
fiscal year of the CAFR. This year the project featured is the new Kelley Cares Miracle Field at the Nannie J. Lee Recreation Center, which was dedicated in November 2012. The Kelley Cares Miracle Field represents a successful public/private partnership, with participation from the City of Alexandria, the Miracle League of Alexandria, the private sector and construction firms.
Staff is confident that the City's FY 2013 CAFR will be awarded the Government Finance
Officers Association's Certificate of Achievement for Excellence in Financial Reporting.
The City has received this award for each of the last 35 consecutive years.
Looking to Future CAFR Reporting: GASB has proposed major changes to the way pension costs are displayed in the financial report. The liabilities that will be included in future years are disclosed on page 110 and include both City and VRS plans. While these liabilities have always been disclosed as part of the CAFR, by FY 2015, the costs will be included as liabilities (CAFR, Exhibit I, page 33) in the City government-wide financial statements, reducing the City's net assets (or net worth).
FISCAL IMPACT: N/A
ATTACHMENT: Comprehensive Annual Financial Report ("CAFR")
STAFF:
Laura B. Triggs, Chief Financial Officer
Ray Welch, Finance
Berenice Harris, Finance