Laserfiche WebLink
City of Centerville [`117 O <br /> April 11, 1996 <br /> 'Page Two ICI{ <br /> CERTIFIED PIINLN: ALYSY.INTAN6 <br /> ANO G)NNLTANTS <br /> Other Matters <br /> The following are areas that came to our attention during the audit that we <br /> feel should be reviewed: <br /> Financial Position and Results of Operations <br /> General Fund <br /> Overall, the fund balance decreased $10,057 during 1995. The total fund <br /> balance is $300,538 and this is approximately 51% of current year <br /> expenditures and operating transfers out. This is adequate to meet <br /> working capital needs and should be maintained for the following reasons: <br /> Purposes and Benefits <br /> • Expenditures are incurred somewhat evenly throughout the year. <br /> However, property tax and state aid revenues are not received until <br /> the second half of the year. An adequate fund balance will provide <br /> the cash flow required to finance the General Fund expenditures_ Your <br /> fund balance appears to be sufficient to provide this working capital. <br /> • The City is vulnerable to legislative actions at the State and Federal <br /> level. Recent years have seen the State continually adjusting the <br /> local government aid and property tax credit formulas. An adequate <br /> fund balance will provide a temporary buffer against those aid <br /> adjustments. <br /> • Expenditures not anticipated at the time the annual budget was adopted <br /> may need immediate Council action. These would include capital outlay <br /> replacement, lawsuits and other items_ An adequate fund balance will <br /> provide the financing needed for such expenditures. <br /> • A strong fund balance will assist the City in maintaining or improving <br /> its bond rating. <br /> A summary of the 1995 operations is as follows: <br /> variance - <br /> Favorable <br /> Budget Actual (Unfavorable) <br /> Revenue $574 698 $686 059 $111 361 <br /> Expenditures 568 998 610 416 (41 418 <br /> Excess Revenue (Expenditures) 5 700 75 643 69 943 <br /> Other Financing Sources (Uses) <br /> Operating transfers in 14 300 14 300 - <br /> Operating transfer out (20 000 (100 000 (80 000 <br /> Total Other Financing <br /> Sources (Uses) (5 700 (85 700 (80 000 <br /> Excess of Revenue Over (Under) <br /> Expenditures and Other <br /> Financing Sources (Uses) S- (10 057) $(10 057 <br /> Fund Balance, January 1 310 595 <br /> Fund Balance, December 31 1120 538 <br />