Now that the activities have been discussed, it is time to transition to financial reporting. GASB Concepts Statement 1 summarizes two main purposes: to provide information that can be used to assess a government’s accountability and to assist users in making economic, social, and political decisions (Reck & Lowenshon, 2016, p 352). This makes great denotation for the primary fact that many users view the financial report.
Financial reports should be understandable, reliable, relevant, timely, consistent, and comparable (Reck & Lowenshon, 2016, p 352). The reason financial reports should consist of the above given components relies upon effective communication (Reck & Lowenshon, 2016, p 352). Have you ever picked up a novel or document that was lengthy and hard to read for no apparent reason? The same concept applies here. Notes are made to further provide information that is essential and important to the user’s understanding (Reck
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The notes are formatted by different sections. There is an introductory, financial, and statistical section (Reck & Lowenshon, 2016, p 359-361). With relations to the CAFR, the table of contents would be considered part of the introductory section. The introductory section simply introduces what is discussed in the CAFR. The financial section would include the auditor’s report, management’s discussion and analysis, and the basic financial statements (Reck & Lowenshon, 2016, p 359-360). This gives information on the different aspects of the financials. Finally, the statistical section would include reports and trends about revenue, debt, operating information, demographics and economic activity (Reck & Lowenshon, 2016, p 360-361). In the CAFR, the statistical data would be the budgetary comparison schedule and the TMRS schedule of funding progress (CAFR,