1. Local Government Mandate Review http://www.apa.virginia.gov _____________________________________ July 30, 2012 Staci Henshaw, CPA, Director Page 1

2. Local Government Mandate Review Overview Provide background surrounding Comparative Report Discuss why locality CAFR’s are not viable sources of information for the Comparative Report Discuss opportunities to improve the process Page 2http://www.apa.virginia.gov

3. Local Government Mandate Review Comparative Report of Local Government Objective is to present uniform financial data on Virginia counties, cities, and towns in an understandable and useful manner Currently is only reliable and consistent source of information about local governments Page 3http://www.apa.virginia.gov

4. Local Government Mandate Review Comparative Report Background 1930s – 1960s –APA audited most counties and prepared County Comparative Report from counties’ records –Cities hired auditors and APA staff prepared City Comparative Report from annual reports –Counties data was uniform; cities data not reliable and was inconsistent Page 4http://www.apa.virginia.gov

5. Local Government Mandate Review Comparative Report Background 1970s –APA audited less than 1/3 of counties –Counties and cities were hiring auditors and APA staff prepared the Comparative Report from annual reports –Comparative Report lost uniformity and comparability Page 5http://www.apa.virginia.gov

6. Local Government Mandate Review Comparative Report Background Late 1970s –APA met with legislators, localities, academia, and other interested parties –All decided need for a Uniform Financial Reporting Manual with uniform chart of accounts and specific detail –Users wanted transparency and ability to compare data between localities Page 6http://www.apa.virginia.gov

7. Local Government Mandate Review Comparative Report Background 1981 –First Comparative Report prepared in accordance with the Uniform Financial Reporting Manual –All local government data is uniform and comparable Page 7http://www.apa.virginia.gov

8. Local Government Mandate Review Comparative Report Users Local government officials Local government organization (VML & VACO) Legislators Commission on Local Government –Fiscal stress index (revenue capacity and revenue effort components) Academia Page 8http://www.apa.virginia.gov

9. Local Government Mandate Review The CAFR is not a viable source of information for the Comparative Report Revenues and expenditures not uniform and comparable between localities or between years Revenues and expenditures not comprehensive of government’s involvement in regional activities Detail not available for fiscal analysis Page 9http://www.apa.virginia.gov

10. Local Government Mandate Review Opportunities to Improve Process – Information APA has started discussions with users and preparers –What is the key information included in the Comparative Report? –Are there other sources for some information? –APA must follow Administrative Process Act for any proposed changes to information Page 10http://www.apa.virginia.gov

11. Local Government Mandate Review Opportunities to Improve Process – Data Collection Locality Opportunities for Improved Efficiency –Set-up general ledger accounts to mirror Comparative Report accounts –Utilize financial system technology to assist in Comparative Report preparation APA is reviewing transmittal forms for process improvements Page 11http://www.apa.virginia.gov

12. Local Government Mandate Review http://www.apa.virginia.gov _____________________________________ QUESTIONS Page 12