HomeMy WebLinkAboutAgenda - 11-19-2002-6aORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: November 19, 2002
Action Agen a
Item No. -
SUBJECT• 2001-2002 Comprehensive Annual Financial Report (CAFR)
DEPARTMENT: Finance PUBLIC HEARING: (YIN) No
ATTACHMENT(S):
CAFR and Single Audit Reports
(Under Separate Cover)
INFORMATION CONTACT:
Ken Chavious, ext. 2453
TELEPHONE NUMBERS:
Hillsborough 732-8181
Chapel Hill 968-4501
Durham 688-7331
Mebane 336-227-2031
PURPOSE: To receive the Comprehensive Annual Financial Report (CAFR) and Single Audit
Report for the fiscal year ended June 30, 2002.
BACKGROUND: The CAFR covers all financial activity of the County for the 2001-2002 fiscal
year and the Single Audit Report focuses on grant compliance for the same fiscal year. Both
reports result from an annual audit of the County's financial records, which occurred during the
past several months. The audit was performed by Cherry Bekaert & Holland, the firm of
independent Certified Public Accountants hired by the Board last fiscal year. Presentation of
these reports is necessary in order to fulfill the requirements set forth in Chapter 159-34 of the
North Carolina General Statutes.
The results of the 2002 audit were very good. 2002 marked the first year implementation of
Governmental Accounting Standards Board (GASB) statement 34. This new pronouncement
by GASB dramatically changes the financial statement presentation to make the traditional
government statements read more like those of private industry. With the assistance of the
auditors, the implementation was very successful. The Finance Director will discuss the major
impacts and changes to the financial statements resulting from GASB 34 in more detail during
the presentation. Undesignated fund balance in the general fund at year-end was 10% of
general fund expenditures. This amount exceeds the Local Government Commission's
recommended minimum of 8%. This percentage is less than prior year levels due to economic
and state budgetary impacts. The County's ability to absorb those impacts and remain above
the 8% minimum reflects the commitment on the part of management and the Board to insure
that fund balance levels are sufficient to address unforeseen circumstances.
The auditors found no instances of material weakness in the County's internal control structure
and have issued an "unqualified" (good) opinion on the County's financial statements. In fact,
there were no material audit findings related to the audit of the CAFR or the single audit. The
auditors did, however, make some minor recommendations. These recommendations along
with responses are included in the reports. The Finance Director will cover in more detail some
of the highlights of the report and will be available, along with representatives of the County's
certified public accountants, Cherry, Bekaert & Holland, to answer any questions.
FINANCIAL IMPACT: The County maintained sound financial condition at year-end and is
currently considering opportunities for further improvement of fund balance position.
RECOMMENDATION(S): The Manager recommends that the Board receive the audit
presentation for information only.