Obtain a copy of the Comprehensive Annual Financial Report (CAFR) for the State
ID: 2422218 • Letter: O
Question
Obtain a copy of the Comprehensive Annual Financial Report (CAFR) for the State of Texas for the Fiscal Year Ended August 31, 2014 from the Texas Department of Finance and Administration website -
http://www.texastransparency.org/State_Finance/Budget_Finance/Reports/Comprehensive_Annual_Financial/14/ ,
and answer the following questions. Provide page numbers where you found the information. You may copy and paste text from the CAFR. Please submit type-written answers.
Page numbers (1-283) can be found at the bottom of each page of the CAFR document and should be included in the blank provided to the left of each question to reference where your selected answers were located within the CAFR report. Note that the PDF Adobe page numbers (1-294) at the top of the screen will be different from the CAFR page numbers and should not be referenced for purposes of this exercise.
______1. Provide the name and title of the individual responsible for transmitting the CAFR to the Governor, Members of the Legislature, and Citizens of the State of Texas.
______2. Who was the CAFR report transmitted to?
______3. What achievement was awarded for the State of Texas CAFR for the prior fiscal year ended August 31, 2013? Who granted the award and what are the requirements?
______4. Who performed an audit of the financial statements for the State of Texas? For the Independent Auditor’s Report, what letterhead was the opinion printed on, who signed the audit report, and what was the date of the audit report?
_____5. The audit of the State of Texas financial statements was conducted in accordance with which standards?
______6. What type of audit opinion did the State of Texas receive for the fiscal year ended August 31, 2014? Provide the language included in the opinion paragraph of the audit report.
_____7. The government-wide financial statements are designed to provide the reader with a broad overview of the State’s finances. What are the names of the government-wide financial statements?
The government-wide financial statements are prepared using the _______ basis of accounting and the _________ measurement focus.
_____ 8. As for other state and local governments, what are the 3 fund categories for the Texas’s fund financial statements?
_____ 9. Most of the State’s general activities are reported in governmental funds. Governmental funds are accounted for using the ______ basis of accounting and ________ measurement focus.
_____ 10. The State of Texas maintains two types of Proprietary Funds: enterprise and internal service. The fiscal 2014 financial statements include ______ total enterprise funds, including _____ major fund and _____nonmajor funds.
List the major enterprise fund:
_____ 11. What Required Supplementary Information (RSI) and other supplementary information is included in the TX CAFR report?
_____ 12. What was the total $ amount of the State’s combined net assets for governmental and business-type activities for the fiscal year 2014?
_____ 13. What were the State’s two major revenue sources, and what were the $ amounts? Together, they accounted for _______ percent of total revenues.
_____ 14. Expenses reported on the Government-wide financial statements are reported on a functional basis. Name the 10 functional categories of expenses for the State’s governmental activities and rank them for 2014 in $ amounts from largest to smallest:
_____ 15. The bulk of the State’s total expenses for fiscal 2014 were related to the health and social services function. What was the $ amount of the expenses for this function, and what % of total primary government expenses do these expenses represent?
_____ 16. What is the chief operating fund of the State, and what was its ending fund balance as of Aug. 31, 2014?
Explanation / Answer
Page no.7 and 9 1. Provide the name and title of the individual responsible for transmitting the CAFR to the Governor, Members of the Legislature, and Citizens of the State of Texas.
Answer: Glenn Hegar, Comptroller of Public Accounts
Page no.3 2. Who was the CAFR report transmitted to
Answer: To the citizens of Texas, Governor Abbott and members of the 84th Texas Legislature
Page no. 7 3. What achievement was awarded for the State of Texas CAFR for the prior fiscal year ended August 31, 2013? Who granted the award and what are the requirements?
Answer: The Government Finance Officers Association (GFOA) of the United States and Canada awarded a Certificate of Achievement for Excellence in Financial Reporting to the state of Texas for its Comprehensive Annual Financial Report for the fiscal year ended Aug. 31, 2013. The Certificate of Achievement is a prestigious national award that recognizes conformance with the highest standards for preparation of state and local government financial reports.
Page no. 15, 18 4. Who performed an audit of the financial statements for the State of Texas? For the Independent Auditor’s Report, what letterhead was the opinion printed on, who signed the audit report, and what was the date of the audit report?
Answer: State auditor’s office; John Keel CPA State auditor; Feb 20, 2015
Page no. 16 5. The audit of the State of Texas financial statements was conducted in accordance with which standards?
Answer: The audit of the state of Texas financial statements was conducted in accordance with auditing standards generally accepted in the United States of America and the Standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.
Page no. 16 6. What type of audit opinion did the State of Texas receive for the fiscal year ended August 31, 2014? Provide the language included in the opinion paragraph of the audit report.
Answer: It is Un-qualified opinion. “In our opinion, based on our audits and the reports of other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate discretely presented component unit and remaining fund information of the state of Texas, as of August 31, 2014, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America”.
Page no. 21 7. The government-wide financial statements are designed to provide the reader with a broad overview of the State’s finances. What are the names of the government-wide financial statements?
Answer: The government wide financial statements are designed to present an overall picture of the financial position of the state. These statement consists of the statement of net position and the statement of activities.
The government-wide financial statements are prepared using the Accrual basis of accounting and the economic resources measurement focus.
Page no. 37 8. As for other state and local governments, what are the 3 fund categories for the Texas’s fund financial statements?
Answer: Government Fund financial statements, Proprietary fund financial statements, Fiduciary fund financial statements.
Page no. 22 9. Most of the State’s general activities are reported in governmental funds. Governmental funds are accounted for using the ______ basis of accounting and ________ measurement focus.
Answer: Governmental funds are accounted for using the modified accrual basis of accounting. Reporting of these funds focusses on the flow of money into and out of the funds and amounts remaining at fiscal year-end for future spending.
Page no. 23 10. The State of Texas maintains two types of Proprietary Funds: enterprise and internal service. The fiscal 2014 financial statements include ______ total enterprise funds, including _____ major fund and _____nonmajor funds.
List the major enterprise fund:
Answer:
When the state charges customers for services it provides, these activities are generally reported in proprietary funds. Services provided to outside (non-governmental) customers are reported in enterprise funds, a component of proprietary funds, and are accounted for using the economic resources measurement focus and the accrual basis of accounting. These are the same business-type activities reported in the government-wide financial statements, but are reported here to provide information at the fund level.
The employees life, accident and health insurance benefits fund is reported as an internal service fund and provides services on a cost reimbursement basis to other agencies of the financial reporting entity.
Colleges and universities, the unemployment trust fund and the lottery fund are reported as major proprietary funds.
The major enterprise funds for the state are listed below.
The Colleges and Universities include:
• University of Texas System
• Texas A&M University System
• Texas Tech University System
• University of Houston System
• Texas State University System
• University of North Texas System
• Texas Woman’s University
• Stephen F. Austin State University
• Texas Southern University
• Midwestern State University
• Texas State Technical College
Page no. 259 11. What Required Supplementary Information (RSI) and other supplementary information is included in the TX CAFR report?
Answer: Financial trend information, Revenue capacity information, Debt capacity information, Demographic and economic information, operating information.
Page no. 23 12. What was the total $ amount of the State’s combined net assets for governmental and business-type activities for the fiscal year 2014?
Answer: $260.3 billion
Page no. 25 13. What were the State’s two major revenue sources, and what were the $ amounts? Together, they accounted for _______ percent of total revenues.
Answer: State’s two major revenue sources are Operating grant and contributions and Taxes. Together they accounted for 89% of revenue.
Page 25_____ 14. Expenses reported on the Government-wide financial statements are reported on a functional basis. Name the 10 functional categories of expenses for the State’s governmental activities and rank them for 2014 in $ amounts from largest to smallest:
Education – 52,035,340
Health and Human Services – 50,774,364
Public safety and corrections – 5,638,569
Transportation – 5,472,547
Lottery – 3,164,120
General government – 3,089,799
Teacher retirement state contributions – 2,700,533
Natural resources - 2260483
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