CERTIFICATE OF EXCELLENCE IN FINANCIAL REPORTING (COE)

Transcription

1 CHECKLIST

2 ESSENTIALS COE CHECKLIST UPDATES For Comprehensive Annual Financial Reports (CAFR) for the fiscal year ending June 30 or August 31, The following GASB Standards are addressed in this update: GASB 72, 73, 74, 77. GASB 76 and 78 do not require updates to the checklist. CERTIFICATE OF EXCELLENCE IN FINANCIAL REPORTING (COE) Thank you for applying to the Certificate of Excellence in Financial Reporting (COE) program. Your participation in the COE program fosters stakeholder confidence by demonstrating your district s commitment to fiscal integrity and transparency through superior financial reporting. COE APPLICATION GUIDELINES All COE application packets must include: The COE Application, with payment information. The School District s Comprehensive Annual Financial Report (CAFR), which - Includes all funds and component units of the school district. - Is prepared in accordance with generally accepted accounting principles. - Includes an unmodified opinion within the independent auditor s report. - Is consistent in formatting and form throughout the document. Reviewer Comments from the previous year and the school district s responses to each comment. The COE Checklist and Cover Letter - Mandatory for school districts (1) applying to the program for the first time, (2) that were conditionally awarded or denied the award for the most recent submission, or (3) that did not submit a CAFR in the previous year. - The Cover Letter should specify any required criteria from the COE Checklist that do not apply to the district. The Cover Letter should also describe unique features of the district that will be helpful to the Review Team during the review process. - The COE Checklist and Cover Letter Optional, if the school district does not fit the criteria above; however, they are still highly recommended. COE RESOURCES For CAFR examples and application resources, visit the COE Resources page on the ASBO website. The COE Seminar and a Discussion Group for prospective applicants are presented each fall at ASBO International s Annual Meeting & Expo. More questions? Contact coe@asbointl.org. COE CHECKLIST 1

3 CHECKLIST NAME OF SCHOOL DISTRICT STATE/PROVINCE CAFR YEAR INSTRUCTIONS Place a check mark in the appropriate column. If you check the No or N/A column, please explain in the cover letter why the question does not apply to the school district. Checklist Questions Yes No N/A 1. REPORT COVER REPORT COVER, TITLE PAGE, AND TABLE OF CONTENTS A. Does the cover use the specific title Comprehensive Annual Financial Report (CAFR) to m m m identify the report? (2012 GAAFR, page 591) B. Does the cover include the full name of the school district and the state in which it is located? m m m (2012 GAAFR, page 591) C. Does the cover include the exact date on which the fiscal year ended (e.g., for the fiscal year m m m ended June 30, 2014)? (2012 GAAFR, page 591) 2. TITLE PAGE A. Is there a title page? (2012 GAAFR, page 591) m m m B. Does the title page use the specific title Comprehensive Annual Financial Report (CAFR) to m m m identify the report? (2012 GAAFR, page 591) C. Does the title page include the full name of the school district and the state in which it is m m m located? (2012 GAAFR, page 591) D. Does the title page include the fiscal period(s) covered? (2012 GAAFR, page 591) m m m E. Does the title page include the school district officials/department responsible for preparing m m m the CAFR (may also contain the list of principal officials)? (2012 GAAFR, page 591) 2 COE CHECKLIST

4 3. TABLE OF CONTENTS A. Is there a table of contents that encompasses the entire report? m m m (NCGA-S1: 139; 2012 GAAFR, page 591) B. Is the table of contents clearly divided into at least three basic sections: Introductory Section, m m m Financial Section, and Statistical Section? (2012 GAAFR, page 591) C. Does the table of contents present the Introductory Section, the Financial Section, and the m m m Statistical Section as the first, second, and third sections, respectively, of the report? D. Does the table of contents clearly distinguish the Basic Financial Statements (including the m m m notes) from other Financial Section items and required supplementary information (RSI)? (2012 GAAFR, page 591) E. Does the table of contents include page numbers for each item in the CAFR? m m m (2012 GAAFR, page 591) F. Do all statements, schedules, table descriptions/titles, and page numbers in the table of m m m contents agree with or cross-reference the contents of the CAFR? 1. GENERAL INTRODUCTORY SECTION A. Does the Introductory Section include a list of the principal officials of the school m m m district-elected, appointed, or both? (2012 GAAFR, page 594) B. Does the Introductory Section include an organizational chart of the school district? m m m (2012 GAAFR, page 594) C. Does the Introductory Section include a copy of the Certificate of Excellence award certificate m m m for the immediate preceding fiscal year (if awarded)? (2012 GAAFR, page 594) 2. TRANSMITTAL LETTER A. Is a transmittal letter included in the Introductory Section? m m m (NCGA-S1: 139; 2012 GAAFR, page 591) B. Is the transmittal letter: m m m 1. Presented on the school district letterhead stationery? (2012 GAAFR, page 592) m m m 2. Dated on or after the date of the independent auditor s report? (2012 GAAFR, page 592) m m m 3. Signed by the chief financial officer (at a minimum) and/or chief executive officer? m m m (2012 GAAFR, page 592) C. Does the transmittal letter include the following: 1. Formal transmittal of the CAFR (2012 GAAFR, pages 592 & 683) m m m a. Any legal requirements the CAFR intends to fulfill? m m m b. Management s responsibility for financial information? m m m c. Internal control structure? m m m d. Independent audit? m m m e. Refer readers to the MD&A? m m m COE CHECKLIST 3

5 2. Profile of the school district (2012 GAAFR, pages 593 &683) m m m a. Population, structure, and types and levels of services provided? m m m b. Component unit? m m m c. Budget process? m m m d. Governmental funds with an annual or biennial appropriated budget? m m m e. Legal level of budgetary control? m m m f. Scope of instructional activities? m m m g. Number of students? m m m h. Types of programs offered? m m m i. Relationship of school district to other governments? m m m j. Discussion of charter schools, indicating their relationship to the school district and m m m how they are funded? 3. Information useful in assessing the economic condition of the school district m m m (2012 GAAFR, pages 593 & 683) a. Local economy and economic outlook? m m m b. Long-term financial planning? m m m c. Relevant financial policies? m m m d. Major initiatives? m m m e. Projected enrollment? m m m f. Age of school buildings? m m m D. Does the transmittal letter include information regarding awards and acknowledgments? m m m (2012 GAAFR, pages 594 & 683) E. Has the school district refrained from duplicating information contained in the MD&A or in the m m m notes to the financial statements?(gasbs 34: 8, footnote 7; 2012 GAAFR, pages ) 1. INDEPENDENT AUDITOR S REPORT FINANCIAL SECTION A. Is a report of the independent auditor included? (2012 GAAFR, page 594) m m m B. Does the Financial Section begin with the report of the independent auditor? m m m (2012 GAAFR, page 594) C. Has the independent auditor conducted the audit in accordance with generally accepted m m m auditing standards or generally accepted government auditing standards? (2012 GAAFR, pages 601 & 770) D. Does the independent auditor express an opinion on the fair presentation of the basic financial m m m statements in conformity with generally accepted accounting principles? (2012 GAAFR, pages 601 & 770) 4 COE CHECKLIST

6 E. Did the CAFR receive an unmodified auditor s opinion? (2012 GAAFR, page 601) m m m F. Does the independent auditor indicate, at a minimum, that the supplemental information is m m m fairly presented in relation to the basic financial statements? (2012 GAAFR, page 595) G. Has the independent auditor refrained from indicating that required supplementary m m m information (RSI) is either absent or otherwise potentially inadequate? (2012 GAAFR, page 595) H. Is the independent auditor s report signed and dated and on the auditor s letterhead? m m m 2. MANAGEMENT S DISCUSSION AND ANALYSIS (MD&A) A. Is an MD&A presented? (GASBS 34: 6; 2012 GAAFR, page 594) m m m B. Is the MD&A presented preceding the basic financial statements? (GASBS 34: 8; 2012 GAAFR, m m m pages 567 & 594) C. Does the MD&A describe the basic government-wide financial statements and the basic fund m m m financial statements, as well as the difference in the kinds of information provided by each? (Cod. Sec b; 2012 GAAFR, page 568) D. Does the MD&A provide condensed financial data extracted from the government-wide m m m financial statements? If yes, does the condensed financial data include: (Cod. Sec b; 2012 GAAFR, pages ) 1. Total assets (distinguishing between capital and other assets)? (Cod. Sec b(1); m m m 2012 GAAFR, page 568) 2. Total deferred outflows of resources? (Cod. Sec b(2)) m m m 3. Total liabilities (distinguishing between long-term liabilities and other liabilities)? m m m (Cod. Sec b(3); 2012 GAAFR, page 568) 4. Total deferred inflows of resources? (Cod. Sec b(4)) m m m 5. Total net position (distinguishing among the net investment in capital assets; restricted m m m net position; and unrestricted net position)? (Cod. Sec b(5); 2012 GAAFR, page 568) 6. Program revenues by major source? (Cod. Sec b(6); 2012 GAAFR, page 568) m m m 7. General revenues by major source? (Cod. Sec b(7); 2012 GAAFR, page 568) m m m 8. Total revenues? (Cod. Sec b(8); 2012 GAAFR, page 568) m m m 9. Program expenses, at a minimum by function? (Cod. Sec b(9); 2012 GAAFR, m m m page 568) 10. Total expenses? (Cod. Sec b(10); 2012 GAAFR, page 568) m m m 11. Excess (deficiency) before contributions to term and permanent endowments or m m m permanent fund principal, special and extraordinary items, and transfers? (Cod. Sec b(11); 2012 GAAFR, page 568) 12. Contributions? (Cod. Sec b(12); 2012 GAAFR, page 569) m m m 13. Special and extraordinary items?(cod. Sec b(13); 2012 GAAFR, page 569) m m m 14. Transfers? (Cod. Sec b(14); 2012 GAAFR, page 569) m m m 15. Change in net position? (Cod. Sec b(15); 2012 GAAFR, page 569) m m m 16. Ending net position? (Cod. Sec b(16); 2012 GAAFR, page 569) m m m COE CHECKLIST 5

7 E. Does the MD&A present condensed financial data for both the current fiscal period and the m m m preceding fiscal period? (GASBS 34: 11b; 2012 GAAFR, page 568) F. Does the MD&A provide an overall analysis of the school district s financial position and m m m results of operations? (GASBS 34: 11c; 2012 GAAFR, page 569) G. Does the MD&A specifically address whether the school district s overall financial position m m m has improved or deteriorated? (GASBS 34: 11c; 2012 GAAFR, page 569) H. Does the MD&A address governmental activities separately from business-type activities? m m m (GASBS 34: 11c; 2012 GAAFR, page 568) I. Does the MD&A provide an analysis of significant balances and transactions of individual major m m m funds? (GASBS 34: 11d; 2012 GAAFR, page 569) J. Does the MD&A address whether restrictions, commitments, or other limitations significantly m m m affect the availability of fund resources for future use? (GASBS 34: 11d; 2012 GAAFR, page 569) K. Does the MD&A provide an analysis of significant budgetary variations (both original budget m m m versus final amended budget and final amended budget versus actual) for the general fund? (GASBS 34: 11e; 2012 GAAFR, page 570) L. Does the MD&A describe significant capital asset and long-term debt activity during the year? m m m (GASBS 34: 11f; 2012 GAAFR, page 570) M. Does the discussion of capital asset and long-term debt activity refer readers interested in m m m more detailed information to the notes to the financial statements? (GASBS 34: 11f, footnote 8; 2012 GAAFR, page 570) N. Do amounts reported in the MD&A agree with related amounts in the basic financial statements? m m m O. Has the school district refrained from addressing in the MD&A topics not specifically m m m prescribed by SGAS 34? (GASBS 37: 4-5; 2012 GAAFR, page 568) 3. BASIC FINANCIAL STATEMENTS - GENERAL CONSIDERATIONS A. Is a complete set (as applicable) of basic financial statements presented, including: 1. Government-wide statement of net position? (GASBS 34: 12; 2012 GAAFR, page 296) m m m 2. Government-wide statement of activities? (GASBS 34: 12; 2012 GAAFR, page 296) m m m 3. Balance sheet - governmental funds? (GASBS 34: 78; 2012 GAAFR, page 189) m m m 4. Statement of revenues, expenditures, and changes in fund balances - governmental funds? m m m (GASBS 34: 78; 2012 GAAFR, page 194) 5. Statement of revenues, expenditures, and changes in fund balances - budget and actual - m m m general fund and major special revenue funds (if not presented as RSI)? (GASBS 34: 130, footnote 53; 2012 GAAFR, page 196) 6. Statement of net position - proprietary funds? (GASBS 34: 91; 2012 GAAFR, page 229) m m m 7. Statement of revenues, expenses, and changes in fund net position - proprietary funds? m m m (GASBS 34: 91; 2012 GAAFR, page 229) 8. Statement of cash flows - proprietary funds? (GASBS 34: 91; 2012 GAAFR, page 229) m m m 9. Statement of fiduciary net position? (GASBS 34: 106; 2012 GAAFR, page 261) m m m 10. Statement of changes in fiduciary net position? (GASBS 34: 106; 2012 GAAFR, page 261) m m m 6 COE CHECKLIST

8 B. Is each basic financial statement clearly referenced to the notes to the basic financial m m m statements? (2012 GAAFR, page 596) C. Do the government-wide Statement of Net Position and fund statements of position m m m (Statement of Net Position or Balance Sheet, as applicable) report separate sections for assets, deferred outflows of resources, liabilities, and deferred inflows of resources, as applicable? (GASBS 63: 7; 2012 GAAFR, pages 229 and ) D. If the statements present non-pension related deferred outflows of resources and deferred m m m inflows of resources, are they limited to those items specifically identified by GAAP for reporting in this category? (GASBS 63: 7) E. Do the statements include pension related deferred outflows of resources and deferred inflows m m m of resources? 1. If the school district is an employer for a single-employer or agent multiple-employer defined benefit pension plan administered through a trust or equivalent arrangement that does not have a special funding situation, were the following items reported as deferred outflows of resources and deferred inflows of resources, as applicable: a. Differences between expected and actual experience with regard to economic or demographic m m m factors (differences between expected and actual experience) in the measurement of the total pension liability not recognized in pension expense? (GASBS 68: 33(a)(1)) b. Changes of assumptions about future economic or demographic factors or of other inputs m m m (changes of assumptions of other inputs) not recognized in pension expense? (GASBS 68: 33(a)(2) c. Differences between projected and actual pension plan investment earnings in different m m m measurement periods not recognized in pension expense? (GASBS 68: 33(b) 2. If the school district is an employer for a cost-sharing multiple-employer pension plan (with or without a special funding situation), an employer for a single-employer or agent multipleemployer pension plan with a special funding situation, or a governmental nonemployer contributing district to a defined benefit pension plan that is administered through a trust or equivalent arrangement, were the following items reported as deferred outflows of resources and deferred inflows of resources, as applicable: a. Differences between expected and actual experience with regard to economic or m m m demographic factors (differences between expected and actual experience) in the measurement of the total pension liability not included in the collective pension expense? (GASBS 68: 53, 71(a)(1), 83, 85, 92, 102) b. Changes of assumptions about future economic or demographic factors or of other inputs m m m (changes of assumptions of other inputs) not included in the collective pension expense? (GASBS 68: 53, 71(a)(2), 85, 92, 102) c. Differences between projected and actual pension plan investment earnings in different m m m measurement periods not recognized in pension expense? (GASBS 68: 53, 71(b), 85, 102) d. The net effect of the change in proportion if there is a change in the employer s proportion m m m of the collective net pension liability since the prior measurement date not recognized in pension expense? (GASBS 68: 54, 86, 103) e. Difference during the measurement period between (a) the total amount of such m m m contributions from the employer (and amounts associated with the employer from nonemployer contributing entities that are not in a special funding situation) and (b) the amount of the employer s proportionate share of the total of such contributions from all employers and all nonemployer contributing entities not recognized in pension expense? (GASBS 68: 55, 87, 104) COE CHECKLIST 7

9 f. If the school district is an employer or a governmental nonemployer contributing district to m m m a defined benefit pension plan administered through a trust or equivalent arrangement (regardless of the type of pension plan and whether there is a special funding situation), were contributions to the pension plan from the employer subsequent to the measurement date of the net pension liability and before the end of the reporting period reported as a deferred outflow of resources? (GASBS 68: 34, 57, 89, 106) F. Has the school district refrained from making direct adjustments to net position or fund balance m m m except in those situations specifically contemplated by GAAP (prior period adjustments, cumulative effect of a change in accounting principle, and changes in inventory balances accounted for using the purchases method)? (2012 GAAFR, pages ) G. Do financial statements within each category (i.e., government-wide, governmental funds, m m m proprietary funds, and fiduciary funds) articulate with one another? (For example, does the amount reported for net position at the end of the period in the government-wide statement of activities tie to the corresponding amount reported for net position in the government-wide statement of net position?) H. If the school district has multiple major discretely presented component units, do the basic m m m financial statements present separate information on each as one of the following: (GASBS 14:51; 2012 GAAFR, page 83-84) 1. By including combining statements in the reporting district s basic statements after the m m m fund financial statements? 2. By presenting condensed financial statements in the notes to the financial statements? m m m 3. By using separate columns in the government-wide financial statements? m m m I. Has the school district reported derivative instruments on the statement of net position as m m m assets or liabilities at their fair value (includes both government-wide and the proprietary fund statements of net position, and the statement of fiduciary net position)? (GASBS 53:19; 2012 GAAFR, page 489) 4. GOVERNMENT-WIDE FINANCIAL STATEMENTS - GENERAL CONSIDERATIONS A. Are governmental activities and business-type activities reported as separate columns? m m m (GASBS 34: 12d, 15; 2012 GAAFR, pages 62, ) B. Is the total column for the primary government presented? (GASBS 34: 14; 2012 GAAFR, m m m pages 299, 313) C. Is the total column for the primary government consolidated? (GASBS 34: 57-60; m m m 2012 GAAFR, pages 299) D. Are any nonfiduciary discretely presented component units presented in one or more separate m m m columns to the right of the total column for the primary government? (GASBS 34: 12c; 2012 GAAFR, pages ) E. Has the school district refrained from including fiduciary funds in the government-wide m m m financial statements? (GASBS 34: 12b; 2012 GAAFR, page 62) 5. GOVERNMENT-WIDE STATEMENT OF NET POSITION A. Are assets and liabilities reported either in the relative order of their liquidity or on a classified m m m basis? (GASBS 34: 31, footnote 23; 2012 GAAFR, pages ) B. Are capital assets that are not being depreciated (e.g., land and construction in progress) m m m reported separately from depreciable capital assets, if significant? (GASBS 34:20; 2012 GAAFR, page 442) 8 COE CHECKLIST

10 C. If assets and liabilities are presented in the relative order of liquidity, is any amount presented m m m for long-term liabilities divided between amounts due within one year and amounts due in more than one year?(gasbs 34: 31; 2012 GAAFR, page 298) D. If a classified approach is taken and restricted assets are reported, are restricted assets and m m m liabilities payable from restricted assets reported in the same category? (2012 GAAFR, page 230) E. Does each column in the government-wide statement of net position include capital assets m m m (including infrastructure assets and intangible assets) used to support those activities? (GASBS 34: 12e, 19; 2012 GAAFR, pages 96,300) F. Has the school district appropriately capitalized its internally generated intangible assets? m m m (GASBS 51:7-8, 2012 GAAFR, pages ) 1. In the case of internally generated computer software, has the school district only m m m capitalized costs incurred during the application development stage? (GASBS 51: 9-15, 2012 GAAFR, pages ) G. Does the governmental activities column include debt and all other long-term liabilities m m m (e.g., compensated absences, claims and judgments, net pension obligation/net other postemployment benefit obligation, net pension liability/collective net pension liability [school district s proportionate share], pollution remediation obligations, nonexchange financial guarantees, if extending) incurred in connection with those activities? (GASBS 34: 12e; GASBS 49: 9-10; GASBS 68; GASBS 70: 7-9; 2012 GAAFR, page 96) 1. Has the school district refrained from netting any liability amounts with a related asset, m m m if any? (GASBS 45: 21; GASBS 68) H. Does the governmental activities column include an asset for the negative net pension m m m obligation/negative net other postemployment benefit obligation and net pension asset/ collective net pension asset (school district s proportionate share), if applicable? (GASBS 45: 21; GASBS 68; 2012 GAAFR, page 400) 1. Has the school district refrained from netting any related liability with the asset? m m m (GASBS 45: 21; GASBS 68: 21) I. Is the school district s assets plus deferred outflows of resources less liabilities, less deferred m m m inflows of resources reported as net position? (GASBS 34: 30; GASBS 63:8; 2012 GAAFR, pages ) J. Is the balance reported as net position subdivided into the following categories, as appropriate? m m m (GASBS 34: 32) 1. Net investment in capital assets (2012 GAAFR, pages ) m m m a. Is the net investment in capital assets correctly calculated? (GASBS 34: 33; 2012 GAAFR, m m m pages ) b. Has the school district included only capital-related deferred outflows of resources and m m m capital-related borrowings and deferred inflows of resources (including bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction or improvements of capital assets)? (2012 GAAFR, pages ) c. Has the school district refrained from including unspent proceeds of debt issued for m m m capital purposes in the calculation? (2012 GAAFR, pages ) 2. Net position-restricted (2012 GAAFR, pages ) m m m a. Are only amounts with externally imposed restrictions (creditors, grantors, contributors, m m m laws/regulations of other governments, constitutional provisions, and normally from enabling legislation) reported as restricted? (2012 GAAFR, pages ) COE CHECKLIST 9

11 3. Net position-unrestricted? (2012 GAAFR, page 305) m m m 6. GOVERNMENT-WIDE STATEMENT OF ACTIVITIES A. Does the format of the statement present expenses before revenues? m m m (GASBS 34: 38; 2012 GAAFR, page 305) B. Is information on expenses for governmental activities presented at least at the functional m m m level of detail? (GASBS 34: 39; 2012 GAAFR, page 306) C. Is the information on expenses for business-type activities presented by different identifiable m m m activities? (GASBS 37: 10; 2012 GAAFR, page 306) D. If a portion of depreciation expense is reported as a separate line item, is it labeled unallocated m m m depreciation expense? (GASBS 34: 44; 2012 GAAFR, page 307) E. Is interest expense reported as a separate line item for governmental activities? m m m (GASBS 34: 46; 2012 GAAFR, pages ) F. Are debt issuance costs, except any portion related to prepaid insurance costs, recognized m m m as an expense in the period incurred? (GASBS 65: 15) G. Does the format of the statement present program revenues associated with individual m m m functions and activities? (GASBS 34: 38, 48; 2012 GAAFR, pages ) H. Are program revenues presented for both governmental activities and business-type activities? m m m (GASBS 34: 15; 2012 GAAFR, page 311) I. Are program revenues segregated into the following categories, as appropriate? m m m (GASBS 34: 48; GASBS 37: 12; 2012 GAAFR, pages ) 1. Charges for services m m m 2. Operating grants and contributions m m m 3. Capital grants and contributions m m m J. Has the school district refrained from including taxes that it has levied as program revenues? m m m (GASBS 34: 52; 2012 GAAFR, page 309) K. Has the school district combined the expenses of individual functions and activities with m m m related program revenues to calculate the net expense/revenue of each function and activity? (GASBS 34: 38; 2012 GAAFR, page 310) L. Has the school district reported each major source of tax revenue (sales, property, franchise, m m m income) separately within the general revenues? (GASBS 34: 52; 2012 GAAFR, pages 169, 313) M. Has the school district reported the following items separately, both from each other and the m m m general revenues: contributions; special items (including transactions related to government combinations and disposals of government operations [GASBS 69: 40 and 47]); extraordinary items; and transfers? (GASBS 34: 53-56; 2012 GAAFR, pages ) N. Has the school district refrained from reporting extraordinary gains and losses in connection m m m with refunding resulting in the defeasance or redemption of debt? (GASBS 23: 4; GASBS 34: 17, 146; 2005 GAAFR, pages ) O. Has the school district refrained from reporting the loss from impairment of capital assets as m m m general revenue? (GASBS 42: 17; 2012 GAAFR, page 457) 10 COE CHECKLIST

12 7. FUND FINANCIAL STATEMENTS - GENERAL CONSIDERATIONS A. Has the school district refrained from reporting discretely presented component units as one m m m or more separate columns in the fund financial statements? (GASBS 34: 63; 2012 GAAFR, page 55) B. Does interfund activity net to zero (unless there is a difference in fiscal year between the m m m primary government and its blended component units)? 1. Are any differences explained in the notes to the basic financial statements? m m m (2012 GAAFR, page 55) C. Does nonreciprocal transfers activity between funds equal (unless there is a difference in fiscal m m m year between the primary government and its blended components units)? (2012 GAAFR, page 55) D. Has the school district refrained from reporting overdrafts of pooled cash and investments as m m m a negative asset balance, i.e., negative cash? (AAG-SLV: 5.27; 2012 GAAFR, pages 49-50) E. Has the school district refrained from blending component units that do not either 1) share a m m m governing body with the primary government and there is either a financial benefit or burden relationship between the primary government and component unit OR management of the primary government has operational responsibility for the component unit or 2) exclusively or almost exclusively benefit the primary government? (GASBS 61: 8a-c; 2012 GAAFR, pages 80-81) F. Has the school district refrained from blending legally separate tax-exempt organizations that m m m are classified as component units only because of the nature and significance of their relationship with the primary government? (GASBS 39: 5; 2012 GAAFR, pages 80-81) 8. GOVERNMENTAL FUND FINANCIAL STATEMENTS - GENERAL CONSIDERATIONS A. Has the school district included only governmental fund types (i.e., general fund, special m m m revenue funds, debt service funds, capital projects funds, and permanent funds)? (GASBS 34: 63-64; 2012 GAAFR, page 40) B. Are funds reported appropriately in accordance with the governmental fund type definitions? m m m 1. Are special revenue funds used to account for and report the proceeds of specific revenue m m m sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects? (GASBS 54: 30; 2012 GAAFR, pages 40-42) 2. Are capital projects funds used to account for and report financial resources that are restricted, m m m committed, or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets? (GASBS 54: 33; 2012 GAAFR, page 42) 3. Are debt service funds used to account for and report financial resources that are restricted, m m m committed or assigned to expenditure for principal and interest? (GASBS 54: 34; 2012 GAAFR, page 42-43) 4. Are permanent funds used exclusively to report resources available to support the school m m m district s programs, but are legally restricted so that only earnings and not principal may be used? (GASBS 54: 35; 2012 GAAFR, page 43) C. Is each major governmental fund reported in a separate column? (GASBS 34: 75-76; m m m 2012 GAAFR, pages 183, 188) D. Are all non-major governmental funds reported in a single column, regardless of fund type? m m m (GASBS 34: 75; 2012 GAAFR, pages 183, 188) E. Is a total column presented? (GASBS 34: 83, 86; 2012 GAAFR, pages 193, ) m m m COE CHECKLIST 11

13 F. Is a summary reconciliation provided that ties this total column and the related amount m m m reported for governmental activities in the government-wide financial statements? (GASBS 34: 77, 85, 90; 2012 GAAFR, pages , 196) G. If aggregation in the summary reconciliation obscures the nature of the individual elements of m m m a particular reconciling item, has the school district provided a more detailed explanation in the notes to the financial statements? (GASBS 34: 77; 2012 GAAFR, pages , 196, ) 9. BALANCE SHEET - GOVERNMENTAL FUNDS A. Has the school district refrained from reporting nonfinancial assets (e.g., capital assets used m m m in operations rather than held for resale, intangibles, a negative net pension obligation, a negative net other postemployment benefit obligation, a net pension asset)? (GASBS 34: 80, 83; GASBS 68; 2012 GAAFR, pages 170) B. Has the school district refrained from reporting unmatured debt and accrued interest payable m m m as liabilities (except in debt service funds employing the early recognition option for debt service payments due early in the subsequent year)? (GASBS 34: 82, 83; 2012 GAAFR, page ) C. Is the school district s assets plus deferred outflows of resources equal to liabilities plus m m m deferred inflows of resources plus fund balance?(gasbs 34: 83, 84; GASBS 63:12; 2012 GAAFR, page 189) D. Is the use of the term deferred limited to items reported as deferred outflows of resources or m m m deferred inflows of resources? (GASBS 65: 31) E. Is the fund balance segregated into the following categories, as appropriate? (GASBS 54: 5-17; m m m 2012 GAAFR, pages ) 1. Nonspendable a. Are nonspendable amounts limited to items either in nonspendable form or legally or m m m contractually required to be maintained intact? (GASBS 54: 6) 2. Restricted a. Are restricted amounts limited to items externally imposed by creditors, grantors, contributors, m m m or laws and regulations of other school districts or imposed by law through constitutional provisions or enabling legislation? (GASBS 54: 8a&b) 3. Committed a. Are committed amounts used only for specific purposes pursuant to constraints imposed by m m m formal action of the government s highest level of decision-making authority? (GASBS 54:10) 4. Assigned a. Are assigned amounts constrained only by the government s intent to be used for specific m m m purposes? (GASBS 54:13) 5. Unassigned F. Has the school district reported unassigned fund balance in the General Fund only (unless m m m reported as a deficit in other funds based on positive restricted, committed and assigned fund balances)? (GASBS 54: 17; 2012 GAAFR, page 192) G. Has the school district refrained from reporting negative amounts in restricted, committed, m m m or assigned fund balance? (GASBS 54: 19; 2012 GAAFR, page 192) H. Are stabilization amounts reported in the general fund as restricted, committed, or unassigned m m m as appropriate? (GASBS 54: 21; 2012 GAAFR, pages ) 12 COE CHECKLIST

14 10. STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS A. Does the format of this statement present items in the following order? m m m (GASBS 34: 86; 2012 GAAFR, page 194) 1. Revenues m m m 2. Expenditures m m m 3. Excess (deficiency) of revenues over (under) expenditures m m m 4. Other financing sources and uses, including transfers m m m 5. Special items (including transactions related to government contributions and disposals of m m m government operations [GASBS 69: 45, 47, 50 and 51]) 6. Extraordinary items m m m 7. Net change in fund balances m m m 8. Fund balances, beginning of period m m m 9. Fund balances, end of period m m m B. Are revenues classified by source? (GASBS 34: 87; 2012 GAAFR, page 194) m m m C. Has the school district refrained from reporting realized gains and losses on investments m m m separately from unrealized gains and losses? (GASBS 31: 13; 2012 GAAFR, page 352) D. Are expenditures classified by character (i.e., current, intergovernmental, capital outlay, and m m m debt service)? (NCGA-SI: par 115; 2012 GAAFR, page 195) E. Are current expenditures further categorized at least by function? (GASBS 34: 87; 2012 m m m GAAFR, page 194) F. Has the school district refrained from reporting negative investment income as an expenditure m m m (instead of as revenue)? (GASB Implementation Guide ; 2012 GAAFR, page 194) G. Has the school district refrained from reporting expenses rather than expenditures (e.g., bad m m m debt expense)? (NCGA-S1: par 70; 2012 GAAFR, page 144) H. If the school district initiated a capital lease during the period, does it report an other financing m m m source equal to the net present value of the minimum lease payments? (NCGA-S5: par 14; 2012 GAAFR, pages ) I. If the school district issued debt during the period that will be repaid with general government m m m resources, does the school district report an other financing source equal to the face value of the debt? (GASBS 34: 88; GASBS 37: 16; 2012 GAAFR, page 156) 1. Has the school district reported a separate other financing source for premiums related to its m m m debt issuances? (GASBS 34: 88; 2012 GAAFR, pages 157, 470) 2. Has the school district reported a separate other financing use for discounts related to its debt m m m issuances? (GASBS 34: 88; 2005 GAAFR, pages , ) 3. Are bond issuance costs (e.g., underwriter s fees) reported as expenditures? (GASBS 34: 87; m m m 2012 GAAFR, page 156) COE CHECKLIST 13

15 J. Has the school district refrained from reporting an other financing source in connection with m m m the issuance of tax anticipation notes, revenue anticipation notes, grant anticipation notes, bond anticipation notes that do not meet the criteria of SFAS 6, and demand bonds that do not qualify as long-term liabilities? (GASBI 1: 13; NCGAI9: 12; 2012 GAAFR, pages 175, ) K. If the school district has used a refunding transaction to defease or redeem debt, has it m m m reported the proceeds of the refunding debt as an other financing source at the face amount of the refunding bonds? (GASBS 7: 8; 2012 GAAFR, pages ) 1. If the school district has used a refunding transaction to advance refund debt, has it reported m m m application of the proceeds as an other financing use with a label such as payment to refunded bond escrow agent? (GASBS 7: 8; 2012 GAAFR, pages ) 2. If the school district has used a refunding transaction for a current refunding, has it reported m m m application of the proceeds as a debt service expenditure with a label such as payment to refunded bond escrow agent (2012 GAAFR, pages ) 11. STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - GENERAL FUND AND MAJOR SPECIAL REVENUE FUNDS A. If the school district has not presented required budgetary comparisons for the general fund m m m and annually budgeted major special revenue funds as RSI, are these comparisons presented as basic governmental fund financial statements? (GASBS 34: 130, footnote 53; 2012 GAAFR, pages ) B. Is the budgetary comparison titled a statement rather than a schedule? (GASBS 34: m m m footnote 53; 2012 GAAFR, page 197) C. Has the school district refrained from presenting budgetary comparisons for debt service funds, m m m capital projects funds, permanent funds, major special revenue funds without annual budgets, and non-major special revenue funds? (GASBS 34: 130; 2012 GAAFR, pages ) D. Does the budgetary statement present the original budget? (GASBS 34: 130a; 2012 GAAFR, m m m pages ) E. Does the budgetary statement present the final amended budget? (GASBS 34: 130b; m m m 2012 GAAFR, page 198) F. Does the budgetary statement present actual data using the budgetary basis of accounting? m m m (NCGA-S1: 155; GASBS 34: 130; 2012 GAAFR, page 198) G. Has the school district presented one or more variance columns? (GASBS 34: 130; m m m 2012 GAAFR, page 198) 1. If yes, has the school district refrained from captioning variance columns as favorable or m m m unfavorable? (2012 GAAFR, page 198) 12. PROPRIETARY FUND FINANCIAL STATEMENTS - GENERAL CONSIDERATIONS A. Has the school district included only proprietary fund types (i.e., enterprise funds and internal m m m service funds)? (2012 GAAFR, page 44-45) B. I s each major enterprise fund reported in a separate column? (GASBS 34: 96; 2012 GAAFR, m m m page 232) C. Are all non-major enterprise funds reported in a single column? (GASBS 34: 96; 2012 GAAFR, m m m page 232) D. Is a total column presented for all enterprise funds? (GASBS 34: 96; 2012 GAAFR, pages ) m m m 14 COE CHECKLIST

16 E. If necessary, is a summary reconciliation provided that ties this total column and the related m m m amount reported for business-type activities in the government-wide financial statements? (GASBS 34: 104; 2012 GAAFR, pages 234, 236) F. Is a single column reported for the internal service fund type? (GASBS 34: 96; m m m 2012 GAAFR, page 235) G. Has the school district refrained from using the enterprise funds to report activities for which m m m fees and charges are not a revenue source (with the exception of activities previously accounted for in accordance with SGAS 29)? (GASBS 34: 67, 147; 2012 GAAFR, pages 44-45). H. Has the school district refrained from using an internal service fund to report activities in which m m m the government itself is not the predominant participant? (GASBS 34: 68; 2012 GAAFR, page 45) 13. STATEMENT OF FUND NET POSITION - PROPRIETARY FUNDS A. Are assets and liabilities classified as current and long-term? (GASBS 34:97; 2012 GAAFR, m m m page 230) B. Is the school district s assets plus deferred outflows of resources less liabilities less deferred m m m inflows of resources reported as net position? (GASBS 34:98, footnote 40; GASBS 63:8; 2012 GAAFR, page 229) C. Is the balance of net position subdivided into the following categories, as appropriate: m m m (GASBS 34: 98; 2012 GAAFR, pages ) 1. Net investment in capital assets? m m m 2. Restricted net position, distinguishing between major categories of restrictions? m m m 3. Unrestricted net position? m m m D. Is the net investment in capital assets correctly calculated? (GASBS 34: 33) m m m E. Are only amounts with externally imposed restrictions (creditors, grantors, contributors, m m m laws/regulations of other governments, constitutional provisions, and normally from enabling legislation) reported as restricted net position? (2012 GAAFR, pages ) 14. STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION - PROPRIETARY FUNDS A. Does the statement distinguish between operating and nonoperating revenues and expenses? m m m (GASBS 34: 100; 2012 GAAFR, page 235) B. Has the school district refrained from including revenues (nonexchange and exchange-like m m m such as tax revenues) related to transactions for which cash flows would be reported in the capital and related financing activities, noncapital financing activities, or investing activities sections of the cash flows statement within the operating category? (GASBS 34: 102) C. Is operating income/loss reported as a separate line item? (GASBS 34: 100) m m m D. Are revenue and expense classifications sufficiently detailed to be meaningful? (GASBS 34: 101) m m m E. If capital assets are reported, is depreciation expense reported separately from other expenses? m m m (APB12: 5) F. Has the school district reported each of the following items separately: capital contributions m m m (grant, developer, and other); additions to permanent and term endowments; special items (including transactions related to government combinations and disposals of government operations [GASBS 69: 40, 43,47, 51]); extraordinary items; and transfers? (GASBS 34: ) COE CHECKLIST 15

17 G. Has the school district refrained from reporting extraordinary gains or losses in connection m m m with refunding transactions that result in the defeasance or redemption of debt? (GASBS 23: 4) 15. STATEMENT OF CASH FLOWS - PROPRIETARY FUNDS A. Does the statement categorize cash flows as follows: (GASBS 9: 15; 2012 GAAFR, page 238) m m m 1. Cash flows from operating activities? m m m 2. Cash flows from noncapital financing activities? m m m 3. Cash flows from capital and related financing activities? m m m 4. Cash flows from investing activities? m m m B. Are cash flows from operating activities reported by major classes of receipts and m m m disbursements (i.e., the direct method)? (GASBS 9: 31; 2012 GAAFR, page 238) C. Has the school district refrained from including receipts and payments of interest as cash flows m m m from operating activities? (GASBS 9: 58; 2012 GAAFR, page 238) D. Has the school district refrained from combining cash flows for noncapital financing activities m m m and cash flows from capital and related financing activities in a single cash flow from financing activities category? (GASBS 9: 53-54; 2012 GAAFR, pages ) E. Has the school district refrained from reporting disbursements for the acquisition of fund m m m capital assets as cash flows from investing activities? (GASBS 9: 57a; 2012 GAAFR, page 239) F. Are cash receipts and cash payments generally reported gross rather than net? m m m (GASBS 9: 12-14; 2012 GAAFR, page 237) G. Does the amount reported as cash and cash equivalents at the end of the period trace to a m m m similar account or accounts on the statement of net position? (GASBS 9: 8; 2012 GAAFR, pages ) H. Is the statement accompanied by a schedule that reconciles operating income and cash flows m m m from operating activities? (GASBS 9: 7; 2012 GAAFR, page 241) I. Is the statement accompanied by information (in narrative or tabular form) concerning investing, m m m capital, or financing activities of the period that affected recognized assets or liabilities but did not result in cash flows? (GASBS 9: 37; 2012 GAAFR, page 241) 16. FIDUCIARY FUND FINANCIAL STATEMENTS - GENERAL CONSIDERATIONS A. Has the school district included only fiduciary fund types [i.e., private-purpose trust funds, m m m pension (and other employee benefits) trust funds, and agency funds]? (2012 GAAFR, pages 46-49, 261) B. Has the school district refrained from reporting either expendable trust funds or nonexpendable m m m trust funds? (GASBS 34: 395, 397) C. Are all funds of a given fund type reported in a single column? (GASBS 34: 106; m m m 2012 GAAFR, page 261) D. Has the school district refrained from using a fiduciary fund to report resources that are m m m available to support the school district s programs? (GASBS 34: 69; 2012 GAAFR, page 251) 17. STATEMENT OF FIDUCIARY NET POSITION A. If the school district only reports agency funds, have they captioned this statement Statement m m m of Fiduciary Assets and Liabilities? 16 COE CHECKLIST

18 B. Are assets reported by major category? (2012 GAAFR, page 262) m m m C. Is the school district s assets plus deferred outflows of resources less liabilities less deferred m m m inflows of resources reported as net position? (GASBS 34: 108; 2012 GAAFR, page 262) D. If a pension (and other employee benefit) trust fund is reported, is net position reported as m m m follows: (GASBS 67: 21; GASBS 74:27; 2012 GAAFR, page 263) 1. Pension plan administered through a trust or equivalent arrangement = net position restricted m m m for pensions? 2. Pension plan not administered through a trust or equivalent arrangement = assets held in trust m m m for pension benefits? 3. OPEB plan = assets held in trust for OPEB benefits? m m m E. Do assets equal liabilities in agency funds? (GASBS 34: 110; 2012 GAAFR, page 263) m m m 18. STATEMENT OF CHANGES IN FIDUCIARY NET POSITION A. Is the statement segregated into two sections: additions and deductions? (GASBS 34: 109; m m m GASBS 74:28 & 31; 2012 GAAFR, page 264) B. For pension (and other employee benefit) trust funds, are additions classified into the following m m m four categories, as applicable: 1. Employer contributions? (GASBS 67:22a;GASBS 74:28a; 2012 GAAFR, page 645) m m m 2. Plan member contributions? (GASBS 67: 22c; GASBS 74:28c; 2012 GAAFR, page 645) m m m 3. Contributions from nonemployer contributing entities? (GASBS 67: 22b; GASBS 74:28b; 2012 m m m GAAFR, page 645) 4. Net investment income? (GASBS 67: 22d; GASBS 74:28d) m m m a. Is investment related expense reported as a separate line item that reduces investment m m m income (rather than as a deduction)? (GASBS 67: 22d; 2012 GAAFR, GASBS 74:28d; page 264; 2012 GAAFR, page 645) C. For pension (and other employee benefit) trust funds, are deductions separated by: 1. Benefits and refunds paid to plan members? m m m 2. Total administrative expenses? (GASBS 67: 27; GASBS 74:31; 2012 GAAFR, page 645) m m m D. Has the school district refrained from including agency funds? (GASBS 34: 110; 2012 GAAFR, m m m page 263) 19. NOTES TO THE BASIC FINANCIAL STATEMENTS A. Are notes to the basic financial statements presented? m m m B. Does the school district present a Summary of Significant Accounting Policies (SSAP) either m m m as the first note to the financial statements or as a separate item immediately preceding the notes? (NCGA-S1: 158; 2012 GAAFR, pages 323 & 346) 20. REPORTING DISTRICT A. Does the SSAP discuss the financial reporting district? (2012 GAAFR, page 324) m m m COE CHECKLIST 17

19 B. Do the notes to the financial statements provide a brief description of component units and m m m their relationship to the school district with the description, including: (Cod.Sec ; GASBS 14: 61; GASBS 61: 11; 2012 GAAFR, pages ) 1. Description of the component units included within the financial reporting district? m m m 2. Description of the relationships between the component units and the primary government? m m m 3. Discussion of the criteria for including component units within the financial reporting district? m m m 4. Discussion of how the component units are reported (i.e., blending or discrete presentation)? m m m 5. Information on how to obtain the separately issued financial statements of component units? m m m C. If the school district itself is a component unit, does the SSAP identify the primary government m m m and describe the nature of the relationship? (GASBS 14: 65; 2012 GAAFR, page 325) 21. JOINT VENTURES A. Does the school district participate in a joint venture? (2012 GAAFR, page 387) m m m 1. Is there a general description of any ongoing financial interest and/or financial responsibility m m m related to participation in the joint venture? 2. Does the school district provide information about the availability of separate financial m m m statements of the joint venture? 3. Are required disclosures for related-party transactions (if applicable) included? m m m 22. ACCOUNTING POLICIES A. Does the SSAP disclose the measurement focus and basis of accounting used in preparing the m m m government-wide financial statements? (GASBS 34: 115b; 2012 GAAFR, page 329) B. Does the SSAP disclose when revenues are considered susceptible to accrual (measurable and m m m available) in governmental funds? (NCGAS 1: 69; 2012 GAAFR, page 329) C. Does this disclosure specifically identify the availability period used for revenue recognition? m m m (GASBS 38: 7; 2012 GAAFR, page 329) D. Does the SSAP disclose the omission of fiduciary funds and fiduciary-type component units m m m from the government-wide financial statements? (GASBS 34: 115a; 2012 GAAFR, page 324) E. Does the SSAP describe the school district s policy for eliminating internal activity in the m m m government-wide statement of activities? (GASBS 34: 115c; 2012 GAAFR, pages ) F. Does the SSAP address the school district s accounting policies for capital assets? m m m (GASBS 34: 115e; GASBS 51: 16; 2005 GAAFR, page 332) 1. Does the SSAP disclose the capitalization threshold(s) for capital assets? m m m 2. Does the SSAP disclose the method(s) used to calculate depreciation and amortization m m m expense? 3. Does the SSAP disclose the estimated useful lives of capital assets (typically disclosed m m m separately for each major class of capital assets)? G. Does the SSAP describe the types of transactions that are reported as program revenues? m m m (2012 GAAFR, page 336) 18 COE CHECKLIST