Essay about City of Smithville

878 WordsOct 5, 20124 Pages
CITY OF SMITHVILLE EVALUATION Below you will find 18 performance measures that use information from the basic financial statements of the City of Smithville (also referred to as “The City”) as of December 31, 2011. These measures are classified by those that address financial position, financial performance, and financial capability. FINANCIAL POSITION INDICATORS Financial position can be calculated using unrestricted net assets, general fund budgetary fund balance, capital asset condition, pension plan funding, debt to assets, current ratio, and quick ratio. I will analyze all of these financial indicators further for the City of Smithville with the exception of pension plan funding due to the lack of information necessary to…show more content…
FINANCIAL PERFORMANCE INDICATORS Financial performance can be calculated using change in net assets, interperiod equity, sales tax growth, BTA self-sufficiency, and debt service coverage. I will analyze all of these financial indicators further for the City of Smithville with the exception of sales tax growth due to the lack of information necessary to reproduce this calculation. Change In Net Assets At 1.8%, the City’s change in net assets is consistent with average or above average standards. This tells us that the City’s financial condition has improved compared to last year in a positive manner. Interperiod Equity At 86.5%, the City’s interperiod equity ratio is quite low and very poor which tells us that the City isn’t necessarily living within its means for the year. BTA Self-Sufficiency At 101.6%, the City’s BTA self-sufficiency ratio is very high which tells us that the City’s business-type activities are mostly funded with current-year service revenues, rather than prior year resources. Debt Service Coverage At -10.9, the City’s debt service coverage is below spectrum ratings which tell us that the City isn’t meeting its debt service requirements on revenue bonds by having enough net operating revenues available. FINANCIAL CAPABILITY INDICATORS Financial capability

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