Cafr Analysis—City of Chicago

CAFR Analysis—City of Chicago

Introduction

The Comprehensive Annual Financial Report I chose to analyze is the CAFR of city of Chicago for the fiscal year ending December 31, 2014. I selected this report because I am quite familiar with this city due to several times travelling and this CAFR provided almost all the information necessary to conduct analysis.

This CAFR is divided into three main sections as follows:

Section 1: Introductory Section (unaudited) – This section includes the Letter of Transmittal, Certificate of Achievement for Excellence in Financial Reporting and a brief chart of how those government departments are organized.

Section 2: Financial Section (audited) – This section provides independent auditors’ report, management discussion and analysis, basic financial statements including governmental-wide and individual fund types’ financial statements, required supplementary information and non-major funds information.

Section3: Statistical Section (unaudited) – This section contains any additional information that needs to be reported, such as last ten years’ debt statistics, Population and income statistics, net position by components and change in net position using accrual basis accounting.

In the following paragraphs, I will overview the Comprehensive Annual Financial Report by sections and analyze some aspects indicated in the CAFR in details.

Management Discussion and Analysis:

By looking at the management discussion and analysis, we can figure out how the Chicago government’s general financial situation last year was and what were the key points that needed to be highlighted for users to obtain the basic information. It indicated that what were the single year and accumulated deficits that the city had and how those deficits were caused. The assets increasing and what were the sources of increasing were explained as well. Besides those highlighted financial information, it also briefly introduced that basic statements in...