AG 2012 12 17 - Laserfiche WebLink

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Management's Discussion and Analysis As management of Cabarrus County, we offer readers of Cabarrus County's financial statements this narrative overview and analysis of the financial activities of Cabarrus County for the fiscal year ended June 30, 2012. We encourage readers to read the information presented here in conjunction with additional information that we have furnished in the County's financial statements, which follow this narrative. Financial Highlights • The liabilities of Cabarrus County exceeded its assets at the close of the fiscal year by ($61,446,567) (net assets). • The total Net Assets of Governmental Activities (Exhibit 1) shows a deficit of $65,093,245 a decrease of $14,662,256 from the prior year's deficit of $79,755,501. In accordance with North Carolina law, the County is financially responsible for funding school facilities and issuing any debt in connection with school facilities. These assets are not reflected in the County's financial statements as the law requires that school capital improvements are to be expensed on the books of the County; the capital asset is recorded by the school system. The effect of this accounting distorts net assets of the County creating a large deficit in unrestricted net assets. The Statement of Net Assets does not present the County's position regarding spending. This information is presented in the governmental fund statements (Exhibit 4). • As of the close of the current fiscal year, Cabarrus County's governmental funds reported combined ending fund balances of $107,209,329, after a net decrease in fund balance of $19,063,604. Approximately 31.1 percent of this total amount, or $33,349,366, is restricted or non - spendable. • At the end of the current fiscal year, unassigned fund balance for the General Fund was $45,700,553, or 22.0 percent of total general fund expenditures for the fiscal year. • Cabarrus County's total debt decreased by $37,419,086 or 9.0% during the current fiscal year. The key factors in this net decrease were the refunding of $34,395,000 of Certificates of Participation (COPS) and the issuance of $33,515,000 Limited Obligation Bonds (LOBS) The debt payments and refunding of COPS were greater than the new LOBS issuance by $19,760,000. Large principal payments totaling $6,965,000 of General Obligation debt and pay off of $11,122,572 of installment financing debt also contributed to this decrease. • Cabarrus County has installment bond ratings of AA / Aa / AA and general obligation bond ratings of AA+ / Aa / AA +. Overview of the Financial Statements This discussion and analysis are intended to serve as an introduction to Cabarrus County's basic financial statements. The County's basic financial statements consist of three components; 1) government -wide financial statements, 2) fund financial statements, and 3) notes to the financial statements (see Figure 1). The basic financial statements present two different views of the County through the use of government - wide statements and fund financial statements. In addition to the basic financial statements, this report contains other supplemental information that is designed to enhance the reader's understanding of the financial condition of Cabarrus County. 15 Attachment number 1 1 -3 Page 269