ACC 409 – CHAPTER 17 CAFR

Student: Khanh “Kai” Nguyen

ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

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ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

Table of Contents
1. Based on the Table of Contents, what financial statements are prepared for the Governmental Funds?
3
2. Does the C&C have any Special Revenue Funds? If so, how many? Identify one fund and provide a
description of its purpose. ............................................................................................................................. 3
3. Does the C&C have any Debt Service Funds? If so, how many? Identify one fund and provide a
description of its purpose. ............................................................................................................................. 4
4. Does the C&C have any Capital Projects Fund? If so, how many? Identify one fund and provide a
description of its purpose. ............................................................................................................................. 4
5. Does the C&C have any Permanent Funds? If so, how many? Identify one fund and provide a
description of its purpose. ............................................................................................................................. 5
6. Based on the Notes to the Financial Statements, what measurement focus and basis of accounting is
used for governmental fund financial statements? What is the C&C policy for determining whether
revenues are available? ................................................................................................................................. 5
7. Find the budgetary comparison schedules for the general fund. Based on the schedules, what were
the estimated revenues and appropriations for the most recent fiscal year? What were the three largest
line-item appropriations for in the final budget?........................................................................................... 5
8. Based on the Notes to the Financial Statement, what is the policy of the general fund with respect to
outstanding encumbrances at the fiscal year end? ........................................................................................ 6
9. On the balance sheet of the general fund, what is the total amount reported for assets and for fund
balance? Of the total amount reported for fund balance, how much is unassigned? ................................... 6
10. On the balance sheet of the general fund what is the amount reported for inventories? Does the
government use the purchase method or the consumption method? ............................................................. 6
11. Based on the Notes to the Financial Statements, what is the government’s revenue recognition
policy with respect to property taxes in the general fund? What percentage of the property tax levy is
estimated to be uncollectible? ....................................................................................................................... 7
12. Examine the statement of revenues, expenditures and changes in fund balance. Compare the
change in fund balance for the general fund with the amount of change in fund balance that was budgeted
for the year. Were the government’s general fund actual results better or worse than expected? ............... 7
13. Has the general fund engaged in any interfund loans and advances? If yes, what are the amounts
owed to the general fund? What are the amounts owed by the general fund? ............................................. 7
14. Has the general fund engaged in any interfund transfers? If yes, what are the amounts transferred
in to the general fund? What are the amounts transferred out of the general fund? .................................... 8

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ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

1. Based on the Table of Contents, what financial statements are prepared for the
Governmental Funds?

Answer
Based on the Table of Contents (page i, C&C of Honolulu CAFR, 2017), the following
financial statements are prepared for the governmental funds:
- Balance Sheet (including Reconciliation of the Balance Sheet to the Statement of Net
Position)
- Statement of Revenues, Expenditures and Changes in Fund Balances
- Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund
Balances to the Statement of Activities

2. Does the C&C have any Special Revenue Funds? If so, how many? Identify one fund
and provide a description of its purpose.

Answer
According to C&C of Honolulu CAFR, 2017, the C&C have the following Special
Revenue Funds:

Special Revenue Funds - Major Category

- Highway Fund

Special Revenue Funds - Nonmajor Funds

- Highway Beautification and Disposal of Abandoned Vehicles Revolving Fund

- Bikeway Fund
- Parks and Playgrounds Fund
- Liquor Commission Fund
- Rental Assistance Fund
- Hanauma Bay Nature Preserve Fund
- Clean Water and Natural Lands Fund
- Affordable Housing Fund
- Community Development Fund
- Patsy T. Mink Central Oahu Regional Park Fund
- Waipio Peninsula Soccer Park Fund
- Golf Fund
- Special Events Fund
- Special Projects Fund
- Federal Grants Fund
- Housing and Community Development Rehabilitation Loan Fund
- Pauahi Project Expenditures, Hawaii R-15 Fund
- Housing and Community Development Section 8 Contract Fund

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ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

For example, Hanauma Bay Nature Preserve Fund accounts for receipts from the entrance
and vehicle admission fees to the Hanauma Bay Nature Preserve and is earmarked
primarily for the operation, maintenance and improvement of the Nature Preserve.

3. Does the C&C have any Debt Service Funds? If so, how many? Identify one fund
and provide a description of its purpose.

Answer
According to C&C of Honolulu CAFR, 2017, the C&C have the following Debt Service
Funds:

Debt Service Funds - Major Category

- General Obligation Bond and Interest Redemption Fund

Debt Service Funds - Nonmajor Funds

- Improvement District Bond and Interest Redemption Fund

For example, Improvement District Bond and Interest Redemption Fund accounts for the
redemption of maturing City improvement district assessment bonds and collections of
special assessments.

4. Does the C&C have any Capital Projects Fund? If so, how many? Identify one fund
and provide a description of its purpose.

Answer
According to C&C of Honolulu CAFR, 2017, the C&C have the following Special
Revenue Funds:

Capital Projects Funds - Nonmajor Funds

- General Improvement Bond Fund

- Highway Improvement Bond Fund
- Federal Grants Capital Projects Fund
- Capital Projects Fund

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ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

For example, General Improvement Bond Fund accounts for proceeds of general obligation
bonds issued to pay all or part of those appropriations in the Capital Budget Ordinance for
public improvements specified to be expended from this fund.

5. Does the C&C have any Permanent Funds? If so, how many? Identify one fund and
provide a description of its purpose.

Answer
Based on my observations and research, I’d say that the C&C does not have any Permanent
Fund.

6. Based on the Notes to the Financial Statements, what measurement focus and basis
of accounting is used for governmental fund financial statements? What is the C&C
policy for determining whether revenues are available?

Answer

According to page 54, C&C of Honolulu CAFR, 2017, governmental fund financial
statements are reported using the current financial resources measurement focus and the
modified accrual basis of accounting.

In the same page, the C&C policy also states that revenues are considered to be available
when they are collectible within the current period or soon enough thereafter to pay
liabilities of the current period.

7. Find the budgetary comparison schedules for the general fund. Based on the
schedules, what were the estimated revenues and appropriations for the most recent
fiscal year? What were the three largest line-item appropriations for in the final
budget?

Answer
Based on the schedules, the most recent fiscal year ends on June 30, 2017.

According to pages 117 and 118, C&C of Honolulu CAFR, 2017:

The estimated revenues for the fiscal year ended June 30, 2017 are $1,272,335,000.
The estimated appropriations for the fiscal year ended June 30, 2017 are $ 1,088,750,000.
Based on my observations, the three largest line-item appropriations in the final budget are:
- Provisional (Miscellaneous): $282,494,000

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ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

- Police (Public safety): $249,556,000

- Fire (Public safety): $131,784,000

8. Based on the Notes to the Financial Statement, what is the policy of the general fund
with respect to outstanding encumbrances at the fiscal year end?

Answer
Based on the Notes to the Financial Statement (page 57, C&C of Honolulu CAFR, 2017),
the C&C’s policy of general fund with respect to outstanding encumbrances at the fiscal
year end is that, encumbrances that are outstanding at year-end are included in fund
balances and do not constitute expenditures or liabilities because the commitments will be
honored during the subsequent year.

9. On the balance sheet of the general fund, what is the total amount reported for assets
and for fund balance? Of the total amount reported for fund balance, how much is
unassigned?

Answer
On the balance sheet of the general fund (page 148, C&C of Honolulu CAFR, 2017):
- For 2017, the total amount reported for assets is $288,629,000.
- For 2017, the total amount reported for fund balance is $214,080,000. Of that total
amount, a total of $139,925,000 from fund balance is unassigned.

10. On the balance sheet of the general fund what is the amount reported for inventories?
Does the government use the purchase method or the consumption method?

Answer
According to page 35, C&C of Honolulu CAFR, 2017, the total amount reported for
inventories is $24,397,000, in which the amount of governmental activities is not recorded
and the amount of business-type activities is $24,397,000.
According to page 60, C&C of Honolulu CAFR, 2017, the costs of inventories are recorded
as expenditures when consumed rather than when purchased  consumption method.

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ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

11. Based on the Notes to the Financial Statements, what is the government’s revenue
recognition policy with respect to property taxes in the general fund? What
percentage of the property tax levy is estimated to be uncollectible?

Answer
According to page 54, C&C of Honolulu CAFR, 2017, property taxes are recognized as revenues
in the year for which they are levied.
According to page 259, C&C of Honolulu CAFR, 2017, collected property taxes levy for 2017 is
$1,087,315,000, which is 99.3% out of the property taxes levy for 2017. This means that, 0.7% of
the property taxes levy is estimated to be uncollectible.

12. Examine the statement of revenues, expenditures and changes in fund balance.
Compare the change in fund balance for the general fund with the amount of change
in fund balance that was budgeted for the year. Were the government’s general fund
actual results better or worse than expected?

Answer
The government’s general fund actual results are better than expected.
According to page 40, C&C of Honolulu CAFR, 2017, the net change in fund balances for 2017
is $10,871,000.
According to page 118, C&C of Honolulu CAFR, 2017, the expected net change in fund balances
for 2017 is ($65,221,000).

13. Has the general fund engaged in any interfund loans and advances? If yes, what are
the amounts owed to the general fund? What are the amounts owed by the general
fund?

Answer
Yes, according to page 81, C&C of Honolulu CAFR, 2017, the general fund has engaged in
at least one interfund loan/advance.
The amount due to general fund from other funds is $132,327,000.
The amount due to other funds from general fund is $6,000.

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ACC 415_Section 001
Student: Khanh “Kai” Nguyen Professor: Jenny Teruya

14. Has the general fund engaged in any interfund transfers? If yes, what are the
amounts transferred in to the general fund? What are the amounts transferred out
of the general fund?

Answer
Yes, according to page 81, C&C of Honolulu CAFR, 2017, the general fund has engaged in
at least one interfund transfers.
The amount transferred in to general fund is $158,187,000.
The amount transferred out of general fund is $485,659,000.

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