#04 - GFOA Certificate of Achievement Program

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STAFF REPORT DATE: June 10, 2025 TO: Mayor and Councilmembers FROM: Clarissa Hadler, Finance Director AGENDA ITEM: GFOA Certificate of Achievement CORE STRATEGIES: ☐ Vibrant, inclusive, connected community ☒ Efficient, reliable, innovative services ☐ Responsive, transparent, adaptive governance ☒ Balanced Finances now and future ☐ Managed Growth ☐ Resilient Infrastructure BACKGROUND: The city has been applying and receiving the GFOA Government Finance Officers’ Association (GFOA) Certificate of Achievement for Excellence in Financial Reporting (COA) since 2013. During the 2024 ACFR process, staff has been contemplating the cost and benefits of this certificate. (From GFOA website) The GFOA established the Certificate of Achievement for Excellence in Financial Reporting Program (COA) in 1945 to encourage and assist state and local governments to go beyond the minimum requirements of generally accepted accounting principles to prepare annual comprehensive financial reports that evidence the spirit of transparency and full disclosure and then to recognize individual governments that succeed in achieving that goal. The goal of the program is not to assess the financial health of participating governments, but rather to ensure that users of their financial statements have the information they need to do so themselves. More information on the program can be found here; https://www.gfoa.org/coa-award There are a number of reporting processes that have been added to the city’s ACFR (Annual Comprehensive Financial Report) in response to the requirements of the COA program and the comments of the reviewers of our past COA applications. Each of the processes are addressed by either the city’s auditors, at a cost of $150-$325 per hour, or high-level city staff. It’s difficult to say exactly what the financial impact is, but we’ve estimated around 10 hours of auditor time and around 60-80 hours of staff time by the Finance Director and Finance Coordinator. The application is due June 30 of each year, so much of this staff time is used during a time when we are still wrapping up the audit and doing other time-consuming annual reporting. Removing the COA from our auditing process should not diminish the value of the ACFR. Minnesota Statutes require all cities to issue an annual report on its financial position and activity prepared in accordance with generally accepted accounting principles (GAAP), under the guidance of the Governmental Accounting Standards Board (GASB), and audited in accordance with generally accepted