Overview of the Financial Statements This CAFR is presented in three sections: introductory, financial and statistical. The introductory section includes a letter of transmittal submitted by the Authority’s Chief Financial and Business Operations Officer, a listing of the Authority’s Board of Directors and organizational chart as of June 30, 2020, and a copy of the Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting that has been awarded to the Authority for the fiscal year ended June 30, 2019. The financial section consists of the Independent Auditor’s Report, Management’s Discussion and Analysis, and the Authority’s basic financial statements which are discussed below, and are presented comparatively for the fiscal years ended June 30, 2020 and 2019. • Statements of Net Position • Statements of Revenues, Expenses and Changes in Net Position • Statements of Cash Flows • Notes to Financial Statements • Required Supplementary Information The Statements of Net Position report the Authority’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources, providing information about the nature and amounts of investments in resources (assets) and obligations to creditors (liabilities). These statements may be used to evaluate the capital structure, liquidity, and financial flexibility of the Authority. The Statements of Revenues, Expenses and Changes in Net Position reflect revenue and expense activity of the Authority for the fiscal years presented. These statements allow the user to measure the Authority’s profitability and creditworthiness by the financial performance of the Authority’s operations, and to determine whether the Authority has successfully recovered its operating costs through user fees and other charges. The Statements of Cash Flows present the Authority’s inflows and outflows of cash during the financial reporting periods by reporting cash receipts, cash payments, and the net changes in cash. Cash flows are categorized by operating, non-capital financing, capital and related financing, and investing activities. The Notes to Financial Statements and the Required Supplementary Information provide necessary disclosures essential to a full understanding of the data provided in the aforementioned basic financial statements. The statistical section includes selected financial, operational, and demographic information presented on a multi-year basis. The Authority operates as an enterprise fund. Enterprise funds are a type of proprietary fund and function similar to a private business in that user charges and fees are expected to cover costs. The Authority’s basic financial statements are presented using the accrual basis of accounting, which provides for revenue recognition in the period in which water and water reclamation services are provided and expense recognition when goods and services are received. Additionally, the Authority’s basic financial statements utilize the flow of economic resources measurement focus, in which all assets, deferred outflows of resources, liabilities and deferred inflows of resources are reflected on the Statements of Net Position. The Statements of Changes in Revenues, Expenses and Net Position include all transactions, such as revenues and expenses, that increase or decrease net position. MANAGEMENT’S DISCUSSION AND ANALY SIS FINANCIAL SECTION 15
Prince William County Service Authority | 4 County Complex Court Woodbridge, VA 22192
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