Chapter 7- Managements Discussion and Analysis (MDamp;A) .ppt

Chapter 7- Management’s Discussion and Analysis (MDA) Presented by Steve DeVetter Partner – KPMG LLP MDA - What is it? Required supplementary information (RSI) which precedes the audited financial statements Management’s opportunity to communicate key financial activities of the Campus MDA requirements Minimum and maximum requirements General rather than specific See “Guide to Preparation of MDA” (Chapter 7, Appendix 1) for discussion of required elements (GASB 34, par. 11) MDA Overview Discussion of the basic financial statements including the relationship of the statements to each other Analysis of financial activities based on currently known facts, decisions or conditions Discussion of current year results in comparison with prior year, with emphasis on the current year Use of charts, graphs, and tables to facilitate understanding of management’s analysis MDA Overview (cont’d.) Focus of analysis should be on the Campus as the primary reporting entity, with component units (auxiliary organizations) included if considered significant Reference to the component unit’s separately issued financial statements, when appropriate MDA Overview (cont’d.) Presentation of condensed financial information comparing current year to prior year for each year presented Overall financial position and result of operations Description of significant capital assets and long-term debt activity For comparative financial statements, must provide two-year comparative analysis (i.e. 2004 vs. 2003 and 2003 vs. 2002) Description of currently known facts, decisions, or conditions that are expected to have a significant financial impact Preparation of MDA “Guide to Preparation of MDA” (refer to Chapter 7, Appendix 1) Starting point – comprehensive variance analysis Identification of significant changes, and the reasons for significant changes, from the prior year Coordination with appropriate Campus personnel to identify: Underlying causes for the changes Key decisions, trans