Project Pages

Economic Condition Reporting: Financial Projections

Project Description: The objective of this project is to consider whether guidance or guidelines should be provided for additional information about economic condition, particularly financial projections, as part of general purpose external financial reporting (GPEFR). This project also will include consideration of the information users identified as necessary to assess the risks associated with a government’s intergovernmental financial dependencies.

Status:
On Hold Pending Resolution of GASB Scope
Added to Research Agenda: April 2004
Added to Current Agenda: December 2009

Economic Condition Reporting—Project Plan


Background
: The current project represents phase three of a long-term project. Phase one involved the background research, including a literature review. The second phase (which resulted in the issuance of GASB Statement No. 44, Economic Condition Reporting: The Statistical Section in May 2004) focused on the existing reporting of economic condition information as presented in the statistical section.

The third and current phase of this project examines the usefulness of indicators of economic condition and its related components, including fiscal sustainability, which might be a part of GPEFR. The results of the research for this phase of the project are summarized in a July 2009 report titled Results of Research on Economic Condition Reporting: Fiscal Sustainability. This phase of the project will incorporate this research, determine and clarify fiscal sustainability’s relationship to economic condition, (including financial position, fiscal capacity, and service capacity), and explore the possibility of providing guidance or suggesting guidelines for the reporting of fiscal sustainability information.

Prior to this project, the Board has not yet considered a working definition of fiscal sustainability, nor the information users need to assess fiscal sustainability in the state and local government environment. This project will not only accomplish both of these tasks but also will create context for better understanding fiscal sustainability in relation to economic condition.

Relevant literature, the research of other standards setters and governments, and the views of various types of users of governmental financial information all highlight the fact that economic condition and similar concepts of financial health are not limited to where a governmental entity currently stands. GASB research also indicates that users are interested in understanding a governmental entity’s past economic condition—and thus how the governmental entity arrived at its current status—with an eye toward assessing a governmental entity’s future viability or fiscal sustainability. In other words, based on existing information, users seek to assess a governmental entity’s ongoing ability to raise revenue, to deliver services, to issue debt, to meet obligations and commitments—the capacity to sustain or improve its financial status. A considerable amount of research has been conducted to identify users’ information needs with regard to the assessment of a government’s economic condition.

A literature review conducted in the first phase of this project produced several major findings. First, it confirmed the notion that users employ a wide range of terms when describing the financial health of a government, including financial condition, financial position, fiscal condition, and fiscal capacity. These terms are often used interchangeably, and individual terms have diverse meanings to different people. Regardless of the terminology used, however, the review of the literature suggests that there is substantial agreement on the key areas of concern that should be addressed when one is assessing the financial health of a government.

Despite variation in the way information from financial reports is used, there was substantial consensus that assessing the financial health of a government requires trend information regarding: (1) fund balances, equity, or net assets, (2) revenues and expense/expenditures, as well as surpluses and deficits, (3) changes in revenue bases, (4) spending pressures and expenditure needs, (5) outstanding debts, debt service, and postemployment benefits, and (6) liquidity. There was less widespread, though still notable, agreement on several other types of information, including: (1) short-term debt, (2) credit ratings, (3) number of employees, (4) condition of the physical plant, (5) output and outcome measures, and (6) management issues such as the quality of financial reporting, planning and budget processes, and accounting practices.

Panel discussions conducted during the second phase of the research project with users experienced with, and knowledgeable about, the assessment of a government’s financial health provided additional insights regarding users’ economic condition information needs. In general, the user panelists agreed that a comprehensive annual financial report (CAFR) containing the financial reporting model established in Statement No. 34, Basic Financial Statements—and Management’s Discussion and Analysis—for State and Local Governments, provided a considerable amount of the information needed to assess economic condition. The panelists generally agreed that the CAFR contains most, if not all, of the information needed to assess financial position, not enough information about fiscal capacity, and little information about service capacity. The panelists considered information in the statistical section to be particularly useful for assessing fiscal capacity. However, these users identified other necessary information not currently found in the CAFR, such as more detailed revenue and expense trends, comparative and benchmarking information, financial ratios, explanations, and a variety of demographic and economic indicators as necessary for assessing fiscal and service capacity.

The enhancement of the statistical section by Statement No. 44, Economic Condition Reporting: The Statistical Section, is expected to have improved the usefulness of the CAFR in providing information that GASB research has shown is valuable for assessing economic condition, particularly fiscal capacity. For instance, the inclusion of government-wide information has given the users more comprehensive trends in revenues, expenses, financial position, and outstanding debt. Furthermore, the addition of trend information presented in schedules such as principal revenue payers and debt limitations should make them more meaningful to users. The improved statistical section is expected to be an enhanced resource for the purposes it currently serves. However, with the important exception of providing trend data for information contained in the government-wide statements and narrative explanations, it does not address the additional information needs that user participants in GASB research identified. This is primarily because the scope of the revisions to the statistical section was limited to existing reporting.

Accounting and Financial Reporting Issues: This project examines the usefulness of indicators of economic condition and its related components, including fiscal sustainability, which might be a part of general purpose external financial reporting. This phase of the project will incorporate research on fiscal sustainability and determine and clarify fiscal sustainability's relationship to economic condition, including fiscal capacity, and service capacity, and financial position.

The project also will:

  1. Develop a definition for fiscal sustainability
  2. Consider whether additional guidance or guidelines should be provided based on the recently completed research
  3. Determine the preferable methods of communicating any additional information, if applicable.

Another major issue the Board will consider is whether or not governments should project fiscal information into the future and, if so, should the Board consider providing guidance on the assumptions used to execute those projections (for example, current policy, reasonable assumptions, or specific alternative scenarios). A related issue is determining the general length of time for reporting forward projected information.

The project also will address how reporting fiscal sustainability information will impact different types of governmental entities, and whether there should be different reporting requirements, recommendations, or guidelines for different types of governmental entities.

Finally, the issue of the reliability of information being reported will be addressed as it relates to information on fiscal sustainability.  

Project History: This represents the third phase of the project, building uponresearch activities that culminated in the issuance of GASB Statement No. 44, Economic Condition Reporting: The Statistical Section. A research project was added in 2004 following the issuance of Statement 44. In 2010, the project was moved to the current agenda, a project task force was created, and deliberations commenced. At the November 2011 Board teleconference, the Board approved for issuance a Preliminary Views, Economic Condition Reporting: Financial Projections.

From the time the Preliminary View was issued through the end of March 2012, the project staff conducted a field test with governmental entities that volunteered to prepare financial projections and related narrative discussions in compliance with the proposals set forth in the Preliminary Views. The Board received 173 comment letters in response to the Preliminary Views. A public hearing was held in Los Angeles, California on March 29, 2012. A second public hearing also was held in East Elmhurst, New York on April 17, 2012.

Finally, the project staff conducted two user outreach sessions to gather additional feedback on whether the reporting of financial projections and related narrative discussions prepared in accordance with the preliminary views is valuable to assist these specific users in assessing a governmental entity’s fiscal sustainability. One user outreach session took place on April 19, 2012 in conjunction with the National Federation of Municipal Analysts Annual Conference and the second on May 1, 2012 in conjunction with the Government Research Association Annual Conference.

At the May/June 2012 meeting, the Board received a summary of the comments received on the Preliminary Views, Economic Condition Reporting: Financial Projections, which the project staff categorized as “Generally Agreeing” and “Generally Disagreeing.” The Board also received a summary of the field test feedback and the user discussion feedback from the National Federation of Municipal Analysts annual conference in May and the Governmental Research Association annual conference in April. The Board discussed these summaries, which were intended to be informal updates, but no decisions were made. The Board did agree to redeliberate the proposals subjected to due process before determining the future course of the project.

At the July 2012 meeting, the Board began its redeliberations by discussing the summary of comments received, staff analysis of those comments, and staff recommendations relating to Chapter 3 and Question 1 of the Preliminary Views, on the components of fiscal sustainability information.

The Board tentatively reaffirmed that Component 1 (projections of total and major individual cash inflows), Component 2 (projections of total and major individual cash outflows), and Component 3 (projections of total and major individual financial obligations) are necessary to assist users in assessing a governmental entity’s economic condition, including fiscal sustainability. The Board also reached a tentative agreement to specifically propose to identify that major cash inflows should be projected by major individual source.

The Board reached a tentative agreement to add a proposed requirement that the projections of cash inflows and outflows (Components 1 and 2) include beginning and ending cash and cash equivalent balances for all projection periods. In addition, the Board reached a tentative agreement that clarification is needed as to what a financial obligation is, and what total financial obligations are encompassed within Component 3.

The Board also reached a tentative agreement that projections of annual debt service payments (Component 4) would be included within the projections of cash outflows (Component 2) and therefore should be removed as an individual component of fiscal sustainability information as presented in the Preliminary Views. The Board reached a tentative agreement to propose that cash outflows related to debt service payments should always be considered “major cash outflows” and therefore individually projected. In addition, the Board reached a tentative agreement to propose that the assumptions used in the projections of cash outflows related to debt service payments include the minimum debt service requirements disclosed in the notes to the financial statements, plus the debt service on debt obligations that have been authorized, not yet issued, but are expected to be issued within the projection period and that this assumption should be disclosed.

Finally, the Board directed the project staff to conducted additional research on intergovernmental interdependencies and how essential users believe the narrative discussion of these interdependencies (Component 5) is to their assessment of a governmental entity’s fiscal sustainability as part of the additional user outreach to be conducted. As a result, the Board made no decisions regarding Component 5.

The Board also received a summary of additional feedback related to field test participants’ implementation efforts regarding the provisions of the Preliminary Views. This summary was an informational update and no decisions were made.

At the August 2012 meeting, the Board discussed the summary of comments received, staff analysis of those comments, and staff recommendations relating to Chapter 4 and Questions 2–5 of the Preliminary Views, Economic Condition Reporting: Financial Projections. The Board also agreed to consider the broad issues associated with the future direction of the project at a future meeting after initial redeliberations are concluded and additional constituent outreach is conducted.

The Board tentatively reaffirmed its preliminary view that financial projections should be (1) based on current policy, (2) informed by historical information, and (3) adjusted for known events and conditions that affect the projection periods. The Board also tentatively reaffirmed its preliminary view that current policy includes policy changes that have been formally adopted by the end of the reporting period but will not be effective until future periods.

The Board tentatively reaffirmed is preliminary views that inflows and outflows should be projected on a cash basis of accounting and that financial obligations should be projected on an accrual basis of accounting. The Board tentatively reaffirmed its preliminary view that the identification and development of assumptions for making financial projections should be guided by a principles-based approach that requires assumptions to be based on relevant historical information, as well as events and conditions that have occurred and that affect the projection periods.

At the October 2012 meeting, the Board discussed the summary of comments received, staff analysis of those comments, and staff recommendations relating to Chapter 5 and Question 7 of the Preliminary Views.

Per the Board’s request, during the period November—December 2012 the project staff conducted additional outreach research to collect additional user feedback. During this period, the project was placed on hold until the Financial Accounting Foundation’s Board of Trustees resolves the GASB scope issue.

The results of the project staff research conducted at the end of 2012 were presented to the board in May 2013.

Current Developments: The project is still on hold.

Work Plan
:

Board Meetings Topics to be considered

Board deliberations on the project have been placed on hold.

 

Economic Condition Reporting—Recent Minutes


Minutes of Meeting, October 2-4, 2012


The Board discussed the summary of comments received, staff analysis of those comments, and staff recommendations relating to Chapter 5 and Question 7 of the Preliminary Views, Economic Condition Reporting: Financial Projections. The discussion focused on the following topics: (1) the qualitative characteristics applicable to financial projections and related narrative discussions; (2) which governments would report financial projections and related narrative discussions; (3) whether to include governmental and business-type activities in the reporting of financial projections and related narrative discussions; (4) whether to exclude discretely presented component units in the reporting of financial projections and related narrative discussions; (5) the methodology for determining what is considered a “major” cash inflow, cash outflow, financial obligation, and intergovernmental service interdependency; and (6) whether to include a cautionary notice preceding the reported financial projections and related narrative discussions and what this notice would include.

The Board tentatively agreed that financial projections and related narrative discussions generally possess the six qualitative characteristics of financial information identified and described in Concepts Statement No. 1, Objectives of Financial Reporting, although not in equal proportion. The Board also tentatively agreed that the scope of any proposed guidance would include all governmental entities with the exception of governments that are fiduciary in nature.

The Board tentatively reaffirmed its preliminary views that (1) financial projections and related narrative discussions would be reported for the primary government, including both governmental activities and business-type activities with net subtotals (inflows less outflows) for the general fund, other governmental activities, total governmental activities, total business-type activities, and a net total for the entire primary government; (2) a narrative discussion would be necessary in instances in which one or more activities are determined to significantly affect (positively or negatively) the fiscal sustainability of the primary government; and (3) individual cash inflows, cash outflows, and financial obligations would be considered major if: (a) individual governmental and business-type activities cash inflows, cash outflows, and financial obligations represent at least 10 percent of total cash inflows, total cash outflows, or total financial obligations, respectively for all activities of that type in any of the projection periods reported; (b) the cash outflows are for capital outlays; (c) the cash inflows are capital-related from bond proceeds, capital grants, or other sources that are restricted or committed to capital outlays; (d) the cash outflows related to debt service; and (e) the cash inflows, cash outflows, or financial obligations that are determined by the government to be particularly important to users when making an assessment of the government’s fiscal sustainability.

The Board tentatively agreed to amend its preliminary view that stated, “governmental entities should not report financial projections and related narrative discussions on their discretely presented component units,” to instead propose that “the primary government should not report financial projections and related narrative discussions for its discretely presented component units.”

The Board tentatively decided not to assess whether it should clarify which specific factors might inform a governmental entity’s determination of which intergovernmental service interdependencies are “major” until after the project staff completes additional constituent outreach efforts. The Board also tentatively agreed to modify its prior tentative decision that “the assumptions and financial projections would include current policy and known events and conditions that existed as of the governmental entity’s report date” to instead propose that “the assumptions and financial projections would include current policy and known events and conditions that existed as of the date the annual financial report is available for issuance.”

The Board tentatively agreed to include the following reference to the cautionary notice on every page of the illustrations of financial projections and related narrative discussions: “The financial projections, related narrative discussions, and accompanying notes should be considered in the context set forth in the cautionary notice on page X.” Finally, the Board tentatively agreed that it is necessary to make several clarifying amendments to the proposed cautionary notice, and members provided suggested edits.

Minutes of Meeting, August 22-24, 2012


The Board discussed the summary of comments received, staff analysis of those comments, and staff recommendations relating to Chapter 4 and Questions 2–5 of the Preliminary Views, Economic Condition Reporting: Financial Projections. The discussion focused on the (1) basis and methodology for projections, (2) basis of accounting for projected information, (3) identification, development, and disclosure of assumptions, and (4) projection period. The Board also agreed to consider the broad issues associated with the future direction of the project at the January 2013 meeting after initial redeliberations are concluded and additional constituent outreach is conducted.

Basis and Methodology for Projections

The Board tentatively reaffirmed its preliminary view that financial projections should be (1) based on current policy, (2) informed by historical information, and (3) adjusted for known events and conditions that affect the projection periods. The Board also tentatively reaffirmed its preliminary view that current policy includes policy changes that have been formally adopted by the end of the reporting period but will not be effective until future periods.

The Board reached tentative agreements to clarify that (1) in the absence of current policies effective through the entire projection period, the assumptions used for making financial projections may be based on historical trend information adjusted for known future events or conditions; (2) the assumptions and financial projections would include current policy and known events and conditions that existed as of the auditor’s report date, rather than as of the end of the fiscal year; (3) any law pertaining to the preparation of a budget, including a balanced budget requirement, is not relevant to the financial projections being proposed in this project because the process of balancing a budget is a prediction or forecast of future actions and should therefore not be included in “current policy” as defined in the Preliminary Views, and (4) authorized capital expenditures would be considered current policy. The Board recognized that in many cases, capital expenditures are not “authorized” until the funding has been authorized (bond proceeds) or awarded (grant proceeds). However, the Board tentatively agreed that in those instances in which capital expenditures have been authorized before securing authorized or awarded funding, the notes to this information should explain this gap between the projections of cash outflows and cash inflows.

Finally, the Board tentatively decided not to include a disclaimer in the cautionary notice that balanced budget laws or other budget requirements were not considered in the development of financial projections. Rather, the Board reached a tentative agreement that the notes to this information should include a requirement to disclose that balanced budget laws were not taken into consideration in developing the financial projections.

Basis of Accounting for Projected Information

The Board tentatively reaffirmed is preliminary views that inflows and outflows should be projected on a cash basis of accounting and that financial obligations should be projected on an accrual basis of accounting. The Board also reached a tentative agreement to include a requirement to disclose the basis of accounting being used for the financial projections.

Identification, Development, and Disclosure of Assumptions

The Board tentatively reaffirmed its preliminary view that the identification and development of assumptions for making financial projections should be guided by a principles-based approach that requires assumptions to be based on relevant historical information, as well as events and conditions that have occurred and that affect the projection periods. The Board also tentatively reaffirmed its preliminary view that assumptions should be (1) consistent with each other (where appropriate) and (2) comprehensive by considering significant trends, events, and conditions. Finally, the Board tentatively reaffirmed its preliminary view that disclosure of assumptions should be required.

The Board reached a tentative agreement to include additional illustrations that use other methods and assumptions in any potential future due process document to convey to preparers that there is more than one acceptable approach to preparing financial projections.

Projection Period

The Board reached a tentative agreement that annual financial projections should be made for five individual years beyond the reporting period for the purpose of external reporting. The Board also reached a tentative agreement to require disclosure of the basis of the assumptions used. For example, current policy, historical trends, or a known event or condition.

Minutes of Meeting, July 10-11, 2012

The Board discussed the summary of comments received, staff analysis of those comments, and staff recommendations relating to Chapter 3 and Question 1 of the Preliminary Views, Economic Condition Reporting: Financial Projections, on the components of fiscal sustainability information. Based on the schedule in the current technical plan, the Board plans to consider all of the due process feedback received as it redeliberates the various proposals included in the Preliminary Views before determining the future direction of the project.

The Board tentatively reaffirmed that Component 1 (projections of total and major individual cash inflows), Component 2 (projections of total and major individual cash outflows), and Component 3 (projections of total and major individual financial obligations) are necessary to assist users in assessing a governmental entity’s economic condition, including fiscal sustainability. The Board also reached a tentative agreement to specifically propose to identify that major cash inflows should be projected by major individual source.

The Board reached a tentative agreement to add a proposed requirement that the projections of cash inflows and outflows (Components 1 and 2) include beginning and ending cash and cash equivalent balances for all projection periods. In addition, the Board reached a tentative agreement that clarification is needed as to what a financial obligation is, and what total financial obligations encompass within Component 3.

The Board also reached a tentative agreement that projections of annual debt service payments (Component 4) would be included within the projections of cash outflows (Component 2) and therefore should be removed as an individual component of fiscal sustainability information as presented in the Preliminary Views. The Board reached a tentative agreement to propose that cash outflows related to debt service payments should always be considered “major cash outflows” and therefore individually projected. In addition, the Board reached a tentative agreement to propose that the assumptions used in the projections of cash outflows related to debt service payments include the minimum debt service requirements disclosed in the notes to the financial statements, plus the debt service on debt obligations that have been authorized, not yet issued, but are expected to be issued within the projection period and that this assumption should be disclosed.

Finally, the Board directed the project staff to include as part of additional user outreach questions on intergovernmental interdependencies and how essential they believe the narrative discussion of these interdependencies (Component 5) is to their assessment of a governmental entity’s fiscal sustainability. As a result, the Board made no decisions regarding Component 5.

The Board also received a summary of additional feedback related to field test participants’ implementation efforts regarding the provisions of the Preliminary Views. This summary was an informational update and no decisions were made.

Minutes of Meeting, May 30–June 1, 2012

The Board received a summary of the comments received on the Preliminary Views, Economic Condition Reporting: Financial Projections, which the project staff categorized as “Generally Agreeing” and “Generally Disagreeing.” The Board also received a summary of the field test feedback and the user discussion feedback from the National Federation of Municipal Analysts annual conference in May and the Governmental Research Association annual conference in April. The presentation was an informational update and no decisions were made.

Minutes of Archive 

Economic Condition Reporting—Tentative Board Decisions to Date


Note: Based on the schedule in the current technical plan, the Board plans to consider all of the due process feedback received as it redeliberates the various proposals included in the Preliminary Views before determining the future direction of the project.

The Board tentatively agreed that:

  • Component 1 (projections of total and major individual cash inflows), Component 2 (projections of total and major individual cash outflows), and Component 3 (projections of total and major individual financial obligations) are necessary to assist users in assessing a governmental entity’s fiscal sustainability. 
  • Cash inflows should be projected by major individual source.
  • The projections of cash inflows and cash outflows (Components 1 and 2) need to include both beginning and ending cash and cash equivalent balances for the all projection periods.
  • Clarification is needed as to what a financial obligation is, and what total financial obligations are included within Component 3.
  • Projections of annual debt service payments (Component 4) would be included within the projections of cash outflows (Component 2) and, therefore, should be removed as an individual component of fiscal sustainability information.
  • Cash outflows related to debt service payments should always be considered “major cash outflows” and therefore individually projected.
  • The assumptions used in the projections of cash outflows related to debt service payments include the minimum debt service requirements disclosed in the notes to the financial statements, plus the debt service on debt obligations that have been authorized, not yet issued, but are expected to be issued within the projection period and that this assumption should be disclosed.
  • Financial projections should be (1) based on current policy, (2) informed by historical information, and (3) adjusted for known events and conditions that affect the projection periods.
  • Current policy includes policy changes that have been formally adopted but will not be effective until future periods. 
  • In the absence of current policies effective through the entire projection period, the assumptions used for making financial projections may be based on historical trend information adjusted for known future events or conditions. 
  • The assumptions and financial projections would include current policy and known events and conditions that existed as of the date the annual financial report is available for issuance. 
  • Any law pertaining to the preparation of a budget, including a balanced budget requirement, is not relevant to the financial projections being proposed in this project and should therefore not be included in “current policy” as defined in the Preliminary Views. The notes should include a requirement to disclose that balanced budget laws were not taken into consideration in developing the financial projections. 
  • Authorized capital expenditures would be considered current policy. 
  • In those instances in which capital expenditures have been authorized before securing authorized or awarded funding, the notes should explain this gap between the projections of cash outflows and cash inflows. 
  • The first sentence in Chapter 4, paragraph 4, of the Preliminary Views, should be edited by removing “through established laws, regulations, and administrative rules” from the sentence and adding those items, as well as “executed contracts and grant agreements” to a second sentence as examples of current policy. 
  • Inflows and outflows should be projected on a cash basis of accounting; financial obligations should be projected on an accrual basis of accounting. 
  • A requirement to disclose the basis of accounting being used for the financial projections should be included. 
  • The identification and development of assumptions for making financial projections should be guided by a principles-based approach that requires assumptions to be based on relevant historical information, as well as events and conditions that have occurred and that affect the projection periods. 
  • Assumptions should be (1) consistent with each other (where appropriate) and (2) comprehensive by considering significant trends, events, and conditions. 
  • Disclosure of assumptions should be required. 
  • Additional illustrations that use other methods and assumptions should be included in any potential future due process document to convey to preparers that there is more than one acceptable approach to preparing financial projections. 
  • Annual financial projections should be made for five individual years beyond the reporting period for the purpose of external reporting. 
  • The basis of the assumptions used should be disclosed. For example, current policy, historical trends, or a known event or condition.
  • Financial projections and related narrative discussions possess all six qualitative characteristics of financial information identified and described in Concepts Statement 1, although not in equal proportion. 
  • The scope of any guidance on economic condition reporting, specifically financial projections, would apply to all governmental entities with the exception of governments that are fiduciary in nature. 
  • Financial projections and related narrative discussions should be reported for the primary government, including both governmental activities and business-type activities with net subtotals (inflows less outflows) for the general fund, other governmental activities, total governmental activities, total business-type activities, and a net total for the entire primary government. 
  • A narrative discussion would be necessary in instances in which one or more activities are determined to significantly affect (positively or negatively) the fiscal sustainability of the primary government. 
  • The primary government should not report financial projections and related narrative discussions for its discretely presented component units. 
  • The following individual cash inflows, cash outflows, and financial obligations are major:
    1. Individual governmental and business-type activities cash inflows, cash outflows, and financial obligations that represent at least 10 percent of total cash inflows, total cash outflows, or total financial obligations, respectively, for all activities of that type in any of the projection periods reported
    2. Cash outflows for capital outlays
    3. Capital-related cash inflows from bond proceeds, capital grants, or other sources that are restricted or committed to capital outlays
    4. Cash outflows related to debt service
    5. Any other cash inflows, cash outflows, or financial obligations that a government believes is particularly important to users when making an assessment of the government’s fiscal sustainability.
  • The following reference to the cautionary notice should be included on every page of the illustrations of financial projections and related narrative discussions: “The financial projections, related to narrative discussions, and accompanying notes should be considered in the context set forth in the cautionary notice on page X.” 
  • The third sentence in the first paragraph of the cautionary notice would state that “These financial projections are intended to assist users in assessing whether projected cash inflows will be sufficient to sustain public services and to meet financial obligations as they come due.”

Economic Condition Reporting—Relevant Links