CITY COUNCIL WORKSHOP AGENDA PACKET

Financial Management for Elected Officials January 2013 Institute for Local Government www.ca-ilg.org 3 Local Agency Financial Policies and Practices Financial policies can provide a solid foundation for sound public agency fiscal practices. Adopted by the governing body, such policies provide: • A means through which the governing body can communicate its collective policy judgments and goals to staff, the public and others. • Direction to staff and standards against which current practices can be measured, and proposals for changes in practices can be evaluated. Ratings agencies (who assess local agencies’ credit for borrowing) also look at local agencies’ financial policies; well-crafted polices can mean higher rating grades which can translate into lower borrowing costs. Questions to Ask Financial Policies • Does the agency have written financial policies? • If so, what do they cover? See sidebar on next page for a checklist of possible topics. • How often does the governing body review them? • With respect to each policy, is it clear who is responsible for implementing that policy? • What procedures does management use to make staff aware of such policies? What training does staff receive to allow them to competently implement such policies? • How does the agency monitor compliance with such policies? Financial Practices • Are agency accounting policies and procedures documented in writing? • What kinds of practices does the agency use (sometimes referred to as “internal controls”) to make sure that the agency has systems for cross checks to minimize the risk of mistakes or maximize the likelihood that misconduct is detected? • Does agency financial staff participate in relevant professional organizations to keep abreast of developments in the field and best practices? Page 53 of 109