6.3 SR 06-05-2023 - Laserfiche WebLink

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City of Elk River Management's Discussion and Analysis As management of the City of Elk River, Minnesota (the City), we offer readers of the City's financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended December 31, 2022. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found starting on page 3 of this report. FINANCIAL HIGHLIGHTS • The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $245,315,759 (net position). Of this amount, $57,038,539 (unrestricted net position) may be used to meet the City's ongoing obligations to citizens and creditors. • The net position of business -type activities increased by $4,806,363 and net position of the governmental activities increased by $3,217,541. This resulted in a total net position increase of $8,023,904 for the City. • As of the close of the current fiscal year, the City's governmental funds reported combined ending fund balances of $42,522,183, a decrease of $2,644,989 from the prior year. • At the end of the current fiscal year, unassigned fund balance for the General Fund was $8,888,888. The City's policy is to maintain a minimum of 40-45% of the following year's budget in unassigned fund balance. At year end, the unassigned fund balance is 43% of the 2023 budgeted General Fund expenditures. OVERVIEW OF THE FINANCIAL STATEMENTS This discussion and analysis is intended to serve as an introduction to the City's basic financial statements. The City's basic financial statements comprise three components: 1) government -wide financial statements, 2) fund financial statements, and 3) notes to the basic financial statements. This report also contains other supplemental information in addition to the basic financial statements themselves. The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. The statements are followed by a section of "combining and individual fund financial statements and schedules" that further explains and supports the information in the financial statements. Figure 1 shows how the required parts of this annual report are arranged and relate to one another. In addition to these required elements, we have included a section with "combining and individual fund financial statements and schedules" that provide details about nonmajor governmental funds, which are added together and presented in a single column for governmental activities in the basic governmental financial statements. 19