ACCT 403 DB 1

Since I live in Fairfax County Virginia, I decided to look at the CAFR for that local

government. As I read the management analysis, some things were interesting to me. One of the

first things that was mentioned in the CAFR was that the amounts for the statements for the 2017

fiscal year had to be restated because of the GASB Statement 75. (County of Fairfax (VA.),

2018, p. 7). GASB statement 75 deals with the recording of Other Post Employment Benefits

(OPEB) which are benefits besides pensions. GASB statement 75 mandates that governments

start recording their present value of the future OPEB as a liability using an actuarily calculated

number. (GASB, 2015) I imagine that this change is because the astronomical size of the future

liability has bankrupted some local governments. However, the restatement caused the overall

balance sheet to appear wrong in 2017.

Something else I found interesting was that 72% of the revenue collected by Fairfax

County is from “Real Property Taxes,” followed by personal property taxes, and finally local

sales and use tax. (County of Fairfax (VA.), 2018, p. 12). I was not too family with the difference

between personal property and real property taxes. Real Property is what most people actually

call real estate. It is property that cannot be moved like homes, land, etc. Personal property, in

contrast, can be moved like cars. The base tax rate for real estate in Fairfax County is $1.15 per

$100 of assessed Fair Market Value (FMV) (Real Estate Assessments & Taxes, 2019). This area

is pretty expensive with many single family homes easily having $600,000 - $800,000 or higher

FMVs. Therefore, the real estate tax for one family can be eight to nine thousand dollars. In

addition, Fairfax County reported an increase in revenue due to rising property values. Values

will no doubt continue to rise because of the recent announcement that Amazon will be building

part of its new headquarters in this area.

 Lastly, the largest expense reported by Fairfax County is education (County of Fairfax

(VA.), 2018, p. 13). According to the CAFR, Fairfax county spent 2.1 billion dollars on

education and the next biggest expense was public safety at only 783 million dollars. According

to Niche.com, a popular ranking site for schools across the United States, Fairfax County is fifth

out of the 133 school districts in Virginia which is pretty good. (2019 Best School Districts in

Virginia, 2019)

The CAFR is supposed to help keep the local governments accountable for the money

that they are supposed to use for the citizen’s good. The Bible says in 1 Corinthians 4:2,

“Moreover it is required in stewards, that a man be found faithful.” (KJV) Even though we do

not have to create statements like the CAFR to show what we do with our resources, every one

of us have been given resources by God and we will have to give an account for them one day

when we die. We are stewards of the time and money. Are we using them faithfully to the best of

our ability?

References

2019 Best School Districts in Virginia. (n.d.). Retrieved January 18, 2019, from

https://www.niche.com/k12/search/best-school-districts/s/virginia/

County of Fairfax (VA.). (2018). Comprehensive Annual Financial Report: for the fiscal year

ended June 30, 2018. Retrieved from:

https://www.fairfaxcounty.gov/finance/financialreporting/comprehensiveannualfinancialr

eport

GASB, Financial Accounting Standards Board. (2015, June 29). Retrieved January 18, 2019,

from https://www.gasb.org/cs/ContentServer?
 c=GASBContent_C&cid=1176166141859&d=&pagename=GASB/GASBContent_C/GA

SBNewsPage

Real Estate Assessments & Taxes. (n.d.). Retrieved January 18, 2019, from

https://www.fairfaxcounty.gov/taxes/real-estate/tax-rates