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Difference Working Capital Current Ratio - Excel

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					  State of Alaska Water/Wastewater Revolving Fund
  Financial Capacity Analysis
Enter System Name


        Checklist                   A list of data needed needed to complete program.



       Financial                    Collects key financial information used for ratio analysis
    Statement Data                  and to determine financial viability.



      Financial                     Collects data related to financial management criteria.
   Management Data


                                    Collects economic data that provides information about the
     Economic Data                  community's relative economic status. These economic
                                    factors are related to affordability.


                                    Collects customer billing and rate information to determine the
     Customer Data
                                    ability of the customer to pay for water service.



       Project Data                 Collects project cost information.



  Individuals or communities seeking assistance with completing the model can contact the Environmental Fin
  Center (EFC) at Boise State University by phone, fax or email using the information provided in the top-right
  corner of this page. Questions concerning how the model will be used to assess SRF Loan applicants can b
  directed to the EFC or Mike Lewis, the Clean Water SRF Coordinator for the State of Alaska. He can be rea
  by phone at: 907-269-7616.
 e program.



 or ratio analysis




 ement criteria.



 ormation about the
 hese economic



mation to determine the




contact the Environmental Finance
ation provided in the top-right
ss SRF Loan applicants can be
 ate of Alaska. He can be reached
                                     System Data Checklist
Community Information
           1)   Community population
           2)   Number of residential customers
           3)   Median household income for the community and the state
           4)   Poverty rate for the community and the state
           5)   Unemployment rate for the community and the state

Financial and Management Information
           1)   Audited financial statements for current year (most recent year available) and two years prior
           2)   Annual budget for current year
           3)   Capital budget
           4)   Capital improvement plan
           5)   Bond rating (including date of issue and who it was issued by)
           6)   Number of days in the billing cycle
           7)   Current average monthly residential customer charge for wastewater service
           8)   Estimated average monthly residential customer charge after receiving loan
           9)   Frequency of rate setting
          10)   Number of rate changes in past 10 years
          11)   Description of guidance used in rate setting
          12)   Date of last rate increase

SRF Loan Information
           1)   Description of project to be funded by SRF loan
           2)   Loan amount
           3)   Loan term
           4)   Loan interest rate



Supporting documents to be sent to the Environmental Finance Center (address located on the main page of the model):
1) Rate Structure (and proposed Rate Structure) for the water/wastewater fund. This document should include all the costs that
are to be paid by the users of the system. This will include setup costs, fixed and volume charges, and any other charges
assessed to users of the water/wastewater system.
2) City Ordinances for the makeup of the system's rate structure. These ordinances will layout the costs for users of the
water/wastewater system as established by the city.
3) Audited Financial Statements. The audited financial statements for the entire city should be included, unless the
water/wastewater fund is a self sustained identity that doesn't receive funds from the general city fund or any other fund to support
its operations; in that case, providing the statements for just the water or wastewater fund would suffice.
Current Financial Condition Current Affordability

Current Affordability

Current Affordability Ratio                                                            Threshold:

Current Affordability Ratio = Current Average Monthly Residential User Fee / Median Monthly Household
Income


  The current affordability ratio measures the average monthly residential user fee as a percentage of median
  monthly household income. As the ratio increases, a greater percentage of disposable income must be used for
  utility services and the ability of customers to pay for service tends to decrease. Normally, the current
  affordability ratio should not exceed the maximum threshold for affordability established by the regulatory
  agency. However, the threshold may be exceeded when there is evidence of strong public support for meeting
  the full costs of providing service. If the current ratio is approaching the maximum threshold, the utility may not
  be able to raise user charges without exceeding the threshold.



Working Capital
Working Capital = Current Assets – Current Liabilities

  Working capital is a measure of liquidity and identifies the net assets that the organization has available on a
  short-term basis. The greater the liquidity, the easier it is to respond to short-term needs for financial resources.


Calculation Inputs
        Current Assets            Current Liabilities                             Difference
                                                                                                0

  NOT ENOUGH DATA HAS BEEN PROVIDED




                              d27925df-0cab-48dc-b32a-b92337fc97c0.xls                 11/18/2010                         Pg 5
Current Financial Condition Current Affordability

Current Ratio
Current Ratio = Current Assets / Current Liabilities
 The current ratio is a measure of liquidity. The greater the liquidity, the easier it is to respond to short-term
 needs for financial resources. The current ratio identifies the assets that the organization has available on a
 short-term basis as a ratio. As the ratio increases, liquidity increases. At a minimum, the current ratio should
 equal to 2.0[.]


Calculation Inputs
       Current Assets            Current Liabilities                             Ratio


 NOT ENOUGH DATA HAS BEEN PROVIDED




Receivables to Sales Ratio
Receivables to Sales Ratio = Total Receivables / Total Sales

 The receivables to sales ratio is a measure of how quickly the organization is able to collect payment for
 services. For example, for a system with monthly billing, receivables should not exceed one month’s worth of
 sales. Thus, the receivables to sales ratio should not exceed 0.083(or 1/12th of total annual sales[.]


Calculation Inputs
      Total Receivables             Total Sales                                  Ratio


 NOT ENOUGH DATA HAS BEEN PROVIDED




                           d27925df-0cab-48dc-b32a-b92337fc97c0.xls                   11/18/2010                     Pg 6
Current Financial Condition Current Affordability

Average Collection Period
Average Collection Period = Total Receivables / (Sales / 360)

  Average collection period measures the average time period in which receivables are outstanding. Average
  collection period should be equal to or less than the number of days in the billing cycle.


Calculation Inputs
      Total Receivables             Total Sales           Days in Cycle          Calculation
                                                                                                   days

  NOT ENOUGH DATA HAS BEEN PROVIDED




Debt to Worth Ratio
Debt to Worth Ratio = Total Liabilities / Net Worth
 The debt to worth ratio is a measure of leverage. It indicates the portion of equity that is contributed by creditors.
 From a creditor’s perspective, it is preferable to issue new debt to an entity that currently carries a limited
 amount of debt relative to net worth. A low debt to worth ratio is positively associated with long-term security.
 For purposes of this analysis, 0.5 is used as a benchmark.

Calculation Inputs
        Total Liabilities            Net Worth                                   Ratio


  NOT ENOUGH DATA HAS BEEN PROVIDED




                            d27925df-0cab-48dc-b32a-b92337fc97c0.xls                  11/18/2010                          Pg 7
Current Financial Condition Current Affordability

Total Sales to Net Fixed Assets Ratio

Total Sales to Net Fixed Assets Ratio = Total Sales / Net Fixed Assets




 Sales revenues (user fees) should support the majority of the cash needs of the utility, as well as provide
 funding for system replacement of capital assets over time. For the sales to net fixed assets ratio, it is important
 to consider the relationship between the amount of sales and the value of the system. It is the system value
 that implies the dollar amount of replacement that might be required each year.

 For example, if a system’s replacement value is $1,000,000, a 20 year plan for asset replacement (as the
 system wears out) would require $50,000 per year – not counting inflation. If the operating revenue
 requirements are also $50,000 and the sales revenues are $75,000, then $25,000 – or half of the asset
 replacement dollars needed – would not be provided by sales. In this case the Total Sales to Net Assets Ratio
 would be .075. $100,000 in Sales Revenue (or a value of 0.1) would be necessary to adequately provide for
 system replacement. Otherwise this would create additional fiscal stress to the system.

 We recommend that the system governing board – along with its finance team – consider this concept, review
 the ratio shown in the table below, and then revisit the cash and replacement funding needs of the utility.



Calculation Inputs
        Total Sales             Net Fixed Assets                                Ratio




                           d27925df-0cab-48dc-b32a-b92337fc97c0.xls                  11/18/2010                         Pg 8
Current Financial Condition Current Affordability

Revenues and Expenses (variance)
Variance = Total Revenues – Total Expenses

 Variance is the difference between total revenues and total expenses, including depreciation. Total revenues
 should exceed total expenses (variance should be positive).


Calculation Inputs
       Total Revenue            Total Expenses                                Difference
                                                                                           $0

 Total revenues are approximately equal to total expenses. The organization is covering the full cost of providing
 utility service.




                           d27925df-0cab-48dc-b32a-b92337fc97c0.xls                11/18/2010                        Pg 9
Current Financial Condition Current Affordability

Fund Net Assets
Change in Fund Net Assets = Net Assets at End of Year – Net Assets at Beginning of Year
Net Assets = Assets – Liabilities

 Net assets is the difference between the assets and liabilities of a fund. It is used as a measure of the amount
 of resources available to budget or spend in the future, indicating whether fees charged for services and other
 revenues collected are keeping pace with inflationary costs and allowing funds for future replacement. The
 change in fund net assets from year to year should generally be positive.

Calculation Inputs
         Beginning                  Ending                                     Difference
                                                                                            $0

 NOT ENOUGH DATA HAS BEEN PROVIDED




                           d27925df-0cab-48dc-b32a-b92337fc97c0.xls                 11/18/2010                      Pg 10
Current Financial Condition Current Affordability

Operating Ratio
Operating Ratio = Operating Revenues / Operating Expenses

 The operating ratio is a measure of efficiency, indicating ability to cover expenses, with revenues. At a
 minimum, the operating ratio should be greater than or equal to 1.0[.]


Calculation Inputs
     Operating Revenue         Operating Expense                               Ratio


 NOT ENOUGH DATA HAS BEEN PROVIDED




                           d27925df-0cab-48dc-b32a-b92337fc97c0.xls                 11/18/2010               Pg 11
Current Financial Condition Current Affordability


Balance Sheet Analysis



  The following table provides information about the distribution of various accounts within the balance sheet for
  the utility enterprise fund, as well as the percentage of operating expenses that make up total expenses.

  Current Assets = Current Assets / Total Assets

  Fixed Assets = Fixed Assets / Total Assets

  Current Liabilities = Current Liabilities / (Net Assets + Total Liabilities)

  Non-Current Liabilities = Non-Current Liabilities / (Net Assets + Total Liabilities)

  Net Assets = Net Assets / (Net Assets + Total Liabilities)

  Operating Expenses = Total Operating Expenses / Total Expenses


            Balance Sheet Accounts                      Alaska Ratio*

       Current Assets
        Fixed Assets
     Current Liabilities
   Non-Current Liabilities
         Net Assets


 *Median ratio for selected Alaska DWSRF loan applicants, using two to
four year averages for each system.




                             d27925df-0cab-48dc-b32a-b92337fc97c0.xls               11/18/2010                       Pg 12
Financial Trends and Future Affordability

Future Affordability

Future Affordability Ratio:                              Threshold:

Future Affordability Ratio = Expected Average Monthly Residential User Fee After Initiation of
the Proposed Capital Improvement Project / Median Monthly Household Income



  The future affordability ratio measures the impact of the proposed capital improvement project on
  residential user fees as a percent of median monthly household income. As the ratio increases, the
  ability of customers to pay for utility service tends to decrease. The future affordability ratio should
  not exceed the maximum threshold for affordability established by the regulatory agency.




                        d27925df-0cab-48dc-b32a-b92337fc97c0.xls                11/18/2010                   Pg 13
Financial Trends and Future Affordability

Working Capital                                             Trend:                      Level
Working Capital = Current Assets – Current Liabilities
 Working capital is a measure of liquidity and identifies the net assets that the organization has
 available on a short-term basis. The greater the liquidity, the easier it is to respond to short-term
 needs for financial resources.




          NOT ENOUGH DATA HAS BEEN PROVIDED




Current Ratio                                               Trend:                      Level
Current Ratio = Current Assets / Current Liabilities

 The current ratio is a measure of liquidity. The greater the liquidity, the easier it is to respond to short-
 term needs for financial resources. The current ratio identifies the assets that are available on a
 short-term basis as a ratio. As the ratio increases, liquidity increases. At a minimum, the current
 ratio should equal to 2.0[.]




        NOT ENOUGH DATA HAS BEEN PROVIDED




                     d27925df-0cab-48dc-b32a-b92337fc97c0.xls                    11/18/2010                  Pg 14
Financial Trends and Future Affordability


Receivables to Sales Ratio                              Trend:                     Level
Receivables to Sales Ratio = Total Receivables / Total Sales
 The receivables to sales ratio is a measure of how quickly the organization is able to collect payment
 for services. For example, for a system with monthly billing, receivables should not exceed one
 month’s worth of sales. Thus, the receivables to sales ratio should not exceed 0.083(or 1/12th of
 total annual sales[.]




       NOT ENOUGH DATA HAS BEEN PROVIDED




Average Collection Period                               Trend:                     Level
Average Collection Period = Total Receivables / (Sales / 360)

 Average collection period measures the average time period in which receivables are outstanding.
 Average collection period should be equal to or less than the number of days in the billing cycle.




       NOT ENOUGH DATA HAS BEEN PROVIDED




                    d27925df-0cab-48dc-b32a-b92337fc97c0.xls                11/18/2010                    Pg 15
Financial Trends and Future Affordability


Debt to Worth Ratio                                        Trend:                      Level
Debt to Worth Ratio = Total Liabilities / Net Worth

 The debt to worth ratio is a measure of leverage. It indicates the portion of equity that is contributed
 by creditors. From a creditor’s perspective, it is preferable to issue new debt to an entity that
 currently carries a limited amount of debt relative to net worth. A low debt to worth ratio is positively
 associated with long-term security. For purposes of this analysis, 0.5 is used as a benchmark.




       NOT ENOUGH DATA HAS BEEN PROVIDED




                     d27925df-0cab-48dc-b32a-b92337fc97c0.xls                   11/18/2010                   Pg 16
Financial Trends and Future Affordability

Total Sales to Net Fixed Assets Ratio                     Trend:                   Level

Total Sales to Net Fixed Assets Ratio = Total Sales / Net Fixed Assets

 Sales revenues – user fees – should support the majority of the cash needs of the utility, as well as
 provide funding for system replacement of capital assets over time. For the sales to net fixed assets
 ratio, it is important to consider the relationship between the amount of sales and the value of the
 system. It is the system value that implies the dollar amount of replacement that might be required
 each year.

 For example, if a system’s replacement value is $10,000,000, a twenty-year plan for asset
 replacement (as the system wears out) would require $50,000 per year – not counting inflation. If
 the operating revenue requirements are also $50,000 and the sales revenues are $75,000, then
 $25,000 – or half of the asset replacement dollars needed – would not be provided by sales. In this
 case the Total Sales to Net Assets Ratio would be .075. $100,000 in Sales Revenue (or a value of
 0.1) would be necessary to adequately provide for system replacement. Otherwise this would create
 additional fiscal stress to the system.

 We recommend that the system governing board – along with its finance team – consider this
 concept, review the ratio shown in the table below, and then revisit the cash and replacement
 funding needs of the utility.

                              Total Sales to Net Fixed Assets Ratio
               Year                Total Sales      Net Fixed Assets       Ratio




       NOT ENOUGH DATA HAS BEEN PROVIDED




                      d27925df-0cab-48dc-b32a-b92337fc97c0.xls              11/18/2010                   Pg 17
Financial Trends and Future Affordability


Revenues and Expenses (variance)                          Trend:                      Level
Variance = Total Revenues – Total Expenses

 Variance is the difference between total revenues and total expenses, including depreciation. Total
 revenues should exceed total expenses (variance should be positive).




       NOT ENOUGH DATA HAS BEEN PROVIDED




Fund Net Assets (variance)                                Trend:                      Level
Variance = Total Assets – Total Liabilities

 Variance is the difference between total assets and total liabilities including net of deprecitation on
 capital assets. Total assets should exceed total liabilities (variance should be positive).




       NOT ENOUGH DATA HAS BEEN PROVIDED




                     d27925df-0cab-48dc-b32a-b92337fc97c0.xls                  11/18/2010                  Pg 18
Financial Trends and Future Affordability


Operating Ratio                                          Trend:                      Level
Operating Ratio = Operating Revenues / Operating Expenses

 The operating ratio is a measure of efficiency, indicating ability to cover expenses, with revenues. At
 a minimum, the operating ratio should be equal to 1.0[.]




       NOT ENOUGH DATA HAS BEEN PROVIDED




                    d27925df-0cab-48dc-b32a-b92337fc97c0.xls                  11/18/2010                   Pg 19
    Financial Management Criteria

Introduction:

 The following criteria are used in combination with the financial analysis provided in the previous section to create a more
 complete picture of the utility's overall capacity to maintain facilities over the long-run and cover the full-cost of providing
 wastewater service, including loan repayment.


Cash Reserve Budget:
 A wastewater system that incorporates a cash reserve budget equivalent to one and one-half the monthly operational
 expenses is conscious of the need to be prepared for emergencies, payment delinquencies and other short-term cash
 flow problems.

Does the system have a cash reserve budget ≥ one and one-half times monthly OMGA?                                       No

Rate Setting:


 It is good practice for a wastewater system to review its rates on a regular basis. A long interval between rate reviews
 decreases flexibility within the system and reduces the ability of the system to adjust quickly to changing conditions.


 It is preferable for the utility to increase user charges at least once every two years. Increasing user charges frequently is
 important to avoid ―rate shock.‖ Rate shock occurs when customers who have become conditioned to paying low rates (or
 the same user charge over a long period of time) are suddenly faced with a large rate increase.


 In addition, use of a guide, or referral to expertise, for rate setting is suggested to ensure that the rate is set according to
 relevant factors. The long-term health of the system largely depends on systematic rate setting.


How frequently does the system review rates?




                                 d27925df-0cab-48dc-b32a-b92337fc97c0.xls                   11/18/2010                          Pg 20
    Financial Management Criteria

When was the last rate increase?
mm/dd/yyyy
How many rate increases have been implemented in the past ten years?


What guidance or expertise is used in rate setting?




Planning Documents:

  Planning helps the management team be proactive—rather than reactive—in guiding the system through the internal and
  external events (risks) that it may face. The plan gives outside examiners confidence that the business can receive
  financial resources and make good use of them. Once the utility’s plan has been established, the resources must be
  gathered to accomplish the goals and objectives. In the plan, the management team has determined what it wants to do.
  In the budget, they establish the financial resources to accomplish their goals.


  Many water systems have two budgets; their annual operational budget and a capital budget. The annual operational
  budget includes the revenue and expenditure plan for meeting the goals of the system for the current year. The capital
  budget is usually a multiple-year plan for larger expenditures that are scheduled in the current and future years. The use
  of a five-year capital budget is a positive indicator of financial management and supports the assessment of technical
  capacity conditions. A capital budget is an indication that the water system is cognizant of the need for financing
  infrastructure upgrade and/or replacement.


  Once the management team has good information about their asset inventory, a multi-year plan for addressing the needs
  for facilities improvement can be designed. A capital improvements plan includes decisions to take action to repair,
  maintain, replace and expand the inventory of water system components. Every year, the capital improvements plan
  action-items become part of the planning function of the annual business cycle, and are translated into budgetary
  priorities. The use of a capital improvement plan is a positive indicator of financial management and supports the
  assessment of technical capacity conditions. A capital improvement plan is an indication that the water system is
  cognizant of the need for planning infrastructure upgrade and/or replacement, growth and other factors that might require
  financing.


Does the system have an annual budget?                                                                              No
Does the system have a capital improvement plan?                                                                    No

Does the system have a capital budget?                                                                              No




                                   d27925df-0cab-48dc-b32a-b92337fc97c0.xls              11/18/2010                        Pg 21
     Financial Management Criteria




Audited Financial Statements:
  An independent audit provides expert testimony to the internal controls, integrity of the financial statements and
  adherence to generally accepted accounting standards of a system.

Does the system undergo annual financial audits?                                                                       No
If yes, who performs the annual audits?



Bond Rating:

  When issuing debt to secure capital financing, some utilities will seek a bond rating. Corporate and governmental bond
  issues may have ratings assigned to them by rating agencies such as Moody’s, Standard & Poors, or Fitch. The bond
  rating speaks to the investment quality of the debt issue. It is not unusual for small wastewater systems not to have a
  corporate bond rating. When a bond rating is not available for an applicant to the Washington State Pollution Control
  Revolving Fund, this indicator is excluded from the financial analysis.


Does the system have a bond rating?                                                                                    No

If Yes:
What is the rating?


When was it issued?


Who was it issued by?




                                 d27925df-0cab-48dc-b32a-b92337fc97c0.xls                 11/18/2010                        Pg 22
Economic Factors


Relative Economic Condition

 The impact of a rate increase on residential customers depends in part on the overall
 economic status of the community. One way to evaluate the community’s economic status
 is to compare its unemployment rate, poverty rate, and median household income to state
 and national benchmarks.


Median household Income Data (MHI)

 The median income divides the income distribution into two equal groups, one having
 incomes above the median, and the other having incomes below the median (U.S. Census
 Bureau). Median household income for the community that is less than median household
 income for the state is a sign of relative economic weakness.


                                                        % of State MHI
Community MHI relative to State MHI



    Source:     Not indicated


Unemployment Rates (2 Year Average)

 Unemployment Rate = Number Unemployed / Total Labor Force (U.S. Bureau of Labor
 Statistics). An unemployment rate for the community that is greater than the
 unemployment rate for the state or the nation is a sign of relative economic weakness and
 could indicate problems with collecting fees for service.

               Community %                                    State %




    Source:     Not indicated




                   d27925df-0cab-48dc-b32a-b92337fc97c0.xls              11/18/2010          Pg 23
Economic Factors


Poverty Rates

 Poverty Rate = Number of Individuals Below the Poverty Threshold / Population (U.S.
 Census Bureau). A poverty rate for the community that is greater than the poverty rate for
 the state or the nation is a sign of relative economic weakness and could indicate problems
 with collecting fees for service.

              Community %                                     State %



   Source:      Not indicated

Affordability Analysis
        Current Affordability Ratio                 Future Affordability Ratio




      Current Avg. Monthly User Fee         Expected Future Average Monthly User Fee



        % Increase in User Fees




                   d27925df-0cab-48dc-b32a-b92337fc97c0.xls                 11/18/2010         Pg 24
  Project Overview



Project Information

Project Name



Project Description




Community Population                            0
Number of Residential Customers                 0




                            d27925df-0cab-48dc-b32a-b92337fc97c0.xls   11/18/2010   Pg 25
  Project Overview



Loan Information


Loan Term in Years
SRF Loan Interest Rate

Loan Amount

Approximate Annual Loan Payment




                         d27925df-0cab-48dc-b32a-b92337fc97c0.xls   11/18/2010   Pg 26
                  Ratio        Code                 IF                                                                 Then
Current Year Report
Working Capital              WCCY1    IF Y(0) > 0               Working capital is a positive number. Current assets are greater than current liabilities.
Working Capital              WCCY2    IF Y(0) = 0               Working capital is a positive number. Current assets are greater than current liabilities.
                                                                Working capital is a negative number. Current assets are less than current liabilities. This indicates that the
Working Capital              WCCY3    IF Y(0) < 0               organization does not have sufficient liquidity.
Interpretation – Trend
Working Capital              WCT1     IF Y(0) > Y(-1) > Y(-2)   Working capital has increased over time. This is a positive trend in the liquidity of the organization.
Working Capital              WCT2     IF Y(0) > Y(-1) = Y(-2)   Working capital has increased over time. This is a positive trend in the liquidity of the organization.
Working Capital              WCT3     IF Y(0) = Y(-1) > Y(-2)   Working capital has increased over time. This is a positive trend in the liquidity of the organization.
Working Capital              WCT4     IF Y(0) < Y(-1) < Y(-2)   Working capital has decreased over time. This is a negative trend in the liquidity of the organization.
Working Capital              WCT5     IF Y(0) < Y(-1) = Y(-2)   Working capital has decreased over time. This is a negative trend in the liquidity of the organization.
Working Capital              WCT6     IF Y(0) = Y(-1) < Y(-2)   Working capital has decreased over time. This is a negative trend in the liquidity of the organization.
Working Capital              WCT7     IF Y(0) < Y(-1) > Y(-2)   Working capital has fluctuated over time. There is no clear trend in the liquidity of the organization.
Working Capital              WCT8     IF Y(0) > Y(-1) < Y(-2)   Working capital has fluctuated over time. There is no clear trend in the liquidity of the organization.
Working Capital              WCT9     IF Y(0) = Y(-1) = Y(-2)   Working capital has not changed over time. There is no clear trend in the liquidity of the organization.
Current Year Report

Current Ratio                CRCY1    IF Y(0) > 2.0             The current ratio is greater than the minimum standard of 2.0[.] This indicates that the system has sufficient
                                                                liquidity. The organization is likely to have funds available to meet obligations on a short-term basis.

Current Ratio                CRCY2    IF Y(0) = 2.0             The current ratio is equal to the minimum standard of 2.0[.] This indicates that the system has sufficient liquidity.
                                                                The organization is likely to have funds available to meet obligations on a short-term basis.


Current Ratio                CRCY3    IF Y(0) < 2.0             The current ratio is less than the minimum standard of 2.0[.] This indicates that the system does not have
                                                                sufficient liquidity. The organization may not have funds available to meet obligations on a short-term basis.
Interpretation – Trend
                                                                The current ratio has increased over time. This is a positive trend in the ability of the organization to meet current
Current Ratio                CRT1     IF Y(0) > Y(-1) > Y(-2)   obligations with current resources.
                                                                The current ratio has increased over time. This is a positive trend in the ability of the organization to meet current
Current Ratio                CRT2     IF Y(0) > Y(-1) = Y(-2)   obligations with current resources.
                                                                The current ratio has increased over time. This is a positive trend in the ability of the organization to meet current
Current Ratio                CRT3     IF Y(0) = Y(-1) > Y(-2)   obligations with current resources.
                                                                The current ratio has decreased over time. This is a negative trend in the ability of the organization to meet
Current Ratio                CRT4     IF Y(0) < Y(-1) < Y(-2)   current obligations with current resources.
                                                                The current ratio has decreased over time. This is a negative trend in the ability of the organization to meet
Current Ratio                CRT5     IF Y(0) < Y(-1) = Y(-2)   current obligations with current resources.
                                                                The current ratio has decreased over time. This is a negative trend in the ability of the organization to meet
Current Ratio                CRT6     IF Y(0) = Y(-1) < Y(-2)   current obligations with current resources.
                                                                The current ratio has fluctuated over time. There is no clear trend in the ability of the organization to meet current
Current Ratio                CRT7     IF Y(0) < Y(-1) > Y(-2)   obligations with current resources.
                                                                The current ratio has fluctuated over time. There is no clear trend in the ability of the organization to meet current
Current Ratio                CRT8     IF Y(0) > Y(-1) < Y(-2)   obligations with current resources.
                                                                The current ratio has not changed over time. There is no clear trend in the ability of the organization to meet
Current Ratio                CRT9     IF Y(0) = Y(-1) = Y(-2)   current obligations with current resources.
Current Year Report
                                                                The receivables to sales ratio is greater than the benchmark of 0.083[.] This indicates that the organization may
Receivables to Sales Ratio   RSRCY1   IF Y(0) > 0.083           have a problem with collections.
                                                                The receivables to sales ratio is equal to the benchmark of 0.083[.] This indicates that the organization does not
Receivables to Sales Ratio   RSRCY2   IF Y(0) = 0.083           have a problem with collections.
                                                                The receivables to sales ratio is less than the benchmark of 0.083[.] This indicates that the organization does not
Receivables to Sales Ratio   RSRCY3   IF Y(0) < 0.083           have a problem with collections.
Interpretation – Trend
                                                                The receivables to sales ratio has increased over time. This is a negative trend in the ability of the organization to
Receivables to Sales Ratio   RSRT1    IF Y(0) > Y(-1) > Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has increased over time. This is a negative trend in the ability of the organization to
Receivables to Sales Ratio   RSRT2    IF Y(0) > Y(-1) = Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has increased over time. This is a negative trend in the ability of the organization to
Receivables to Sales Ratio   RSRT3    IF Y(0) = Y(-1) > Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has decreased over time. This is a positive trend in the ability of the organization to
Receivables to Sales Ratio   RSRT4    IF Y(0) < Y(-1) < Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has decreased over time. This is a positive trend in the ability of the organization to
Receivables to Sales Ratio   RSRT5    IF Y(0) < Y(-1) = Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has decreased over time. This is a positive trend in the ability of the organization to
Receivables to Sales Ratio   RSRT6    IF Y(0) = Y(-1) < Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has fluctuated over time. There is no clear trend in the ability of the organization to
Receivables to Sales Ratio   RSRT7    IF Y(0) < Y(-1) > Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has fluctuated over time. There is no clear trend in the ability of the organization to
Receivables to Sales Ratio   RSRT8    IF Y(0) > Y(-1) < Y(-2)   collect payment for services.
                                                                The receivables to sales ratio has not changed over time. There is no clear trend in the ability of the organization
Receivables to Sales Ratio   RSRT9    IF Y(0) = Y(-1) = Y(-2)   to collect payment for services.
Current Year Report
                                                                Average collection period is greater than the number of days in the billing cycle. This indicates that the
Average Collection Period    ACPCY1   IF Y(0) > billing cycle   organization has a problem with collections and indirectly suggests that user charges may not be affordable to
                                                                customers because, on average, they do not pay their bills on time.
                                                                Average collection period is equal to the number of days in the billing cycle. This indicates that the organization
Average Collection Period    ACPCY2   IF Y(0) = billing cycle   does not have a problem with collections and indirectly suggests that user charges are affordable to customers
                                                                because, on average, they pay their bills on time.
                                                                Average collection period is less than the number of days in the billing cycle. This indicates that the organization
Average Collection Period    ACPCY3   IF Y(0) < billing cycle   does not have a problem with collections and indirectly suggests that user charges are affordable to customers
                                                                because, on average, they pay their bills on time.
Interpretation – Trend
                                                                Average collection period has increased over time. This is a negative trend in the ability of the organization to
Average Collection Period    ACPT1    IF Y(0) > Y(-1) > Y(-2)   collect payment for services.
                                                                Average collection period has increased over time. This is a negative trend in the ability of the organization to
Average Collection Period    ACPT2    IF Y(0) > Y(-1) = Y(-2)   collect payment for services.
                                                                Average collection period has increased over time. This is a negative trend in the ability of the organization to
Average Collection Period    ACPT3    IF Y(0) = Y(-1) > Y(-2)   collect payment for services.
                                                                Average collection period has decreased over time. This is a positive trend in the ability of the organization to
Average Collection Period    ACPT4    IF Y(0) < Y(-1) < Y(-2)   collect payment for services.
                                                                Average collection period has decreased over time. This is a positive trend in the ability of the organization to
Average Collection Period    ACPT5    IF Y(0) < Y(-1) = Y(-2)   collect payment for services.
                                                                Average collection period has decreased over time. This is a positive trend in the ability of the organization to
Average Collection Period    ACPT6    IF Y(0) = Y(-1) < Y(-2)   collect payment for services.
                                                                Average collection period has fluctuated over time. There is no clear trend in the ability of the organization to
Average Collection Period    ACPT7    IF Y(0) < Y(-1) > Y(-2)   collect payment for services.
                                                                Average collection period has fluctuated over time. There is no clear trend in the ability of the organization to
Average Collection Period    ACPT8    IF Y(0) > Y(-1) < Y(-2)   collect payment for services.
                                                                Average collection period has not changed over time. There is no clear trend in the ability of the organization to
Average Collection Period    ACPT9    IF Y(0) = Y(-1) = Y(-2)   collect payment for services.
Current Year Report
Debt to Worth Ratio           DWRCY1    IF Y(0) > 50%             The debt to worth ratio is greater than the benchmark of 0.5. This indicates that it may be more costly to acquire
                                                                  debt for future capital projects because the risk of repayment would be greater for the next lender.


Debt to Worth Ratio           DWRCY2    IF Y(0) = 50%             The debt to worth ratio is equal to the benchmark of 0.5. This indicates that it may be more costly to acquire debt
                                                                  for future capital projects because the risk of repayment would be greater for the next lender.

Debt to Worth Ratio           DWRCY3    IF Y(0) < 50%             The debt to worth ratio is less than the benchmark of 0.5. This indicates that it may be less costly to acquire debt
                                                                  for future capital projects because the risk of repayment would be smaller for the next lender.
Interpretation – Trend
                                                                  The debt to worth ratio has increased over time. This is a negative indicator of the long-term security of the
Debt to Worth Ratio           DWRT1     IF Y(0) > Y(-1) > Y(-2)   organization. The cost of acquiring debt is likely to be increasing.
                                                                  The debt to worth ratio has increased over time. This is a negative indicator of the long-term security of the
Debt to Worth Ratio           DWRT2     IF Y(0) > Y(-1) = Y(-2)   organization. The cost of acquiring debt is likely to be increasing.
                                                                  The debt to worth ratio has increased over time. This is a negative indicator of the long-term security of the
Debt to Worth Ratio           DWRT3     IF Y(0) = Y(-1) > Y(-2)   organization. The cost of acquiring debt is likely to be increasing.
                                                                  The debt to worth ratio has decreased over time. This is a positive indicator of the long-term security of the
Debt to Worth Ratio           DWRT4     IF Y(0) < Y(-1) < Y(-2)   organization. The cost of acquiring debt is likely to be decreasing.
                                                                  The debt to worth ratio has decreased over time. This is a positive indicator of the long-term security of the
Debt to Worth Ratio           DWRT5     IF Y(0) < Y(-1) = Y(-2)   organization. The cost of acquiring debt is likely to be decreasing.
                                                                  The debt to worth ratio has decreased over time. This is a positive indicator of the long-term security of the
Debt to Worth Ratio           DWRT6     IF Y(0) = Y(-1) < Y(-2)   organization. The cost of acquiring debt is likely to be decreasing.
                                                                  The debt to worth ratio has fluctuated over time. There is no clear trend in the long-term security of the
Debt to Worth Ratio           DWRT7     IF Y(0) < Y(-1) > Y(-2)   organization and the associated cost of acquiring debt.
                                                                  The debt to worth ratio has fluctuated over time. There is no clear trend in the long-term security of the
Debt to Worth Ratio           DWRT8     IF Y(0) > Y(-1) < Y(-2)   organization and the associated cost of acquiring debt.
                                                                  The debt to worth ratio has not changed over time. There is no clear trend in the long-term security of the
Debt to Worth Ratio           DWRT9     IF Y(0) = Y(-1) = Y(-2)   organization and the associated cost of acquiring debt.
Current Year Report
                                                                  The debt service coverage ratio is greater than the benchmark of 1.25[.] This indicates that the organization has
Debt Service Coverage Ratio   DSCRCY1   IF Y(0) > 1.25            sufficient resources available to cover annual debt service payments.
                                                                  The debt service coverage ratio is equal to the benchmark of 1.25[.] This indicates that the organization has
Debt Service Coverage Ratio   DSCRCY2   IF Y(0) = 1.25            sufficient resources available to cover annual debt service payments.
                                                                  The debt service coverage ratio is less than the benchmark of 1.25[.] This indicates that the organization may not
Debt Service Coverage Ratio   DSCRCY3   IF Y(0) < 1.25            have sufficient resources available to cover annual debt service payments.
Debt Service Coverage Ratio   DSCRCY4   IF Y(0) = 0               This is not an applicable ratio. The system does not carry debt.
Interpretation – Trend
                                                                  The debt service coverage ratio has increased over time. This is a positive trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT1    IF Y(0) > Y(-1) > Y(-2)   make annual debt service payments.
                                                                  The debt service coverage ratio has increased over time. This is a positive trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT2    IF Y(0) > Y(-1) = Y(-2)   make annual debt service payments.
                                                                  The debt service coverage ratio has increased over time. This is a positive trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT3    IF Y(0) = Y(-1) > Y(-2)   make annual debt service payments.
                                                                  The debt service coverage ratio has decreased over time. This is a negative trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT4    IF Y(0) < Y(-1) < Y(-2)   make annual debt service payments.
                                                                  The debt service coverage ratio has decreased over time. This is a negative trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT5    IF Y(0) < Y(-1) = Y(-2)   make annual debt service payments.
                                                                  The debt service coverage ratio has decreased over time. This is a negative trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT6    IF Y(0) = Y(-1) < Y(-2)   make annual debt service payments.
                                                                  The debt service coverage ratio has fluctuated over time. There is no clear trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT7    IF Y(0) < Y(-1) > Y(-2)   make annual debt service payments.
                                                                  The debt service coverage ratio has fluctuated over time. There is no clear trend in the organization’s ability to
Debt Service Coverage Ratio   DSCRT8    IF Y(0) > Y(-1) < Y(-2)   make annual debt service payments.
                                                                       The debt service coverage ratio has not changed over time. There is no clear trend in the organization’s ability to
Debt Service Coverage Ratio        DSCRT9    IF Y(0) = Y(-1) = Y(-2)   make annual debt service payments.
Current Year Report
Total Revenues to Total Expenses   TRTECY1   IF Y(0) > 0               Total revenues exceed total expenses. The organization is covering the full cost of providing utility service.
                                                                       Total revenues are approximately equal to total expenses. The organization is covering the full cost of providing
Total Revenues to Total Expenses   TRTECY2   IF Y(0) = 0               utility service.
                                                                       Total revenues are less than total expenses. The organization is not covering the full cost of providing utility
Total Revenues to Total Expenses   TRTECY3   IF Y(0) < 0               service.
Interpretation – Trend

Total Revenues to Total Expenses   TRTET1    IF Y(0) > Y(-1) > Y(-2)   The difference between total revenues and total expenses has increased over time. This is a positive trend in the
                                                                       ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.

Total Revenues to Total Expenses   TRTET2    IF Y(0) > Y(-1) = Y(-2)   The difference between total revenues and total expenses has increased over time. This is a positive trend in the
                                                                       ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.


Total Revenues to Total Expenses   TRTET3    IF Y(0) = Y(-1) > Y(-2)   The difference between total revenues and total expenses has increased over time. This is a positive trend in the
                                                                       ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.

Total Revenues to Total Expenses   TRTET4    IF Y(0) < Y(-1) < Y(-2)   The difference between total revenues and total expenses has decreased over time. This is a negative trend in
                                                                       the ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.


Total Revenues to Total Expenses   TRTET5    IF Y(0) < Y(-1) = Y(-2)   The difference between total revenues and total expenses has decreased over time. This is a negative trend in
                                                                       the ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.

Total Revenues to Total Expenses   TRTET6    IF Y(0) = Y(-1) < Y(-2)   The difference between total revenues and total expenses has decreased over time. This is a negative trend in
                                                                       the ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.


Total Revenues to Total Expenses   TRTET7    IF Y(0) < Y(-1) > Y(-2)   The difference between total revenues and total expenses has fluctuated over time. There is no clear trend in the
                                                                       ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.

Total Revenues to Total Expenses   TRTET8    IF Y(0) > Y(-1) < Y(-2)   The difference between total revenues and total expenses has fluctuated over time. There is no clear trend in the
                                                                       ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.


Total Revenues to Total Expenses   TRTET9    IF Y(0) = Y(-1) = Y(-2)   The difference between total revenues and total expenses has not changed over time. There is no clear trend in
                                                                       the ability of the organization to generate sufficient revenue to cover the full cost of providing utility service.
Current Year Report
                                                                       Operating revenues exceed operating expenses. This is a positive indicator of the organization’s current financial
Operating Ratio                    ORCY1     IF Y(0) > 1.0             condition.
                                                                       Operating revenues are equal to operating expenses. This is a positive indicator of the organization’s current
Operating Ratio                    ORCY2     IF Y(0) = 1.0             financial condition.
                                                                       Operating revenues are not sufficient to cover operating expenses. This is a negative indicator of the
Operating Ratio                    ORCY3     IF Y(0) < 1.0             organization’s current financial condition.
Interpretation – Trend
                                                                       The operating ratio has increased over time. This is a positive trend in the ability of the organization to cover
Operating Ratio                    ORT1      IF Y(0) > Y(-1) > Y(-2)   operating expenses with operating revenues.
                                                                       The operating ratio has increased over time. This is a positive trend in the ability of the organization to cover
Operating Ratio                    ORT2      IF Y(0) > Y(-1) = Y(-2)   operating expenses with operating revenues.
                                                                       The operating ratio has increased over time. This is a positive trend in the ability of the organization to cover
Operating Ratio                    ORT3      IF Y(0) = Y(-1) > Y(-2)   operating expenses with operating revenues.
                                                                       The operating ratio has decreased over time. This is a negative trend in the ability of the organization to cover
Operating Ratio                    ORT4      IF Y(0) < Y(-1) < Y(-2)   operating expenses with operating revenues.
                                                                    The operating ratio has decreased over time. This is a negative trend in the ability of the organization to cover
Operating Ratio                  ORT5     IF Y(0) < Y(-1) = Y(-2)   operating expenses with operating revenues.
                                                                    The operating ratio has decreased over time. This is a negative trend in the ability of the organization to cover
Operating Ratio                  ORT6     IF Y(0) = Y(-1) < Y(-2)   operating expenses with operating revenues.
                                                                    The operating ratio has fluctuated over time. There is no clear trend in the ability of the organization to cover
Operating Ratio                  ORT7     IF Y(0) < Y(-1) > Y(-2)   operating expenses with operating revenues.
                                                                    The operating ratio has fluctuated over time. There is no clear trend in the ability of the organization to cover
Operating Ratio                  ORT8     IF Y(0) > Y(-1) < Y(-2)   operating expenses with operating revenues.
                                                                    The operating ratio has not changed over time. There is no clear trend in the ability of the organization to cover
Operating Ratio                  ORT9     IF Y(0) = Y(-1) = Y(-2)   operating expenses with operating revenues.
Current Year Report
                                                                    Net assets increased over the period of one year. This indicates that revenues collected and other assets
Fund Net Assets                  UNACY1   IF Y(0) > 0               employed for the current period exceeded fund liabilities.
                                                                    There was no change in net assets over the period of one year. This indicates that revenues collected and other
Fund Net Assets                  UNACY2   IF Y(0) = 0               assets employed for the current period meet fund liabilities.
                                                                    Net assets decreased over the period of one year. This indicates that revenues collected and other assets
Fund Net Assets                  UNACY3   IF Y(0) < 0               employed for the current period did not exceed fund liabilities.
Interpretation – Trend
                                                                    Fund Net Assets has increased over time. This is a positive indicator of the funds ability to meet future capital
Fund Net Assets                  UNAT1    IF Y(0) > Y(-1) > Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has increased over time. This is a positive indicator of the funds ability to meet future capital
Fund Net Assets                  UNAT2    IF Y(0) > Y(-1) = Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has increased over time. This is a positive indicator of the funds ability to meet future capital
Fund Net Assets                  UNAT3    IF Y(0) = Y(-1) > Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has decreased over time. This is a negative indicator of the funds ability to meet future capital
Fund Net Assets                  UNAT4    IF Y(0) < Y(-1) < Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has decreased over time. This is a negative indicator of the funds ability to meet future capital
Fund Net Assets                  UNAT5    IF Y(0) < Y(-1) = Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has decreased over time. This is a negative indicator of the funds ability to meet future capital
Fund Net Assets                  UNAT6    IF Y(0) = Y(-1) < Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has fluctuated over time. There is no clear trend of the funds ability to meet future capital
Fund Net Assets                  UNAT7    IF Y(0) < Y(-1) > Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has fluctuated over time. There is no clear trend of the funds ability to meet future capital
Fund Net Assets                  UNAT8    IF Y(0) > Y(-1) < Y(-2)   replacement and other budgetary needs.
                                                                    Fund Net Assets has not changed over time. There is no clear trend of the funds ability to meet future capital
Fund Net Assets                  UNAT9    IF Y(0) = Y(-1) = Y(-2)   replacement and other budgetary needs.
Net Fixed Assets Ratio – Trend
Net Fixed Assets                 UNFAT1   Y(0) > Y(-1) > Y(-2)      The total sales to net fixed assets ratio has increased over time.
Net Fixed Assets                 UNFAT2   Y(0) > Y(-1) = Y(-2)      The total sales to net fixed assets ratio has increased over time.
Net Fixed Assets                 UNFAT3   Y(0) = Y(-1) > Y(-2)      The total sales to net fixed assets ratio has increased over time.
Net Fixed Assets                 UNFAT4   Y(0) < Y(-1) < Y(-2)      The total sales to net fixed assets ratio has decreased over time.
Net Fixed Assets                 UNFAT5   Y(0) < Y(-1) = Y(-2)      The total sales to net fixed assets ratio has decreased over time.
Net Fixed Assets                 UNFAT6   Y(0) = Y(-1) < Y(-2)      The total sales to net fixed assets ratio has decreased over time.
Net Fixed Assets                 UNFAT7   Y(0) < Y(-1) > Y(-2)      The total sales to net fixed assets ratio has fluctuated over time.
Net Fixed Assets                 UNFAT8   Y(0) > Y(-1) < Y(-2)      The total sales to net fixed assets ratio has fluctuated over time.
Net Fixed Assets                 UNFAT9   Y(0) = Y(-1) = Y(-2)      The total sales to net fixed assets ratio has not changed over time.
Other
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Description: Difference Working Capital Current Ratio document sample