2011 Municipal Study - City of Brantford

Municipal Study 2011Evaluating a Municipality’s Financial ConditionA concern in conducting municipal financial analysis is the lack of normative standards for the financialcharacteristics such as size, geography, demographics, revenue structure and responsibility orauthority to provide services. Another concern is that financial statements do not show, on an annualbasis, all costs that are being postponed to the future. They do not show erosion of streets, buildingsor other fixed assets. Nor do they relate to economic and demographic change and changes inrevenue and expenditure rates.Evaluating a municipality’s financial condition is a complex process that involves sorting through anumber of factors. The factors include:the state of the economyservice levels and standards of the municipalitypopulation levelcomposition of the communitylocal business climateinternal finances of the municipalityMany of these are difficult to isolate and quantify. Relationships between the factors add to thecomplexity. Some are more important than others, but often cannot be determined until all the factorshave been assembled.The information contained in this section of the report is intended as a management tool that pullstogether information from each participating municipality’s budget and financial reports. This,combined with various economic and demographic data also included in other sections of this report,help to facilitate analysis and measurement by sharing information between municipalities.When the information is plotted over time, it can be used to monitor changes in financial condition andalert the municipality to future problems. We are committed to refining and developing additional datato have more efficient and effective benchmarking tools for municipalities.Municipal Financial Indicators47