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    MD&A Section of Financial Statement

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    GASB-34 requires that state and local governments will include a Management Discussion and Analysis (MD&A) section preceding the basic financial statements.

    Describe and discuss this requirement and compare this requirement with the SB-2 Report - (MD&A) as required by SOX.

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    GASB-34 requires that state and local governments include a MD&A section preceding the basic financial statements. The specific requirements of GASB-34 are stated under paragraph 11 of GASB-34. The requirements are as follows. Please note that the requirements listed below are taken verbatim from the GASB-34

    MD&A requirements established by this Statement are general rather than specific to encourage financial managers to effectively report only the most relevant information and avoid "boilerplate" discussion. At a minimum, MD&A should include:

    a. A brief discussion of the basic financial statements, including the relationships of the statements to each other, and the significant differences in the information they provide. This discussion should include analyses that assist readers in understanding why measurements and results reported in fund financial statements either reinforce information in government-wide statements or provide additional information.

    b. Condensed financial information derived from government-wide financial statements comparing the current year to the prior year. At a minimum, governments should present the information needed to support their analysis of financial position and results of operations required in c, below, including these elements:

    (1) Total assets, distinguishing between capital and other assets
    (2) Total liabilities, distinguishing between long-term liabilities and other liabilities
    (3) Total net assets, distinguishing among amounts invested in capital assets, net of related debt; restricted amounts; and unrestricted amounts
    (4) Program revenues, by major source
    (5) ...

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