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The regular evaluation of an organization’s finances goes a long way toward establishing trust with stakeholders, such as tax payers, board members, clients, patrons, and funding agencies. Just as financial planning and budgeting are integral parts of an organizationâ€™s success, financial audits and evaluations are vital parts of the functioning of an organization. Evaluating the financial condition of an organization involves determining whether it has the revenue from taxes, fees, and other sources to meet its needs as well as if its assets exceed its liabilities. Assessing the financial condition is really just an analysis of the city’s financial health.
In this Assignment, discuss the city in which you live and then evaluate its financial condition and opportunities for growth by addressing the bulleted statements below. Be sure to first review your readings and then research additional resources to assist in your evaluation. For example, it is helpful to examine available data and other public documents for that city. These resources are useful and should be incorporated into your paper, but remember that those resources do not count as scholarly (peer-reviewed, academic articles and texts).
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Write a 6- to 8-page paper (not including title page and reference page) that addresses the following:
- Describe your local city or county entity. Include descriptive information as population, trends, and other important demographical information. (1 page)
- Look at sales tax in the city, which is a main source of revenue. Is your entityâ€™s revenue and expenditures balanced? Why or why not? In your assessment, consider the following three factors: amount of revenue that the entity is collecting, the percentage of total revenue contributed by sales tax, how much the city is spending. (2 pages)
- Consider these six important factors that impact city revenue: Deterioration of revenue base, internal procedures or policies that may adversely affect revenue yields, over-dependence on obsolete or external revenue sources, changes in tax burden, poor revenue estimating practices, and inefficiency in the collection and administration of revenues. Select two that apply to your city, and then evaluate how these impact your city. (1- 2 pages)
- You propose to increase city tax revenue, and you know from your course readings that price elasticity and demand are important considerations. Understanding the characteristics of your city, evaluate whether the following three tax increase options would be effective: 1) a .5% increase in sales tax, 2) a 3% increase in restaurant tax, and 3) a 5% increase in tourism tax. In your evaluation, consider price elasticity and positive and negative externalities for each type of tax.This is where knowing your city and its major sources of revenue are especially important. (1 â€“ 1 1/2 pages)
- As part of your conclusion, provide one recommendation to improve the cityâ€™s financial health. Examples may include (but are not limited to) the need to shift public or customer service priorities or a need to shift policies because of a loss of competitive position. Be creative â€“ one suggestion may be to research examples of other similar cities and determined what changes have worked for them. (1/2 – 1 page)Use proper APA formatting and include the following:
- A title page and running head
- An introduction that states the purpose of the paper
- Level 1 headings to define each part (bullet) of the paper
- A conclusion to synthesize the entire paper
- A minimum of three additional scholarly sources to support your paper
- In-text citations as appropriate
- A reference list
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