Town of Matthews
Financial Strength

Auditing

North Carolina General Statutes (G.S. 159-34) require each governmental unit to have an annual independent audit and specifies the general terms and condition of the audit. The Town's independent auditing firm is selected by competitive bids and the Finance Director is responsible for preparing the bid request and monitoring the audit procedures.The Town is consistently found to have a clean audit with no compliance issues.

Banking

Banking services are selected on a competitive basis through a Request for Proposal (RFP) process. This process is intended to result in the selection of a financial institution that can provide the Town of Matthews with the highest quality and most flexible banking services for the lowest cost to the public. RFP's are generally issued on a three-to-five year cycle. The Finance Department ensures that all accounts of the Town are properly managed.

Bond Ratings

Sometimes a "quick-and-dirty" way of gauging the quality of financial management in a given municipality is by noting their general financial health. One popular method of doing so is by checking the local bond rating to see how industry analysts judge the municipality's creditworthiness.

What is a rating? It is the opinion of the ability and willingness of an issuer to make timely payments on a debt instrument, such as a bond, over the life of that instrument. The purpose of a rating is to provide investors with a simple system of gradation by which relative creditworthiness of securities may be noted. Credit ratings are a measure that forecast or indicate the potential for credit loss due to a failure to make payments, delay in payment, or partial payment to the investor.

There are several types of bonds that can be issued (i.e. general obligation bonds, revenue bonds and certificates of participation). Rating agencies generally consider revenue bonds and certificates of participation to be higher risk since taxing power is not pledged to cover the debts.

Town of Matthews has general obligation bonds that are rated by two of the three national credit rating agencies.

Moody's Aa1 - high grade - very strong capacity to repay
Standard & Poors AA+/Stable - investment grade - very strong capacity to repay
Our high ratings are based on the town's strong credit characteristics. These include a stable and diverse local economy with access to employment opportunities in the greater Charlotte labor market, sound financial performance and policies, and manageable debt loads.

Debt

Debt is also a useful indicator of a community's financial health. One long accepted general warning signal for potentially burdensome debt to a municipality is the debt margin percentage. The State of North Carolina closely monitors all debt incurred by municipalities. Overall net debt should not exceed 8 percent of the assessed taxable valuation. The Town of Mathews is well under that percentage. As of June 30, 2015 our assessed valuation was $3,527,790,551. Eight percent of the assessed valuation totals $282,223,244. The Town's debt at the close of FY15 was $8,722,299 providing a debt margin available of $273,500,945.

Fund Balance

Fund Balance is defined in general terms as "the cumulative difference of all revenues and expenditures from the government's creation."

A suitable fund balance provides a source of working capital to meet cash flow needs, offers a cushion against revenue shortfalls and unanticipated expenditures, provides an accumulation of funds that some municipalities use for capital projects and contributes to a favorable bond rating.

The Town of Matthews Board of Commissioners adopted a fund balance policy on March 10, 2003. The Board of Commissioners adopted a revised policy on November 25, 2013. Fund Balance information can be found in the Town's Comprehensive Annual Financial Reports.

Town of Matthews Policies for Fund Balance

It is the policy of the Town of Matthews to maintain an unassigned fund balance at a level sufficient to provide for the required resources to meet operating cost needs, to allow for unforeseen needs of an emergency nature and to permit orderly adjustment to changes resulting from fluctuations of revenue sources. Based on the recommendation of the State Treasurer's Office, the Town of Matthews will maintain never less than 8 percent of the next year's budget in the unassigned fund balance. Furthermore, it shall be the policy goal of the Town of Matthews to maintain an unassigned fund balance of not less than 34 percent of the subsequent year's budget, subject to specific actions of the Board, relating to special opportunities or expenses. In the event the fund balance shall decline below the policy amount, council shall develop a recovery plan to rebuild the fund balance as soon as practical.

Any amounts remaining in the fiscal year-end unassigned fund balance in excess of 34 percent of the approved subsequent year's budget, excluding any Federal and State pass-through revenue, shall be designated as available for subsequent year's expenditures. This excess amount will be available for appropriation by the Board of Commissioners in a subsequent fiscal year to fund capital, operating or debt service expenditures as determined by the Board of Commissioners during the budget for that subsequent fiscal year.

Investment Policy

The Finance Department coordinates the Town's investment program. Firms wishing to be considered for participation in the Town's investment program should contact Chris Tucker, Finance Director at Town of Matthews, 232 Matthews Station St., Matthews, NC 28105 or e-mail.
    Finance
    Christopher Tucker
    Finance Director

    Finance Department
    232 Matthews Station St.
    Matthews, NC 28105

    Phone: (704) 847-4411

    Fax: (704) 845-1964

    E-mail:
    ctucker@matthewsnc.gov

    Hours:
    Monday-Friday
    8:00 a.m. – 5:00 p.m.
     
     
     
     
     
    Town of Matthews | 232 Matthews Station Street Matthews, NC 28105  |  Phone: 704-847-4411  |  Fax: 704-845-1964
    Contact Us  |  Site Map   |  Powered by MunicipalCMS
    E-notify RSS Feeds Twitter Facebook 
    0