Cashion, Oklahoma: GFOA's first certificate of conformance recipient.

• Author: Baker, Freddie
• Position: BEST PRACTICES - Governmental Accounting Standards Board

The Town of Cashion, Oklahoma, is not unlike many of the small local governments that dot the U.S. landscape. It's a typical small town --neighbors know each other's business, drivers offer a friendly wave, in the evenings the teens drag Main Street, and the town has no stop lights. But though the town might be considered typical, it now has a very special designation --Cashion, Oklahoma, is the first local government to receive the Government Finance Officers Association Certificate of Conformance for Small Government Annual Financial Reports.

BACKGROUND

Cashion, which has a population of approximately 800, provides typical municipal services such as public safety, street maintenance, parks and recreation, and utility services including gas, water, wastewater, and sanitation services. The majority of the town's revenue is derived from sales tax and utility service charges. Its only long-term debt is in the form of utility revenue bonds, which were used to construct utility system improvements. The town's accounting system is relatively simple and encompasses four governmental funds and two proprietary funds established as separate accounting entities within its accounting system.

Because of the complexity of generally accepted accounting principles and the town management and governing body's preference for financial statements that mirror the budget, the town has historically issued annual financial reports on a modified cash basis of accounting.

Cashion is similar to many other governments across the United States that have straggled through tough economic times and had to tighten their budget belts. After experiencing excessive turnover in the town clerk position (the town's chief financial officer), Cashion fell behind in meeting its daily financial responsibilities, a situation that led to the lack of reliable and useful accounting information and delayed issuances of audited financial statements. In fact, until recently, the town had consistently been two years behind in issuing audited financial statements. As a result of the turnover and inability to stay current, the town's management and governing body realized outside help was needed and contracted with an accounting firm to help Cashion catch up and stay caught up. For quite some time, the town has been forced to make important financial decisions without access to reliable, up-to-date financial information. Because of these hardships, Cashion knows firsthand the importance of...