Financial Statement of Wal-Mart Stores - Essay Example

This paper compares and contrasts the financial ment of Wal-Mart Stores, Inc. (Wal-Mart) (Wal-Mart Stores, Inc., 2005) with the Comprehensive Annual Financial Report (CAFR) of the city of Minneapolis (City of Minneapolis, 2005), Minnesota for the year ended 2005. The table of contents, introductory section, financial section, and statistical section are reported in the CAFR of the city of Minneapolis. The introductory section contains transmittal letter, organization chart, mayor and council, and certificate of achievement for excellence in financial reporting.

The financial section contains the independent auditor’s report, management’s discussion and analysis, basic financial statements, required supplementary information other than management’s discussion and analysis, and other supplementary information (City of Minneapolis, 2005). Contents, vested interest, letter from the president and chief executive officer, thoughts and comments from chairman of the board, operational reviews, and financial information including the report of independent registered public accounting firm, report of independent registered public accounting firm on internal control over financial reporting, and management’s report to shareholders are reported in the financial statement for Wal-Mart (Wal-Mart Stores, Inc., 2005). The Certificate of Achievement for Excellence in Financial Reporting is found in the introductory section of the CAFR of the city of Minneapolis but not in the financial statement of Wal-Mart.

This is because governments may participate in the award program called the Certificate of Achievement for Excellence in Financial Reporting administered by the Government Finance Officers Association (GFOA). The GFOA requires more detailed reporting than the Generally Accepted Accounting Principles (GAAP) requirements of the Government Accounting Standards Board (GASB) (Ruppel, 2004). Combining and individual fund statements and schedules in the section called “other supplementary information” is another item that appears in the CAFR of the city of Minneapolis but not in the financial statement of Wal-Mart.

The combining and individual fund statements and schedules are required by GASB 34, which focuses on information about nonmajor fund and nonmajor component unit financial information. The basic financial statement provides information about major funds; the combining and individual fund statements and schedules provide information about nonmajor funds and nonmajor component units (Ruppel, 2004). The last item that appears in the CAFR of the city of Minneapolis but not in the financial statement of Wal-Mart is the statistical section.

The statistical section presents certain information on a trend basis that gives citizens and analysts a better idea of changes and trends in a government’s economic condition (Cheney, 2004; Ruppel, 2004). The reporting of this section is mandated by GASB Statement 44, “Economic Condition Reporting: The Statistical Section” (Cheney, 2004). Perhaps of interest to the users of the CAFR would be the government-wide expenses by function, government-wide revenues, general governmental expenditures by function, and general governmental revenues by source, to understand what their tax dollars have been spent on.

REFERENCES Cheney, G. (2004). GASB’s new Statement 44 beefs up statistics section. Retrieved October 2, 2006, from http://www.findarticles.com/p/articles/mi_go1464/is_200407/ai_n6559381 City of Minneapolis. (2005). 2005 Comprehensive Annual Financial Report (CAFR). Retrieved October 1, 2006, from http://www.ci.minneapolis.mn.us/financial-reports/cafr2005/ Ruppel, W. (2004). Governmental Accounting Made Easy. New Jersey: John Wiley & Sons. Wal-Mart Stores, Inc. (2005). Wal-Mart 2005 Annual Report.

Retrieved October 1, 2006, from http://www.walmartstores.com/Files/2005AnnualReport.pdf