How many of your residents pick up your annual audited financial statements and read them cover to cover? As a former certified public accountant known for saying “accounting is fun,” I would love to believe the answer is hundreds. A more realistic guess is zero.

During my tenure as administrator, I have made a concerted effort to educate the public about what county government does—and how local government finances work. It’s no secret that many people aren’t exactly sure what counties do. Part of that outreach includes a strong focus on our financial information. Both the budget and audited financials can be daunting when you are not familiar with governmental accounting. 

Over the past eight years, we have taken steps to support that effort—educating residents, increasing engagement, and simplifying complex financial information. Two of the most effective tools have been our one-page budget snapshot and our popular annual financial report (PAFR).

Budget Snapshot at a Glance

In 2018, we issued our first budget summary, which we refer to as our budget snapshot. This double-sided, one-page document graphically depicts general fund revenue and expenditures, including millage details for the general fund and other special millages. The charts and percentages help readers understand what we do and how much we do. Residents are also reminded of our mission and that all three branches of government are represented at the county government level.

The budget snapshot also includes high-level demographic information, workforce data, county facilities, and the primary programs we offer. A small section highlights potential budget challenges for the coming year—another opportunity to educate residents. Most importantly, it’s a resource that elected officials and our management team can share to start conversations, answer questions, demonstrate transparency, and continue educating the public about county government.

The Evolution of our Popular Annual Financial Report

While the budget snapshot helped simplify our annual budget, we also began exploring ways to make our audited financial information more accessible.

When I attended a Government Finance Officers Association (GFOA) conference in 2016, I went to a session on popular annual financial reports (PAFRs). The idea immediately caught my attention. A PAFR is designed to take information from the annual comprehensive financial report (ACFR) and present it in a format that is easier for the public to understand.

GFOA established their PAFR award program in 1991 to encourage state and local governments to create clear, user-friendly reports that make financial information more accessible to residents and others who may not have a background in public finance, while recognizing governments that do an especially good job communicating that information. The PAFR submission process is very similar to GFOA’s certificate of achievement for excellence in financial reporting, though less complex. Although the idea of creating this document intrigued me, I quickly wrote it off as something my team and I didn’t have the discretionary time to put together.

Fast-forward to 2020 and a global pandemic, which eliminated in-office work for most people. It also reduced the number of fellowship opportunities for students working toward their master of public administration (MPA) degree. I received an email from GFOA announcing a partnership with Engaging Local Government Leaders (ELGL) to provide virtual internship/fellowship opportunities for these MPA students. Local governments interested in creating their own PAFR could apply for a fellow and the only cost was that of filing the completed PAFR with GFOA. I applied immediately.

We were quickly matched with a student interested in local government who also aspired to become an attorney. My finance director and I began reviewing county PAFRs that had received GFOA certificates of excellence. There was no need to reinvent the wheel when strong examples already existed. Our fellow knew very little about government financials at first, but she was a quick learner and eager to try new things. She even introduced us to new software that helped pull the entire document together, making it a learning experience for all of us.

We submitted the PAFR for GFOA review for the year ending 2019. The review process felt like it took forever. We waited with bated breath for either the “I’m sorry” email or the one that began with “congratulations.” I am happy to say that our 2019 PAFR did receive the certificate of excellence and so has each PAFR we have submitted since then. Our fellow continued to work on this project through the development of the 2020 edition, after which she devoted her focus to law school. I am not sure I would have ever kicked off this project without that opportunity.

Since 2021, each PAFR has been designed by a local marketing company with input from the Midland County finance and administrative teams, and every year we try to improve the document. Our elected officials and commissioners use this tool when engaging with other local units of government and constituents.

Receiving the certificate of excellence from GFOA is also a point of pride for the staff and board members. In 2023, only 100 counties of the 3,069 counties in the United States received this certificate of excellence—50 in the small county category and 50 in the large county category. You can find more information on the PAFR award program at gfoa.org/pafr-award.

For counties interested in improving how they communicate financial information, the process does not have to start with a complex or resource-intensive project. A simple one-page summary of your budget can go a long way in helping residents understand how local government operates. From there, tools like a PFAR can build on that foundation by translating detailed financial information into a format that is easier for the public to read and understand. The key is to start with transparency and gradually build communication tools that make financial information accessible to everyone.

The Value of Transparency and Goodwill

We understood that making a deliberate effort to educate the public about what county government does—and the finances that support it—would come with a cost. But if we didn’t see the value in communicating about our programs and services, why would anyone else? In the context of our overall annual expenditures, the investment has been well worth it. Graphic design for the two documents averages about $4,000 per year, with printing costs around $1,500. Since 2018, the total investment has been just over $27,000—less than 0.1% of our annual general fund budget. The goodwill and trust built with residents, however, are invaluable.

Learn more:

Midland County’s 2024 PFAR 

Midland County’s latest budget snapshot

BRIDGETTE M. GRANSDEN, CPA, CGFM, is administrator/controller of Midland County, Michigan.