This how-to guide provides an overview of financial management for small-community water utilities, from developing and balancing an expense budget to estimating and collecting revenue. This primer is ideal for a board member of a drinking water or wastewater utility who needs to understand the financial aspects of a utility's operations. The guide explains in very simple, easy-to-understand terms how to read and interpret the common financial statements so more informed decisions can be made with the information that can be gained from them.
The publication enhances:
- understanding financial statements: income statements, balance sheets, cash flow statements, audit reports and related documents
- using financial ratios; computing ratios to assess financial sustainability
New guide on the basics of financial management for small water utilities [1] from RCAP [2] on Vimeo [3].
About the sample financial-management policies (from Chapter 1: The framework for financial management) that are attached:
The Microsoft Word 97-2003 files that are included here as attachments are provided in this form so that you can have the text in an editable form in order to adapt the policies to your utility.
Some of the requirements or procedures described in the sample policies may be covered in state statutes or local ordinances, particularly if your utility is operated as a division of a public entity, such as a county or municipal government.
These sample policies are not ready-to-use and should not be adopted or distributed as-is. They must be customized to fit your utility and your circumstances. You can change or add to these policies depending on your system’s circumstances and requirements. Be sure to review them carefully and fill in all the blanks with the required information. Ensure that all the information is pertinent to your specific utility.
Before adopting any financial policies, also be sure to check for items required by state law, local ordinances, your system bylaws or charter, and documents relating to any loans or grants your system may have received.
The information contained herein is for informational purposes only as a service to the public and is not legal advice or a substitute for legal counsel. As legal advice must be tailored to the specific circumstances of each case, nothing provided herein should be used as a substitute for advice of competent counsel. RCAP, Inc. expressly disclaims all liability in respect to actions taken or not taken based on any or all of the contents of the sample policies.
