Board of Finance Financial Policies - East Haddam

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    Board of Finance Financial Policies

    Introduction

    The East Haddam Board of Finance recognizes that financial decisions for our community are driven by our fiscal health.  We understand that our citizens expect their town government to deliver essential services such as public safety, education, sound infrastructure, recreational opportunities and more.  To fulfill these expectations, we must invest in infrastructure, reserve funds and other obligations to assure our financial wellbeing for years to come.  Effective financial policies can help elected officials, management and staff make sound decisions for our citizens now and into the future.

    What are Financial Policies?

    Financial policies provide written guidance for how local government elected officials, management and staff should approach fiscal issues and core financial areas.

    Effective financial policies are essential to our community’s fiscal health.  They provide stability and continuity by establishing what actions are acceptable and unacceptable, identifying who is responsible for taking certain actions and provided standards to measure your jurisdiction’s performance.

    Financial policies are used during the annual audit to assess compliance, by credit ratings agencies to help determine our fiscal stability and by other financial professionals as a basis for providing services.

    Benefits of Financial Policies

    Among many benefits, financial policies can:

    • Outline a clear vision of how we will manage our financial resources to provide the best value to our community
    • Increase accountability and minimize confusion by identifying who can take what actions
    • Support good bond ratings and reduce the cost of borrowing
    • Promote long-term strategic thinking
    • Manage and reduce risks to our community’s fiscal health
    • Help our community comply with established best practices identified by organizations such as the Government Finance Officers Association (GFOA)

    Key Components of a Comprehensive Financial Policy

    Financial policies and procedures can include a wide variety of topics.  The Board of Finance has embarked upon preparing financial policies.

    The following Policies have been adopted:

    • Fund Policies—that detail for the purpose, conditions and guidance for each fund and the subset of funds.  The Fund Policies were adopted by the Board of Finance on May 14, 2018.  The Board reviews and evaluates the Fund Policies annually or as needed.

    The Board of Finance Policy Subcommittee is in the process of reviewing the following policies, with a goal of presenting to the full Board for review and adoption by the end of calendar year 2018.

    • Budget Policies
    • Debt Management Policies

    The Policy areas that will be reviewed in 2019 include (but are not limited to):

    Cash Management/Investments

    • Capital Improvement
    • Asset Management
    • Risk Management

    As the Board of Finance progresses adopting policies, the policies will be made available on the Town’s website.

    Any questions regarding policies may be directed to the Finance Director at 860-873-5022 or financeadmin@easthaddam.org

    Fund Policies