Institutional Federal Compliance Report 2021

_______________________________________________________________________________________________ STATE OF NEW YORK • 9

FINANCIAL OVERVIEW This report has been prepared by the Office of the State Comptroller, as required by Chapter 405, Laws of 1981, in accordance with generally accepted accounting principles (GAAP) for governments as promulgated by the Governmental Accounting Standards Board (GASB). Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, included within this Comprehensive Annual Financial Report rests with the Office of the State Comptroller. The basic financial statements contained in this report have been audited by KPMG LLP. Their audit was conducted in accordance with generally accepted government auditing standards (GAGAS) and their auditors’ report precedes the basic financial statements. An independent audit provides reasonable assurance that the State’s basic financial statements for the year ended March 31, 2018 are free of material misstatement. Independent audit procedures include examining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall basic financial statement presentation. An audit also includes consideration of internal controls over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the State’s internal controls over financial reporting. Accordingly, the independent auditor expressed no opinion with respect to internal controls over financial reporting. The independent auditor believed that their audit provided a reasonable basis for rendering an unmodified opinion that the State’s basic financial statements for the fiscal year ended March 31, 2018 are fairly presented in conformity with GAAP. The basic financial statements include a narrative introduction, overview, and analysis that is required by GAAP and referred to as Management’s Discussion and Analysis (MD&A). This transmittal letter is intended to complement the MD&A and should be read in conjunction with it. The State’s MD&A can be found immediately following the independent auditors’ report. Profile of New York State New York State was one of the original 13 states, ratifying the United States Constitution and entering the Union on July 26, 1788. The State has a total area (land and water) of 54,555 square miles and a park system that is among the largest in the nation (Adirondack Park). Geographically, New York State is divided into 62 counties (five of which are boroughs of New York City). Within these counties are 62 cities (including New York City), 932 towns, 535 villages and 692 school districts. The State’s major economic sectors are the industrial-commercial, service, financial and agricultural sectors. New York’s government comprises three branches—executive, legislative and judicial. The executive branch includes the Executive (including 20 authorized State departments), the Department of Audit and Control, and the Department of Law, which are headed respectively by the Governor, Comptroller and Attorney General. The departments of the State report to the Governor; however, the departments of Audit and Control and Law report to their respective elected officials, and the Education Department and the State University of New York report to the Board of Regents. The Board of Regents is elected by the State Legislature. The legislative branch comprises two houses, the Senate with 62 senators and the Assembly with 150 members. Members of the Legislature are elected to two-year terms. The Chief Judge of the Court of Appeals, which is the highest court of the State, heads the judicial branch. The Governor, with the advice and consent of the State Senate, appoints the Chief Judge and six Associate Judges to 14- year terms. In New York State, the courts of original jurisdiction, or trial courts, hear cases in the first instance and the appellate courts hear appeals from the decisions of other courts. Economic Condition and Outlook Overall economic activity, employment and wages all rose in New York State in 2017. Growth in the nation’s real Gross Domestic Product accelerated in 2017, with an increase of 2.3 percent. In comparison, New York’s real Gross State Product grew by roughly half this rate, an increase of 1.1 percent. Similar to the nation, this economic growth was stronger than the State’s 0.5 percent gain in 2015.