Institutional Federal Compliance Report 2021

______________________________________________________________________________________________ STATE OF NEW YORK • 13

In developing the State’s accounting system, consideration was given to the adequacy of internal controls. Internal accounting controls are designed to provide reasonable, but not absolute, assurance regarding the safeguarding of assets against loss from unauthorized use or disposition and the reliability of financial records for preparing financial statements and maintaining accountability for assets. The concept of reasonable assurance recognizes that the cost of control should not exceed the benefits derived. The State’s internal accounting controls are periodically tested to ensure adherence to internal control policies and procedures. In 1987 the Legislature passed the New York State Governmental Accountability, Audit and Internal Control Act, which commits the State to enhancing existing systems of internal controls in all State governmental entities. As a result, there is now a requirement for managers in all branches and components of government to maintain com- prehensive internal control systems and to regularly evaluate the effectiveness and adequacy of these systems by internal reviews and external audits. Finally, the legislation promotes accountability by assuring that all external audits are made available to the public. General Governmental Results An operating deficit of $1.3 billion is reported in the General Fund for the fiscal year ended March 31, 2019. As a result, the General Fund now has an accumulated fund balance of $3.4 billion. The State completed its fiscal year ended March 31, 2019 with a combined Governmental Funds operating surplus of $97 million as compared to a combined Governmental Funds operating surplus in the preceding fiscal year of $2.5 billion. The combined operating surplus of $97 million for the fiscal year ended March 31, 2019 included an operating deficit in the General Fund of $1.3 billion, an operating deficit in the Federal Special Revenue Fund of $4 million, an operating surplus in the General Debt Service Fund of $458 million and an operating surplus in Other Governmental Funds of $934 million. For further information, refer to the MD&A which immediately follows the independent auditors’ report. The State’s financial position as shown in its Governmental Funds Balance Sheet as of March 31, 2019 includes a fund balance of $13.9 billion comprised of $48.6 billion of assets less liabilities of $32.7 billion and deferred inflows of resources of $2 billion. The Governmental Funds fund balance includes a $3.4 billion accumulated General Fund balance. Certificate of Achievement The Office of the State Comptroller was honored for the 30th consecutive year to receive the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association for the State’s 2018 Comprehensive Annual Financial Report. This prestigious award represents the highest form of recognition in the area of governmental financial reporting, and reflects a commitment by the Office of the State Comptroller to com- municate the State’s financial results and position clearly to the taxpayers through public disclosure. Acknowledgments This report could not have been prepared without the cooperation of all State agencies, the Legislature, and the Judiciary. I especially appreciate the professionalism and dedication demonstrated by my staff in the preparation of this report.