According to GAAP, all of the following should be addressed in the MD&A EXCEPT

Management’s Discussion and Analysis (MD&A) is a required part of Required Supplementary Information (RSI) under GASB standards. It includes:

An overview and analysis of financial activities

Condensed comparative financial data

A discussion of the basic financial statements

An explanation of significant changes from the prior year

However, computation of legal debt margins is not required in the MD&A. This type of information is typically included in the statistical section of the ACFR (Annual Comprehensive Financial Report), not in MD&A.

Relevant References:

GASB Statement No. 34 – Basic Financial Statements and Management’s Discussion and Analysis

GASB Codification Section 2200 – MD&A Requirements

GFOA ACFR Checklist

Answer: C. computation of legal debt margins