AGA TOPICS Newsletter

CGFM Gets Another Boost in Tennessee

Tennessee is already one of the states that formally recognize the Certified Government Financial Manager (CGFM) designation. Now, new legislation makes the CGFM certification even more valuable.

“Tennessee is the only state in the country that requires all municipalities to produce financial statements conforming to Generally Accepted Accounting Principles,” said Ron Queens, MA, CGFM, CPA, Manager of the Division of Local Finance, Office of the Comptroller of the Treasury. “A sophisticated level of knowledge is needed to handle accounting standards that change frequently and complicated financial transactions such as variable rate debt and derivatives.”

“Some municipalities were having trouble understanding all the accounting requirements,” Queen said. The legislation passed in June requires all municipalities to employ a certified municipal finance officer (CMFO) or if total revenues are $300,000 or less, the municipality can contract with a qualified person.

To become certified, the officer must undergo 80 hours of course work in 10 areas of government financial management, including debt administration, enterprise resource planning, pension and benefits administration, internal controls and budgeting.

Queen said the new legislation will do more than improve the stewardship of financial assets in the state’s municipalities.

“We also believe that this will improve the status of government financial management with the public by having high standards for government financial managers to meet,” Queen said.

Finance officers in Tennessee’s 346 cities and towns, for the first time, will be mandated to either undergo the training or seek approval for an exemption. That’s where the CGFM comes in. Individuals who have earned the CGFM, a CPA, or the Government Finance Officers Association’s Certified Public Finance Officer (CPFO) credential are exempt from the educational requirements of the CMFO designation.

Queen serves as co-chair of the CGFM committee of AGA’s Nashville Chapter. He speculates that the new legislation may prompt more people to earn the CGFM credential because it is transferable across all three levels of government. The 80-hour training program, which will be developed by the Municipal Technical Advisory Service at the University of Tennessee and approved by the Comptroller’s Office, is specific to Tennessee municipal governments.

In addition, testing facilities for the CGFM are conveniently located throughout Tennessee and in the Nashville area. The Nashville chapter provides incentives, study groups and other supports.

The legislation, which was championed by the Office of the Comptroller of the Treasury and the University of Tennessee’s Institute of Public Service’s Municipal Technical Advisory Service, goes into effect for the largest municipalities in 2010.

Read the full text of the bill at http://www.comptroller.state.tn.us/ma/municipalfinanceofficerssb2059.pdf. —Christina Camara, AGA.