City of Pine Lawn, Missouri

Transcription

1 City of Pine Lawn, Missouri Independently Prepared Financial Report Year Ended June 30, 2016 Prepared by:

2 Independent Preparer s Report February 27, 2017 Honorable Mayor and Board of Aldermen City of Pine Lawn, Missouri Report on the Financial Statements Following are financial statements for the fiscal year ended June 30, 2016 for the City of Pine Lawn, Missouri (the City) and related notes to the statements prepared by ArchTech, LLC (the Preparer). Management s Responsibility for the Financial Statements Management has determined that the cash basis of accounting is an acceptable basis of preparation of the financial statements while under the current circumstances. Management has approved certain allocations of funds and provided accurate raw financial data to the best of its ability. Management is also responsible for the design, implementation, and maintenance of internal controls relevant to the preparation of this report. Lastly, Management represents that the financial data used in the preparation of these financial statements is free from material misstatement, whether due to error or fraud. Preparer s Responsibility, Scope of Work and Disclaimer of Opinion Our responsibility is to prepare the financial statements to the best of our abilities with the information provided by the City. In the Scope of Work specified for this review, the City agreed that a full audit of records would not be conducted by the Preparer at this time. The City is taking steps toward achieving accounting best practices for the municipality in compliance with GASB 34, GAAP and other standards. Therefore, at the specific request of the client, this report was prepared based on a review of the provided QuickBooks file for the fiscal year ended June 30, The Preparer also reviewed the Audited Financial Statement prepared for the City for the fiscal year ended June 30, 2014 and the required filing for the State of Missouri prepared by the City for the fiscal year ended June 30, The Preparer also reviewed the information and analyses with the City Administrator, who provided important information regarding asset transfers and court reporting of revenue and expenditures. The Preparer specifically did not review additional supporting information in the form of bank statements, cash or other receipts journals or statements, canceled checks, deposit journals, statements of accounts receivable or payable other than those provided in the QuickBooks files, or any other documentation 2

3 whatsoever, including asset information and verification. Our work was conducted for the purpose of preparing the necessary financial statements the City is required to file with the State of Missouri based on the Scope of Work. Overview of the Financial Statements This is intended to serve as an introduction to the City's basic financial statements. The City's basic financial statements are comprised of two components: 1) government-wide financial statements, and 2) fund financial statements. This report also contains additional information related to the basic financial statements themselves. Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City's finances, in a manner similar to a private-sector business. The Statement of Net Position - Cash Basis presents information on all of the City's assets and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The Statement of Activities - Cash Basis presents information showing how the City's net position changed during the most recent fiscal year. Both of the government-wide financial statements distinguish functions of the City that are principally supported by sales tax and fines, forfeitures, and charges for services (governmental activities). The governmental activities of the City include administration, courts, housing, parks, police, senior citizens building, sewer lateral, and streets. Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. These funds are divided into three categories, governmental funds, proprietary funds, and fiduciary funds. The City does not maintain any proprietary funds. Governmental funds. The governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, the governmental funds financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements. The City maintains five governmental funds. Information is presented separately in the Governmental Funds Balance Sheet - Cash Basis and in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances - Cash Basis for the General Fund, Capital Improvement Fund, and Storm Water/Parks Fund, which are considered to be major funds. Individual fund data for each of the nonmajor governmental funds is provided in the form of combining statements. 3

4 Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of individuals or units outside of the City. The City's fiduciary fund type consists of the Court Bond Fund. Government-wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the City, assets exceeded liabilities by $205,832 at the close of the most recent fiscal year. Comparisons cannot be made to the prior 2015 fiscal year, as audited financials were not available at this time. Basis of Accounting Because of the limited scope of review, a cash basis of accounting was used in preparation of the financial statements. In previous years, the City had financials presented in the modified cash basis of accounting. While acceptable, the cash basis was considered more accurate at this time based on the information provided. Additional Information Used in Preparation of the Statements The provided financial statements are considered reliable within the Scope of Work defined. As stated above, the preparation of the financial statements was primarily based on an analysis of the QuickBooks file provided for the year ending June 30, Some statements required more detail and therefore conclusions were made based on prior financial statements filed by the City. While compiling the Balance Sheet report, funds were originally all classified as General Funds. After reviewing the prior two years of statements, observed ratios were applied to the total funds in order to show a more probable picture of what funds are held. However, when compiling the Statement of Revenues, Expenditures, and Changes in Fund Balances, no conclusions could be drawn as to what movements had occurred within each fund, and all were noted as Unallocated on that statement. In preparing the Statement of Activities, the Net Position used for July 1, 2015 was the net position found based on financial statements filed for the fiscal year ended June 30, In preparing the Statement of Fiduciary Net Position, Bond amounts were derived from a worksheet provided by Janice Jones, City Administrator, detailing a breakdown of court fines. The data provided was for a ten-month period and was annualized for inclusion in this report. Following are the independently prepared financial statements for the year ended June 30, Respectfully, Edward Wilson for ArchTech, LLC 4

5 Statement of Net Position Cash Basis Governmental Activities Assets Cash and investments 205,832 Total Assets $ 205,832 Liabilities - Net Position Unassigned 205,832 Total Net Position $ 205,832 5

6 Statement of Activities Cash Basis Program Revenues Charges for Services Operating Grants & Contributions Net Revenues (Expenses) and Change in Net Position Expenses FUNCTIONS/PROGRAMS Governmental Activities Administration $ 468,916 20,805 - (448,111) Courts 178, , ,063 Housing 82, ,489-36,993 Parks 2, (2,969) Police 892,908 14,362 - (878,546) Senior citizens building 4,268 (50) - (4,318) Sewer Lateral 2,425 33,642-31,217 Streets 158, (158,712) Total Governmental Activities $1,790,922 $666,539 $ - $ (1,124,384) General Revenues Allocated Taxes: Property 45,775 Sales 597,917 Utility 294,504 Other 116,726 Total General Revenues 1,054,922 Change in Net Position (69,461.64) Net Position July 1 275,294 Net Position June 30 $ 205,832 6

7 Balance Sheet Cash Basis Governmental Funds Assets General Capital Improvement Storm Water/Parks Other Governmental Funds Total Cash & Investments 127,070 50,035 25,769 2, ,832 Total Assets $ 127,070 $ 50,035 $ 25,769 $ 2,958 $ 205,832 Fund Balances Unassigned 127,070 50,035 25,769 2, ,832 Total Fund Balances $ 127,070 $ 50,035 $ 25,769 $ 2,958 $ 205,832 7

8 Statement of Revenues, Expenditures, and Changes in Fund Balances Cash Basis Governmental Funds Unallocated Funds Total Revenues Taxes $ 677, ,333 Gross Receipts Tax 294, ,504 Intergovernmental - - Fees, Licenses, and Permits 140, ,294 Fines & Forfeitures 492, ,653 Charges for Services - - Other Revenue 116, ,676 Investment Income - - Total Revenues 1,721,461 1,721,461 Expenditures Administration 468, ,916 Courts 178, ,228 Housing 82,496 82,496 Park 2,969 2,969 Police 892, ,908 Senior Citizen Building 4,268 4,268 Sewer Lateral 2,425 2,425 Streets 158, ,712 Total Expenditures 1,790,922 1,790,922 Revenues Over (Under) Expenditures (69,462) (69,462) Net Change In Fund Balances (69,462) (69,462) Fund Balances July 1 275, ,294 Fund Balances June 30 $ 205, ,832 8

9 Statement of Fiduciary Net Position Fiduciary Fund Cash Basis Agency Fund Court Bond Fund Assets Cash $ 169,669 Liabilities Due to others - court bonds $ 169,669 9