CITY OF ROBERTA, GEORGIA INDEPENDENT AUDITOR S REPORT AND FINANCIAL STATEMENTS

Transcription

1 INDEPENDENT AUDITOR S REPORT AND FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017

2 ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 TABLE OF CONTENTS Page FINANCIAL SECTION INDEPENDENT AUDITOR S REPORT FINANCIAL STATEMENTS Government-wide Financial Statements: Statement of Net Position... 4 Statement of Activities... 5 Fund Financial Statements: Balance Sheet Governmental Funds... 6 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position... 7 Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds... 8 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities... 9 Statement of Revenues, Expenditures and Changes in Fund Balance Budget and Actual General Fund Statement of Net Position Proprietary Funds Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds Statement of Cash Flows Proprietary Funds Notes to the Financial Statements REQUIRED SUPPLEMENTARY INFORMATION Schedule of Changes in the Net Pension Liability and Related Ratios Schedule of Contributions Notes to the Required Supplementary Information

3 ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 TABLE OF CONTENTS (CONTINUED) Page SUPPLEMENTARY INFORMATION Combining Balance Sheet Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual Law Enforcement Confiscation Project Cost Schedule - Community Development Block Grant Program Schedule of Projects Constructed with Special Sales Tax Proceeds SINGLE AUDIT SECTION Schedule of Expenditures of Federal Awards Notes to the Schedule of Expenditures of Federal Awards Summary Schedule of Prior Audit Findings Corrective Action Plan Independent Auditor s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Independent Auditor s Report on Compliance for Each Major Program; Report on Internal Control Over Compliance; and Report on the Schedule of Expenditures of Federal Awards Required by the Uniform Guidance Schedule of Findings and Questioned Costs

4 CLIFTON, LIPFORD, HARDISON & PARKER, LLC INDEPENDENT AUDITOR'S REPORT Honorable Mayor and Members of City Council The City of Roberta, Georgia Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Roberta, Georgia as of and for the year ended September 30, 2017, and the related notes to the financial statements, which collectively comprise the City of Roberta, Georgia s basic financial statements as listed in the table of contents. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 1 Member of 1503 Bass Road American Institute of 468 South Houston Lake Road P.O. Box 6315 Macon, Georgia Certified Public Accountants Warner Robins, Georgia Phone Fax Phone Fax

5 Honorable Mayor and City Council City of Roberta, Georgia Page Two We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the remaining fund information of the City of Roberta, Georgia, as of September 30, 2017, and the respective changes in financial position, and, where applicable, cash flows thereof and the respective budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the schedule of changes in the net pension liability and related ratios on page 36, the schedule of contributions on page 37 and the notes to the required supplementary information on pages be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Management has omitted the Management s Discussion and Analysis that accounting principles generally accepted in the United States of America requires to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Roberta, Georgia s basic financial statements. The combining and individual nonmajor fund financial statements and schedules, the schedule of projects constructed with special sales tax proceeds, and schedule of expenditures of federal awards as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, are presented for purposes of additional analysis and are not a required part of the basic financial statements. 2

6 Honorable Mayor and City Council City of Roberta, Georgia Page Three The combining and individual nonmajor fund financial statements and schedules and the schedule of projects constructed with special sales tax proceeds, and the schedule of expenditures of federal awards are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements and schedules the schedule of projects constructed with special sales tax proceeds and schedule of expenditures of federal awards are fairly stated in all material respects in relation to the basic financial statements taken as a whole. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated September 14, 2018, on our consideration of the City of Roberta, Georgia s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City of Roberta, Georgia s internal control over financial reporting and compliance. Macon, Georgia September 14,

7 FINANCIAL STATEMENTS

8 STATEMENT OF NET POSITION SEPTEMBER 30, 2017 Primary Government Governmental Business-Type Activities Activities Total ASSETS Current Assets: Cash and cash equivalents $ 207,749 $ 132,993 $ 340,742 Certificates of deposit 723,870 38, ,146 Receivables, net of allowance Taxes 1,866-1,866 Accounts 6,694 33,986 40,680 Intergovernmental 26, , ,137 Internal balances 88,839 (88,839) - Restricted cash and cash equivalents: Sinking fund - 33,850 33,850 Capital assets Non depreciable 56, , ,013 Depreciable, net 733,771 3,343,923 4,077,694 Total Assets 1,845,585 4,402,543 6,248,128 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows of resources related to pensions 36,717 3,193 39,910 LIABILITIES Accounts payable 63, , ,364 Retainage payable - 10,858 10,858 Accrued liabilities 8,754 1,944 10,698 Accrued interest payable - 4,658 4,658 Due to other governments Customer deposits - 31,140 31,140 Noncurrent liabilities: Due within one year Compensated absences 10,504-10,504 Notes payable - 25,753 25,753 Bonds payable - 13,000 13,000 Due in more than one year Notes payable - 547, ,788 Bonds payable - 58,000 58,000 Net pension liability 129,752 11, ,035 Total Liabilities 213, ,971 1,035,768 DEFERRED INFLOWS OF RESOURCES Deferred inflows of resources related to pensions 7, ,449 NET POSITION Net investment in capital assets 790,113 3,503,053 4,293,166 Restricted for: Perpetual care 800, ,655 Capital outlay 184, ,463 Debt retirement - 33,850 33,850 Unrestricted (deficit) (114,499) 46,186 (68,313) Total Net Position $ 1,660,732 $ 3,583,089 $ 5,243,821 The notes to the financial statements are an integral part of the basic financial statements. 4

9 STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Net (Expense) Revenue and Program Revenues Changes in Net Position Operating Capital Primary Government Charges Grants and Grants and Governmental Business-Type Functions/Programs Expenses for Services Contributions Contributions Activities Activities Total Primary Government: Governmental Activities General government $ 189,274 $ 29,024 $ - $ - $ (160,250) $ - $ (160,250) Public safety 359,259 57,688 43,288 - (258,283) - (258,283) Public works 231,692 39, ,426 (77,329) - (77,329) Culture and recreation 20, (20,267) - (20,267) Interest on long-term debt (327) - (327) Total governmental activities 800, ,649 43, ,426 (516,456) - (516,456) Business-Type Activities Water & Sewer 455, , , , ,679 Total business-type activities 455, , , , ,679 Total Primary Government $ 1,256,203 $ 534,812 $ 43,288 $ 407,326 (516,456) 245,679 (270,777) General Revenues Property tax 111, ,214 Sales tax 104, ,630 Other tax 219, ,426 Investment earnings 10, ,621 Gain on sale of capital assets 4,952-4,952 Miscellaneous 14,693-14,693 Total General Revenues 465, ,536 Change in Net Position (51,224) 245, ,759 Net Position - Beginning of year, restated 1,711,956 3,337,106 5,049,062 Net Position - End of year $ 1,660,732 $ 3,583,089 $ 5,243,821 The notes to the financial statements are an integral part of the basic financial statements. 5

10 BALANCE SHEET GOVERNMENTAL FUNDS SEPTEMBER 30, 2017 Permanent Fund Total General SPLOST 2013 Cemetery Non-Major Governmental Fund Fund Trust Fund Funds Funds ASSETS Cash and cash equivalent $ 7,127 $ 97,664 $ 76,785 $ 26,173 $ 207,749 Certificates of deposit , ,870 Receivables, net of allowance Taxes 1, ,866 Accounts 6, ,694 Intergovernmental 15,335 6,477-4,642 26,454 Due from other funds 31,356 63, ,705 Total Assets $ 62,378 $ 167,490 $ 800,655 $ 30,815 $ 1,061,338 LIABILITIES Accounts payable $ 50,102 $ - $ - $ 13,715 $ 63,817 Accrued liabilities 8, ,754 Due to other governments Due to other funds 5, ,866 Total Liabilities 65, ,091 79,407 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 1, ,807 Total Deferred Inflows of Resources 1, ,807 FUND BALANCES Restricted for: Perpetual care , ,655 Capital outlay - 167,490-16, ,463 Unassigned (deficit) (4,745) - - (249) (4,994) Total Fund Balances (4,745) 167, ,655 16, ,124 Total Liabilities, Deferred Inflows of Resources and Fund Balances $ 62,378 $ 167,490 $ 800,655 $ 30,815 $ 1,061,338 The notes to the financial statements are an integral part of the basic financial statements. 6

11 RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION SEPTEMBER 30, 2017 Amounts reported for governmental activities in the statement of net position are different because: Total fund balances - governmental funds $ 980,124 Capital Assets Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. Cost of the assets 1,507,701 Accumulated depreciation (717,588) Deferred outflows of resources Change in deferred outflows of resources related to pensions 36,717 Other long-term assets are not available to pay for current period expenditures and, therefore, are reported as unavailable revenue in the funds. 1,807 Long-term Liabilities Long-term liabilities are not due and payable in the current period and, therefore, are not reported as fund liabilities. Interest on long-term debt is not accrued in governmental funds, but rather is recognized as an expenditure when due. All liabilities both current and long-term are reported in the Statement of Net Position. Long-term liabilities at year-end consist of the following: Net pension liability (129,752) Compensated absences (10,504) Deferred inflows of resources Change in deferred inflows of resources related to pensions (7,773) Net position of governmental activities $ 1,660,732 The notes to the financial statements are an integral part of the basic financial statements. 7

12 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Permanent Fund Total General SPLOST 2013 Cemetery Non-Major Governmental Fund Fund Trust Fund Funds Funds Revenues: Taxes Property tax $ 113,967 $ - $ - $ - $ 113,967 Sales tax 104, ,630 Other taxes 219, ,426 License and permits 29, ,024 Intergovernmental 43,288 73,181-41, ,714 Fines and forfeitures 56, ,619 57,688 Charges for services 39, ,937 Interest earnings ,317-10,317 Miscellaneous 73-14,620-14,693 Total Revenues 606,414 73,181 24,937 42, ,396 Expenditures: Current: General government 165, ,382 Public safety 348, , ,356 Public works 172, ,403 Culture and recreation ,267-20,267 Capital Outlay ,318 50,318 Debt Service: Principal - 9, ,136 Interest Total Expenditures 686,576 9,567 20,267 52, ,189 Excess (Deficiency) of Revenues Over (Under) Expenditures (80,162) 63,614 4,670 (9,915) (21,793) Other Financing Sources (Uses): Transfers from other funds Transfers to other funds (200) (200) Proceeds from sale of property 4, ,952 Total other financing sources (uses) 4, ,952 Net change in fund balances (75,410) 63,614 4,670 (9,715) (16,841) Fund Balances, beginning of year, restated 70, , ,985 26, ,965 Fund Balances (deficit), end of year $ (4,745) $ 167,490 $ 800,655 $ 16,724 $ 980,124 The notes to the financial statements are an integral part of the basic financial statements. 8

13 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Amounts reported for governmental activities in the statement of activities are different because: Net changes in fund balances - total governmental funds $ (16,841) Capital Assets Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of those assets is depreciated over their estimated useful lives and reported as depreciation expense. Total depreciation (31,937) Deferred outflows of resources related to pensions is not available during the current period and therefore is not reported in the funds. Change in deferred outflows of resources related to pensions (13,534) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. (2,753) Deferred inflows of resources related to pensions is not incurred during the current period and therefore is not reported in the funds. Change in deferred inflows of resources related to pensions (4,650) Long-term Debt Repayment of general obligation, debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position. Repayment of long-term debt Change in net pension liability Compensated absences reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. 9,136 15,632 (6,277) Change in net position of governmental activities $ (51,224) The notes to the financial statements are an integral part of the basic financial statements. 9

14 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL GENERAL FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Budgeted Amounts Variance with Original Final Actual Final Budget Revenues: Taxes Property taxes $ 119,731 $ 119,731 $ 113,967 $ (5,764) Sales tax 95,000 95, ,630 9,630 Automobile 33,000 33,000 33, Franchise 70,000 70,000 77,165 7,165 Insurance premium 60,000 60,000 62,726 2,726 Other taxes 45,500 45,500 45, Licenses and permits 28,000 28,000 29,024 1,024 Intergovernmental 67,000 67,000 43,288 (23,712) Fines and forfeitures 78,150 78,150 56,069 (22,081) Charges for services 46,000 46,000 39,937 (6,063) Miscellaneous 1,000 1, (927) Total Revenue 643, , ,414 (36,967) Expenditures: Current: General government Legislative 3,000 3,000 3,000 - Executive 3,200 4,407 4,407 - Administrative 93, , ,871 - Public safety Police department 329, , ,105 - Fire department 4,300 4,300 3, Public works Streets 177, , ,351 33,649 Garbage 33,000 33,000 29,052 3,948 Total Expenditures 643, , ,576 38,107 Excess of Revenue Over (Under) Expenditure - (81,302) (80,162) 1,140 Other Financing Sources (Uses): Transfer to Law Enforcement Confiscation Fund - (200) (200) - Proceeds from sale of property - - 4,952 4,952 Total Other Financing Sources (Uses) - (200) 4,752 4,952 Net change in fund balance - (81,502) (75,410) 6,092 Fund balance, beginning of year 70,665 70,665 70,665 - Fund balance (deficit), end of year $ 70,665 $ (10,837) $ (4,745) $ 6,092 The notes to the financial statements are an integral part of the basic financial statements. 10

15 STATEMENT OF NET POSITION PROPRIETARY FUNDS SEPTEMBER 30, 2017 Business-type Activities- Enterprise Funds Water & Sewer Fund ASSETS Current assets: Cash and cash equivalents $ 132,993 Certificate of deposit 38,276 Restricted cash and cash equivalents: Sinking fund 33,850 Accounts receivable, net of allowance 33,986 Due from other funds 64 Due from other governments 104,683 Total current assets 343,852 Long-term assets: Capital assets: Nondepreciable 803,671 Depreciable, net 3,343,923 Total capital assets, net 4,147,594 Total long-term assets 4,147,594 Total Assets 4,491,446 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows of resources related to pensions $ 3,193 The notes to the financial statements are an integral part of the basic financial statements. PAGE 1 OF 2 11

16 STATEMENT OF NET POSITION PROPRIETARY FUNDS SEPTEMBER 30, 2017 (CONTINUED) Business-type Activities- Enterprise Funds Water & Sewer Fund LIABILITIES Current liabilities: Accounts payable $ 117,547 Retainage payable 10,858 Accrued interest payable 4,658 Accrued salaries 1,944 Due to other funds 88,903 Notes payable - current 25,753 Bonds payable - current 13,000 Total current liabilities 262,663 Long-term liabilities: Customer deposits 31,140 Notes payable 547,788 Bonds payable 58,000 Net pension liability 11,283 Total long-term liabilities 648,211 Total Liabilities 910,874 DEFERRED INFLOWS OF RESOURCES Deferred inflows of resources related to pensions 676 NET POSITION Net investment in capital assets 3,503,053 Restricted for debt retirement 33,850 Unrestricted 46,186 Total Net Position $ 3,583,089 The notes to the financial statements are an integral part of the basic financial statements. PAGE 2 OF 2 12

17 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION PROPRIETARY FUNDS FOR THE YEAR ENDED SEPTEMBER 30, 2017 Business-type Activities- Enterprise Funds Water & Sewer Fund Operating revenues: Charges and fees $ 408,163 Total operating revenues 408,163 Operating expenses: Salaries and benefits 111,832 Professional services 7,554 Operating materials 27,449 Other operating expenses 27,357 Repairs and maintenance 76,904 Utilities 69,657 Depreciation 116,727 Total operating expenses 437,480 Operating income (loss) (29,317) Nonoperating revenues (expenses): Interest income 304 Intergovernmental 286,000 Interest expense (17,904) Total nonoperating revenues (expenses) 268,400 Income (loss) before contributions and transfers 239,083 Capital contributions 6,900 Change in net position 245,983 Total Net Position - Beginning of Year 3,337,106 Total Net Position - Ending of Year $ 3,583,089 The notes to the financial statements are an integral part of the basic financial statements. 13

18 STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED SEPTEMBER 30, 2017 Business-type Activities- Enterprise Funds Water & Sewer Fund Cash Flows from Operating Activities: Cash received from customers $ 420,113 Cash paid to suppliers for goods and services (77,962) Cash paid to employees (126,164) Net Cash Flows Provided by (Used for) Operating Activities 215,987 Cash Flows from Capital and Related Financing Activities: Principal payments on debt (26,654) Proceeds from capital grants 181,317 Proceeds from issuance of debt 429,000 Capital contributed 6,900 Interest and fiscal charges on debt (18,105) Purchases of capital assets (815,928) Net Cash Flows Provided by (Used for) Capital and Related Financing Activities (243,470) Net Increase (Decrease) in Cash and Cash Equivalents (27,483) Cash and Cash Equivalents, Beginning of Year 194,326 Cash and Cash Equivalents, End of Year $ 166,843 The notes to the financial statements are an integral part of the basic financial statements. PAGE 1 OF 2 14

19 STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED SEPTEMBER 30, 2017 (CONTINUED) Business-type Activities- Enterprise Funds Water & Sewer Fund Classified as: Current assets $ 132,993 Restricted assets 33,850 Total Cash and Cash Equivalents $ 166,843 Reconciliation of Net Operating Income (Loss) to Net Cash Provided by (Used for) Operating Activities Net Operating Income (Loss) $ (29,317) Adjustments to Reconcile Net Operating Income (Loss) to Net Cash Provided by (Used for) Operating Activities: Depreciation 116,727 Changes in Assets and Liabilities: (Increase) decrease in accounts receivable 9,204 (Increase) decrease in due from other funds (64) (Increase) decrease in deferred outflows of resources 8,594 Increase (decrease) in accounts payable 62,579 Increase (decrease) in retainage payable 10,858 Increase (decrease) in accrued salaries (49) Increase (decrease) in customer deposits 2,746 Increase (decrease) in due to other funds 57,586 Increase (decrease) in net pension liability (22,820) Increase (decrease) in deferred inflows of resources (57) Total Adjustments 245,304 Net Cash Provided by (Used for) Operating Activities $ 215,987 The notes to the financial statements are an integral part of the basic financial statements. PAGE 2 OF 2 15

20 NOTES TO THE FINANCIAL STATEMENTS

21 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies The City of Roberta was incorporated as a City by an Act of the General Assembly of Georgia in The City operates under a mayor-council form of government and provides the following services as authorized by its charter: public safety, highways and streets, sanitation, recreation, water and sewerage and general administrative services. The accounting policies of the City of Roberta, Georgia conform to generally accepted accounting principles as applicable to governments. The following is a summary of the City's more significant policies applied in the preparation of the accompanying financial statements. A. Reporting Entity As required by generally accepted accounting principles, the financial statements of the reporting entity include those of the City of Roberta (the primary government) and any component units. A component unit is a legally separate organization for which the elected officials of the primary government are financially accountable. In addition, a component unit can be another organization for which the nature and significance of its relationship with a primary government is such that exclusion would cause the reporting entity's financial statements to be misleading or incomplete. In conformity with generally accepted accounting principles, as set forth in Statement of Governmental Accounting Standards Board (GASB) No. 61 The Financial Reporting Entity: Omnibus, an amendment of GASB Statements No. 14 and 34, the City s relationships with other governments and agencies have been examined. As a result, no component units were identified which should be included in the reporting entity. Related Organizations Housing Authority of the City of Roberta The Mayor of Roberta appoints the five-member Board of Commissioners of the Authority to five-year terms. The City provides no financial support to the Authority and is not responsible for the debts or entitled to the surpluses of the Authority. The Authority designates its own management and has power to approve its own budget and maintain its own accounting system. Although the City of Roberta appoints the governing board of the Authority, no other criteria exists for the inclusion of the Authority in the financial reports of the City of Roberta. The Housing Authority of the City of Roberta pays the City of Roberta payments in lieu of taxes, which is based on specific formula. Under Georgia law, the City of Roberta, Georgia, in conjunction with other cities and counties in the twelve-county Middle Georgia area, is a member of the Middle Georgia Regional Commission (RC) and is required to pay annual dues thereto. Membership in a RC is required by the Official Code of Georgia Annotated (OCGA) Section which 16

22 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) provides for the organizational structure of the RC in Georgia. The RC Board membership includes the chief elected official of each city and municipality of the area. OCGA provides that the member governments are liable for any debts or obligations of an RC. Separate financial statements may be obtained from: Middle Georgia Regional Commission 175 Emery Highway Macon, Georgia B. Government-Wide and Fund Financial Statements The government-wide financial statements (Statement of Net Position and Statement of Activities) report information on all of the primary government activities and its component units if any. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. Likewise, the primary government is reported separately from certain legally separate component units for which the primary government is financially accountable. The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation Government-Wide Financial Statements The government-wide financial statements are reported using the flow of economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. As a general rule the effect of interfund activity has been eliminated from the governmentwide financial statements. Exceptions to this general rule are payments-in-lieu of taxes where the amounts are reasonably equivalent in value to the interfund services provided and other charges between the government s public utilities and various other functions of the 17

23 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) government. Elimination of these charges would distort the direct cost and program revenues reported for the various functions concerned. Amounts reported as program revenues include 1) charges to customers or applicants for goods, services or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions. Internally dedicated resources are reported as general revenues rather than as program revenues. Fund Financial Statements Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt services expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Property taxes, local option sales taxes, other taxes, intergovernmental revenues, interest, and charges for services associated with the current fiscal period are all considered susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenues are considered to be measurable and available only when cash is received by the government. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services in connection with a proprietary fund s principal ongoing operations. The principal operating revenue of the City s enterprise fund is charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. The fund financial statements provide more detailed information about the government s most significant funds, not the government as a whole. The activities of the government are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures, or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. 18

24 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) The government reports the following major governmental funds: General Fund The General Fund is the government s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. Special Local Option Sales Tax 2013 The Special Local Option Sales Tax 2013 Fund is used to account for the City s public safety and water and sewer projects based on the 1 cent special local option sales tax approved by the voters of the City of Roberta. Cemetery Trust Fund The Cemetery Trust Fund is used to account for donations and sales of lots and the maintenance and upkeep and preservation of the grounds and graves in the Roberta cemetery. The government reports the following major proprietary funds: Enterprise Funds The Water & Sewer Fund accounts for the activities of the water and sewer distribution system. Additionally, the government reports the following fund types: Special Revenue Funds Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than special assessments, expendable trusts, or major capital projects) that are legally restricted to expenditures for specified purposes. Capital Projects Funds Capital Project Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities, other than those financed by proprietary funds. D. Deposits and Investments The government s cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. Investments are reported at fair value, which is determined using selected bases. Short-term investments are reported at cost, which approximates fair value. Securities traded on national or international exchanges are valued at the last reported sales price at current exchange rates, and investments that do not have an established market are reported at estimated fair value. Cash deposits are reported at carrying amount, which reasonably estimates fair value. E. Receivables Receivables and Due from Other Governments represent funds to be received from other local governments, state grant-in-aid, state contracts, or federal funds. No allowance is deemed necessary for these receivables. 19

25 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the year are referred to as either due to/from other funds or advances to/from other funds. All other outstanding balances between funds are reported as due to/from other funds. Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as internal balances. All trade and property tax receivables, have been reduced to their estimated net realizable value, and are shown net of an allowance for doubtful accounts. Estimated uncollectible amounts are based upon historical experience rates. F. Inventories Inventories of expendable supplies held for consumption are not considered material and are recorded as expenditures, or expenses, as appropriate, when purchased. G. Prepaid Items Payments made to vendors for services that will benefit periods beyond September 30, 2017, are recorded as prepaid items using the consumption method by reporting an asset for the prepaid amount and reflecting the expenditure/expense in the year in which services are consumed. At the fund reporting level, an equal amount of fund balance is reserved, as this amount is not available for general appropriation. H. Restricted Assets Certain resources of the enterprise fund debt repayment are classified as restricted assets on the balance sheet because their use is limited by management s discretion. I. Capital Assets Capital assets, which include property, plant, equipment and infrastructure assets (e.g. roads, bridges, curbs, streets, sidewalks and similar items acquired subsequent to January 1, 2004) are reported in the applicable governmental or business-type activities column in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of two years. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation. General infrastructure assets acquired prior to January 1, 2004 are not reported in the basic financial statements. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized in proprietary funds as projects are constructed. Interest incurred during the construction phase is reflected in the 20

26 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) capitalized value of the asset constructed, net of interest earned on the invested proceeds over the same period. Capital assets of the primary government are depreciated using the straight line method over the following estimated useful lives: Water system Sewer system Tank Buildings and improvements Machinery and equipment Vehicles Infrastructure years years 50 years 5-50 years 3-20 years 3-25 years 50 years J. Compensated Absences It is the City s policy to permit employees to accumulate unused vacation and sick pay benefits. There is no liability for unpaid accumulated sick leave since the government does not have a policy to pay any amounts when employees separate from service with the government. All vacation pay is accrued when incurred in the government-wide and proprietary fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements. K. Deferred Outflows/Inflows of Resources In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period or periods and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has one item that qualifies for reporting in this category. The item is the deferred outflow of resources relative to the pension plans change in assumptions. This amount is deferred and will be recognized as a reduction of the net pension liability in future years. In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period or periods and so will not be recognized as an inflow of resources (revenue) until that time. The City has two types of items, which arises under a modified accrual basis of accounting that qualifies for reporting in this category. This first item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from one source, property taxes. This amount is deferred and recognized as an inflow of resources in the period that the amounts become available. The second item is the deferred inflow of resources relative to the differences between expected and actual experience and the net difference between projected and actual earnings on the pension plan investments. This amount is deferred and will be recognized as a reduction of the net pension liability in future years. 21

27 L. Net Position Flow Assumption NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Sometimes the City will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted - net position and unrestricted - net position in the government-wide and proprietary fund financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the City s policy to consider restricted - net position to have been depleted before unrestricted - net position is applied. M. Long-Term Obligations In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities or proprietary fund type statement of net assets. Bond premiums and discounts are amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. In the fund financial statements, governmental fund types recognize bond premiums and discounts during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. N. Fund Equity In the fund financial statements, governmental funds report the following classifications of fund balance: Nonspendable amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. Restricted amounts are restricted when constraints have been placed on the use of resources by (a) externally imposed by creditors, grantors, contributors or laws or regulations of other governments or (b) imposed by law through constitutional provisions or enabling legislation. Committed amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the City Council through adoption of a resolution. The City Council also may modify or rescind the commitment. Assigned amounts that are constrained by the City Council s intent to be used for specific purposes, but are neither restricted nor committed. By resolution, the City Council has authorized the Mayor or City Clerk or designee to assign fund balances. Unassigned amounts that have not been assigned to other funds and that are not restricted, committed or assigned to specific purposes within the General Fund. The General Fund is the only fund that reports a positive unassigned fund balance. 22

28 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Flow Assumptions when both restricted and unrestricted amounts of fund balance are available for use for expenditures incurred, it is the City s policy to use restricted amounts first and then unrestricted amounts as they are needed. For unrestricted amounts of fund balance, it is the City s policy to use fund balance in the following order: Committed Assigned Unassigned The City does not have a formal minimum fund balance policy. The following is a summary of the fund balance classifications as of September 30, 2017: Fund Balances: Restricted for: Perpetual care - General SPLOST 2013 Cemetery Nonmajor Fund Fund Trust Fund Governmental Total $ $ - $ 800,655 $ - $ 800,655 Capital outlay - 167,490-16, ,463 Unassigned (4,745) - - (249) (4,994) Total fund balances $ (4,745) $ 167,490 $ 800,655 $ 16,724 $ 980,124 O. Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to, or destruction of assets; and errors or omissions. The City purchases commercial insurance for most types of risk. For these risks, settlements have not exceeded coverage s for each of the past three years. The City had no significant reduction in insurance coverage from coverage in the prior year. NOTE 2 STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY Budget Process The annual budget document is the financial plan for the operation of the City of Roberta. The budget process exists for the purpose of providing a professional management approach to the establishment of priorities and the implementation of work programs while providing an orderly means for control and evaluation of the financial posture of the City. Annual budgets are adopted on a basis consistent with generally accepted accounting principles for the general fund. All annual appropriations lapse at fiscal year-end. Budgets are prepared for Capital Projects Funds on a project-length basis, which usually covers two or more fiscal years. Proprietary Fund budgets are prepared and utilized as a management tool to assess the operations of the Water and Sewer Fund. Legal provisions, including the City Charter and the Georgia Fiscal Standards Act, govern the budgetary process. In 23

29 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) addition, many administrative policies are incorporated into the budgetary process in order to assure that the budget is a management plan for the budget year. The City s charter states that the Mayor shall prepare and present to the Council at its first meeting in March of each year, a proposed budget, a capital improvements program, and a capital budget, including requirements as to scope, content and form of such budgets and programs. The City Council shall at the next regular meeting thereafter accept and adopt said proposed budgets and programs. If the proposed budgets are rejected, the Council shall submit an amended or substitute proposal for said budgets at a special meeting called for that purpose within two weeks of the date of rejection. The Mayor is authorized to transfer budget amounts between expenditure characters within individual departments for each fund. Transfers between departments or revisions, which increase total expenditures of a Fund must be approved by City Council. The legal level of budgetary control for the General Fund is at the department level. Unencumbered appropriations in the annual operating budget lapse at year-end. No supplemental appropriations were approved by City Council during the current year. Deficit Fund Balance The General Fund had a deficit fund balance of $4,745. The City plans to eliminate the deficit with future revenues. NOTE 3 DEPOSITS AND INVESTMENTS Custodial credit risk deposits The custodial credit risk for deposits is the risk that in the event of a bank failure, the City s deposits may not be recovered. State statues require banks holding public funds to secure these funds by FDIC insurance, securities pledged at par value, and surety bonds at face value in combined aggregate totaling not less than 110 percent of the public funds held. The City s Cemetery Trust Fund had deposit accounts which were under collateralized by $223,870 as of September 30, At September 30, 2017, the City s certificates of deposit were as follows: Investment Maturity Amount Certificate of deposit - Cemetery Trust Fund 1-6 months $ 250,000 Certificate of deposit - Cemetery Trust Fund 1-5 years 223,870 Certificate of deposit - Cemetery Trust Fund 1-6 months 250,000 Certificate of deposit - Water & Sewer Fund 7-12 months $ 38, ,146 24

30 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Interest rate risk The City does not have a formal investment policy that limits investment maturities as a means of managing its exposure fair value losses arising from increasing interest rates. Credit risk Georgia law authorizes the City to invest in the following types of obligations: obligations of the State of Georgia or any other states; obligations issued by the U.S. government; obligations fully insured or guaranteed by the U.S. government or by a government agency of the United States; prime bankers acceptance; the local government investment pool established by state law; repurchase agreements; and obligations of other political subdivisions of the State of Georgia. At September 30, 2017, the City s only investments were in certificates of deposit. NOTE 4 PROPERTY TAXES State law requires that property taxes be based on assessed value, which is 40% of market value. All real and personal property (including motor vehicles) is valued as of January 1 of each year and must be returned for tax purposes by March 1. With the exception of motor vehicles and the property of public utilities, which are valued by the State Revenue Department, all assessments are made by the Crawford County Board of Tax Assessors. Upon completion of all assessments and tax returns, the information is compiled to form the tax digest. The completed tax digest must be submitted to the State Revenue Commissioner for approval. The State Revenue Commissioner must ascertain that real property on the tax digest has been assessed at the state mandated forty percent (40%) of fair market value. The Commissioner has the option to withhold certain state funding if the mandated 40% level is not reached. Property taxes are levied each year based on assessed values determined the previous January 1. The Mayor and Council officially set the mill rates each year. Property taxes attach an enforceable lien on property as of June 30 th of the following year. Judicial property sales are commenced during June and July of the following year. The property tax calendar is as follows: Real/Personal Property (Excluding Vehicles) Motor Vehicles Assessment date January 1 January 1 Levy date November 15 January 1 Due date and collection date January 20 Staggered Lien date June 20 N/A Property taxes receivable have been reduced to their estimated net realizable value. Estimated uncollectible amounts are based upon historical experience rates and result in a direct reduction of the related revenue amount at the end of the period. 25

31 NOTE 5 RECEIVABLES NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Receivables as of year-end for the government s individual major funds in the aggregate, including the applicable allowances for uncollectible accounts, are as follows: Receivables: Nonmajor Water & General SPLOST 2013 Governmental Sewer Total Taxes $ 2,770 $ - $ - $ - $ 2,770 Accounts 7, ,619 59,210 Intergovernmental 15,335 6,477 4, , ,137 Gross Receivables 25,696 6,477 4, , ,117 Less: allowance for uncollectibles (1,801) - - (17,633) (19,434) Total net receivables $ 23,895 $ 6,477 $ 4,642 $ 138,669 $ 173,683 NOTE 6 INTERFUND RECEIVABLES AND PAYABLES The composition of interfund balances as of September 30, 2017, is as follows: Receivable Fund Payable Fund Amount General Fund Water & Sewer Fund $ 31,044 Non-Major Governmental 312 SPLOST 2013 Fund General Fund 5,490 Water & Sewer Fund 57,859 Water & Sewer Fund Non-Major Governmental 64 $ 94,769 The outstanding balances between funds result mainly from the time lag between the dates that (1) interfund goods and services are provided or reimbursable expenditures occur, (2) transactions are recorded in the accounting system, and (3) payments between funds are made. 26

32 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Interfund transfers: Transfer In: Non-Major Governmental Transfer Out: General Fund $ 200 Total $ 200 Transfers are used to move unrestricted revenue to finance various programs that the government must account for in other funds in accordance with budgetary authorizations, including amounts provided as subsidies or matching funds for various grant programs. NOTE 7 CAPITAL ASSETS Governmental activities: Beginning Ending Balance Increase Decrease Balance Capital assets, not being depreciated: Land $ 56,342 $ - $ - $ 56,342 Total capital assets, not being depreciated 56, ,342 Capital assets, being depreciated: Buildings and improvements 685, ,439 Infrastructure 357, ,699 Vehicles 221, ,322 Equipment 186, ,899 Total capital assets, being depreciated 1,451, ,451,359 Less accumulated depreciation for: Buildings and improvements (212,060) (18,051) - (230,111) Infrastructure (85,231) (7,154) - (92,385) Vehicles (221,322) - - (221,322) Equipment (167,038) (6,732) - (173,770) Total accumulated depreciation (685,651) (31,937) - (717,588) Total capital assets, being depreciated, net 765,708 (31,937) - 733,771 Net investment in capital assets $ 822,050 $ (31,937) $ - $ 790,113 27

33 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Business-type activities: Beginning Ending Balance Increase Decrease Balance Capital assets, not being depreciated: Land $ 11,450 $ - $ - $ 11,450 Construction in progress 59, , ,221 Total capital assets, not being depreciated 70, , ,671 Capital assets, being depreciated: Buildings 5, ,000 Tank 75, ,000 Machinery 54,871 82, ,803 Water system 2,754, ,754,402 Sewer system 2,944, ,944,586 Total capital assets, being depreciated 5,833,859 82,932-5,916,791 Less accumulated depreciation for: Buildings (5,000) - - (5,000) Tank (75,000) - - (75,000) Machinery (54,873) (4,307) - (59,180) Water system (1,151,624) (51,113) - (1,202,737) Sewer system (1,169,644) (61,307) - (1,230,951) Total accumulated depreciation (2,456,141) (116,727) - (2,572,868) Total capital assets, being depreciated, net 3,377,718 (33,795) - 3,343,923 Net investment in capital assets $ 3,448,393 $ 699,201 $ - $ 4,147,594 Less related long term debt outstanding (644,541) Net investment in capital assets $ 3,503,053 Depreciation expense was charged to functions / programs of the primary government as follows: Governmental activities: General government $ 15,063 Public safety 7,903 Public works 8,971 Total depreciation expense - governmental activities $ 31,937 Business-type activities: Water and sewer $ 116,727 Total depreciation expense - business-type activities $ 116,727 28

34 NOTE 8 LONG-TERM DEBT Changes in long-term liabilities NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Long-term liability activity for the fiscal year ended September 30, 2017, was as follows: Beginning Ending Due Within Balance Additions Reductions Balance One Year Governmental activities: Compensated absences $ 4,227 $ 6,580 $ (303) $ 10,504 $ 10,504 USDA loan 9,136 - (9,136) - - Net pension liability 145,384 - (15,632) 129,752 - Governmental activity long-term liabilities $ 158,747 $ 6,580 $ (25,071) $ 140,256 $ 10,504 Business-type activities: GEFA 2004 loan $ 158,195 $ - $ (13,654) $ 144,541 $ 14,185 GEFA loan - 429, ,000 11, bonds 84,000 - (13,000) 71,000 13,000 Net pension liability 34,103 - (22,820) 11,283 - Business-type activity long-term liabilities $ 276,298 $ 429,000 $ (49,474) $ 655,824 $ 38,753 For the governmental activities, compensated absences and net pension liability are generally liquidated by the general fund. For business-type activities, compensated absences and net pension liability are liquidated by the water and sewer fund. USDA Loan Purpose of Debt: To purchase two patrol cars. In 2012, the City obtained a $42,720 loan from the United States Department of Agriculture (USDA) to purchase two patrol cars. The loan is due in five annual installments of $9,463, including interest at 3.50%. The note holds the two police cars as collateral. The note was paid off in Notes Payable Purpose of Debt: To construct and improve the water, sewer and solid waste management facilities of City of Roberta. In 2006, the City entered into a contract with the Georgia Environmental Facilities Authority for a State Revolving Loan Fund loan to provide financing for the improvement of water, sewer and sold waste management facilities. The total proceeds for the loan were $271,838, due in 240 monthly installments of $1,622, including interest at 3.82%. 29

35 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) On October 25, 2016 the City entered into a contract with the Georgia Environmental Facilities Authority for a Drinking Water State Revolving Loan Fund grant/loan to provide financing for the decommissioning of an elevated tank, construction of water main, installation of pressure reducing valves, replacement of water meters, upgrades to the telemetry system and all related appurtenances. The City may draw down funds up to $725,000, of which 40% is forgivable. As of September 30, 2017, $715,000 has been drawn down. $429,000 is the loan portion and is payable to Georgia Environmental Finance Authority. Interest is at 1.49%. Principal payments will begin after the final draw has been made. Revenue Bonds: Revenue bonds payable as of September 30, 2017, are comprised of the following issue: $277,000 Water and Sewerage Revenue Bonds Series through Farmers Home Administration due in various annual installments through January 1, 2022, interest at 5.0% annum $ 71,000 Classified as current (13,000) Long-term debt $ 58,000 The bonds are secured by a pledge of revenues from the operation of the City s Water and Sewerage Fund subject to payment of the reasonable and necessary costs of operating and maintaining the fund s facilities and systems. The bonds were issued to provide funds for paying the costs of acquiring, constructing and equipping additions, extensions and improvements to the existing water and sewerage system. Annual debt service requirements to maturity for these notes payable and bonds are as follows: Years Ending GEFA 2004-L17WS GEFA Bonds September 30 Principal Interest Principal Interest Principal Interest 2018 $ 14,185 $ 5,274 $ 11,568 $ 6,410 $ 13,000 $ 3, ,736 4,723 20,066 6,545 14,000 2, ,309 4,150 20,367 6,244 14,000 2, ,904 3,555 20,673 5,938 15,000 2, ,522 2,937 20,983 5,628 15,000 1, ,885 5, ,731 23, ,213 14, ,399 5, Total $ 144,541 $ 25,725 $ 429,000 $ 74,595 $ 71,000 $ 12,400 30

36 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Restricted Assets The balances of the restricted asset accounts in the Water & Sewer enterprise fund are as follows: Sinking fund $ 33,850 NOTE 9 EMPLOYEE RETIREMENT PLANS Georgia Municipal Employees Benefit System Plan Description The City contributes to the Georgia Municipal Employees Benefit System (the system), an agent multiple-employer public employee retirement system administered by the Georgia Municipal Association. The City of Roberta Retirement Plan is a defined benefit plan that provides retirement and disability benefits and death benefits to plan members and beneficiaries. The Public Retirement Systems Standard Law (Georgia Code Section ) assigned the authority to establish and amend the plan to the City of Roberta. The Georgia Municipal Employees Benefit System issues a publicly available financial report that includes financial statements and required supplementary information for the System. The report may be obtained by writing to the Georgia Municipal Employees Benefit System, 201 Pryor Street S.W., Atlanta, Georgia Benefits Provided The GMEBS Plan provides retirement, disability and death benefits to plan members and beneficiaries. Effective January 1, 2015, the Plan was amended to provide for immediate participation for employees. This change has no impact on service credited under the Plan and has no impact on benefits. Employees Covered by the Plan Contributions Inactive employees (or their beneficiaries) currently receiving benefits 7 Inactive employees entitled to but not yet receiving benefits 5 Active employees 11 The plan members are not required to contribute to the plan. The City is required to contribute at an actuarially determined rate; the current rate is 11.02% of annual covered payroll. The contribution requirements of the City are established and may be amended by the GMEBS Board of Trustees. Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At September 30, 2017, the City reported a net pension liability. The net pension liability was measured as of September 30, The total pension liability used to calculate the net pension liability was based on an actuarial valuation as of January 1, An expected total pension liability as of September 30, 2016 was determined using standard roll-forward techniques. 31

37 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) For the year ended September 30, 2017, the City recognized pension expense relative to GMEBS in the amount of $25,389. At September 30, 2017, the City reported deferred outflows of resources and deferred inflows of resources related to the Pension from the following sources: Deferred Outflows of Resources Deferred Inflows of Resources Differences between expected and actual experience $ 5,044 $ 4,938 Changes of assumptions - 1,928 Net difference between projected and actual earnings on pension plan investments - 1,583 Employer contributions subsequent to the measurement date 34,866 - $ 39,910 $ 8,449 City contributions subsequent to the measurement date of $34,866 are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ended September 30, Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year ended September 30: 2018 $ (2,170) 2019 (778) , (4,958) Actuarial Assumptions: The total pension liability as of September 30, 2017 was determined by an actuarial valuation as of January 1, 2017 using the following actuarial assumptions, applied to all periods included in the measurement: Inflation 3.25% Salary increase %, including inflation adjustment Investment rate of return 7.75%, On-going basis, based on long-term expected rate of return of pension plan investments Mortality rates were based on the RP-2000 Combined Mortality Table with sex-distinct rates, set forward two years for males and one year for females, and the RP-2000 Disabled Mortality Table with sex-distinct rates. The mortality and economic actuarial assumptions used in the January 1, 2017 valuation were based on the results of an actuarial experience study for the period January 1, 2010 to June 30,

38 Net Pension Liability: NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) Total Pension Fiduciary Net Pension Changes in the Net Pension Liability: Liability Net Position Liability Balances at September 30, 2016 $ 904,652 $ 725,165 $ 179,487 Changes for the year: Service cost 11,870-11,870 Interest 68,110-68,110 Differences between expected and actual experience (7,407) - (7,407) Contributions - employer - 33,814 (33,814) Net investment income - 80,186 (80,186) Benefit payments (51,637) (51,637) - Administrative expense - (2,975) 2,975 Net changes 20,936 59,388 (38,452) Balance at September 30, 2017 $ 925,588 $ 784,553 $ 141,035 The City s net pension liability is recorded in the Government-Wide, Statement of Net Position and in the Water and Sewer Fund, Statement of Net Position in the amounts of $129,752 and $11,283, respectively. The long-term expected rate of return on pension plan investments was determined using a buildingblock method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighing the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan s target asset allocation as of September 30, 2016 are summarized in the following table: Long-Term Target Expected Real Asset Class Allocation Rate of Return Domestic equity 45% 6.75% International equity 20% 7.45% Real estate 10% 4.55% Global fixed income 5% 3.30% Domestic fixed income 20% 1.75% Cash 0% Total 100% Discount Rate: The discount rate used to measure the total pension liability was 7.75%. The projection of cash flows used to determine the discount rate assumed that employer contributions will be made at the actuarially determined contribution rates. Based on those assumptions, the pension 33

39 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) plan s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the Net Pension Liability to Changes in the Discount rate: The following presents the City s net pension liability calculated using the discount rate of 7.75%, as well as what the City s net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (6.75%) or 1-percentage-point higher (8.75%) than the current rate: 1% Current 1% Decrease Discount Rate Increase (6.75%) (7.75%) (8.75%) Sensitivity of the Net Pension Liability to Changes in the Discount Rate $ 222,975 $ 141,035 $ 70,104 Pension plan fiduciary net position: Detailed information about the pension plan s fiduciary net position is available in the separately issued GMEBS financial report which is publically available at Special Funding Defined Benefit Pension Plans The City s policemen are also covered by the State of Georgia Peace Officers Annuity and Benefit Fund. The City makes no contribution to this plan. Contributions are collected by the City as the agent for this fund through its municipal court system. This plan is administered through the Peace Officers Annuity and Benefit Fund of Georgia located at 1210 Greenbelt Parkway in Griffin, Georgia where separate financial statements may be obtained. This plan is considered immaterial to the City s financial statements. NOTE 10 CONTINGENT LIABILITIES A. Litigation The City is involved in several pending lawsuits. Liability, if any, which might result from these proceedings, would not, in the opinion of management and legal counsel, have a material adverse effect on the financial position of the City. B. Grants Amounts received or receivable from grant agencies are subject to audit and adjustment by grantor agencies, principally the federal government. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amounts, if any, of expenditures that may be disallowed by the grantor cannot be determined at this time, although the government expects such amounts, if any, to be immaterial. 34

40 NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2017 (CONTINUED) NOTE 11 EVALUATION OF SUBSEQUENT EVENTS The City has evaluated subsequent events through September 14, 2018 the date which the financial statements were available to be issued. In February 2018, the City obtained a loan for $45,000 and grant for $25,000 from USDA. The loan and grant funds are to be utilized to purchase two vehicles and equipment for the City s public works department. NOTE 12 PRIOR PERIOD ADJUSTMENT The City recorded a prior period adjustment of $795,985 to include a Cemetery Trust Fund that was not reported on the City s financial statements in previous years. The effects of this adjustment are as follows: Governmental Activities Net Position September 30, 2016, as previously stated $ 915,971 Cemetery Trust Fund 795,985 Net Position September 30, 2016, restated $ 1,711,956 Cemetery Trust Fund Fund Balance September 30, 2016, as previously stated $ - Cemetery Trust Fund 795,985 Fund Balance September 30, 2016, restated $ 795,985 35

41 REQUIRED SUPPLEMENTARY INFORMATION

42 REQUIRED SUPPLEMENTARY INFORMATION GEORGIA MUNICIPAL EMPLOYEES BENEFIT SYSTEM FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS Total Pension Liability Service cost $ 11,870 $ 12,605 $ 13,005 Interest 68,110 65,632 64,311 Differences between expected and actual experience (7,407) 9,016 2,143 Changes in assumptions - - (7,711) Benefit payments, including refunds of employee contributions (51,637) (58,938) (50,453) Net change in total pension liability 20,936 28,315 21,295 Total pension liability - beginning 904, , ,042 Total pension liability - ending $ 925,588 $ 904,652 $ 876,337 Plan Fiduciary Net Position Contributions - employer $ 33,814 $ 37,911 $ 31,115 Net investment income 80,186 9,150 77,573 Benefit payments, including refunds of employee contributions (51,637) (58,938) (50,453) Administrative expense (2,975) (3,605) (2,944) Net change in fiduciary net position 59,388 (15,482) 55,291 Plan fiduciary net position - beginning 725, , ,356 Plan fiduciary net position - ending $ 784,553 $ 725,165 $ 740,647 Net Pension Liability Net pension liability - ending $ 141,035 $ 179,487 $ 135,690 Plan's fiduciary net position as a percentage of the total pension liability 84.76% 80.16% 84.52% Covered-employee payroll $ 341,443 $ 308,806 $ 285,784 Net pension liability as a percentage of covered-employee payroll 41.31% 58.12% 47.48% Note: Schedule is intended to show information for the last 10 fiscal years. Additional years will be displayed as they become available. 36

43 REQUIRED SUPPLEMENTARY INFORMATION GEORGIA MUNICIPAL EMPLOYEES BENEFIT SYSTEM FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 SCHEDULE OF CONTRIBUTIONS Actuarially determined contribution $ 34,866 $ 33,814 $ 35,082 Contributions in relation to the actuarially determined contribution 34,866 31,560 37,911 Contribution deficiency (excess) $ - $ 2,254 $ (2,829) City's covered-employee payroll $ 341,443 $ 308,806 $ 285,784 Contributions as a percentage of covered-employee payroll 10.21% 10.95% 13.27% Note: Schedule is intended to show information for the last 10 fiscal years. Additional years will be displayed as they become available. 37

44 NOTES TO REQUIRED SUPPLEMENTARY INFORMATON FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Georgia Municipal Employee Benefit System Changes of assumptions: As a result of the new administrative fee structure approved by the Board, the administrative expense assumption was adopted for fiscal years beginning in Benefit Changes There were no changes in benefit provisions in the last two fiscal years. Valuation date The actuarially determined contribution rate was determined as of January 1, 2017, with an interest adjustment to the fiscal year. Contributions in relation to this actuarially determined contribution rate will be reported for the fiscal year ending September 30,

45 NOTES TO REQUIRED SUPPLEMENTARY INFORMATON FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 (CONTINUED) Methods and assumptions used to determine contribution rates: Actuarial cost method Amortization method Remaining amortization period Asset valuation method Actuarial Assumptions: Entry Age Normal Closed level dollar for the remaining unfunded liability Remaining amortization period varies for the bases, with a net effective amortization period of 10 years. Sum of actuarial value at beginning of year and the cash flow during the year plus the assumed investment return, adjusted by 10% of the amount that the value exceeds or is less than the market value at end of year. The actuarial value is adjusted, if necessary, to be within 20% of market value. Net Investment Rate of Return 7.75% Projected Salary Increases 3.25% plus service based merit increases Cost of Living Adjustments 0.00% Retirement Age Mortality Ages rate of 10%, age 60 rate of 20%, age 61 rate of 25%, age 62 rate of 35%, age 63 rate of 40%, age 64 rate of 45%, ages rate of 50% and age 70 and over rate of 100% RP-2000 Combined Healthy Mortality Table with sexdistinct rates, set forward two years for males and one year for females RP-2000 Disabled Retiree Mortality Table with sexdistinct rates. 39

46 SUPPLEMENTARY INFORMATION

47 NONMAJOR GOVERNMENTAL FUNDS SPECIAL REVENUE FUNDS SPECIAL REVENUE FUNDS are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt service or capital projects. LAW ENFORCEMENT CONFISCATION - to account for funds confiscated from criminal activity and their expenditures in compliance with State and Federal Laws. CAPITAL PROJECTS FUNDS CAPITAL PROJECTS FUNDS are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. CDBG - to account for the grant funds from the Community Development Block Grant and the related expenditures for water improvements. SPLOST to account for the City's public safety and water and sewer projects based on the 1 cent special local option sales tax approved by the voters of the City of Roberta.

48 COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS SEPTEMBER 30, 2017 Special Revenue Fund Law Total Nonmajor Enforcement CDBG SPLOST 2008 Governmental Confiscation Fund Fund Funds ASSETS Cash and cash equivalent $ 63 $ 64 $ 26,046 $ 26,173 Due from other governments - 4,642-4,642 Total Assets $ 63 $ 4,706 $ 26,046 $ 30,815 LIABILITIES AND FUND BALANCES Capital Projects Fund Liabilities: Accounts payable $ - $ 4,642 $ 9,073 $ 13,715 Due to other funds Total Liabilities 312 4,706 9,073 14,091 Fund Balances: Restricted ,973 16,973 Unassigned (249) - - (249) Total Fund Balances (249) - 16,973 16,724 Total Liabilities and Fund Balances $ 63 $ 4,706 $ 26,046 $ 30,815 40

49 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Special Revenue Fund Capital Projects Fund Law Total Nonmajor Enforcement CDBG SPLOST 2008 Governmental Confiscation Fund Fund Funds Revenues: Intergovernmental $ - $ 41,245 $ - $ 41,245 Fines and forfeitures 1, ,619 Total Revenues 1,619 41,245-42,864 Expenditures: Current: Public safety 2, ,461 Capital outlay - 41,245 9,073 50,318 Total Expenditures 2,461 41,245 9,073 52,779 Excess (Deficiency) of Revenues Over (Under) Expenditures (842) - (9,073) (9,915) Other Financing Sources (Uses): Transfers from other funds Total other financing sources (uses) Net change in fund balances (642) - (9,073) (9,715) Fund Balances, beginning of year ,046 26,439 Fund Balances (deficit), end of year $ (249) $ - $ 16,973 $ 16,724 41

50 LAW ENFORCEMENT CONFISCATION SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Final Variance with Budget Actual Final Budget Revenues: Fines and forfeitures $ - $ 1,619 $ 1,619 Total Revenues - 1,619 1,619 Expenditures: Current: Public safety 2,461 2,461 - Total Expenditures 2,461 2,461 - Excess (Deficiency) of Revenues Over (Under) Expenditures (2,461) (842) 1,619 Other Financing Sources (Uses): Transfers from General Fund Total Other Financing Sources (Uses) Net change in fund balance (2,461) (642) 1,819 Fund balance - beginning of year Fund balance - end of year $ (2,068) $ (249) $ 1,819 42

51 CiTY OF ROBERTA, GEORGIA COMMUNITY DEVELOPMENT BLOCK GRANT - WATER IMPROVEMENTS 16p-x PROJECT COST SCHEDULE FROM INCEPTION AND FOR THE YEAR ENDED SEPTEMBER 30, 2017 Prior Current Total to Project Years Year Date Authorization REVENUES Department of Community Affairs $ - $ 41,245 $ 41,245 $ 500,000 Total Revenues - 41,245 41, ,000 EXPENDITURES Contingencies - Unprogramed Funds ,200 Engineering - Water/Sewer Improvements - 24,995 24,995 28,600 Water Facilities ,200 Administration - 16,250 16,250 30,000 Total Expenditures - 41,245 41, ,000 Net change in fund balance Fund balance - beginning of year Fund balance - end of year $ - $ - $ - $ - 43

52 SCHEDULE OF PROJECTS CONSTRUCTED WITH SPECIAL SALES TAX PROCEEDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Original Expenditures 2008 Special Local Estimated Current Option Sales Tax Projects: Cost Prior Years Year Total Public safety and equipment $ 140,280 $ 135,733 $ - $ 135,733 Water and sewer upgrades 467, ,935 9, ,008 Totals $ 607,880 $ 420,668 $ 9,073 $ 429,741 Original Expenditures 2013 Special Local Estimated Current Option Sales Tax Projects: Cost Prior Years Year Total Public safety and equipment $ 210,000 $ - $ 9,567 $ 9,567 Water and wastewater 210, Totals $ 420,000 $ - $ 9,567 $ 9,567 44

53 SINGLE AUDIT SECTION

54 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 Federal Pass-Through Passed Federal Grantor/Pass-Through CFDA Entity Identifying Through to Federal Grantor/Program or Cluster Title Number Number Subrecipients Expenditures Environmental Protection Agency Passed through Georgia Environmental Finance Authority Drinking Water State Revolving Funds DWSRF ,000 Subtotal DWSRF Cluster CFDA ,000 Total Environmental Protection Agency - 715,000 Department of Housing and Urban Development Passed through Georgia Department of Community Affairs CDBG - Water Improvements p-x ,245 Total Department of Housing and Urban Development - 41,245 U.S. Department of Justice Direct: Public Safety Partnership and Community Policing Grant ,970 Total U.S. Department of Justice - 30,970 U.S. Department of Transportation Passed through Georgia Department of Public Safety Governor's Office of Highway Safety GA ,995 Total U.S. Department of Transportation - 1,995 Total Expenditures of Federal Awards $ - $ 789,210 See accompanying notes to schedule of expenditures of federal awards 45

55 NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 NOTE 1 BASIS OF PRESENTATION The accompanying Schedule of Expenditures of Federal Awards (the Schedule ) includes the federal award activity of the City of Roberta, Georgia under programs of the federal government for the fiscal year ended September 30, The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administration Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the City of Roberta, Georgia, it is not intended to and does not present the financial position, changes in net position or cash flows of the City of Roberta, Georgia. NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. NOTE 3 INDIRECT COST RATE The City of Roberta, Georgia has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. 46

56 CITY OF ROBERTA P.O. Box 278, 123 E. Agency St. Roberta, Georgia Jay Andrews, Mayor SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 FINANCIAL STATEMENT FINDINGS Accounts Receivable/Revenue Status: Unresolved. See current year finding Accounts Payable/Expenditures or Expenses Status: Unresolved. See current year finding COMPLIANCE FINDINGS Violation of Georgia Law Budget Adoption Procedures Special Revenue Fund Status: Resolved. FEDERAL AWARD FINDINGS AND QUESTIONED COSTS A Single Audit was not required for fiscal year ended September 30,

57 CITY OF ROBERTA P.O. Box 278, 123 E. Agency St. Roberta, Georgia Jay Andrews, Mayor CORRECTIVE ACTION PLAN FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2017 FINANCIAL STATEMENT FINDINGS Accounts Receivable/Revenue Name of Contact Person: Vikki Brown, City Clerk Recommendation: We recommend that the City develop procedures to insure the recording of revenues when they become both measurable and available to finance expenditures of the fiscal period. Corrective Action: The City concurs with the finding and will focus on properly recording accounts receivable as of the year-end. Anticipated Completion Date: September 30, Accounts Payable/Expenditures/Expenses Name of Contact Person: Vikki Brown, City Clerk Recommendation: The City should establish procedures to insure the proper accrual and classification of all liabilities incurred during the fiscal period. Corrective Action: The City concurs with the finding and will work toward developing adequate procedures to properly record and classify liabilities. Anticipated Completion Date: September 30,

58 CITY OF ROBERTA P.O. Box 278, 123 E. Agency St. Roberta, Georgia Jay Andrews, Mayor Capital Assets Name of Contact Person: Vikki Brown, City Clerk Recommendation: The City should establish procedures to ensure that the capital asset records are complete, accurate and properly recorded. Corrective Action: The City concurs with the finding. The City s consultant will be more involved in the capital assets for future years. Anticipated Completion Date: September 30, Control Procedures over the Preparation of the Schedule of Expenditures of Federal Awards (SEFA) Name of Contact Person: Vikki Brown, City Clerk Recommendation: We recommend that the City review the controls in place over the preparation of the SEFA. Additionally, individuals responsible for the preparation of the SEFA should have adequate training to insure compliance with grant provisions. Corrective Action: The City concurs with the finding. The City has not had a single audit in many years and will consider additional training for the upcoming year. Anticipated Completion Date: September 30, Prior Period Adjustment Cemetery Trust Fund Name of Contact Person: Vikki Brown, City Clerk Recommendation: No additional action is required. Corrective Action: The City concurs with the finding. The Cemetery Trust Fund is included in the City s financial reporting as of September 30, No further action is required. Anticipated Completion Date: September 30,

59 CITY OF ROBERTA P.O. Box 278, 123 E. Agency St. Roberta, Georgia Jay Andrews, Mayor COMPLIANCE FINDINGS Violation of Georgia Law SPLOST 2013 Fund Name of Contact Person: Vikki Brown, City Clerk Recommendation: The City should implement procedures to ensure restricted funds are not accessed to finance daily operations of the City and efforts be made to eliminate current amounts due to the SPLOST 2013 Fund. Corrective Action: The City concurs with the finding. The Water and Sewer Fund and General Fund have repaid the SPLOST 2013 Fund. Anticipated Completion Date: September 30,