HomeMy WebLinkAbout2006 Audit Review April 24, 2007 x :
City of
Oak Park Heights
IR
Minnesota
2
ay r
Rf"
e.
e
2006 Audit Review
April 24, 2007
f:
.w:
Tautges Redp
Member of NLB'tntemational ttl,
r
#i= Re Issued
3._ y
�a
I
4
E
{. uL
{1 L r
' V II � h' +f I �yy� luy 'f� {Itl� r� � K.
k
1 1
Y.
u
fil If V
kq
�
Member of FfLB tnt rrr i
e at oria ' Tutge� �ieedp�.
Annual Financial Report
The financial statements r
ae
the responsibility of
p Y
management
♦
Independent orts
auditor re p
on the fair presentation of
the financial statements
♦ "Clean opinion" n ion" on the p 2006
financial statements
Member of HLB'tntematrona!
3 Ta otb R
Annual Financial Report
=µ ♦ Statement of Activities
Program Revenues Net (Expense) Revenue and
Operating Capital Changes in Net Assets
Charges For Grants and Grants and Governmental Business-Type
Functions/Pro2rams Expenses Services Contributions Contributions Activities Activities Total
V
Governmental activities:
Y,': General government $987,597 $85,3 $ I 0
902,282) $ ($902,282)
Public safety 1,226,042 456,3 72 (697,629) (697,629)
Public works 755,989 1,819,396 1,599 40,397 1,105,403 1,105,403
Parks and recreation 152,899 1,004,240 425 125,000 976,766 976,766
Interest on long-term debt 43,965 - - - (43,965) (43,965)
Total governmental activities 3,166,492 3,365,283 74,105 165,397 438,293 0 438,293
Business-type activities:
Water 398,766 502,407 103,641 103,641
Sanitary sewer 661,367 767,207
105,840 105,840
Storm sewer 65,149 74,173 9,024 9,024
Sanitation 147,565 97,266 (50,299) (50,299)
Total business-type activities 1,272,847 1,441,053 0 0 0 168,206 168,206
Total $4,439,339 $4,806,336 $74,105 $165,397 438,293 168,206 606,499
General revenues:
General property taxes 2,417,014 2,417,014
Grants and contributions not
restricted to specific programs 29,838 - 29,838
Unrestricted investment earnings 425,160 49,037 474,197
Gain on sale of capital assets 244,099 244,099
Other 16,254 16,254
Transfers 101,917 (101,917)
Total general revenues and transfers 3,234,282 (52,880) 3,181,402
Change in net assets 3,672,575 115,326 3,787,901
Net assets - beginning 18,998,645 7,093,419 26,092,064
Net assets ending $22,671,220 $7,208,745 $29,879,965
Includes General Fund, Special Revenue, Debt Service and Capital Project Funds.
P
Member ofHL'6` Winai
Si
`f =# Minnesota
Legal Compliance Report
xT,. ♦
Required b v Minnesota Statute
§6.65
R V- 1 ♦ OSA established a task force to
rR
=je develop audit guide for legal
compliance
s
♦
Audit guide covers seven
categories
1) contracting and bidding
2) deposits and investments
3) conflicts of interest
y .
4) public indebtedness
5) claims and disbursement
6) other miscellaneous provisions
7) Tax increment
♦ No findings of non-compliance
Member of HLS lntemational 5 Uut 1 Redpi
Report on Internal Control
i
ag
♦ The 2006 Report is based on new
standards (SAS 112)
x . ♦ SAS 112 lowered the threshold for
reporting of internal control
p g
matters and re- defined internal
r:
control deficiencies
♦
Significant Deficiency defined a s
"a control deficiency that adversely affects
the entity's ability to initiate, authorize,
record, process, or report financial data
reliably in accordance with GAAP, such that
there is more than a remote likelihood that a
misstatement of an entity's financial
statements that is more than inconsequential
s= will not be prevented or detected"
g ..
♦ Three deficiencies reported
R �a Management Letter
+All Funds Summarv:
All Funds Financial Summary-2006
Increase
(Decrease) in Fund Balance/
Revenue Expenditures Fund Balance/ Net
and Other and Other Transfers Net Assets
Fund Sources Uses (Net) Assets 12/31/06
General $3,148,673 $2,401,234 ($548,680) $198,759 $2,302,502
Special Revenue Funds:
Forfeiture and Seizure 16,061 7,392 8,669 30,788
Economic Development 2,380 444 - 1,936 55,538
Debt Service Funds:
Bonds of 1998 520,565 167,812 55,000 407,753 512,829
Bonds of 2002 4,331 66,723 - (62,392) 47,315
Capital Project Funds:
Capital Revolving 277,597 12,452 - 265,145 723,527
Budgeted Projects and Equipment Revolving 239,369 271,507 332,900 300,762 1,033,981
Street Reconstruction 25,132 - 152,180 177,312 688,138
Brekke Park Memorial 113 - - 113 350
McKean Square 105 105 - - -
Oakgreen Avenue Utilities 140,504 204,456 63,952 - -
Water Tower Rental 25,631 - - 25,631 57,573
Park Development 1,038,374 628,036 - 410,338 769,057
Renewal and Replacement 117,872 - 165,517 283,389 2,928,984
Novak Avenue Street and Utility Improvements 797,689 797,689 - - -
Sanitary Sewer Connection 171,068 - (91,727) 79,341 476,280
Water Connection 435,155 - (9,625) 425,530 667,284
Storm Sewer Connection 295,818 126,099 (17,600) 152,119 882,414
Enterprise Funds:
Water 526,410 398,766 (99,021) 28,623 3,737,112
Sanitary Sewer 786,966 661,367 (88,096) 37,503 3,314,440
Storm Sewer 79,191 65,149 (3,300) 10,742 132,489
Sanitation 97,523 147,565 88,500 38,458 24,704
Total $8,746,527 $5,956,796 $0 $2,789,731 $18,385,305
2. � asy �• ..
. S RE�op
Member of j- 11.;B.lnterxa�l�n�ll- <" � � ��' � �� � w
a.� Management Letter
♦
Summary:
— General Fund:
�
• Fund balance increased $198,000
during 2006.
Budget Actual Variance
Revenue $2,927,781 $3,148,673 $220,892
Expenditures /transfers out 2,927,772 2,949,914 (22,142)
Increase (decrease) in fund balance $9 $198,759 $198,750
• Fund balance at December 31,
2006 was $2,302,000
' ;: �. .fit•• t.
Member of International'8 Tilt a
' t
x, Management Letter
Y } "a
i{
k§ Fund balance at December 31,
w.
2006 was sufficient to fulfill all city
policy reserve requirements.
General Fund Balance
December 31,
2005 2006
$ Designated for:
Cash flow $1,237,000 $1,409,000
Contingent employee benefits 141,533 169,633
General contingency 439,000 493,000
Subtotal - designated 1,817,533 2,071,633
Undesignated 286,210 230,869
Total fund balance $2,103,743 $2,302,502
WB tber O}.1 6. tntG' tOn�. „ . T t it�BS S#'Wla I W �, z
k - =$ Mana Letter
,` s
a - Debt Service Funds:
• One bond issue outstanding
totaling $875,000.
City of Oak Park Heights, Minnesota
Projection of Cashflow
General Obligation Improvement Bonds of 1998
Total
Cash Balance Property Special Other Investment Projected Debt Other Cash Balance
Year January I Taxes Assessments Receipts Interest Receipts Payments Disbursements December 31
2007 $496,113 $ $30,913 $50,000 $14,551 $95,464 $162,687 $ $428,890
2006 428,890 29,660 50,000 12,577 92,237 157,500 - 363,627
2007 363,627 28,407 50,000 10,662 89,069 152,250 - 300,446
2008 300,446 27,153 50,000 8,810 85,963 146,938 239,471
2009 239,471 25,900 45,000 7,013 77,913 141,562 - 175,823
2010 175,823 24,647 50,000 5,161 79,808 136,125 - 119,506
2011 119,506 23,394 30,000 3,467 56,861 130,625 45,741
2012 45,741 22,141 - 1,538 23,679 - - 69,420
Total $0 $212,215 $325,000 $63,779 $600,994 $1,027,687 $0
L
Assumptions
Special assessment collection rate .................... 95%
Property tax collection rate . ............................... 99%
;;.
Investment interest rate ..... ............................... 3.00%
Negative interest charged to funds ? .................. no
Y
_ {
P.XC1bE) tJ HL Etl CFt�1tIQn3� 1 n c
ar Management Letter
�s.
— Capital Proiect Funds:
• Connection Charge Funds - a
summary is as follows:
,
Sanitary Water Storm
Sewer Works Water Total
Fund balance - December 31, 2006 $476,280 $667,284 $882,414 $2,025,978
Future connection charges (est.) 67,301 349,750 54,560 471,611
Subtotal 543,581 1,017,034 936,974 2,497,589
Debt service commitments:
Bonds of 1998 (164,125) (56,875) (104,000) (325,000)
Subtotal 379,456 960,159 832,974 2,172,589
Available for new well - (960,159) - (960,159)
Uncommitted $379,456 $0 $832,974 $1,212,430
r:
Member oaf F#181nt at �
itinal � �.TI�,� +� �
p" 8
Management Letter
- Enterprise Funds:
Change in Net Assets by Year
Sanitary Storm
Year Water Sewer Sanitation Sewer Total
2006
$28,623 $37,503 $38,458 $10,742 $115,326
2005 226,051 326,221 20,804 39,279 612,355
2004 13,895 12,665 18,151 26,496 71,207
2003 117,821 87,935 5,457 36,789 248,002
2002 41,573 81,542 3,955 5,794 132,864
2001 41,643 (5,994) (3,604) 5,875 37,920
2000 65,051 (80,152) (255) (4,765) (20,121)
1999 49,552 (111,811) (32,625) 12,279 (82,605)
1998 (31,669) (38,145) (25,637) - (95,451)
1997 11,294 50,550 - - 61,844
1996 26,964 (6,551) - - 20,413
1995 54,581 (2,359) - - 52,222
1994 (302,719) (198,539) - - (501,258)
1993 73,349 40,156 - - 113,505
pre -1993 595,125 595,126 - - 1,190,251
Subtotal 1,011,134 788,147 24,704 132,489 1,956,474
Contributed capital - 1/1/06 2,725,978 2,526,293 - - 5,252,271
Net assets - 12/31/06 $3,737,112 $3,314,440 $24,704 $132,489 $7,208,745
r4 "
MBtllber Uf H1# Intl t I `
CCJd tC1r#31 f T �utgdS RH
iz Management Letter
— Other Items:
• Collection rates:
— Property taxes 98%
zF — Special assessments 98%
• Tax capacity rates:
—2004 34.382%
—2005 36.488%
—2006 38.377%
—2007 35.731%
• Comparison to other communities —
3
2007 initial tax rate:
— Oak Park Heights 35.731%
— Stillwater 47.471%
— Bayport 31.007%
— Lake Elmo 19.272%
— Mahtomedi 25.765%
M$Tlllt
Of HOB ITit4'C#jiltSiia)
Au C Letter
— Required Communication
• Audit firm responsibility under U.S.
audit standards.
• Significant accounting policies
• Accounting estimates
• Audit Adjustments
• Disagreements with management
• Consultations with other auditors
• Issues discussed prior to retention
of auditor
a
• Difficulties encountered in
performing the audit
,a
s, z
Member of HLB Inteinafional. .� �" h � "° ° ' '.
Audit Comm Letter
z — Other Matters
M < • New audit standards for 2007 SAS
. F
104 -111)
^F
a
• New statistical section in 2006
financial statements
q
Zs
Member of M B In #eritat�nal
1 0:.:: F