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HomeMy WebLinkAboutItem 8.1 City Auditor Report 1982-83 Ow w S ) 0 - 30 CITY OF DUBLIN AGENDA STATEMENT CITY COUNCIL MEETING DATE: November 28, 1983 SUBJECT City ' s Auditor Report - Fiscal Year 1982-83 EXHIBITS ATTACHED 1982-83 Financial Statement; Management Letter RECOMMENDATION 1 ) Receive report from Audit Committee 2 ) Accept 6-30-83 Financial Statement and modify as recommended 3 ) Approve 1983-84 Budget Modifications in the amount of $22 , 273 FINANCIAL STATEMENT: See Below DESCRIPTION Bray, Burke, Waterman, Cockrill & Carter, the City' s Audit Firm has completed its review of the City ' s financial records for Fiscal Year 1982-83 . As indicated in the Auditor ' s Financial Statements, the total revenues for Fiscal Year 1982-83 were $4 , 138, 755 . This is approximately $210 , 000 ( 5%) more than was estimated in the 1983-84 budget. This increase was primarily attributable to sales tax, state motor vehicle in-lieu tax, state cigarette tax and County gas tax. Total actual expenditures for Fiscal Year 1983-84 were $1, 820 , 351 . This is approximately $69 , 000 ( 3 . 6% ) less than was estimated in the 1983-84 budget. This was primarily attributable to several capital improvement projects not being completed prior to the end of the fiscal year ( $38, 094 ) ; salary and fringe benefit savings as a result of late recruitments and fringe benefit programs not being implemented; and savings on the Police Services Contract. The City ' s total reserves as of June 30 , 198' are as follows : F U N D RESERVE GENERAL GAS TAX CAPITAL TOTAL Street Improvements $2 , 329 , 053 $270 , 929 $ $2 , 599 , 982 Authorized Projects 152 , 517 38 , 094 190 , 611 $2 , 481, 570 $270 , 929 $ 38 , 094 $2 , 790, 593 This is $260 , 000 more than the year end reserve estimated in the 1983-84 budget. It should be pointed out that these reserves should be modified to include $400 , 000 for facility acquisition and construction as was approved by the City Council as part of the 1982-83 bt!dget. The auditor ' s financial statement includes these funds as part of a reserve for authorized projects and street improvement reserves . It is also necessary for the City Council to make additional appropriations from reserves in order to modify the 1983-84 budget. This is necessary because the anticipated completion or level of completion of certain capital projects was not realized during Fiscal Year 1982-83 . Shown below is a listing of the project amounts required: San Ramon Road Study $ 751 Dublin Blvd Aerial Map 26 City Base Map 13 , 502 General Plan 8 , 669 Total $22 , 273 These funds would be transferred from the Capital Projects Reserves . MANAGEMENT LETTER The City ' s Auditor has made several recommendations regarding the improvement of internal control for the City ' s accounting system. Staff has made an effort to implement most of these recommendations . The City Council ' s Audit Committee will make a report to the Council with respect to the audit. ------------------------------ ---------------- ---------------- ------------- COPIES TO: ITEM NO. 8. BRAY.BURKEMATERMAN.COCKRILL&CARTER -CERTIFIED PUBLIC ACCOUNTANTS CITY OF DUBLIN FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 1983 With Report of Certified Public Accountants BRAY.BURKE.WATERMAN.COCK RILL 8 CARTER -CERTIFIED PUBLIC ACCOUNTANTS CITY OF DUBLIN FINANCIAL STATEMENTS YEAR ENDED JUNE 30 . 1983 CONTENTS Paae Report of Certified Public Accountants I FINANCIAL SECTION Combined Statements: Combined Balance Sheet - All Fund Types and Account Groups 2 Combined Statement of Revenues, Expenditures and Changes in Fund Balances - All Governmental Fund Types 3 Combined Statement of . Revenues, Expenditures and Changes in Fund Balances - Budget (GAAP Basis) and Actual - General, Special Revenue and Capital Projects Fund Types 4 Notes to Financial Statements 5 - 10 Financial Statements of Individual Funds: General Fund: Balance Sheet 11 Statement of Revenues, Expenditures and Changes in Fund Balance 12 - 13 Special Revenue Funds: Combining Balance Sheet 14 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 15 Capital Projects Funds: Combining Balance Sheet . 16 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 17 General Fixed Assets Account Group: Schedule of General Fixed Assets by Sources 18 BRAY, BURKE, WATERMAN, COCKRILL & CARTER CERTIFIED PUBLIC ACCOUNTANTS NORMA J.WATERMAN,CPA CITY CENTER BUILDING,SUITE 509 GERALD L.COCKRILL.CPA 22300 FOOTHILL BOULEVARD PERRY H.CARTER.CPA HAYWARD,CALIFORNIA 94541 OF COUNSEL: (415)8866411 8 3573200 CHARLES E.BRAY,CPA THOMAS F.BURKE,JR,,CPA REPORT OF CERTIFIED PUBLIC ACCOUNTANTS Honorable Mayor, Members of the City Council and City Manager City of Dublin Dublin, California We have examined the combined financial statements of the City of Dublin, California and its combining and individual fund financial statements as of and for the year ended June 30, 1983, as listed in the table of contents. Our examination was made in accordance with generally accepted auditing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. In our opinion, the combined financial statements referred to above present fairly the financial position of the City of Dublin, California at June 30, 1983 , and the results of its operations for the year then ended, in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceeding year. Also, in our opinion, the combining and individual fund financial statements referred to above present fairly the financial position of the individual funds of the City of Dublin, California at June 30, 1983 and their results of operations for the year then ended in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year. Izz October 6, 1983 Page 2 CITY OF DUBLIN COMBTNED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS JUNE 30, 1983 •Account Governmental Fund Tyg)es Group General- Special Capital Fixed Total General Revenue Projects Assets (Memorandum Only) ASS Cash and investments $2,245,760 $260,713 $65,560 $ $2,572,033 Receivables: Assessments 11,177 11,177 Accounts 627 627 Accrued interest 50,868 50,868 Due from other governments 415,082 47;550 462,632 Due from other funds 5,383 5,383 Prepaid expenses 7,061 7,061 Machinery and equipment 51,582 51,582 Construction in progress 21,678 21,678 Improvements 1 ,092 _ 1 ,092 Total Assets $2,735,958 $308®263 $65,550 $74.352 $3,184,133 . LTABIL.TTT .S AND FUND EQUITY Liabilities: Accounts payable $ 221,771 . $.31,951 $19,706_ $ - $ 273,428 Accrued wages 6,238 . 6,238 Withholding taxes,payable 1,788 1,788 Deposits 24,591 7,760 32,351 Due to other funds 5,383 5,383 Total Liabilities 254,388 37,334 27,466 - 319,188 Fund Equity: Investments in general fixed assets - - - 74,352 74,352 Fund balance: Reserved for street improvement 2,329,053 270,929 2,599,982 Reserved for authorized expenditures/ projects 17 152,5 - - 38,094 190.611 . Total Fund Equity 2,481,570 270,929 38,094 74,352 2,864,945 Total Liabilities and Fund Equity $2,735,958 $308.263 $65,560 "$74.352 $7<184.133 • The accompanying notes are an integral part of the financial statements. CITY OF DUBLIN Page 3 COMBINED STATEMENT OF REVENUES, XP NDITIR S - . . AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL.FUNQ TYPES YEAR ENDED JUNE 30 1983 Special Capital Total General Revenue Projects (Memorandum Only) Revenues: Taxes $ 3,009;677 $ - $ - $ 3,009,677 Licenses and permits 3,936 3,936 Intergovernmental 642,894 262,567 905,461 Charges for services 32,906 32,906 Fines and forfeits 3,556 45,250 48,806 Use of money and property 116,471 16,442 132,913 Miscellaneous 5 5,055 Total Revenues 3,814,495 324,259 - 4,138,754 Expenditures: General government 191,506 - 31,331 222,837 Public safety 1,130,962 48,162 1,179,124 Highways and streets 105,392 44,677 150,069 Health and welfare 3,348 3,348 Community development 152,064 152,064 Capital outlay 52,384 60,525 112,909 Total Expenditures 1 ,635,656 92,839 91,856 1,820.351 Revenues in Excess of (Less Than) Expenditures 2,178,839 231,420 ( 91,856) 2,318,403 Other Financing Sources (Uses) Operating transfers in - - 129,950 129,950 Operating transfers out * , ( 110,950) ( 19,000) . ( 129,950) Total Other Financing Sources (Uses) ( 110, 50) ( 19,000) 129.950 - Revenues and Other Financing Sources in Excess of (Less Than) Expenditures and Other Uses 2,067,889 212,420 38,09.4 2,318,403 Fund Balances, Beginning of Year (Note 11) 413,681 58,509 - 472,190 Fund Balances, End of Year $2,481,570 $ 270.929 $ _38;094 $ 2,790,593 The accompanying notes are an integral part of the financial statements. CITY OF DUBLIN Page 4 COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - .BUDGET- ( .AAP BASIS) AND ACTUAL. - GENERAL., SPECIAL• REVENUE AND CAPITAL PROJECTS FUND TYPES YEAR ENDED JUNE 30; 1,983 -- General` Fund Variance Special Revenue Fund Types 7 capital Project Fund Type_ Favorable Revenues: Budget Actual (Unfavorable) Budget_ Actual Variance Buda et Actual Variance Taxes $ 2,610,851 $ 3,009,677 $ 398,826 $ - $ - $ - $ - $ $ - Licenses and permits 100,000 . 3,936 ( 96,064). Intergovernmental 486,610 642,894 156,284 261,000 262,567 1,567 Charges for services 21,000 32,906 11,906 Fines and forfeits 1,000 3,556 2,556 45,250 45,250. Use of money and property 72,000 116,471 44,471 16,442 16,442 Miscellaneous 11000 5,055 4,055 Total Revenues 3,292,461 3,814,495 522,034 261,000 324,259 63,259 Expenditures: General government 242,606 191,506 51,100 - - - 52,350. 31,331 21,019 Public safety 1,290,104_ . 1,130,962 159,142 48,162 ( 48,162) Highways and streets 202,148 105,392 96,756 227,000 44,677 . 182,323 Health and welfare 9,818 3,348 6,470 Community development 227,953 152,064 75,889 Capital outlay 198,816 52,384 146,432 77,600 60,52!i 17.075 Total Expenditures 2,171,4 1.635,656 535,789 227,000 92,839 134,161 129,950 91,896 38,094 Revenues in Excess of (Less-Than.) Expenditures 1,121 ;016' 2,178,839 1,057,823 34,000 231,420 197,420 (129,950) ( 91 ,856) 38,094 Other Financing Sources (Uses) : Operating transfers. in - - - 129,950 129,950 Operating transfers out ( 110,950)' ( 110.9sn) ( 19,000) ( 19,000) Total Other Financing Sources (Uses) ( 110,950). 1 1 10,9SO) - ( 19,000) ( 19,000) - 129,950 129,950 Revenues and Other Financing Sources in Excess of (Less Than) Expenditures and Other Uses 1,010,066 2,067,889 1,057,823 15,000 .212,420 197,420 - 38,094 38,094 Fund Balances, Beginning of Year (Note 11) . 413,681 413,681 - 58,509. 58,509 Fund Balances, End of Year $ 1,423 $ 2,481,57 $ 1,057,823 38,04 $38,094 The accompanying notes are an integral part of the financial statements. BRAY.BURKEVATERMAN.COCKRILL 8 CARTER -CERTIFIED PUBLIC ACCOUNTANTS Page 5 CITY OF DUBLIN NOTES TO FINAN IAr STATEMENTS JUNE 30 , 1983 1. summary of Significant Ac ounting Policies The City of Dublin was incorporated February 1, 1982 under the Municipal Organization Act of 1977. The City operates under a Council-Manager form of government and provides services to residents primarily by contracting with other governmental agencies and private contractors. The accounting policies of the City of Dublin conform to generally accepted accounting principles as applicable to governments. The following is a summary of the more significant policies: a) Fund Accounting The accounts of the City are organized on the basis of funds and account groups, 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. The funds required by the City of Dublin are grouped, in the financial statements of this report, into three generic fund types and one account group as follows: Governmental Fund General Fund - The General Fund is the general operating fund of the City. It is used to account for all financial resouces except those required to be accounted for in another fund. 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 Projects Funds are used to account for financial resources to be used for the acquisition or construction of major capital projects (other than those financed by Proprietary Funds, Special Assessment Funds and Special Revenue Funds) . BRAY.BURKEMATERMAN.COCKRILL 6 CARTER -CERTIFIED PUBLIC ACCOUNTANTS Page 6 Account Group General fixed assets are recorded as expenditures in the General Fund, Special Revenue Funds, and the Capital Projects Funds at the time of purchase. Such assets are accounted for in the General Fixed Assets account group. Depreciation is not provided for in the General Fixed Assets account group. All fixed assets are valued at historical cost. Donated assets are valued at their estimated fair market value at the date donated. The City has elected not to capitalize "improvements other than buildings " which would consist of nonenterprise expenditures relating to roads, bridges, curbs, gutters, streets, sidewalks, drainage systems, and lighting systems. The account group is not a fund. Consequently, it is concerned with the measurement of financial position only and not the results of operations. b) Basis of Accounting Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. All governmental funds and Expendable Trust Funds are accounted for using the modified accrual basis of accounting. Their revenues are recognized when they become measurable and available as net current assets. Taxpayer assessed income, gross receipts, and sales taxes are considered "measurable" when in the hands of intermediary collecting governments and are recognized as revenue at that time. Anticipated refunds of such taxes are recorded as liabilities and reductions of .revenue when they are measurable and their validity seems certain. Expenditures are generally recognized under the .modified accrual basis of accounting when the related fund liability is incurred. Exceptions to this general rule include: (1) accumulated unpaid vacation, sick pay, and other employee amounts which are not accrued; and (2) principal and. interest on general long-term debt which is recognized when due. The City does not currently require the use of other than the General Fund, Special Revenue Funds, and Capital Projects Funds. However, at such time as may be required, proprietary and other funds will be used. BRAY.BURKEMATERMAN.COCKRILL&CARTER -CERTIFIED PUBLIC ACCOUNTANTS Page 7 All proprietary funds and Nonexpendable Trust and Pension Trust Funds are accounted for using the accrual basis of accounting. Their revenues are recognized when they are earned, and their expenses are recognized when they are incurred. c) Budgets and Budgetary Accounting The City follows these procedures in establishing the budgetary data reflected in the financial statements: 1. Prior to June 30, the City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following. July 1. The operating budget includes proposed expenditures and the means of financing them. 2. Public hearings are conducted to obtain taxpayer comments. 3 . Prior to July 1, the budget is legally enacted through passage of an ordinance. 4 . The City Manager is authorized to transfer budgeted amounts up to $2, 500 within an activity, within any fund; however, any other budget transfer must be approved by the City Council. 5. Formal budgetary integration is employed as a management control device during the year for the General Fund, Special Revenue Funds and Capital Projects Funds. 6. Budgets for the General , Special Revenue, and Capital Projects Funds are adopted on a basis consistent with generally accepted accounting principles (GAAP) . d-) Investments Investments are stated at cost or amortized cost, which approximates market. e) Accumulated Unpaid Vacation, Sick Pay, and Other Employee Benefit Amounts. Accumulated unpaid vacation, sick pay, and other employee benefit amounts are accrued when incurred in proprietary funds ( using the accrual basis of accounting) . Such amounts are not accrued in governmental funds (using the modified accrual basis of accounting) . BRAY.BURKEVATERMAN.COCKRILL&CARTER -CERTIFIED PUBLIC ACCOUNTANTS Page 8 f) Total Columns on Combined Statements Total columns on the Combined Statements are captioned Memorandum Only to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in financial position in conformity with generally accepted accounting principles. Neither is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. 2. Due From Other Governments Amounts due from other governments at June 30, 1983 consist of the following: Special General Revenue Fund Fund Total Documentary taxpayer tax $ 1,876 $ - $ 1,876 Fines and forfeitures 138 5,383 5,521 Cigarette tax 81,157 8 ,157 State motor vehicle in-lieu tax 29,516 29 ,516 Gas tax 42,167 42,167 Sales and use tax 299 ,265 299 ,265. Revenue Sharing 75,662 . 75,662 Dog licenses 468 468 $415 ,082 $47 , 550 $462 .63 3 . Long-Term Debt The City had no long-term debt at June 30, 1983. 4. Changes In General Fixed Assets A summary of changes in general fixed assets follows: Balance Balance February 1, June 30, 1982 Additions Deletions 1983 Land $ - $ - $ - $ - Buildings Equipment 5,363 46,219 51,582 Construction- in-progress 21,678 21,678 Improvements 1 '092 - 1 .092 $5 3 $§ $ - $ 4 352 BRAY.BURKEVATERMAN.COCKRILL 6 CARTER -CERTIFIED PUBLIC ACCOUNTANTS Page 9 5. Other Required Individual Fund Disclosures Generally accepted accounting principles require disclosure, as part of the Combined Statements, of certain information concerning individual funds including: a) Summary disclosures of debt service requirements to maturity for all types of outstanding debt. This requirement is met by Note 3. b) Summary disclosures of changes in general fixed assets by major asset class. This requirement is met by Note 4 . c) Individual fund interfund receivable and payable balances. Interfund balances at June 30, 1983 consist of the following: Interfund Interfund Receivable Payable General Fund $5,383 $ - Special Revenue Fund 5. 383 $5.383 $5 6. General Fund - Miscellaneous Revenues The schedule below sets out the detail of miscellaneous revenues of the General Fund for the year ended June 30, 1983 Revenues Park Dedication Fees $51,000 All other 55 $5, 055 7.. Retirement Commitments Substantially all of the City's employees are covered by the Public Employers Retirement System (PERS) . PERS is a defined benefit, contributory retirement plan administered by .the State of California. Total pension expense and the amount funded for the year ended June 30, 1983 was $3,819. 8 . Commitments The City was not obligated under any long-term lease agreements for facilities or equipment at June 30, 1983 . BRAY,BURKEMATERMAN,COCKRILL R CARPER -CERTIFIED PUBLIC ACCOUNTANTS Page 10 9 . Litigation The City was not a defendant in any litigation at June 30 , 1983 . 10 . Contingent Liabilities The City participates in the General Revenue Sharing Grant Program. This program is subject to program compliance audits by the grantor or their representatives. The program has not been audited, nor were any Revenue Sharing Funds expended for the year ended June 30 , 1983 . 11. Prior Period Adjustment For the year ended June 30, 1982 Gas Tax Revenues were recognized on the accrual basis. Due to the nature of the revenue, it has been determined that the Gas Tax should be recognized as revenue when received. The purpose of this adjustment is to reverse the Gas Tax receivable at June 30, 1982 for the State Gasoline Tax Fund. Fund balance at June 30, 1982 as previously reported $ 72,716 Reversal of receivable at June 30, 1982 (17 ,119) Fund Balance, as Restated $ 55 .597 BRAY.BURKEMATERMAN.COCKRILL&CARTER -CERTIFIED FURLIC ACCOUNTANTS COMBINING AND INDIVIDUAL FUND STATEMENTS AND GENERAL FIXED ASSETS BRAY.BURKEVATERMAN.COCKRILL 8 CARTER -CERTIFIED PUBLIC ACCOUNTANTS GENERAL FUND The purpose of the General Fund is to account for resources traditionally associated with City Government, which are not required to be accounted for in another fund. Revenues and expendittres of the Federal Revenue Sharing Program are accounted for in this fund. BRAY.BURKEMATERMAN.COCKRILL&CARTER -CERTIFIED PUBLIC ACCOUNTANTS Page 11 CITY OF DUBLIN GENERAL FUND BALANCE SHEET JUNE 30 ,1983 ASSETS Cash and investments $2,245,760 Receivables: Assessments 11,177 Accounts 527 Accrued interest 501,868 Due from other governments 415,082 . Due from other funds 5,383 Prepaid expenses 7x061 Total Assets $2.735 ,958 r.IABILITIES AND FUND EQUITY Liabilities: Accounts payable $ 221,771 Accrued wages 6,238 Withholding taxes 1,788 Deposits 24,591 Total Liabilities 254,388 Fund Equity: Fund balance: Reserved for street improvement 2,329,053 Reserved for authorized projects - 152,517 Total Fund Equity 2,481,570 Total Liabilities and Fund Equity $2,1735c958 The accompanying notes are an integral part of the financial statements. BRAY,BURKE.WATERMAN,COCK RILL 8 CARTER -CERTIFIEO FU©LIC ACCOUNTANTS Page 12 CITY OF DUBLIN GENERAL FUND STATEMENT OF REVENUES, EXPENDITURE AND CHANGES IN FUND BALANCE YEAR ENDED JUNE 30 , 1983 Revenue: Taxes : Property tax $ 289,920 Sales and use tax 2,6031382 Real property transfer tax 20,507 Cable TV franchise tax 23,502 Electric franchise tax 43 ,037 Gas franchise tax 29,329 $3, 009,677 Licenses and permits: Encroachment fees 1,047 Animal permits 2,829 Other permits 60 3,936 Intergovernmental : Motor vehicle in-lieu tax 365,154 Cigarette tax 86 ,653 Off highway motor vehicle in-lieu tax 332 Homeowner ' s property tax relief 15,323 Business inventory tax relief 24,108 Revenue sharing 151 ,324 642,894 Charges for services: Zoning fees 3,400 Plan checking fees 20,395 Special police fees 51231 Animal shelter fees 2, 202 Sales of maps and documents 928 Engineering inspection fees 750 32, 906 Fines' and forfeits 3,556 Use of money and property: Interest 116,147 Rents and concessions 324 116,471 Miscellaneous 5x055 Total Revenue 3 ,814.495 (Continued) The accompanying notes are an integral part of the financial statements. BRAY,BURKEMATERMAN,COCKRILL 8 CARTER CERTIFIED PUBLIC ACCOUNTANTS Page 13 CITY OF DUBLIN GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE YEAR ENDED JUNE 30, 1983 (Concluded) Expenditures: General government: Personal services $ 74,711 Services and supplies 113 ,302 Contract services 3,493 $ 191, 506 Public safety: Services and supplies 2,129 Contract services ],,128 .833 1,130,962 Highways and streets : Contract services 105,392 Health and welfare: Contract services 3,348 Community development: Personal services 47,311 Services and supplies 451,345 Contract services 59,408 152,064 Capital outlay: Equipment 51,292 Improvements 1 .092 52,384 Total Expenditures 1, 635656 Excess of Revenues over Expenditures 2,178 ,839 Other Financing Uses: Operating transfers out 11011!950 Excess of Revenues over Expenditures and Other Financing Uses 2,067,889 Fund Balance, Beginning of Year 413 ,681 Fund Balance, End of Year $2,481, 570 The accompanying notes are an integral part of the financial statements. BRAY,BURKEMATERMAN,COCKRILL 8 CARTER -CERTIFIED PUBLIC ACCOUNTANTS SPECIAL REVENUE FUNDS Traffic Safety Fund - Resources of this fund are required to be used exclusively for official traffic control devices, maintenance thereof, equipment and supplies for traffic law enforcement and maintenance, improvement, or construction of public streets, bridges and culverts within the City. State Gasoline .Tax Fund - Resources of this fund are required to be used primarily for the research, planning, construction, improvement, maintenance and operation of public streets and highways, and for certain other transportation related activities. County Gasoline Tax Fund - Resources of this fund are required to be used primarily for the research, planning, construction, improvement, maintenance and operation of public streets and highways, and for certain other transportation related activities. CITY OF DUBLIN Page 14 SPFCTAL REVENUE FUNDS COMBINING BALANCE SHEET JUNE 30, 1983 Traffic State County Safety Gasoline Gasoline Fund Tax Tax Total ASSETS Cash and investments $ — $260,713 $ — $260,713 Due from other governments $1383 42,167 47,550 Total Assets $5.383 $260.713 $42,167 $308,263 LIABILITIES AND FUND FnIITTY Accounts payable $ $ 31,951 $ — $ 31,951 Due to other funds .5,383 5,383 - Fund Equity: Fund balance Reserved for street improvements 228,762 42,167 270,929 Total Liabilities and Fund Equity $5,383 $260;713 $42,167 $308.263 -The accompanying notes are an integral part of the financial st'atesents. Page 15 CITY OF DUBLIN SPECIAL REVENUE FUND COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES YEAR .ND •D JUNE 30, 1983 Traffic State County Safety Gasoline Gasoline Fund Tax Tax Total Revenues: Intergovernmental: Gasoline tax $ - $' 220,400 $42,167 $ 262,567 Revenue sharing Fines and forfeits: Vehicle code fines 45,250 45,250 Use of money and property Interest 19,442 16,442 Total Revenues 45,250 236,842 42,167 324,259 Expenditures: Public safety: Service and supplies 28,855 Contract services 19,307 19,307 Highways and streets: Contract services 44,677 44,677 Total Expenditures 48.162 44,677 - 92,8 Revenues in Excess of (Less Than) Expenditures ( 2,912) 192,165 42,167 231,420 Other Financing Sources (Uses) - Operating Transfers Out ( 19,000) ( 19,000) Revenues in Excess of (Less Than) Expenditures and Other Financing Uses ( 2,912) 173,165 42,167 212,420 Fund Balances, Beginning of Year (Note 11) 2.1912 5 ,597 58,509 Fund Balances, End of Year $ - $ 228,762 $ Q, $ 270.929 The accompanying notes are an integral . part of the financial statements. BRAY,BURKEMATERMAN,COCKRILL&CARTER -CERTIFIED PUBLIC ACCOUNTANTS CAPITAL PROJECTS FUNDS. Capital Projects Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities or projects. Page 16 . CITY OF DUBLIN CAPIAL PROJECTS FUNDS COMBINING BALANCE SHEET JUNE 30, 1983 Dublin Dublin Dublin Boulevard City Village Boulevard Boulevard/ San Ramon Aerial Base Parkway General Traffic Silvercate Road Map Maw Median Plan Signal Total ASSETS Cash $5Z $$Z2 $2fi $24,191 $15,174 $17,470 $7,760 $55,560 Total Assets $§Z $ $2 $24.191 $15.174 $17,470 $7,760 $65.560 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $57 $128 $ - $10,688 $ 32 $ 8,801 $ - $19,706 Deposits _ _ 7,760 7.760 Total Liabilities 57 128 10,688 32 8,801 7,760 27,466 Fund Balances: Reserved for authorized projects U 25. 13.503 15.142 8.669 _ 38,094_ Total Liabilities and Fund Balances sfa $ $Zk $24,191 $15.174 $17,470 $71760 $65,560 The accompanying not are an integral part of the finank i statements. Page 17 CITY OF DUBLIN CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES EXPENDITURES AND CHANGES IN FUND BALANCES YEAR FNDED TUNE 30, 1983 Dublin Dublin Dublin Boulevard City Village Boulevard Boulevard/ San Ramon Aerial Base Parkway General Traffic ,Silvergate Road Map Map Median Plan signal Total Revenues: Expenditures: General government: Contractual services 31,331 31,331 Capital projects: Construction in progress 4,390. 10,256 31174 3,858 21,678 Equipment 38.847 38.847 Revenues Less Than Expenditures (4,390) (10,256) (3,174) (38,847) (3,858) (31,331) - ( .91,856) Other Financing Sources - Operating Transfers In 4.400 11.000 3,200 52,350 19,000 40.000 129.950 Revenues and Other Financing Sources in Excess of Expenditures 10 744 26 13,503 15,142 8,669 - 38,094 Fund Balances, Beginning of. Year Fund Balances, End of Year. $ 13.503 $ 15,142 S -8,669 $ S 38,094 The accompanying notes are an integral part of the financial statements. BRAY.BURKEMATERMAN.COCKRILL 8 CARTER -CERTIFIED PUBLIC ACCOUNTANTS GENERAL FIXED ASSETS The purpose of the General Fixed Assets group of accounts is to account for fixed assets not used in proprietary fund operations or accounted for in Trust Funds. BRAY.BURKEMATERMAN,COCKRILL&CARTER -CERTIFIED PUBLIC ACCOUNTANTS Page 18 CITY OF DUB M SCHEDULE OF GENERAL FIXED ASSETS BY SOURCES JUNE 30. 198 General Fixed Assets: Equipment $51,582 Construction in progress 21 ,678 Improvements 1r09� Total General Fixed Assets $74,352 Investment in General Fixed Assets from: General fund purchases $70,294 Special revenue fund revenues 3,858 Gifts 200 Total Investment in General Fixed Assets $ 4 .352 4� « BRAY.BURKE`VATERMAN.COCKRILL 6 CARTER CERTIFIED PUBLIC ACCOUNTANTS CITY OF DUBLIN MANAGEMENT LETTER JUNE 30. 1983 BRAY, BURKE, WATERMAN, COCKRILL & CARTER CERTIFIED PUBLIC ACCOUNTANTS NORMA J.WATERMAN•CPA CITY CENTER BUILDING.SUITE 509 GERALD L.COCKRILL.CPA 22300 FOOTHILL BOULEVARD PERRY H.CARTER.CPA HAYWARD.CALIFORNIA 94541 OF COUNSEL: (415)686-6411 8 357-3200 CHARLES E.BRAY.CPA THOMAS F.BURKE,JR.CPA Honorable Mayor, Members of the City Council, and City Manager City of Dublin, California Vie have examined the financial statements of the City of Dublin for the year ended June 30, 1983 and have issued our report . thereon dated October 6, 1983. As part of our examination, we made a study and evaluation of the City's system of internal accounting control to the extent we considered necessary - to evaluate the system as required by generally accepted auditing standards. Under. these standards, the purposes of such an evaluation are to establish a basis for reliance on the system of internal accounting control in determining the nature, timing, and extent of other auditing procedures that are necessary for expressing an opinion on the financial statements and to assist the auditor in planning and performing his examination of the financial statements. The objective of internal accounting control is to provide reasonable, but not absolute, assurance as to the safeguarding of assets against loss from unauthorized use or disposition, and the reliability of financial records for preparing financial statements and maintaining accountability for assets. The concept of reasonable assurance recognizes that the cost of a system of internal accounting control should not exceed the benefits derived and also recognizes that the evaluation of these--factors necessarily requires estimates and judgments by management. There are inherent limitations that should be recognized in considering the potential effectiveness of any system of internal accounting control. In the performance of most control p.r.ocedures, errors can result from misunderstanding of instructions, mistakes of judgment, carelessness, or other personal factors. Control procedure-s whose effectiveness depend upon segregation of duties can be circumvented by collusion. Similarly, control procedures can be circumvented intentionally by management either with respect to the execution and recording of transactions or with respect to the judgments required in the preparation of financial statements. BRAY DURKE W A I EAMAN.COCK RiLL& CARTER .CEFU1F:1Er t,u'-L.iC ACCOU�.7:�u;s Honorable Mayor , Members of the City Council, and City Manager Page 2 Further, projection of any evaluation of internal accounting control to future periods is subject to the risk that the procedures may become inadequate because of changes in conditions and that the degree of compliance with the procedures may deteriorate. Our examination of the financial statements was made in accordance with generally accepted auditing standards, including the study and evaluation of the system of internal accounting control for the year ended June 30, 1983. The examination, which was made for the purposes set forth above, would not necessarily disclose all weaknesses in the system because it was based on selective tests of accounting records and related data. However, such evaluation disclosed the following conditions that we believe to be weaknesses, excluding those which were corrected before they came to our attention. In addition, we have included our recommendations for improving the accounting system. These conditions were considered .in determining the nature, timing, and extent of audit tests to be applied in our examination of the financial statements, and this report of such conditions does not modify our report dated October 6, 1983, on such financial statements. Our recommendations with respect to the City's system of internal control is discussed below, and includes the status of the prior year ' s recommendations, along with the current year ' s recommendations. I Current Year Recommendations 1. Adjusting Journal Entries During our review we noted certain areas with respect to adjusting journal entries that we felt warranted comment. First, the form used to make adjusting journal entries should be revised to provide for account titles and side by side debit and credit columns. This will make the entry easier to read, particularly when several funds are affected. The City Manager has agreed with this recommendation and an improved form is now in use. We also noted that all adjusting journal entries should be reviewed, approved, and the approval noted on the form. The City Manager has agreed to this recommendation, and all entries will be signed to document the approval in the future. BRAY.BURKE WATERMAN.CCCKRILL& CARTER -CERTIFIED PUBLIC ACC,C)ONTANT$ Honorable Mayor , Members of the City Council, and City Manager Page 3 Finally, we noted that for some of the adjusting journal entries the documentation supporting the entry w.as not attached to the journal form. In all cases, the entries were proper, and adequate support existed in the underlying accounting records. However, to efficiently review the entry all necessary data, or copies thereof, should be attached to the form. When this procedure i.s not practical, then adequate reference to the supporting data should be made, in the explanation section of the adjusting journal entry form. 2. Bank Reconciliations Currently all bank reconciliations are reviewed by the City Manager. To document this review the City Manager should initial and date the reconciliations. 3. Written Accounting Procedures Last year we recommended that the City develop written accounting procedures. However, due to the small size of the City's staff, and urgency of other priorities, it was not possible to implement this recommendation in 1982-83. As the City continues to grow we think it will become even more important that the City develop written procedures for the accounting functions. With this in mind we are repeating this recommendation as a current year recommendation. II Prior Year Recommendations The following is a summary of the status of the prior year's recommendations. I. Internal Accounting Controls Status A. Division of duties: Cash receipts Implemented Cash disbursements Implemented Check custodian Implemented M Bank reconciliation Implemented except for the initialing and dating of reconciliation to document review. Internal control checklist Implemented 2. Written Accounting Procedures Repeated as current year recommendation r ©RAY SURKE.V/ATERIA AN.COCK III ILL A CART_R CcR'r�i_�FUBLic ACCOUNTANTS Honorable Mayor , Members of the City Council, and City Manager Page 4 We wish to thank the City Manager and his staff for their cooperation during the course of the audit. Should you wish to discuss any of the comments we have made, we will be happy to meet with you at your convenience. Sincerely, BRAY, BURKE, A�AN, COCKRILL & CARTER