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HomeMy WebLinkAbout5.a. Presentation and Acceptance of 1999 Comprehensive Annual Financial Report (CAFR)CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION CITY COUNCIL MEETING DATE: June 6, 2000 AGENDA ITEM: Presentation and Acceptance of 1999 AGENDA SECTION: Comprehensive Annual Financial Report (CAFR) Department Heads Report PREPARED BY: Jeff May, Finance Director AGENDA ,.. # 5 ATTACHMENTS: Resolution & 1999 CAFR APPROVED BY: Jerry Reutzel of Boeckermann, Heinen & Mayer will be here on Tuesday evening, June 6th, to review the City of Rosemount's 1999 CAFR. Jerry is the manager in charge of our audit. He will give a brief presentation, highlighting items that may be worthy of your attention and also be available to answer any questions that you may have. The motion you have before you formally accepts, by resolution, the CAFR as presented. After you have reviewed your CAFR, if you have no further use for it, please return it to me so I can use it as an extra copy for people or organizations that may request them. Thank you!! RECOMMENDED ACTION: Motion to adopt A RESOLUTION ACCEPTING THE 1999 COMPREHENSIVE ANNUAL FINANCIAL REPORT. COUNCIL ACTION: I RL CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 2000 - A RESOLUTION ACCEPTING THE 1999 COMPREHENSIVE ANNUAL FINANCIAL REPORT WHEREAS, the City of Rosemount has been presented its 1999 comprehensive annual financial report, prepared by the audit firm of Boeckermann, Heinen & Mayer. NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Rosemount, accepts its 1999 comprehensive annual financial report, prepared by the audit firm of Boeckermann, Heinen & Mayer. ADOPTED this 6th day of June, 2000. Cathy Busho, Mayor ATTEST: Linda J. Jentink, City Clerk CERTIFICATION I hereby certify that the foregoing is a true and correct copy of a resolution presented to and adopted by the City Council of Rosemount at a duly authorized meeting thereof, held on the 6th day of June, 2000, as disclosed by the records of said City in my possession. (SEAL) Linda J. Jentink, Rosemount City Clerk Motion by: Voted in favor: Seconded by: Voted Against: BOECKERMANN HEINEN & MAYER, PA. InctudingtheformerAPPLE &APPLE Certified Public Accountants REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Honorable Mayor and Members of the City Council Rosemount, Minnesota We have audited the general purpose financial statements of the City of Rosemount, Minnesota, as of and for the year ended December 31, 1999, and have issued our report thereon dated March 31, 2000. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether the City of Rosemount, Minnesota's general purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. Internal Control Over Financial Reporting In planning and performing our audit, we considered the City of Rosemount, Minnesota's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. Minnesota Legal Compliance We conducted our audit in accordance with generally accepted auditing standards and the provisions of the Minnesota Legal Compliance Audit Guide for Local Government, promulgated by the Legal Compliance Task Force pursuant to Minnesota Statute Section 6.65. Accordingly, the audit included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. The Minnesota Legal Compliance Audit Guide for Local Government contains five main categories of compliance to be tested: contracting and bidding, deposits and investments, conflicts of interest, public indebtedness, and claims and disbursements. Our study included all of the listed categories. The results of our tests indicate that for the items tested the City of Rosemount, Minnesota complied with the material terms and conditions of applicable legal provisions except as noted below: Minnesota Statute Section 118A.03 Subd. 3 requires deposits in excess of FDIC coverage be covered by bond or collateral. During the year, deposits exceeded FDIC, bond or collateral coverage. Further, for the items not tested, based on our audit and the procedures referred to above, nothing came to our attention to indicate that the City of Rosemount, Minnesota had not complied with such legal provisions. This report is intended for the information of management, the City Council, state agencies, and federal awarding agencies and pass- through entities, and should not be, used by anyone other than those specified parties. 80?c BOECKERMANN, HEINEN & MAYER, P.A. Certified Public Accountant Minneapolis, Minnesota March 31, 2000 i 1 1 1 1 f 1 1 1 1 1 1 1 1 1 1 1 1 1 City of Rosemount Minnesota X31,= CITY OF ROSEM NT Everything's Coming Up Rosemount!! 2000 BOECKERMANN, HEINEN & MAYER, P. A. ' City of Rosemount, Minnesota Report to Council Table of Contents December 31, 1999 ACCOUNTANT'S REPORT ........................................................................................... ..............................1 I CURRENT YEAR COMMENTS .................................................................................... ............................... 2 GRAPHIC ANALYSIS-. ..... ****,,*,* .................... ­* ....... *'*""*'*'** ....... - ...... .................. *"*,,** ... 6 ' GENERAL FUND BALANCE AS A PERCENTAGE OF ADOPTED EXPENDITURE BUDGET ......... ............................... 6 TAXLEVY VS. NET TAX CAPACITY ................................................................................. ............................... 7 PROPERTY- ESTIMATED MARKET VALUES...... . ............... .... ... ..... ... . ... . ........... .......... ...... ........ .... .............. 8 GENERAL FUND INTERGOVERNMENTAL REVENUE VS. PROPERTY TAXES ........................ ............................... 9 TEN LARGEST TAXPAYERS AND OTHERS .. ................................................................. ............................... 10 NETBONDED DEBT .................................................................................................... ............................... 11 1 GROSS BONDED DEBT ................................................................................................ ............................... 12 BOECKERMANN HEINEN & MAYER, PA. Including the formerAPPLE & APPLE Certified Public Accountants To the Honorable Mayor and Members of the City Council ' City of Rosemount, Minnesota ' In planning and performing our audit of the general purpose financial statements of the City of Rosemount, Minnesota for the year ended December 31, 1999, we considered the City's internal control to determine our auditing procedures for the purpose of expressing an opinion on the general purpose financial statements and not to provide assurance on the internal control. The memorandum that accompanies this letter summarizes our current year comments and ' includes some graphic analysis. This letter does not affect our report dated March 31, 2000 on the general purpose financial statements of the City of Rosemount, Minnesota. We want to take this opportunity to express our sincere appreciation for the courtesies and cooperation extended to us by the City's personnel during the audit. We look forward to working with you in the future. 1 I ' BOECKERMANN, HEINEN & MAYER, P.A. Certified Public Accountants ' Minneapolis, Minnesota March 31, 2000 I City of Rosemount, Minnesota Report to Council i Current Year Comments December 31, 1999 ' GASB Statement No. 34: Basic Financial Statements -and Management's Discussion and Analysis -for State and Local Governments This Statement establishes financial reporting standards for state and local governments. It ' establishes that the basic financial statements and required supplementary information for general purpose governments should consist of: 1 C� fl • Management's discussion and analysis should introduce the basic financial statements and provide an overview of the government's financial activities. • Basic Financial Statements - should include: Government -wide financial statements -consist of a statement of net assets and a statement of activities. Prepared using the economic resources measurement focus and the accrual basis of accounting, these statements should report all of the assets, liabilities, revenues, expenses, and gains and losses of the government. Each statement should distinguish between the government and business -type activities of the primary government and between the total primary government and its discretely presented component units by reporting each in separate columns. Fiduciary activities, whose resources are not available to finance the government's programs, should be excluded from the government -wide statements. Fund financial statements -consist of a series of statements that focus on information about the government's major governmental and enterprise funds, including blended component units. Fund financial statements should also report information about a government's fiduciary funds and component units that are fiduciary in nature. Governmental fund financial statements should be prepared using the current financial resources measurement focus and the modified accrual basis of accounting. Proprietary fund financial statements and fiduciary fund financial statements should be prepared using the economic resources measurement focus and the accrual basis of accounting. Required supplementary information -must include budgetary comparison schedules along with other types of data as required by previous GASB pronouncements. This statement also mandates required supplementary information for governments that use the modified approach for reporting infrastructure assets. I Boeckermann, Heinen & Mayer, P.A. 2 ' City of Rosemount, Minnesota Report to Council Current Year Comments December 31, 1999 GASB Statement No. 34: Basic Financial Statements -and Management's Discussion and Analysis -for State and Local ' Governments (Continued) The requirements of this statement are effective in three phases based on a government's total ' annual revenues in the first fiscal year ending after June 15, 1999. Governments with total annual revenues (excluding extraordinary items) of $100 million or more (phase 1) should apply this Statement for periods beginning after June 15, 2001. Governments with at least $10 million ' but less than $100 million in revenues (phase 2) should apply this Statement for periods beginning after June 15, 2002. Governments with less than $10 million in revenues (phase 3) should apply this Statement for periods beginning after June 15, 2003. Earlier application is encouraged. Governments that elect early implementation of this Statement for periods beginning before June 15, 2000, should also implement GASB Statement No. 33, Accounting and Financial Reporting for Nonexchange Transactions, at the same time. If a primary government chooses early implementation of this Statement, all of its component units also should implement this standard early to provide the financial information required for government -wide financial statements. I Boeckermann, Heinen & Mayer, P.A. 3 '1 F r i City of Rosemount, Minnesota Report to Council Current Year Comments December 31, 1999 Required Communications We have audited the financial statements of the City of Rosemount, Minnesota (the "City") for the year ended December 31, 1999, and have issued our report thereon dated March 31, 2000. Professional standards require that we provide you with the following information related to our audit. Our Responsibility Under Generally Accepted Standards As stated in our engagement letter dated December 1, 1999, our responsibility, as described by professional standards, is to plan and perform our audit to obtain reasonable, but not absolute, assurance that the general purpose financial statements are free of material misstatement and are fairly presented in accordance with generally accepted accounting principles. Because of the concept of reasonable assurance and because we did not perform a detailed examination of all transactions, there is a risk that material errors, fraud, or other illegal acts may exist and not be detected by us. As part of our audit, we considered the internal control of the City. Such considerations were solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control structure. Significant Accounting Policies Management has the responsibility for selection and use of appropriate accounting policies. In accordance with the terms of our engagement letter, we will advise management about the appropriateness of accounting policies and their application. The significant accounting policies used by the City are described in the Notes to the financial statements. We noted no transactions entered into by the city during the year that were both significant and unusual, and of which under professional standards, we are required to inform you, or transactions for which there was a lack of authoritative guidance of consensus. Accounting Estimates Accounting estimates are an integral part of the financial statements prepared by management and are based upon management's current judgments. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from management's current judgments. Management's estimate of the allowance for doubtful accounts receivable is based on a review of outstanding accounts receivable at December 31, 1999. This review included an aging analysis as well as payments received during 1999. We evaluated the key factors and assumptions used to develop the allowance for doubtful accounts in determining that it is reasonable in relation to the financial statements taken as a whole. Boeckermann, Heinen & Mayer, P.A. 4 City of Rosemount, Minnesota Report to Council Current Year Comments December 31, 1999 1 Required Communications (Continued) ' Significant Audit Adjustments For the purposes of this letter, professional standards define a significant audit adjustment as a proposed correction of the financial statements that, in our judgment, may not have been ' detected except through our auditing procedures. These adjustments may include those proposed by us but not recorded by the City that could potentially cause future financial statements to be materially misstated, even though we have concluded that such adjustments are not material to the current financial statements. ' We proposed no audit adjustments that could, in our judgment, either individually or in the aggregate, have a significant effect on the City's financial reporting process. Disagreements With Management For purposes of this letter, professional standards define a disagreement with management as a ' matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter that could be significant to the financial statements or the auditor's report. We are pleased to report that no such disagreements arose during the course of our audit. ' Consultation with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the governmental unit's general purpose financial statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Issues Discussed Prior to Retention of Independent Auditors We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City's auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with the management relating to the performance of the audit. I Boeckermann, Heinen & Mayer, P.A. 5 s r == M M= M M M M= M r e= M == M City of Rosemount General Fund Balance as a % of Adopted Expenditure Budget 100.0% 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% 1995 1996 1997 1999 Boeckermann, Heinen & Mayer, P.A. 6 City of Rosemount Tax Levy vs. Net Tax Capacity $14 $12,000 $10 $8,000,000 $6 $4,000 $2 $0 1995 1996 a Total Tax Levy Net Tax Capacity 1997 1998 1999 Boeckermann, Heinen & Mayer, P.A. 7 M M M ' = = M M M M M = M M City of Rosemount Property - Estimated Market Values $800 $700 $600 $500 $400 $300,000 $200 $100 $0 1995 1996 1997 1998 1999 Boeckermann, Heinen & Mayer, P.A. 8 City of Rosemount General Fund Intergovernmental $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1 -� $500,000 $0 4- 1995 1996 1997 Intergovernmental Revenue Property Taxes Li 6 1999 Boeckermann, Heinen & Mayer, P.A. a a I M M M r i M M M M M M r= M M M= M City of Rosemount 10 Largest Taxpayers &Others ■Ten Largest Taxpayers El All Others Boeckermann, Heinen & Mayer, P.A. 10 M M M M M M i M M M M M M M M M M M M City of Rosemount Net Bonded Debt $3 $3 $2 $2 $1 $1 $500 $0 1995 1996 1997 1999 Boeckermann, Heinen & Mayer, P.A. 11 M M M M S M � M M M M M M M M M M M M City of Rosemount Gross Bonded Debt $40 $35 $30 $25 $20 $15 $10 $5 $0 1995 1996 1997 1998 1999 B©eckermann, Heinen & Mayer, P.A. 12