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HomeMy WebLinkAboutReport on examination of accounts for the period March 21, 1977 to June 30, 1977 • TOWN OF MARANA, ARIZONA • • • } REPORT ON EXAMINATION OF ACCOUNTS • 3 . FOR THE PERIOD MARCH 21, 1 977 TO JUNE 30, 1977 • • E. . RIORDON, CROUSE & SCHIEVER. CERTIFIED PUBLIC ACCOUNTANTS • - VALLEY NATIONAL BUILDING TUCSON, ARIZONA I 3 PA RTsENT OF Lt TOWN OF MARANA, ARIZONA TABLE OF CONTENTS Auditors' Report Exhibit A - Combined Balance Sheet Exhibit B - Combirned Statement Of Changes In Fund Balances Exhibit C - Statement Of Revenue - Estimated And Actual Exhibit D - Statement of Expenditures Compared With Authorizations Notes To Financial Statements RIORDON,.CROUSE & SCHIEVER CERTIFIED PUBLIC ACCOUNTANTS ROBERT B. RIORDON, C.P.A. CASPER A. CROUSE, C.P.A. 705 VALLEY NATIONAL BUILDING (602) 622-6471 LAWRENCE SCHIEVER, C.P.A. TUCSON, ARIZONA 85701 Honorable Mayor And City Council Town Of Marana, Arizona We have examined the financial statements of the funds of the Town Of Marana, Arizona, for the period ended June 30, 1977, listed in the foregoing 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 financial statements listed in the aforementioned table of contents present fairly the financial position of the funds of the Town Of Marana, Arizona, at June 30, 1977, and the results of operations of such funds for the period then ended in conformity with generally accepted accounting principles. ° Pc=0 1 4.:14.10- , September p ber 5, 1978 TOWN OF MARANA, ARIZONA COMBINED BALANCE SHEET JUNE 30, 1977 Exhibit A Hiway User General Revenue Fund Fund ASSETS ash iasoline Tax Receivable $ 5,876 $ 4,504 Total assets $ 5,876 $ 4 LIABILITIES AND FUND BALANCES tote Payable - Bank lccounts Payable $10,000 ?ayroll Taxes Payable 519 76 Total liabilities $10,595 and Balance (Deficit) $(4,719)$ 4, 504 Total liabilities and fund balance $ 5,876 $ 4,504 iee Notes To Financial Statements TOWN OF MARANA, ARIZONA STATEMENT OF CHANGES IN FUND BALANCE FOR THE PERIOD MARCH 21, 1977 TO JUNE 30, 1977 Exhibit B Hiway User General Revenue Fund Fund and Balance At March 21, 1977* Zero Zero dd: Excess of Revenue over Expenditures Revenues (Exhibit C) Expenditures (Exhibit D) $ 2 $ 4 504 6,753 Excess (deficit) $ (4, 719 )$ 4, 504 and Balance (Deficit) At June 30, 1977 (Exhibit A) $ (��)$ 4,504 33 3 )ate Of Incorporation Notes To Financial Statements TOWN OF MARANA, ARIZONA STATEMENT OF REVENUE ESTIMATED AND ACTUAL FOR THE PERIOD MARCH 21, 1977 TO JUNE 30, 1977 Exhibit C Actual Fund And Source Estimated Actual Over (Under) Revenue Revenue Estimated general Fund: Sales tax $ 16, 864 $ - $ (16,864) Auto lieu tax Urban sharing 2 2 (482) Fines 4,507 -- (4, 507) 2,851 - (2,851) Total revenue $ 26,738 $ 2,034 $ (24 704) , Highway User Revenue Fund: Gasoline tax $ 5,705 $ 4,504 $ (1,201) Total revenue $ 5,705 $ 4,504 $ � $ (1 201) xi B ee Notes To Financial Statements TOWN OF MARANA, ARIZONA STATEMENT OF EXPENDITURES COMPARED WITH AUTHORIZATIONS FOR THE PERIOD MARCH 21, 1977 TO JUNE 30, 1977 Exhibit D Over { I Fund /Function (Under) C Appropriations Expenditures Appropriations general Fund Administration Magistrate court and police $ 4,700 $ 4,693 $ (7) 300 (19,300) Elections 19,300 Legal 600 11 (589) Contingencies 800 800 Total 1 1, 249 -- general fund (51) $ 26,700 $ 6,753 $ (19 947) ghway User Revenue Fund Expenditures $ 5,705 $ - $ (5,705) Total highway revenue fund $ 5 F.' Pe Notes To Financial Statements • TOWN OF MARANA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1977 (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Method Of Accounting The Town of Marana, Arizona, maintains its records on the modified accrual basis of accounting. The modified accrual basis of accounting recognizes expenditures on an accrual basis, but revenues are recognized when received, except for material revenues determined to be both measurable and available. (2) INITIAL FISCAL YEAR The community of Marana in Pima County, Arizona, was incorporated as The Town of Marana on March 21, 1977. The financial statements present activity from March 21, 1977 to June 30, 1977. Revenue was received from state shared sources and local magistrate court fines. The Town of Marana did not levy a general property tax. No expenditures were made for any municipal utility undertaking or acquisition of fixed assets. (3) NOTE PAYABLE Note payable, $10,000, is a temporary loan from Valley National Bank and was repaid in the subsequent year. t l ' I r. Honorable Mayor and Town Council Town of Marana, Arizona We noted the following reportable conditions: 1. GENERAL LEDGER Condition: The Town's general ledger utilized for fiscal 1995 did not capture all of the Town's activities, and the general ledger did not segregate activities by fund. It should be noted that currently the Town has a limited number of activities that are not accounted through the general fund. Criteria, effect and cause: Utilization of a general ledger system that segregates and captures all activities by fund is necessary in order to assure the propriety of reporting in financial statements and grantor reports. Without such a system, financial statements could be misstated. Such a system has not been utilized because the Town has had a limited number of activities that needed to be segregated in the general ledger. Recommendation: We suggest the Town implement procedures to record and segregate all activities of the Town by fund in its general ledger. With the growth and expansion of the Town, it is becoming too cumbersome to manually account for and segregate Town activities required to be recorded within a combined general ledger. Such procedures will enable the Town to better report financial activities, provide more assurance to the Town relative to grantor compliance requirements and provide better information as to the cost of certain activities in order to determine self - sufficiency. Management's 'response and corrective plan: The Town experienced rapid growth in its general fund activities the last couple of years with no significant changes in its special revenue funds. As a result, there have been higher priorities in finance and accounting than soliciting new accounting software that will provide fund breakdowns in the general ledger. Management hopes to either make changes to the existing accounting software or purchase a new general ledger system by the end of fiscal 1996, or during fiscal 1997. 2. FIXED ASSET INVENTORY Condition: The Town has not recently conducted a reconciliation of its physical property records and the items reflected in its general fixed assets group of accounts. It should be noted that there has been a limited amount of fixed assets purchased from federal grants passed 0 through the Town in its special revenue funds. 0 Criteria, effect and cause: In order to maintain control over fixed assets, periodic physical inventories are necessary, with appropriate adjustments being made to the general ledger. 0 Without such inventories, financial statements could be misstated. The Town has not performed such an inventory because it has had a limited number of fixed assets before its recent dramatic growth. 0 0 4 9 Honorable Mayor and Town Council Town of Marana, Arizona Recommendation: We recommend that a physical inventory of property be conducted in the near future, and that a reconciliation of that inventory be made to the general ledger, with all appropriate adjustments being investigated and made, including those for donated assets. Detailed schedules of the fixed asset history have been provided by us to the Town to facilitate this physical inventory. 4 Management's response and corrective plan: With the Town's dramatic growth and recent substantial purchases of new fixed assets, management recognizes the importance of performing a physical inventory of fixed assets and upgrading the Town's fixed asset records. Such inventory policies and procedures will be implemented by the end of fiscal 1996. A material weakness is a reportable condition in which the design or operation of the internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material ih 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. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe none of the reportable conditions described above are material weaknesses. This report is intended for the information of the Town Council, management and various providers of 4 governmental financial assistance. However, this report is a matter of public record and its distribution is not limited. el1/4974/ g..04diesie* 54-66 Tucson, Arizona February 8, 1996 0 0 5 ' A Clifton, Gunderson & Co. Certified Public Accountants & Consultants Honorable Mayor and Town Council Town of Marana, Arizona itt INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH LAWS AND REGULATIONS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS We have audited the general purpose financial statements of the Town of Marana, Arizona as of and for the year ended June 30, 1995, and have issued our report thereon dated February 8, 1996. We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards,, issued by the Comptroller General of the United States, and the provisions of Office of Management and Budget (OMB) Circular A -128, Audits of State and Local Governments. These standards and OMB Circular A -128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. Compliance with laws, regulations, contracts and grants applicable to the Town of Marana, Arizona is the responsibility of the Town of Marana, Arizona's management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Town's compliance with certain provisions of laws, regulations, contracts and grants. However, our objective was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported herein under Government Auditing Standards. This report is intended for the information of the Town Council, management and various providers of governmental financial assistance. However, this report is a matter of public record and its distribution is not limited. Tucson, Arizona February 8, 1996 i1 Members Of 6 N INTERNATIONAL AMERICAN INSTITUTE OF CERTIFIED PUBLIC ARIZONA COLORADO ILLINOIS INDIANA IOWA MARYLAND MISSOURI OHIO WISCONSIN ACCOUNTANTS Clifton, Gunderson & Co. Certified Public Accountants & Consultants Honorable Mayor and Town Council Town of Marana, Arizona INDEPENDENT AUDITOR'S REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS We have audited the general purpose financial statements of the Town of Marana, Arizona as of and for the year ended June 30, 1995, and have issued our report thereon dated February 8, 1996. We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of . Office of Management and Budget (OMB) Circular A -128, Audits of State and Local Governments. These standards and OMB Circular A -128 "require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. In planning and performing our audit for the year ended June 30, 1995, we considered the Town's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements of the Town and to report on the internal control structure in accordance with OMB Circular A -128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable • to federal financial assistance programs. We have addressed internal control structure policies and • procedures relevant to our audit of the general purpose financial statements in a separate report dated February 8, 1996. The management of the Town of Marana, Arizona is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any 0 evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. Members Of 1M lit 7 INTERNATIONAL AMERICAN INSTITUTE OF CERTIFIED PUBLIC ARIZONA COLORADO ILLINOIS INDIANA IOWA MARYLAND MISSOURI OHIO WISCONSIN ACCOUNTANTS Honorable Mayor and Town Council Town of Marana, Arizona For the purpose of this report, we have classified the significant internal control structure policies and procedures in the following categories: Financial • Cash • Fixed assets • Long -term debt • Revenue, receivables and receipts • Expenditures and accounts payable • Governmental financial assistance programs General requirements • Political activity • Davis -Bacon Act • Civil rights _ -- • Cash management • • Drug -free workplace • Allowable costs/cost principles • Administrative requirements Specific requirements • Types of services allowed or unallowed • Eligibility • Reporting and recordkeeping • Special tests and provisions • For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. During the year ended June 30, 1995, the Town of Marana, Arizona had no major programs and expended 64.7% of its total federal financial assistance under the federal financial assistance program through Pima County for its Community Development Block Grants. We performed tests of controls, as required by OMB Circular A -128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with specific requirements and general requirements, and requirements governing types of services allowed or unallowed, eligibility, reporting and recordkeeping, and special tests and provisions that are applicable to the aforementioned nonmajor program. Our procedures were less in scope than would be necessary to render an opinion on these ) internal control structure policies and procedures. Accordingly, we do not express such an opinion. 8 Honorable Mayor and Town Council Town of Marana, Arizona We noted a certain matter involving the internal control structure and its operation that we consider to be a reportable condition under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure, that in our judgment, could adversely affect the Town's ability to administer federal financial assistance programs in accordance with applicable laws and regulations. We noted the following reportable condition: GENERAL LEDGER Condition: The Town's general ledger utilized for fiscal 1995 did not capture all of the Town's activities, and the general ledger did not segregate activities by fund. It should be noted that currently the Town has a limited number of activities that are not accounted through the general fund. Criteria, effect and cause: Utilization of a. general ledger system that segregates and captures all activities by fund is necessary in order to assure the propriety of reporting in financial statements and grantor reports. Without such a system, financial statements could be misstated. Such a system has not been utilized because the Town has had a limited number of activities that needed to be segregated in the general ledger. Recommendation: We suggest the Town implement procedures to record and segregate all O activities of the Town by fund in its general ledger. With the growth and expansion of the Town, it is becoming too cumbersome to manually account for and segregate Town activities required 0 to be recorded within a combined general ledger. Such procedures will enable the Town to better report financial activities, provide more assurance to the Town relative to grantor compliance requirements and provide better information as to the cost of certain activities in order to O determine self - sufficiency. Management's response and corrective plan: The Town experienced rapid growth in its general fund activities the last couple of years with no significant changes in its special revenue funds. As a result, there have been higher priorities in finance and accounting than soliciting new accounting software that will provide fund breakdowns in the general ledger. Management hopes to either make changes to the existing accounting software or purchase a new general ledger system by the end of fiscal 1996, or during fiscal 1997. A material weakness is a reportable condition in which the design or operation of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. 9 4 Honorable Mayor and Town Council Town of Marana, Arizona Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe the reportable condition described above is not a material weakness. This report is intended for the information of the Town Council, management and various providers of governmental financial assistance. However, this report is a matter of public record and its distribution is not limited. d iA3114 g_ gi . 0 Tucson, Arizona February .8, 1996 • 0 0 0 4 4 • 4 0 0 4 0 4 9 4 4 10 4 Clifton, Gunderson & Co. Certified Public Accountants & Consultants FQ Honorable Mayor and Town Council Town of Marana, Arizona a INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS We have audited the general purpose financial statements of the Town of Marana, Arizona as of and O for the year ended June 30, 1995, and have issued our report thereon dated February 8, 1996. We have applied procedures to test the Town of Marana, Arizona's compliance with the following requirements applicable to its federal financial assistance programs, which are identified in the accompanying schedule of federal financial assistance for the year ended June 30, 1995: • Political activity Davis -Bacon Act • Civil rights Cash management Drug -free workplace Allowable costs/cost principles O Administrative requirements , 0 Our procedures were limited to the applicable procedures described in the Office of Management and Budget's Compliance Supplement for Single Audits of State and Local Governments. Our procedures 0 were substantially less in scope than an audit, the objective of which is the expression of an opinion on 4 the Town of Marana, Arizona's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. 0 With respect to the items tested, the results of those procedures disclosed no material instances of Q noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the Town of Marana, Arizona had not complied, in all material respects, with those requirements. This report is intended for the information of the Town Council, management and various providers of governmental financial assistance. However, this report is a matter of public record and its distribution is not limited. 64 14721 % , Tucson, Arizona Members Of February 8, 1996 dlk . 11 INTERNATIONAL AMERICAN INSTITUTE OF CERTIFIED ARIZONA ACCOUNTANTS COLORADO ILLINOIS INDIANA IOWA MARYLAND MISSOURI OHIO WISCONSIN Clifton, Gunderson & Co. Certified Public Accountants & Consultants Honorable Mayor and Town Council Town of Marana, Arizona INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM 'TRANSACTIONS We have audited the general purpose financial statements of the Town of Marana, Arizona as of and for the year ended June 30, 1995, and have issued our report thereon dated February 8, 1996. In connection with our audit of the 1995 general purpose financial statements of the Town of Marana, Arizona and with our consideration of the Town of Marana, Arizona's internal control structure used to administer the Town's federal financial assistance programs, as required by Office of Management and Budget (OMB) Circular A -128, Audits of State and Local Governments, we selected certain 0 transactions applicable to certain nonmajor federal financial assistance programs for the year ended June 30, 1995. As required by OMB Circular A -128, we have performed auditing procedures to test compliance with the requirements governing types of services allowed or unallowed, eligibility, reporting and recordkeeping, and special tests and provisions that are applicable to those transactions. Our procedures were substantially less in scope than an audit, the objective of which is the expression 4 of an opinion on the Town of Marana, Arizona's compliance with these requirements. Accordingly, we do not express such an opinion. 0 With respect to the. items tested, the results of those procedures disclosed no material instances of 0 - noncompliance with the requirements listed in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Town of Marana, Arizona had not complied, in all material respects, with those requirements. 4 This report is intended for the information of the Town Council, management and the various Q providers of governmental financial assistance. However, this report is a matter of public record and its distribution is not limited. d0 .4 gy*willotes, 9 Tucson, Arizona 9 February 8, 1996 4 Members Of fl 12 1 INTERNATIONAL 4 AMERICAN INSTITUTE OF CERTIFIED PUBLIC ARIZONA COLORADO ILLINOIS INDIANA IOWA MARYLAND MISSOURI OHIO WISCONSIN ACCOUNTANTS TOWN OF MARANA, ARIZONA SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended June 30, 1995 None • !�1 0 0 0 4 0 0 0 0 0 0 0 0 0 0 13 4 4 4 4 TOWN OF MARANA, ARIZONA SCHEDULE OF PRIOR YEAR'S FINDINGS Year Ended June 30, 1995 For the year ended June 30, 1994, there were no findings and questioned costs. Reportable conditions concerning the general ledger and a fixed asset inventory have been repeated in the fiscal 1995 reports. 0 0 0 0 • 0 0 0 0 0 • 0 0 0 0 0 0 0 0 0 0 0 14 0