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HomeMy WebLinkAboutCouncil Presentation - 2024 Audit Resultsbakertilly MARANA Reporting and insights from 2024 audit: Town of Marana, Arizona June 30, 2024 This communication is intended solely for the information and use of those charged with governance, and, if appropriate, management, and is not intended to be and should not be used by anyone other than these specified parties. Baker Tilly Advisory Group, LP and Baker Tilly US, LLP, trading as Baker Tilly, are members of the global network of Baker Tilly International Ltd., the members of which are separate and independent legal entities. Baker Tilly US, LLP is a licensed CPA firm that provides assurance services to its clients. Baker Tilly Advisory Group, LP and its subsidiary entities provide tax and consulting services to their clients and are not licensed CPA firms. xecutive summary MARANA AZ We have completed our audit of the financial statements of the Town of Marana for the year ended June 30, 2024 and have issued our report thereon dated February 14, 2025. • Financial Statement Audit Report • Unqualified opinion • Government Auditing Standards Compliance Report • No instances of noncompliance or other matters • No identified material weaknesses • Federal Grants Single Audit Report • Major Programs — Homeland Security Grant Program and Capitalization Grants for Drinking Water State Revolving Fund Program • No Findings This .presentation supplements our letter to governance dated February 14, 2025 as required by our professional standards. Our responsibilities MARANA AZ As your independent auditor, our responsibilities include: • Planning and performing the audit to obtain reasonable assurance about whether the basic financial statements are free from material misstatement. Reasonable assurance is a high level of assurance, but not an absolute level of assurance. • Assessing the risks of material misstatement of the basic financial statements whether due to fraud or error. Included in that assessment is a consideration of the Town's internal control over financial reporting • Performing appropriate procedures based upon our risk assessment • Evaluating the appropriateness of the accounting policies used and the reasonableness of significant accounting estimates made by management • Forming and expressing an opinion based on our audit about whether the basic financial statements prepared by management, with the oversight of those charged with governance: • Are free from material misstatement • Present fairly in all material respects and in accordance with accounting principles generally accepted in the United States of America • Performing tests related to compliance with certain provisions of laws, regulations, contracts and grants, as required by Government Auditing Standards • Considering internal control over compliance with requirements that could have a direct and material effect on major federal programs to design tests of both controls and compliance with identified requirements • Forming and expressing an opinion based on our audit in accordance with OMB's Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance) about the entity's compliance with requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of its major federal programs. • Our audit of the basic financial statements does not relieve management or those charged with governance of their responsibilities. Our responsibilities MARANA AZ We are also required to communicate significant matters related to our audit that are relevant to the responsibilities of those charged with governance including: • Internal control matters — Various controls have been tested with no reportable findings. • Qualitative aspects of the Town's accounting practice including policies, accounting estimates and financial statement disclosures — This can be found on Note 1 of the financial statements • Significant unusual transactions — All significant and unusual transactions have been audited with no reportable issues. • Significant difficulties encountered — No difficulties to report • Disagreements with management — No disagreements to report • Circumstances that affect the form and content of the auditors' report • Audit consultations outside the engagement team — None noted • Corrected and uncorrected misstatements — No uncorrected misstatements identified • Other audit findings or issues — No audit findings or issues identified Required communications MARANA AZ Management's consultations with other accountants • In some cases, management may decide to consult with other accountants about auditing and accounting matters. • Management informed us that and to our knowledge, there were no consultations with other accountants regarding auditing or accounting matters. Compliance with laws and regulations We did not identify any non-compliance with laws and regulations during our audit. Fraud We did not identify any instances of known or suspected fraud during our audit. Going concern Pursuant to professional standards, we are required to communicate to you, when applicable, certain matters relating to our evaluation of the Town's ability to continue as a going concern for a reasonable period of time but no less than 12 months from the date of the basic financial statements including the effects on the basic financial statements and the adequacy of the related disclosures and the effects on the auditor's report. No such matters or conditions have come to our attention during our engagement. Related parties We did not have any significant findings or issues arise during the audit in connection with the Town's related parties. Nonattest services The following nonattest services were provided by Baker Tilly: • Financial statement preparation • Adjusting journal entries • Preparation of Part II of the Data Collection Form MARANA AZ In addition, we prepared GASB No. 34 conversion entries which are summarized in the, "Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position" and the, "Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities" in the financial statements. None of these nonattest services constitute an audit under generally accepted auditing standards, including Government Auditing Standards. *Non -attest services are provided by Baker Tilly Advisory Group, LP Communications with Town Council and Management MARANA AZ • Expenditure Limitation Report • Town was $184.1 million dollars under the Home Rule Expenditure Limitation • Issued to the Arizona State Auditor General timely Voter -Approved Expenditure Limitation Town Expenditures Subject to Limitation Amount under the expenditure Limitation $336,261,198 152,072,904 $184,188,294 • Single Audit • Town expended $1,989,588 of federal funds in Fiscal Year 2024 • Major programs were: • Homeland Security Grant Program • Capitalization Grants for Drinking Water State Revolving Fund Program • Town received an unmodified opinion on the federal single audit • Communications with Town Council and Management MARANA AZ • General Fund • Fund balance increased by $30.7 million mainly as a result of an increase in intergovernmental revenue, investment income, and licenses, fees and permits • Actual revenues were $24.4 million more than budget • Actual expenditures were $16.7 million less than budget • Highway User Revenue Fund • Fund balance increased by $1.4 million mainly due to an increase in licenses, fees, and permits and interest earnings. • Actual revenues were $292K more than budget • Actual expenditures were $2.5 million less than budget Communications with Town Council and Management MARANA AZ • Enterprise Funds • Water fund —Development fees of $7.8 million and capital contributions of $4.3 million led to an increase in net position • Wastewater fund —Transfers out of $14.4 million led to a decrease in net position • Airport fund —Capital contributions of $2.3 million and transfers in of $213K led to an increase in net position Questions? Brian Hemmerle, CPA, CFE Partner E: Brian.Hemmerle@bakertilly.com MARANA