Finance Committee February 12, 2019 6:15 pm Action It Item A: : - PowerPoint PPT Presentation

Finance Committee February 12, 2019 6:15 pm

Action It Item A: : Approval of the Min inutes • From the December 11, 2018 meeting.

Action It Item B: : Dis iscuss Fis iscal Year 2017-2018 Audit it Presented by Kent Willis, CPA Pattillo, Brown & Hill, LLP

PRESENTED TO CITY OF WESTWORTH VILLAGE, TEXAS Annual Financial & Compliance Audit FINANCE COMMITTEE/CITY COUNCIL February 12, 2019

INTRODUCTION & AGENDA Kent Willis, CPA Government Audit Audit process • Audit results • Required auditor communications • Financial highlights • Discussion/questions •

AUDIT PROCESS

AUDIT PROCESS • The audit was performed in accordance with Generally Accepted Auditing Standards (GAAS) and Government Auditing Standards (GAS). • Interim testing performed in June of 2018 including: Walkthroughs of accounting controls over significant ‒ transaction cycles Tests of controls over cash disbursements, payroll, and ‒ utility billing Tests of compliance with laws, regulations, contracts and ‒ grants • Fieldwork performed in November 2018.

AUDIT RESULTS

AUDIT RESULTS • Independent Auditors’ Report, found on pages 1 – 3 of the Comprehensive Annual Financial Report. Unmodified opinion - highest form of opinion that can be ‒ issued. • Independent Auditors’ Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards, found on pages 61 – 62 of the Annual Financial Report. No material instance of non-compliance ‒ One deficiency in internal control identified to be a ‒ material weakness Capital Assets (recurring deficiency) – page 63 ‒

COMMUNICATION

COMMUNICATION REQUIRED COMMUNICATION TO THOSE IN CHARGE OF GOVERNANCE AUDITOR’S RESPONSIBILITY • Reasonable assurance that the financial statements are UNDER GENERALLY free of material misstatement. ACCEPTED AUDITING STANDARDS (GAAS) • Express an opinion about whether the financial statements prepared by management are fairly presented, in all material respects .

COMMUNICATION REQUIRED COMMUNICATION TO THOSE IN CHARGE OF GOVERNANCE FRAUD & ILLEGAL ACTS No fraud, irregularities, or illegal acts were noted. MATERIAL WEAKNESS IN INTERNAL CONTROL One material weaknesses noted. MANAGEMENT Management’s estimates were evaluated and JUDGMENTS AND determined to be reasonable in relation to the ACCOUNTING ESTIMATES financial statements as a whole. DIFFICULTIES No difficulties or disagreements during the course of ENCOUNTERED our audit.

FINANCIAL HIGHLIGHTS

FINANCIAL HIGHLIGHTS COMPARISON OF GOVERNMENTAL ACTIVITIES Net Position 4.22 6 3.715 2.877 MILLIONS 4 5.358 2 2.585 3.43 2017 0 2018 Net Investment in Restricted Capital Assets Unrestricted

FINANCIAL HIGHLIGHTS COMPARISON OF BUSINESS-TYPE ACTIVITIES Net Position 8.000 6.775 6.000 M I L L I O N S 6.556 4.000 0.891 2.000 2017 0.624 0.000 2018 Net Investment in Unrestricted Capital Assets

FINANCIAL HIGHLIGHTS GOVERNMENTAL FUNDS Net Position FUND BALANCE (in thousands) As of year end, the City’s governmental funds reported a combined ending fund balance of $6.22 million as follows: General Fund $1,522 - General Fund $3,550,753 Capital Projects $3,551 - Capital Projects 211,346 $370 - Debt Service 369,557 Debt Service $211 - WRA 1,522,512 WRA Unassigned General Fund Balance, $3.48 million, is 105% of total General Fund expenditures for fiscal year 2018. Restricted fund balance in the General Fund includes $72,163 for various items.

FINANCIAL HIGHLIGHTS COMPARISON OF GOVERNMENTAL FUNDS Revenues $113,589 Other $439,946 Fines and Forfeitures $806 2017 $72,505 Charges for Services $176,893 $2,190,571 Intergovernmental $191,105 License and Permits $315,564 Taxes $11,969 2018 $96,664 $370,013 $2,538,880 $0 $1,000,000 $2,000,000 $3,000,000 REVENUE Overall total revenues for fiscal year 2018 were 18% higher. Governmental Funds revenues totaled $4.79 million, a $44 thousand increase from fiscal year 2017.

FINANCIAL HIGHLIGHTS COMPARISON OF GOVERNMENTAL FUNDS Expenditures 1,056,598 2,094,809 90,306 Debt Service 94,709 2017 277,667 Capital Outlay 150,740 1,250,027 Redevelopment 1,303,753 Culture and Recreation 1,152,713 1,652,175 Fire 26,993 85,647 2018 Judicial 314,494 151,879 1,322,249 Police 1,773,668 General Government 0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 EXPENDITURES Expenses increased by $161 thousand in fiscal year 2018.

FINANCIAL HIGHLIGHTS PROPRIETARY FUNDS Net Position As of year end, the City’s NET POSITION proprietary funds reported a combined ending net position of $7.2 million as follows: $2,304,242 Water and Sewer $4,885,594 Hawks Creek Golf Course

FINANCIAL HIGHLIGHTS COMPARISON OF PROPRIETARY FUNDS Operating Revenues & Expenses 1.915 2.000 1.688 1.600 1.800 1.499 1.457 1.425 1.444 Water and 1.600 1.248 MILLIONS Sewer 1.400 1.200 1.000 0.800 Hawks Creek 0.600 Golf Course 0.400 0.200 0.000 2018 Revenues 2018 Expenses 2017 Revenues 2017 Expenses

DISCUSSION

Action It Item C: Next xt Meeting • Next meeting is scheduled for March 12 th . Meeting Adjourned