HomeMy WebLinkAboutPublic Safety CFD 2019
City of Azusa –
Community Facilities
District No. 2017-1
(Public Safety Services)
Azusa, California
Financial Statements
and Independent Auditors’ Reports
For the year ended June 30, 2019
City of Azusa – Community Facilities District No. 2017-1
Public Safety Services
Table of Contents
i
Page
Independent Auditors’ Report .............................................................................................................................. 1
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position ........................................................................................................................... 6
Statement of Activities ................................................................................................................................ 7
Fund Financial Statements:
Balance Sheet ................................................................................................................................................ 10
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position........................................................................ 11
Statement of Revenues, Expenditures and Changes in Fund Balances ............................................... 12
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures
and Changes in Fund Balances to the Government-Wide
Statement of Activities .......................................................................................................................... 13
Notes to Financial Statements .......................................................................................................................... 15
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 ................................................................................ 19
ii
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INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the City Council
of the City of Azusa
Azusa, California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and fund
information of the City of Azusa Community Facilities District No. 2017-1 (Public Safety Services)
(District), as of and for the year ended June 30, 2019, and the related notes to the financial statements, as
listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation of
the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
To the Honorable Mayor and Members of the City Council
of the City of Azusa
Azusa, California
Page 2
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and fund information of the District as of
June 30, 2019, and the respective changes in financial position, and, where applicable, cash flows
thereof for the year then ended in accordance with accounting principles generally accepted in the
United States of America.
Other Matters
Required Supplementary Information
Management has omitted the Management Discussion and Analysis that accounting principles
generally accepted in the United States of America require to be presented to supplement the basic
financial statements. Such missing information, although not a part of the basic financial statements, is
required by the Governmental Accounting Standards Board who considers it to be an essential part of
financial reporting for placing the basic financial statements in an appropriate operational, economic,
or historical context. Our opinion on the basic financial statements is not affected by this missing
information.
Emphasis of Matter
As discussed in Note 1, the financial statements present only the City of Azusa – Community Facilities
District No. 2017-1 (Public Safety Services) (District) and do not purport to, and do not, present fairly
the financial position of the City as of June 30, 2019, and the changes in its financial position for the
year then ended in accordance with accounting principles generally accepted in the United States of
America.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated February 19,
2020, on our consideration of the District’s internal control over financial reporting and on our tests of
its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the District’s internal
control over financial reporting and compliance.
Badawi & Associates
Certified Public Accountants
Berkeley, California
February 19, 2020
BASIC FINANCIAL STATEMENTS
3
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4
GOVERNMENT-WIDE FINANCIAL STATEMENTS
5
City of Azusa Community Facilities District No. 2017-1
Public Safety Services
Statement of Net Position
June 30, 2019
Governmental
Activities
ASSETS
Cash and investments 4,545$
Total assets 4,545
LIABILITIES
Accounts payable -
Total liabilities -
NET POSITION
Unrestricted 4,545
Total net position 4,545$
See accompanying Notes to Basic Financial Statements.
6
City of Azusa Community Facilities District No. 2017-1
Public Safety Services
Statement of Activities
June 30, 2019
Net (Expense)
Revenue and
Changes in
Net Position
Operating
Charges for Grants and Governmental
Functions/Programs Expenses Services Contributions Total Activities
Governmental activities:
Rivers and mountains conservation 750$ 5,295$ -$ 5,295$ 4,545$
Total primary government 750$ 5,295$ -$ 5,295$ 4,545
General revenues:
Investment income -
Total general revenues -
Change in net position 4,545
Net position - beginning of year -
Net position - end of year 4,545$
See accompanying Notes to Basic Financial Statements.
Revenues
Program
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8
FUND FINANCIAL STATEMENTS
9
City of Azusa Community Facilities District No. 2017-1
Public Safety Services
Balance Sheet - General Fund
June 30, 2019
ASSETS
Cash and investments 4,545$
Total assets 4,545$
LIABILITIES AND
FUND BALANCES
Liabilities:
Accounts payable -$
Total liabilities -
Fund Balances:
Unassigned 4,545
Total fund balances 4,545
Total liabilities and fund balances 4,545$
See accompanying Notes to Basic Financial Statements.
10
City of Azusa Community Facilities District No. 2017-1
Public Safety Services
Reconciliation of the Balance Sheet of the General Fund
to the Statement of Net Position
Total Fund Balances for the General Fund 4,545$
There were no reconciling differences for fiscal year 2019.
Net Position of Governmental Activities 4,545$
See accompanying Notes to Basic Financial Statements.
June 30, 2019
Amounts reported for governmental activities in the Statement of Net
Position were different because:
11
City of Azusa Community Facilities District No. 2017-1
Public Safety Services
Statement of Revenues, Expenditures and Changes in Fund Balance
General Fund
For the year ended June 30, 2019
REVENUES:
Community maintenance fee 5,295$
Total revenues 5,295
EXPENDITURES:
Current:
Public safety 750
Total expenditures 750
Net change in fund balances 4,545
FUND BALANCES:
Beginning of year -
End of year 4,545$
See accompanying Notes to Basic Financial Statements.
12
City of Azusa Community Facilities District No. 2017-1
Public Safety Services
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balance of the General Fund to the Statement of Activities
For the year ended June 30, 2019
Net Changes in Fund Balances - General Fund 4,545$
There were no reconciling differences for fiscal year 2019.
Change in Net Position of Governmental Activities 4,545$
See accompanying Notes to Basic Financial Statements.
Amounts reported for governmental activities in the Statement of
Activities are different because:
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14
15
NOTES TO FINANCIAL STATEMENTS
City of Azusa – Community Facilities District No. 2017-1
Public Safety Services
Notes to Financial Statements
For the year ended June 30, 2019
16
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Description of Reporting Entity
The City of Azusa Community Facilities District No. 2017-1 (Public Safety Services) (the District) was
established on June 19, 2017, by the City Council of the City of Azusa (the City) pursuant to Chapter 2.5
of Part 1 of Division 2 of Title 5, commencing with Section 53311, of the California Government code
(the “Act”), for the purpose of providing fire protection and suppression services and police protection
services required by new development located within the City using a special tax levy on the properties
within the boundaries of the District.
The financial statements presented in this report cover only the City of Azusa Community Facilities
District No. 2017-1 (Public Safety Services). Therefore, these financial statements do not purport to
represent the financial position or results of operations of the City of Azusa.
B. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net assets and the statement of
activities) report information on the City of Azusa Community Facility District No. 2017-1 (Public Safety
Services).
The statement of activities demonstrates the degree to which the direct expenses of a given function or
segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment.
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement
focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are
recorded when a liability is incurred, regardless of the timing of the related cash flows.
City of Azusa – Community Facilities District No. 2017-1
Public Safety Services
Notes to Financial Statements
For the year ended June 30, 2019
17
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation, Continued
Government fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both
measurable and available. Revenues are considered to be available when they are collectible within the
current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the
government considers revenues to be available if they are collected within 60 days of the end of the
current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual
accounting. However, debt service expenditures are recorded only when payment is due.
D. Asset, Liabilities, and Net Position
Investments
Investments are reported at fair value. Increases and decreases in the fair value of investments, as
well as interest earned on the investments, are reported as investment income.
Receivables and Payables
All trade receivables are shown net of an allowance for uncollectible.
2. CASH AND INVESTMENTS
As of June 30, 2019, cash and investments were reported in the accompanying financial statements as
follows:
Cash and investments pooled with the City of Azusa $ 4,545
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19
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
To the Honorable Mayor and Members of the City Council
of the City of Azusa
Azusa, California
We have audited, in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards issued
by the Comptroller General of the United States, the financial statements of the City of Azusa Community
Facilities District No. 2017-1 (Public Safety Services) (District), as of and for the year ended June 30, 2019,
and the related notes to the financial statements, which collectively comprise the District’s basic financial
statements, and have issued our report thereon dated February 19, 2020.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the District’s internal
control over financial reporting (internal control) to determine the audit procedures that are appropriate in
the circumstances for the purpose of expressing our opinions on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do
not express an opinion on the effectiveness of the District’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management
or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct,
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control, such that there is a reasonable possibility that a material misstatement of the entity’s
financial statements will not be prevented, or detected and corrected on a timely basis. A significant
deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a
material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any
deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses
may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the District’s financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, 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 or other matters that are required to be
reported under Government Auditing Standards.
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To the Honorable Mayor and Members of the City Council
of the City of Azusa
Azusa, California
Page 2
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this
communication is not suitable for any other purpose.
Badawi & Associates
Certified Public Accountants
Berkeley, California
February 19, 2020