ITEM 4.2CAFRots11.r o
MINNESOTA V
DEPARTMENT INFORMATION
Request for
City Council Action
ORIGINATING DEPARTMENT:
REQUESTOR:
MEETING DATE:
Administration
Lori Johnson, City Administrator
June 22, 2015
PRESENTER(s):
REVIEWED BY:
ITEM #:
Lori Johnson, City Administrator
(clean) opinion on the statements. KDV completed the audit of the City's financial reports, and Michael
4.2
AGENDA ITEM DETAILS
RECOMMENDATION:
Following a presentation of the 2014 Comprehensive Annual Financial Report (CAFR), it is recommended
that the City Council adopt Resolution 2015-32 a Resolution Adopting the Comprehensive Annual
Financial Statement for the Fiscal Year Ended December 31, 2014.
ARE YOU SEEKING APPROVAL OF A CONTRACT?
IS A PUBLIC HEARING REQUIRED?
No
No
BACKGROUND/JUSTIFICATION:
The CAFR for the year ended December 31, 2014, is hereby submitted. The City received an unmodified
(clean) opinion on the statements. KDV completed the audit of the City's financial reports, and Michael
Bosl of KDV will be at Monday's meeting to report the results of the audit.
SUPPORTING DOCUMENTS: X ❑ ATTACHED ❑ NONE
• 2014 CAFR
• 2014 Auditor's Reports on Compliance
• 2014 Auditor's Communications Letter
• Resolution 2015-32 Adopting the Comprehensive Annual Financial Statement for the
Fiscal Year Ended December 31, 2014
POSSIBLE MOTION
Please word motion as you would like it to appear in the minutes.
Motion to adopt Resolution 2015-32 Adopting the Comprehensive Annual Financial Statement for the
Fiscal Year Ended December 31, 2014.
BUDGET INFORMATION
FUNDING: BUDGETED: X ❑ YES
N/A
❑ NO
ACTION TAKEN
❑ APPROVED AS REQUESTED ❑ DENIED ❑ TABLED ❑ OTHER (List changes)
COMMENTS:
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO: 2015-32
RESOLUTION ADOPTING THE COMPREHENSIVE ANNUAL FINANCIAL
STATEMENT FOR THE FISCAL YEAR ENDED DECEMBER 31, 2014
WHEREAS, the City annually prepares fmacial statements detailing the balance sheets,
revenues and expenses, cash flows, debt positions, investment details and other statistical
information conveying the financial condition of the City to users of these financial statements;
and
WHEREAS, the compilation of these statements and their narrative components are referred to
as the Comprehensive Annual Financial Statement of the City; and
WHEREAS, the CAFR has been subjected to the review and audit standards mandated by
Minnesota State Statutes and Laws, GAAP, GAAFR standards the Certificate of Compliance
criteria of the Government Finance Officers Association (GFOA); and
WHEREAS, the audit of the CAFR has been completed by KDV Ltd., a certified public
accounting firm from Saint Cloud, Minnesota with expertise in municipal audits, and the City's
financial statement have been found to "present fairly, in all material respects, the respective
financial position of governmental activities, the business type -funds, each major fund and the
aggregate remaining fund information of the City of Otsego, Minnesota as of December 31,
2014" conveying an unmodified or clean opinion of the fair presentation of the CAFR; and
WHEREAS, said CAFR and the documents summarizing the audit process and finding have
been distributed to and discussed with the City Council of the City of Otsego on Monday, June
22, 2015.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
OTSEGO, WRIGHT COUNTY, MINNESOTA THAT:
the Comprehensive Annual Financial Report of the City of Otsego, Minnesota for the year ended
December 31, 2014 be and hereby is adopted as the official financial statement of the City of
Otsego for said fiscal year.
ADOPTED by the Otsego City Council this 22nd day of June, 2015.
MOTION made by Council Member and SECONDED by Council
Member
IN FAVOR:
OPPOSED:
CITY OF OTSEGO
Jessica Stockamp, Mayor
ATTEST:
Tami Loff, City Clerk
IDV
Oty of Otsego
Comprehensive Annual Finandal
[bport
Audit Presentation
June 22, 2015
Planning
Fieldwork
Draft M
Final Peports
Board Presentation
Qty of Otsego) 612312015
KON
Components of the Audit K.D-V
Opinion on the City's Basic Financial Statements
- Unmodified Opinion - Bei opinion an auditor isable
to offer
- Provides assurance that thefinancial s�atementsare
fairly presented in all material respects
Comprehensive Annual Financial Peport (CAA also
reviewed for GFOA Certificate of Achievement for
Excel I ence i n Fi nand al Peport i ng
Qty of Otsego) 612312015 13
Components of the Audit
Report on the results of tes[ing in accordance with
a 40o01[cj:jb1s-no findings
1. Cont rad sand Bidding
2. Depots and Inves[ments
3. Conflids of Interes[
4. Public Indebtedness
5. gaimsand Disbursements
6. Miscellaneous Provisons
7.Tax Increment Anand ng
Qty of Otsego) 612312015 14
KON
Components of the Audit
Internal Control Findings
- Material Weakness
— Prior Period Adju�ment
- 9gnificant Deficiency
— Lack of %gregation of Accounting Duties
Pequired Communication
Qty of Otsego) 612312015
KON
General Fund
F, 1� 1y
d Iz. -
General Fund
YON
1 1
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$-
2012
2010
2011
2013
2014
1 Total Revenues
$3,596,033
$4,006,449
$3,697,348
$3,779,808
$5,307,292
1 Total Expenditures
2,824,216
2,992,102
3,521,355
3,654,491
4,165,186
1Fund Balance
1,713,440
1,703,598
1,764,591
1,912,075
3,393,638
Oty of Otsego I June 22, 2015
General Fund fbvenues Kph
General Fund Revenues
0U,VVV,VVU
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$(1,000,000)
2010
2011
2012
2013
2014
1Taxes
$3,155,451
$3,443,841
$3,245,677
$3,449,691
3,442,280
1Intergovernmental
191,784
199,053
208,822
217,630
337,779
�Licenses and Permits
15,708
23,450
33,915
36,455
1,238,823
Charges for Services
93,611
175,275
59,996
38,321
192,168
1Investment Income
97,904
119,555
93,509
(5,403)
37,427
1 Other
41,575
45,275
55,429
43,114
58,815
Oty of Otsego I June 22, 2015
Taxes
64
General Fund fbvenues
2014
U. l%
1.110
Oty of Otsego I June 22, 2015
;overnmental
6.4%
Licenses and
Permits
23.3%
Ode
KON
General Fund fbvenues KPV
Budget and Actual
Q1 0A ..
1
$,
$,
$1
400,000
200,000
000,000
800,000
600,000
400,000
200,000
000,000
800,000
600,000
400,000
200,000
0
6
4 00,000
00,000
00,000
00,000
200,000
$ Taxes Intergovernmental Licenses and Permits Charges for Services Investment Income Other
NBudget $3,378,715 $316,611 $557,300 $65,650 $100,000 $-
lActual 3,442,280 337,779 1,238,823 192,168 37,427 58,815
Oty of Otsego I June 22, 2015 19
Oty of Otsego I June 22, 2015 19
General Fund Expenditures
m n enn nnn
kD'V
,p`F,JUU,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
2010
2011
2012
2013
2014
1 General Government
$803,043
$894,209
$920,619
$973,051
$1,188,802
(Public Safety
854,746
877,875
1235,982
1,263,881
1,496,112
(Public Works
948,251
961,590
998,144
1,109,949
1,014,937
1Parks and Recreation
201,080
246,075
277,605
304,324
461,240
(Economic Development
17,096
12,353
89,005
3,286
4,095
Oty of Otsego I June 22, 2015
J
General Fund Expenditures KI A/I
2014
General
Government
28.5%
Public Safety
35.9%
Public Works
24.4%
aty of OtsegD
Economic
Development
0.1%
June 22, 2015 111
Parks and General
Recreation 2
11.1%
F2O13
Alwi QIf.hr
Public Works
Economic ga/o
Development
1.0%
4%
tion
General Fund Expenditures
Budget and Adual
$1,600,000
,400,000
,200,000
,000,000
6800,000
6600,000
6400,000
6200,000
$
General
Government
Public Safety
Public Works
Parks and
Recreation
Economic
Development
iBudget
$1,161,211
$1,540,942
$1,017,240
$482,602
$13,790
iActual
$1,188,802
1,496,112
1,014,937
461,240
4,095
aty of Otsego I ,ane 22, 2015
Tax Capacity, levy and Rates
$14,000,000
$12,000,000
$10,000,000
a�
$8.000.000
u
2
0 $6,000,000
P.•
N
$4,000,000
$2,000,000
wa
46.23%D
44.58%D
$13,012,184 $11,660,126 41,45%
101111hooE,4
= Is
$9,470,288
$10 278,548 $10,095,765
1 , Apo
34.01°/D
29.34%D
$4,260,869 $4,378,021 $4,500,188
F$3,818,034 $3,966,075
2010 2011 2012 2013 2014
-I— Tax Levy -*-Total Tax Capacity -+-Tax Capacity Rate I
Oty of Otsego iI lue 22, 2015 1113
45.00%
40.00%
35.00%
30.00%
25.00%
a
20.00% u
15.00%
10.00%
5.00%
0.00%
H
Wafer Fund
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
ION
$(200,000)
2010
2011
2012
2013
2014
1 Operating Revenues
$737,164
$728,544
$986,597
$1,195,892
$1,114,528
1 Operating Expenses
876,910
888,876
877,076
907,185
853,551
1 Operating Income (Loss) with Depreciation
(139,746)
(160,332)
109,521
288,707
260,977
1 Operating Income (Loss) without Depreciation
334,112
312,899
582,900
763,931
733,738
aty of Otsego I June 22, 2015 114
Viewer Fund
$1,500,000
$1,000,000
$500,000
$(500,000)
$(1,000,000)
2010
2011
2012
2013
2014
1 Operating Revenues
$978,455
$1,051,945
$1,043,570
$1,186,523
$1,325,181
Operating Expenses
1,526,183
1,638,686
1,571,150
1,529,321
1,458,714
Operating Income (Foss) with Depreciation
(547,728)
(586,741)
(527,580)
(342,798)
(133,533)
Operating Income (Loss) without Depreciation
272,161
239,354
298,662
481,694
689,589
Oty of Otsego I June 22, 2015 115
,R,orm Dater Fund
KDV
$90,000
$70,000
$50,000
$;0,000
$10,000
$(10,000)
$(30,000)
$(50'000) 2010 2011 2012 2013 2014
1Operating Revenues $72,081 $71,762 $37,231 $41,831 $45,570
I Operating Expenses 68,903 61,024 69,834 72,944 57,977
1Operating Income Goss) with Depreciation 3,178 10,738 (32,603) (31,113) (12,407)
1 Operating Income ( oss) without Depreciation 20,936 28,496 (14,845) (13,355) 5,376
Gty of Otsego I June 22, 2015 116
K,D-V
CITY
rtrtr- r'�lr�
Nari� Shla�enberg, CPr1
Audi Patne'
(320)6500219
Thank you!
Oty of Otsego I June 22, 2015 117