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1999 City Compliance ReportsH I 1 1 I I CITY OF ROSEMEAD COMPLIANCE REPORTS AND OTHER FINANCIAL INFORMATION JUNE 30, 1999 1 1 1 CONTENTS SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS I and 2 INDEPENDENT AUDITOR'S REPORT ON: Compliance with requirements applicable to the major program and internal control over compliance in accordance with OMB Circular A-133 3 and 4 Compliance and on internal control over financial reporting based on an audit of financial statements performed in accordance with Government Auditing Standards 5 and 6 SCHEDULE OF FINDINGS AND QUESTIONED COSTS 7 and 8 INDEPENDENT AUDITOR'S REPORT REQUIRED BY PROPOSITION I I 1 ON THE CITY'S APPROPRIATIONS LIMIT CALCULATION 9 and 10 Annronriations Limit Calculation 11 LJ 1 1 I CITY OF ROSEMEAD, CALIFORNIA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Year Ended June 30, 1999 Catalog of Federal Pass- Domestic through Entity Program Program Assistance Identifying or Award Expendi- Grantor/Pass-through Grantor Program Title Number Number Amount tures U.S. Department of Housing and Urban Development Direct Programs: Community Development Block Grant Entitlement Program 14.218 B-97-MC-06-0580 $ 1,567,940 $ 1,420,296 14.218 B-98-MC-06-0580 1,507,000 820,792 3,074,940 2,241,088 HOME Investment Partnership Program 14.239 M96-MC-06-0553 448,000 448,000 14.239 M97-MC-06-0553 437,000 437,000 14.239 M98-MC-06-0553 467,000 115,000 1,352,000 1,000,000 U.S. Department of Justice Passed through County of Los Angeles Sheriffs Department: Community Oriented Policing Services 16.580 P41401 379,375 - Local Law Enforcement Block Grant 16.592 98LBVX3711 123,782 123,782 503,157 123,782 U.S. Department of Transportation Passed through California Department of Transportation: Highway Planning and Construction Program 20.205 07-5358 1,021.000 1,021,000 Total expenditures of federal awards $ 5,951,097 $ 4,385 870 I I I I I CITY OF ROSEMEAD NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS June 30, 1999 Note 1. Basis of Presentation The accompanying schedule of expenditures of federal awards includes the federal grant activity of the City of Rosemead, California (the City) and is presented on the modified-accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profa Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the general purpose financial statements. Note 2. Subrecipienis Of the federal expenditures presented in the schedule, the City provided federal awards to subrecipients as follows: CFDA Number Program Title Provided 14.218 Community Development Block Grant Entitlement Program 2 Amount Expended $131,382 0 McGLADREY& PULLEN, LL P ® Certified Public Accountants RSM international I I City of Rosemead INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO THE MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 To the Honorable Mayor and Members of the City Council Rosemead, California ' Compliance We have audited the compliance of the City of Rosemead, California (the City) with the types of ' compliance requirements described in U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to its major federal program for the year ended June 30, 1999. The City's major federal program is identified in the summary of auditors results section of the ' accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to its major federal program is the responsibility of the City's management. Our responsibility is to express an opinion on the City's compliance based on our audit. I We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of Slates, Local Governments and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the City's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on the City's compliance with those requirements. In our opinion, the City complied, in all material respects, with the requirements referred to above that are applicable to each of its major federal program for the year ended June 30, 1999. I Internal Control Over Compliance The management of the City is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to federal programs. In planning and performing our audit, we considered the City's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133. ' Our consideration of internal control over compliance would not necessarily disclose all matters of internal control that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more internal control component does not reduce to a relatively low level the risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major federal program being audited may occur and not be detected ' within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving internal control over financial reporting and its operation that we consider to be material weaknesses. ' Schedule of Expenditures of Federal and State Awards We have audited the general purpose financial statements of the City as of and for the year ended ' June 30, 1999, and have issued our report thereon, dated August 31, 1999. Our audit was performed for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The accompanying schedule of expenditures of federal and state awards is presented for purposes of additional analysis as required by OMB Circular A-133 and is not a required part of the general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly stated in all material respects in ' relation to the general purpose financial statements taken as a whole. This report is intended for the information of City Council, management and applicable governmental ' control agencies and is not intended to be and should not be used by anyone other than those specified parties. ~G~e~~eifliJC t /l .C- Pasadena, California ' August 31, 1999 1 4 I 1 `McGLADREY&PULLENLL P 1 ® Certified Public Accountants INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Honorable Mayor and Members of the City Council City of Rosemead Rosemead, California RSM international We have audited the financial statements of the City of Rosemead, California (the City) as of and for the year ended June 30, 1999, and have issued our report thereon, dated August 31, 1999. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether the City's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, 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 that are required to be reported under Government Auditing Standards. Internal Control Over Financial Reporting In planning and performing our audit, we considered the City's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on internal control over financial reporting. Our consideration of internal control over financial reporting would not necessarily disclose all matters in internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more internal control component does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the 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. We noted no matters involving internal control over financial reporting and its operation that we consider to be material weaknesses. ' This report is intended for the information of City Council, management, and applicable governmental control agencies and is not intended to be and should not be used by anyone other than those specified ' parties. Pasadena, California August 31, 1999 1 1 6 CITY OF ROSEMEAD SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended June 30, 1999 1. Summary of Independent Auditor's Results Financial Statements Type of auditor's report issued: Unqualified Internal control over financial reporting: Material weakness(es) identified? Yes X No Reportable condition(s) identified that are not considered to be material weaknesses? Yes X None Reported Noncompliance material to financial statements noted? Yes X No Federal Awards Internal control over major program: Material weakness(es) identified? Yes X No Reportable condition(s) identified that are not considered to be material weakness(es)? Yes X None Reported Type of auditor's report issued on compliance for major programs: Unqualified Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A-133? Yes X No Identification of major program CFDA Number Name of Federal Program Amount Expended 14.218 Community Development Block Grant Entitlement Program $1241,088 Dollar threshold used to distinguish between type A and type B programs $300,000 Auditee qualified as low-risk auditee? X Yes No 7 1 1 1 1 1 1 CITY OF ROSEMEAD SCHEDULE OF FINDINGS AND QUESTIONED COSTS, CONTINUED Year Ended June 30, 1999 IL Findings relating to the financial statement audit as required to be reported in accordance with generally accepted Government Auditing Standards NONE III. Findings and questioned costs for federal awards NONE 8 McGLADREY& PULLEN, LLP RSM ® Certified Public Accountants international 1 ' INDEPENDENT ACCOUNTANT'S REPORT REQUIRED BY PROPOSITION 111 ON THE CITY'S APPROPRIATIONS LIMIT CALCULATION To the Honorable Mayor and Members of the City Council ' City of Rosemead Rosemead, California ' We have applied the procedures enumerated below to the accompanying Appropriations Limit Calculation of the City of Rosemead, California (the City) for the year ended June 30, 1999. These procedures, which were agreed to by the League of California Cities and presented in their Article XIIIB ' Appropriations Limitation Uniform Guidelines, were performed solely to assist you in meeting the requirements of Section 1.5 of Article XIIIB of the California Constitution. This agreed-upon procedures engagement was performed in accordance with standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of the specified users of the report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures performed and our findings were as follows: I. We obtained the completed computations and determined that the limit and annual adjustment factors were adopted by a resolution of the City Council, along with the annual budget. 2. For the accompanying Appropriations Limit Calculation, we added line A, last year's limit, to line E, total adjustments, and agreed the resulting amount to line F, this year's limit. I3. We agreed the current year information presented in the accompanying Appropriations Limit Calculation to the supporting calculations described in #1 above. ' 4. We agreed the prior year Appropriations Limit presented in the accompanying Appropriations Limit Calculation to the prior year Appropriations Limit which was adopted by the City Council during the prior year. ' We were not engaged to, and did not, perform an examination, the objective of which would be the expression of an opinion on the accompanying Appropriations Limit Calculation of the City. ' Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. I 9 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 This report is solely for the information and use of the Honorable Mayor and Members of the City Council, and is not intended to be and should not be used by anyone other than those specified parties. 1 Pasadena, California August 31, 1999 10 1 1 1 1 1 1 1 1 1 CITY OF ROSEMEAD APPROPRIATIONS LIMIT CALCULATION Year Ended June 30, 1999 Amount Source A. Last year's limit B. Adjustment factors 1. Population change 2. Inflation change Total adjustment C. Annual adjustment $ 21,151,499 1.0139 State Finance 1.0415 State Finance .0560 $ 1,184,484 D. Other adjustments: Lost responsibility Transfer to private Transfer to fees Assumed responsibility Subtotal E. Total adjustments F. This year's limit 1,184,484 $ 22,335,983 (BxA)