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ITEM 29 |
City Council Memorandum Management Services Memo No.
22-031
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Date: |
January 24, 2022 |
To: |
Mayor and Council |
Thru: |
Joshua H. Wright, City Manager Dawn Lang, Deputy City Manager - CFO |
From: |
Kristi Smith, Financial Services Assistant Director |
Subject: |
Annual Comprehensive Financial Report for the Fiscal Year Ended June 30, 2021, and Resolution No. 5542 to demonstrate compliance with ARS §9-481(H) and ARS §41-1494 |
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Proposed Motion: |
Move City Council accept the Annual Comprehensive Financial Report (ACFR) and related financial audit reports submitted by Heinfeld, Meech & Co., P.C. for the fiscal year ended June 30, 2021, and approve Resolution No. 5542 to demonstrate compliance with §9-481(H) and ARS §41-1494. |
Background: |
The City is required by City Charter and State Statute to issue an annual audited financial report, and federal law requires the City to undergo an annual single audit (A-133) of federal financial assistance. Effective September 29, 2021, ARS §9-481(H), as amended by Laws 2021, Ch 427, §1, auditors must present audit results and any findings to the council in a regular meeting without the use of a consent agenda within 90 days of audit completion. On June 14, 2018, City Council approved an agreement with Heinfeld, Meech & Co., P.C. (HM) for audit services, for a one-year period, with the option of up to four one-year extensions. The agreement was extended for FY 2020-21 and HM, as independent auditors, completed the financial audit for FY 2020-21. The final FY 2020-21 ACFR and Single Audit Report are available for viewing on the City's website at chandleraz.gov/FinancialReport. As in years past, this year's ACFR is believed to conform to the Government Finance Officers Association's (GFOA's) Certificate of Achievement for Excellence in Financial Reporting Award Program qualifications and has been submitted for the 40th consecutive year of recognition. |
Discussion: |
In HM's Independent Auditor's Report on the City's FY 2020-21 ACFR, HM stated that the financial statements present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate discretely presented component units and remaining fund information. The Independent Auditor's Report can be found on pages 11-13 of the ACFR. Beginning on page 1 of the Single Audit Reporting Package, HM issued Independent Auditor's Reports on the 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 and Report on Compliance for Each Major Federal Program, Report on Internal Control Over Compliance, and Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance. These reports state that the testing disclosed no significant deficiencies or material weaknesses in internal control, that the City complied in all material respects with the types of compliance requirements, and the schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements. HM also provided a Communication to Governance letter that summarizes significant aspects of the City's accounting practices, which includes noting the newly applicable accounting standards along with the City's most sensitive accounting estimates and other required disclosures. This report does not identify any areas of concern. Also, effective September 29, 2021, ARS §41-1494, added a requirement for the governing body to demonstrate compliance prohibiting the use of " . . . public moneys for training, orientation or therapy that presents any form of blame or judgment on the basis of race, ethnicity or sex. This subsection does not preclude any training on sexual harassment." Resolution No. 5542 determines compliance with ARS §9-481(H) and ARS §41-1494. |
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