HomeMy WebLinkAboutFin Single Audit FY2011-12F`ry OF�� Agenda Item No: 3. f
Meeting Date: March 18, 2013
SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: FINANCE
Prepared by: Mark Moses
Interim Finance Director
City Manager Approval• _
SUBJECT: FY 2011-2012 SINGLE AUDIT REPORT
RECOMMENDATION: ACCEPT THE FY 2011-2012 SINGLE AUDIT REPORT
BACKGROUND: As required by both local code and State law, the City of San Rafael must
complete an annual audit of its financial activities. The firm of Maze and Associates,
Accountancy Corporation performed the audit for fiscal year 2011-2012. Their work was
completed in accordance with generally accepted auditing standards; Government Auditing
Standards, issued by the Comptroller General of the United States; and the provisions of Office
of Management and Budget Circular A-133, Audits of State and Local Government and Non -
Profit Organizations.
The Federal Government requires that any local agency receiving or expending $500,000 or more
in combined federal grant funds, either directly or indirectly in a fiscal year, is subject to a
separate audit on those programs and a separate Single Audit Report is issued. This threshold
amount occurred in fiscal year 2011-2012; therefore, this separate audit report was required.
ANALYSIS: The City incurred a total of $851,151 in federal expenditures during FYI 1-12 that
fall under the parameters of this audit. The auditor identified the following two major programs
to be audited.
U.S Department of Transportation - State and Community Highway Safety: $151,921 —
funds supported traffic enforcement, including DUI enforcement and awareness.
2. U.S Department of Transportation — Minimum Penalties for Repeat Offenders for Driving
While Intoxicated: $185,989 — funds supported DUIIDL checkpoints, DUI saturation patrols,
multi -Agency DUI task force operations, warrant service operations, and Court stings, which
raise general public awareness regarding the problem associated with drinking and driving and
increase DUI enforcement and intensive media campaigns on a county -wide basis.
FOR CITY CLERK ONLY
File No.. -I. q- S m -2 0
Council Meeting: q� y
Disposition: o 2
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
As required under the Single Audit Act, a number of separate reports are contained within this
document. Most of these reports comment on either compliance with Federal assistance
regulations or recommendations regarding the City's accounting practices. With respect to
compliance, the auditors found no material instances of noncompliance with laws, regulations,
contracts or grants applicable to our programs. There were no current findings or
recommendations.
FISCAL IMPACT: No fiscal impact occurs by City Council's acceptance of this report.
RECOMMENDATION: Accept the report as prepared by the City's financial audit firm.
ATTACHMENTS
Single Audit Report
W:\Managernent Services- WorkFile\Finance- WorkFile\Council Material\,Staff Reports\22013"Eity'Audit report
fy2011-12 Single Audit.doc
CITY OF SAN RAFAEL
SINGLE AUDIT REPORT
FOR THE YEAR ENDED JUNE 30, 2012
CITY OF SAN RAFAEL
SINGLE AUDIT REPORT
For The Year Ended June 30, 2012
TABLE OF CONTENTS
Page
Schedule of Findings and Questioned Costs ..................................... ........................................ I
Section I - Summary of Auditor's Results .............................. ............ ............................... I
Section U — Financial Statement Findings ............................................... .................... ...... 2
Section M — Federal Award Findings and Questioned Costs ............................................. 2
Section W - Status of Prior Year Findings
andQuestioned Costs .................................................................................................... 2
Schedule of Expenditures of Federal Awards ............................................................................ 3
Notes to Schedule of Expenditures of Federal Awards ............................................................. 5
Independent Auditor's 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 ...................... 7
Independent Auditor's Report on Compliance with Requirements that Could
Have a Direct and Material Effect on Each Major Program and on Internal
Control over Compliance in Accordance with OMB Circular A-133 — ......... — .............. --. 9
This Page Left Intentionally Blank
CITY OF SAN RAFAEL
SCIIEDULE OF FINDINGS AND QUESTIONED COSTS
For The Year Ended June 30, 2012
SECTION I --SUMMARY OF AUDITOR'S RESULTS
Financial Statements
Type of auditor's report issued: Unqualified
Internal control over financial reporting:
• Material weakness(es) identified? Yes X
• Significant deficiency(ies) identified?
Noncompliance material to financial statements noted?
Federal Awards
Type of auditor's report issued on compliance for major
programs:
Internal control over major programs:
• Material weakness(es) identified?
* Significant deficiency(ies) identified?
Any audit findings disclosed that are required to be reported
in accordance with section 510(a) of OMB Circular A-133?
Identification of major programs:
X Yes
Yes X
Unqualified
No.
None
Reported
No
Yes X No
Drone
Yes X Reported
Yes X No
CFDA#(s) Name of Federal Program or Cluster
20.600 U.S. Department of Transportation — State and Community Highway
20.608 U.S. Department of Transportation — Minimum Penalties for Repeat Offenders for
Driving While Intoxicated
Dollar threshold used to distinguish between type A and type B programs: MUM
Auditee qualified as low-risk auditee? X Yes No
1
SECTION H — FINANCIAL STATEMENT FINDINGS
Our audit disclosed significant deficiencies but no material weaknesses or instances of noncompliance material
to the basic financial statements. These significant deficiencies are listed on the Schedule of Significant
Deficiencies included in a separately issued Memorandum on Internal Control dated October 26, 2012, which
is an integral part of our audits and should be read in conjunction with this report.
SECTION III — FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
Our audit did not disclose any findings or questioned costs required to be reported in accordance with
section 5 1 0(a) of OMB Circular A-133.
SECTION TV - STATUS OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS —
Prepared by Management
Financial Statement .Prior Year Findings
There were no prior year Financial Statement Findings reported.
Federal Award Prior Year Findings and Questioned Costs
There were no prior year Federal Award Findings and Questioned Costs reported.
CITY OF SAN RAFAEL
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Fiscal Year Ended June 30, 2012
Total U.S. Department of Health and Human Services
U.S. Department of Transportation, Pass -Through Programs
Pass -Through State of California Department of Transportation
Highway Planning and Construction
Puerto Suello Transit Center Connector
Canal St. Pedestrian Access & Safety Improvements
Subtotal for Highway Planning and Construction
Pass -Through California Office of Traffic Safety
State and Community Highway Safety
Selective Traffic Enforcement Program
Subtotal for State and Community Highway Safety
Pass -Through California Office of Traffic Safety
Minimum Penalties for Repeat Offenders for Driving While Intoxicated
Sobriety Checkpoint - Mini grant 2011
Avoid the Marin 13
Avoid Grant
Subtotal for Minimum Penalties for Repeat Offenders for Driving While Intoxicated
Total U.S. Department of Transportation
U.S. Department of Justice, Direct Programs
JAG Program Cluster
ARRA - Edward Byrne Memorial Justice Assistance Grant (JAG) Program/
Grants to Units of Local Government
Citizen Police Academy
Edward Byrne Memorial Justice Assistance Grant Program
Swat Trailer
Gang Enforcement Grant.
Total for JAG Program Cluster
Total U.S. Department of Justice
U.S Department of Homeland Security, Pass -Through Programs
Pass -Through State of California Department of Boating and Waterways
Boating Safety Financial Assistance
Mission City Equipment Contract
Pass -Through County of Marin, California
Homd..iand Security Grant Prog am
Homeland Security Grant
Marin County CERT
Automated License Plate Reader System
Subtotal for Homeland Security Grant Program
Pass -Through City and County of San Francisco Departm=t of Emergency Management
Regional Catastrophic Preparedness Grant Program
GR5 Bay Area
Total Office of Homeland Security
G
20.205
20.600
20.608
16.804
16.738
97.012
97.067
Pass -Through
Identifying Federal
Number Expenditures
HUD -04527-0I-11 $14,914
HLTM4536-01-11 266,391
281,305
10-204 20,000
ADP -AD -532-10-11 26,876
46,876
04SO43R-017-N 46,809
04 -5043R -029-N 7,267
54,076
PT 1106 & 20042 151,921
151,921
SCII 381 14,688
AL0942 63,903
20525 107,398
185,989
391,986
13,230
1,568
8,666
23,464
23,464
11-204-769 35,000
2010-0085 2,198
2011 -SS -0077 6,945
DHS -II -CTPD -067-000-02 33,126
42,269
97.111 2010CA-TO-O002 28,470
105,739
{Connuuedj
Federal
Federal Grantor/
CFDA
Pass -Through Grantor/Program or Cluster Title
Number
U.S. Department of Housing and Urban Development, Pass -Through Programs
Pass -Through County of Marin, California
Child Care
14.218
ADA 1 DOJ Compliance - Curb Ramps
14.218
Total U.S. Department of Housing and Urban Development
U.S. Department ofHealth and Human Services, Pass -Through Programs
Pass -Through County of Marin, California
Special Programs for the Aging Title III,
Part B - Grants for Supportive Services and Senior Centers
93.044
Block Grants for Prevention and Treatment of Substance Abuse
93.959
Total U.S. Department of Health and Human Services
U.S. Department of Transportation, Pass -Through Programs
Pass -Through State of California Department of Transportation
Highway Planning and Construction
Puerto Suello Transit Center Connector
Canal St. Pedestrian Access & Safety Improvements
Subtotal for Highway Planning and Construction
Pass -Through California Office of Traffic Safety
State and Community Highway Safety
Selective Traffic Enforcement Program
Subtotal for State and Community Highway Safety
Pass -Through California Office of Traffic Safety
Minimum Penalties for Repeat Offenders for Driving While Intoxicated
Sobriety Checkpoint - Mini grant 2011
Avoid the Marin 13
Avoid Grant
Subtotal for Minimum Penalties for Repeat Offenders for Driving While Intoxicated
Total U.S. Department of Transportation
U.S. Department of Justice, Direct Programs
JAG Program Cluster
ARRA - Edward Byrne Memorial Justice Assistance Grant (JAG) Program/
Grants to Units of Local Government
Citizen Police Academy
Edward Byrne Memorial Justice Assistance Grant Program
Swat Trailer
Gang Enforcement Grant.
Total for JAG Program Cluster
Total U.S. Department of Justice
U.S Department of Homeland Security, Pass -Through Programs
Pass -Through State of California Department of Boating and Waterways
Boating Safety Financial Assistance
Mission City Equipment Contract
Pass -Through County of Marin, California
Homd..iand Security Grant Prog am
Homeland Security Grant
Marin County CERT
Automated License Plate Reader System
Subtotal for Homeland Security Grant Program
Pass -Through City and County of San Francisco Departm=t of Emergency Management
Regional Catastrophic Preparedness Grant Program
GR5 Bay Area
Total Office of Homeland Security
G
20.205
20.600
20.608
16.804
16.738
97.012
97.067
Pass -Through
Identifying Federal
Number Expenditures
HUD -04527-0I-11 $14,914
HLTM4536-01-11 266,391
281,305
10-204 20,000
ADP -AD -532-10-11 26,876
46,876
04SO43R-017-N 46,809
04 -5043R -029-N 7,267
54,076
PT 1106 & 20042 151,921
151,921
SCII 381 14,688
AL0942 63,903
20525 107,398
185,989
391,986
13,230
1,568
8,666
23,464
23,464
11-204-769 35,000
2010-0085 2,198
2011 -SS -0077 6,945
DHS -II -CTPD -067-000-02 33,126
42,269
97.111 2010CA-TO-O002 28,470
105,739
{Connuuedj
CITY OF SAN RAFAEL
SCHEDULE OF EXPENDITURES OF FEDERAL. AWARDS
For the Fiseal Year Ended 7unt 30, 2012
See Accompanying Notes to Schedule of Expenditures of Federal Awards
Federal
Pass -Through
Federal Grantor/
CFDA
Identifying
Federal
Pass -Through Grantor/Program or Cluster Title
Number
Number
Expenditures
U.S. Department of Energy, Direct Program
Energy Efficiency and Conservation Block Grant
S 1.128
1,781
Total U.S. Department of Energy
1,781
Total Expenditures of Federal Awards
$851,151
See Accompanying Notes to Schedule of Expenditures of Federal Awards
CITY OF SAN RAFAEL
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For The Year Ended June 30, 2012
NOTE I -REPORTING ENTITY
The Schedule of Expenditure of Federal Awards (the Schedule) includes expenditures of federal awards for
the City of San Rafael, California and its component units as disclosed in the notes to the Basic Financial
Statements, except for federal awards of the San Rafael Sanitation District (District). Federal awards
expended by the District, if any, are excluded from the Schedule and are subject to a separate Single
Audit performed by other auditors.
NOTE 2 -BASIS OF ACCOUNTING
Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts
and reported in the financial statements, regardless of the measurement focus applied. All governmental
funds and agency funds are accounted for using the modified accrual basis of accounting. All proprietary
funds are accounted for using the accrual basis of accounting. Expenditures of Federal Awards reported on
the Schedule are recognized when incurred.
NOTE 3 -DIRECT AND INDIRECT (PASS-THROUGH) FEDERAL AWARDS
Federal awards may be granted directly to the City by a federal granting agency or may be granted to other
government agencies which pass-through federal awards to the City. The Schedule includes both of these
types of Federal award programs when they occur.
This Page Left Intentionally Blank
MAZE
&ASSOCIATES
P*'ATAJT *111 U1411VII-ErIVICE -Xll�
FPiANCIAL STATEMENTS PERFORMED IN ACCORDANCE W1TH
GO VERNMENTA UDITEVG STANDARDS
Honorable Mayor and City Council
of the City of San Rafael, California
We have audited the financial statements of the City of San Rafael as of and for the year ended June 30,
2012, and have issued our report thereon dated November 15, 2012. The report includes a reference to a
special emphasis paragraph concerning the dissolution of the Redevelopment Agency. We conducted our audit
in accordance with generally accepted auditing standards 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.
Internal Control over Financial Reporting
Management of the City of San Rafael is responsible for establishing and maintaining effective internal control
over financial reporting. In planning and performing our audit we considered the City's internal control over
financial reporting as a basis for designing our auditing procedures for the purpose of expressing our
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opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of
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the City's internal control over financial reporting. Accordingly, we do not express an opinion on the
effectiveness of the City's internal control over financial reporting.
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.
Our consideration of internal control over financial reporting was for the limited purpose described in the
first paragraph of this section and was not designed to identify all deficiencies in internal control over
financial reporting that might be deficiencies, significant deficiencies or material weaknesses. We did not
identify any deficiencies in internal control over financial reporting that we consider to be material
weaknesses. as defined above.,However, we identified certain deficiencies in internal control over financial
reporting, described in the accompanying schedule of findings and questioned costs and the separately
issued Memorandum on Internal Control dated October 26, 2012, that we consider to be a significant
deficiency in internal control over financial reporting: 2012-01, 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.
T 925,930.0902
Accountancy Corporation F 925.930,0135
3478 Busk !rk Avenje, Suite 215 E maze@mazeassodates-com
Pleasant 14M, CA 94523 w mazeassociates.corn
Compliance and Other Matters
As part of obtaining reasonable assurance about whether City financial statements are free of 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 instances of noncompliance or other matters that are required to be reported
under Government Auditing Standards and which are described in the accompanying schedule of findings
and questioned costs and the separately issued Memorandum on Internal Control dated October 26, 2012 as
items 2012-02 and 2012-03.
We have also issued a separate Memorandum on Internal Control dated October 26, 2012 which is an integral
part of our audits and should be read in conjunction with this report.
The City's response to the findings identified in our audit is described in the accompanying schedule of
findings and questioned costs. We did not audit the City's response and, accordingly, we express no
opinion on it.
This report is intended solely for the information and use of City Council, management, and federal
awarding agencies and pass-through entities and is not intended to be and should not be used by anyone
other than these specified parties.
November 15, 2012
M MAZE
&ASSOCIATES
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Honorable Mayor and City Council
of the City of San Rafael, California
Compliance
We have audited City of San Rafael's compliance with the types of compliance requirements described in
the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of
the City's major federal programs for the year ended June 30, 2012. The City's major federal programs
are identified in the summary of auditor's results section of the accompanying schedule of findings and
questioned costs. Compliance with the requirements of laws, regulations, contracts, and grants applicable
to each of its major federal programs is the responsibility of City's management. Our responsibility is to
express an opinion on the City's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; 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. 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 of the City's
compliance with those requirements.
In our opinion, the City complied, in all material respects, with the compliance requirements referred to
above that could have a direct and material effect on each of its major federal programs for the year
ended June 30, 2012.
i
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the 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 the requirements that could have a direct and material effect on a major federal program
to determine the 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, but not for the
purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly,
we do not express an opinion on the effectiveness of the City's internal control over compliance.
T 925.9s 0902
Accountancy Corporation F 925.930,0135
3478 Busk* Avenue, Suite 215 E maze@rnazeassociates.com
Pleasant Hi€i, CA, 94523 W mazeassociates.com
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a
federal program on a timely basis. A material weakness in internal control over compliance is a
deficiency, or combination of deficiencies, in internal control over compliance, such that there is a
reasonable possibility that material noncompliance with a type of compliance requirement of a federal
program will not be prevented, or detected and corrected, on a timely basis.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be deficiencies, significant deficiencies, or material weaknesses. We did not
identify any deficiencies in internal control over compliance that we consider to be material weaknesses,
as defined above.
Schedule of Expenditures of Federal Awards
We have audited the financial statements of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information of the City as of and for the year ended June
30, 2012, and have issued our report thereon dated November 15, 2012 which contained an unqualified
opinion on those financial statements. Our audit was performed for the purpose of forming our opinions
on the financial statements that collectively comprise the City's Entity's financial statements. The
accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis
as required by OMB Circular A-133, Audits of States, Local Governments, and Non -Profit
Organizations, and is not a required part of the financial statements. Such information is the
responsibility of management and was derived from and relates directly to the underlying accounting and
other records used to prepare the financial statements. The information has been subjected to the auditing
procedures applied in the audit of the financial statements and certain other procedures, including
comparing and reconciling such information directly to the underlying accounting and other records used
to prepare the financial statements or to the financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of America. In
our opinion, the schedule of expenditure of federal awards is fairly stated in all material respects in
relation to the financial statements as a whole.
This report is intended solely for the information and use of management, City Council, federal awarding
agencies, and pass-through entities and is not intended to be and should not be used by anyone other than
these specified parties.
21,
February 21, 2013
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