ADMINISTRATIVE REPORT
MEETING DATE: January 27, 2025 AGENDA CATEGORY: New Business TO: Finance, Economic Development and Jobs Committee
FROM: Randy McKeegan, Finance Director
DATE: January 23, 2025
SUBJECT: Fiscal Year 2023 Audit Reports:
1. Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2023.
2. Agreed Upon Conditions Report for the fiscal year ended June 30, 2023.
3. Auditor Communication with Those Charged with Governance (SAS 114 Letter) for fiscal year ended June 30, 2023.
4. Independent Auditors Report – Compliance with Contractual Requirements relative to the Bakersfield Subregional Wastewater Management Plan for the year ended June 30, 2023.
5. Independent Auditors Report on Appropriations Limit Worksheet (GANN Limit) of the City of Bakersfield for the fiscal year ended June 30, 2023.
6. Independent Auditors Report – Mechanics Bank Arena, Theater, Convention Center, Dignity Health Amphitheatre & Valley Children’s Ice Center for the fiscal year ended June 30, 2023.
7. Agreed Upon Procedures Report (Public Safety and Vital Services) for the fiscal year ended June 30, 2023.
8. Single Audit Report for the fiscal year ended June 30, 2023
RECOMMENDATION:
Staff recommends acceptance of the fiscal year 2023 audit reports
BACKGROUND:
1. The City’s Annual Comprehensive Financial Report (ACFR), commonly referred to as the Annual Audit Report, for the fiscal year ended June 30, 2023 will be provided to the City Council as part of the packet prior to this meeting. A copy of the report will also be on file in the City Clerk’s office for public review. The ACFR represents the City’s financial statements as of June 30, 2023, which are audited by the accounting firm of Brown Armstrong Accountancy Corporation. The current year audit opinion issued by the outside auditors was “unqualified,” which indicates that the City complied, in all material respects, with accounting principles generally accepted in the United States of America.
2. The Agreed Upon Conditions Report is designed to increase efficiency, internal controls and/or financial reporting and includes any reportable conditions noted during the Audit. A summary of reported conditions are included in the report. The report also addresses conditions identified in the prior year which have all been resolved to the auditors’ satisfaction.
3. The SAS 114 Letter provides information about our auditors’ responsibilities under auditing standards generally accepted in the United States of America, Government Auditing Standards, and the Uniform Guidance, as well as certain information related to the planned scope and timing of the audit.
4. Contract requirements contained in City of Bakersfield Agreement 76-153 as amended by Agreements 76-153(5), 76-153(4), 77-44, 85-197 and 92-106 apply to operations of the
Bakersfield Subregional Wastewater Management Plan. The City’s compliance with contract
requirements is audited on an annual basis. The current compliance report, issued by the outside auditors, is attached for your review and indicates that there were no audit findings.
5. Attached is a letter from the City’s independent auditors Brown Armstrong Accountancy Corporation indicating they have completed their annual review of the Appropriations Limit Worksheet prepared by the City in accordance with Section 1.5 of Article XIIIB of the California Constitution (GANN Limit). This annual review is performed by the auditors as part of their contract to provide auditing services to the City of Bakersfield. The agreed upon review procedures are substantially less in scope than an audit and therefore no audit opinion is expressed regarding the calculation.
6. Attached is the independent audit report for the Mechanics Bank Arena, Theater, Convention Center, Dignity Health Amphitheatre & Valley Children’s Ice Center, for the fiscal year ended June 30, 2023. This audit report presents the financial statements for this operational unit as of June 30, 2023. The management company (AEG) is required to submit an independent audit report of their operations to the City after the end of each fiscal year. This audit report was prepared by the accounting firm of Barbich, Hooper, King, Dill & Hoffman.
7. The Agreed Upon Procedures Report for the Public Safety and Vital Services measure is designed to increase efficiency, internal controls and/or financial reporting and includes any reportable conditions noted during the Audit. This report is a requirement per the guidelines stated in Resolution No. 089-18 regarding the Public Safety and Vital Services measure. A summary of reported conditions is included in the report.
8. Attached is the Single Audit Report for the fiscal year ended June 30, 2023. This audit report tests the City’s compliance for each major program and on internal control over compliance and report on the schedule of expenditures of federal awards required by the uniform guidance. The current audit report, issued by outside auditors, finds that the City has complied, in all material respects, with the compliance requirements that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2023.
FISCAL IMPACT:
The act of accepting th ese reports and referred to the committee will have not Fiscal Impact to the City General Fund.
COUNCIL GOAL:
Innovative and Efficient City Government
ATTACHMENTS:
1. ACFR 2023 – Financial statements Final
2. AUC Report Final
3. SAS 114 Letter Final
4. Wastewater AUP Report Final
5. GANN Report 2023 Final
6. Mechanics Bank Arena Financials 6 30 23 – Final
7. AUP Report Final
8. Final 2023 Single Audit Report