• Subtitle
New SV Clean Energy
PowerPoint Template
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PRESENTATION
O Welcome
2025 Audit Committee Members
Alt. Dir. Sergio Lopez,
City of Campbell
Harjot Sangha
City of Gilroy
Dir. George Tyson
Los Altos Hills
Dir. Bryan Mekechuk,
City of Monte Sereno
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Thank you! / Questions?
8 Item 3
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Silicon Valley Clean Energy Authority
Report to the Audit Committee
February 28, 2025
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KOSMATKA DONNELLY & CO., LLP
Introduction
• Kellin Gilbert, CPA
• Audit Partner
• 17 years in public accounting and performing audits of government entities
• Currently working with several CCA’s throughout California • Alauna Rico
• Engagement Senior Associate
• 4 years in public accounting and 2 years in performing audits of governments (CCA’s)
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Transition to Kosmatka Donnelly & Co., LLP
• As of January 2025, Pisenti & Brinker LLP has joined practices with Kosmatka Donnelly & Co., LLP (dba, KDP Certified Public Accountants, LLP). The former Pisenti & Brinker LLP Partners are now Partners of KDP. Unveiling of a unified name anticipated in the summer of 2025.
• By combining resources with the strategic merger, we can make even greater investments in technology as well as our greatest assets, our people and clients.
• No changes to staffing, costs or timing of the services we provide to SVCE.
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Next Steps as Kosmatka Donnelly & Co., LLP
• There is a signed contract and amendment in place between Pisenti & Brinker LLP and Silicon Valley Clean Energy Authority through the contract term September 2027 – audit period date September 30, 2026.
• Kosmatka Donnelly & Co., LLP (formerly Pisenti & Brinker LLP) will carry out the services for the remaining term of the contract. • There will be no changes to the original contract or amendment other than the name of the company.
• The current audit partner, Kellin Gilbert, will continue to be the audit partner for the remainder of the contract.
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Results of current year audit:
• The audit is complete. We reported:
• Unmodified opinion – Based on our audit, the financial statements are materially accurate.
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Audit of the year ended September 30, 2024
Financial Statements
Relative Roles & Responsibilities
• Management is responsible for preparing the Financial Statements and establishing a system of internal control.
• Auditor is responsible for auditing the Financial Statements • Considering risks of material misstatement in the Financial Statements
• Considering internal controls relevant to the Financial Statements • Performing tests of year-end balances based on risk assessment • Evaluating adequacy of disclosures
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Risk Assessment for the year ended September 30,
2024 Financial Statements
Our audit is a risk-based audit. Risk assessment procedures include:
• Gain understanding of the entity’s operating characteristics, practices, and procedures.
• Compare to our knowledge of similar entities, industry and professional guidance.
• Review procedures and controls surrounding significant transaction cycles and business processes.
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Audit Procedures
Significant areas of focus
• Revenue recognition
• Accounts receivable and accrued revenue
• Test a sample of customer billings
• Relate total cash received during the year to revenue • Review revenue recognition through year-end and method for determining (accrued revenue)
• Cash
• Confirmations sent to financial institutions
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Audit Procedures
Significant areas of focus
• Accrued Cost of Electricity
• Review subsequent bills from electricity providers and cash payments • Other Liabilities
• Reviewed contracts and other support to determine completeness of amounts recorded
• Financial Statement Note Disclosures – Complete and without bias Item 5
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Required Board Communications
• There were no new material accounting policies adopted by Silicon Valley Clean Energy Authority throughout the period audited.
• We did not identify any significant or unusual transactions or applications of accounting principles where a lack of
authoritative guidance exists.
• We did not propose any adjustments to the financial
statements.
• There were no reportable deficiencies or material weaknesses in internal controls identified.
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• There have been no disagreements with management concerning the scope of our audit, the application of accounting principles, or the basis for management’s judgments on any significant matters. • We have not encountered any difficulties in dealing with management during the performance of our audit.
Required Board Communications
(continued)
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Questions?
Kellin Gilbert: 707-577-1511
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KOSMATKA DONNELLY & CO., LLP
New SV Clean Energy
PowerPoint Template
Subtitle
Item 6
PRESENTATION
Purpose
Overview of Staff’s Recommendation that
the Board establish a Rate Stabilization
Fund under GASB 62
Main Areas of Discussion
1. Accounting Rule -GASB 62
2. Other CCA’s Using Rate Stabilization
Fund
3. Financial Statement Illustration
4. Impact on Reader’s of Financial
Statement
5. Comparison of Reserves and Rate
Stabilization Fund
6. Criteria for Directing and Recognizing
Revenues to and from the Rate
Stabilization Fund
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0 Other CCAs Are Using GASB 62
CCA Fund Amount ($ Million)
Clean Power Alliance (CPA) 135
Ava Community Energy (East Bay) 79.2
Marin Clean Energy (MCE) 70
Peninsula Clean Energy (PCE) 68
Sonoma Clean Power (SCP) and Orange County Power Authority (OCPA) plan to contribute to a rate stabilization fund.
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Financial Statement Impact
MARIN CLEAN ENERGY
STATEMENTS OF REVINUIS, EXPENSES
AND CHANGES IN NET POSITION
Y EARS ENDED MARCH 31, 2024 AND 2023
2024 2023
OPERATING REVENUES
Ilcctrkity safes, net $ 770,344,682 $ 633.836,160
| Rale stabilization (40,000,000) (19,000.0001)1
Grunt revenue 11,360,450 10,532,421
liquidated damages 26,074,259 7,219,945
Total operating revenues 767,779,391 636,588,526
OPERATING EXPENSES
Cost of electricity 571,404,901 559,107,368
Contract services 21,157,869 19.389,252
Stall'compensation 20,936,409 17,193,096
Other operating expenses 9,002,600 6.935,136
Depreciation and amortisation 955,278 996,241
Total operating expenses 623,457,057 603,621,093
()perating income 144,322,334 32,967,433
NONOPERATING REVENUES (EXPENSES)
(irunt revenue • 4,226,302
Interest and investment returns 15,420,160 4,007,603
Finance costs (228,825) (236,468)
Nonoperating revenues (expenses), net 15,191,335 7,997,437 CHANGE IN NET POSITION 159,513,669 40,964,870
Net position at beginning of year 244,171,846 203,206,976 Nel position at end of year $ 403,685,515 $ 244,171,846
MARIN CLEAN ENERGY
STATEMENTS OF NET POSITION
MARCH 31, 2024 AND 2023
2024 2023
ASSETS
Current assets
Cash and cash equivalents - lairvstnctcd S 101.027.404 $ 73.348.263 Accounts receivable. net ol'aloxvancc 61.447.640 66,401.473 Accrued revenue 31.912.468 31.180.447
Other receivables 5,822.709 1.985.508
Prepaid expenses 972.203 651.310
Restricted cash 40.322.101 33.782.947
Investments 115.763.550 68.841.532
DcposMs 14.108.352 10.924.834
Total current assets 371.376.427 287.116.314
Noncurrent assets
Cash and cash equivalents - unrcstnclcd 70.000.000 30.000.000 Investments 149.588.819 45,538.694
CapMal assets, net ofdeprecation and amortizauon 863.432 1.818,709 DcposMs 203.498 203.499
Total noncurrcnt assets 220,655.749 77.560.902
Total assets 592,032.176 364.677.216
LIABILITIES
Current kibihtics
Accrued cost ofclectricty 67.950.289 45.803.423
Accomts pavablc 4.552.442 4.071.832
Other accrued labthtcs 2,713.413 1.845,922
User taxes and energy surcharges due to other governments 1.288.372 3.112.581 Securlv deposits - energx suppers 983.400 578.400
Lease habiiocs 536.644 773.620
Advances from grantors 40.322.101 33.782.947
Total current kibihlics 118.346.661 89.968.725
Noncurrvnt kibibues
Lease habtlurs - 536.645
Total habites 1 18,346,661 90.505.370
DEFERRED INHXM'S OF RESOURCES
Operating Reserve Fund 70,000.000 30.000.000
NET POSITION
Net posuon
Net investment n capital assets 326.788 508.444
Univsineled 403.358.727 243.663.402
Total net position $ 403.685,515 $ 244.171.846
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Potential Impact on Readers of Financial Statement
Readers Pros Cons Staff’s Overall
Assessment
Public Net position statement reflects
unspent but earmarked funds.
Shows unspent funds
as liabilities but the
Board can redirect to
other uses inthefuture.
Positive
Credit RatingAgencies
(S&P and Moody’s)
Demonstrates greater Board
commitment to separately set
aside funds to promote rate
stability.
Potential confusionthat
these liabilities reduce
financial liquidity.
CCAs, staff consulted
with have not
experienced this.
Positive
Counterparties(Energy
Suppliers,Financial
Institutions)
More stableyearly financial
statement of Revenues and
Expenses (Income Statement).
Potential confusionthat
these liabilities reduce
financial liquidity.
Positive
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Thank you! / Feedback / Questions?
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