Crowe LLP
Independent Member Crowe Global
INDEPENDENT ACCOUNTANT'S REPORT
To the Board of Directors
Visit Newport Beach Inc.
We have examined management of Visit Newport Beach Inc.s assertion, included in the accompanying Management Statement Regarding Compliance With Certain Provisions of the Agreement Between the City of Newport Beach and Visit Newport Beach Inc. for Tourism Promotion, Branding, and Marketing Services, that Visit Newport Beach Inc. (the Organization) complied with the provisions in Exhibit A of the Agreement Between the City of Newport Beach and Visit Newport Beach Inc. for Tourism Promotion, Branding, and Marketing Services (the Agreement) regarding the attached 2025 Expenditures Report, summarizing the expenditures of funds received pursuant to the Agreement during the period July 1, 2024 to June 30, 2025. The Organizations management is responsible for its assertion. Our responsibility is to express an opinion on management's assertion about Visit Newport Beach Inc.s compliance with the specified requirements based on our examination.
Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we plan and perform the examination to obtain reasonable assurance about whether management's assertion about compliance with the specified requirements is fairly stated, in all material respects. An examination involves performing procedures to obtain evidence about whether management's assertion is fairly stated, in all material respects. The nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material misstatement of management's assertion, whether due to fraud or error.
We believe that the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion.
We are required to be independent and to meet our other ethical responsibilities in accordance with relevant ethical requirements relating to the engagement.
Our examination does not provide a legal determination on Visit Newport Beach Inc.'s compliance with the specified requirements.
In our opinion, management's assertion that Visit Newport Beach Inc. complied with the provisions of Exhibit A of the Agreement regarding the attached 2025 Expenditures Report for the year ended June 30, 2025, is fairly stated, in all material respects.
This report is intended solely for the information and use of Visit Newport Beach Inc. and the City of Newport Beach and is not intended to be and should not be used by anyone other than the specified parties.
Crowe LLP
Costa Mesa, California
September 23, 2025
A crowe
~ lLP
ATTACHMENT C
14-38
Management Statement Regarding Compliance With Certain Provisions of the Agreement Between the City of Newport Beach and Visit Newport Beach Inc. for Tourism Promotion, Branding, and Marketing Services
We, as members of management of Visit Newport Beach Inc. (the “Organization”), are responsible for complying with the provisions of Exhibit A of the Agreement Between the City of Newport Beach and Visit Newport Beach Inc. (collectively, the “Parties”) for Tourism Promotion, Branding, and Marketing Services (the “Agreement”) in that funds received by the Organization pursuant to this Agreement were expended in accordance with this Agreement. We are responsible for establishing and maintaining effective internal controls over compliance with the provisions of Exhibit A of the Agreement. We have performed an evaluation of the Organization’s compliance with the provisions of Exhibit A of the Agreement regarding funds expended during the year ended June 30, 2025, as summarized in the attached 2025 Expenditures Report. Based on this evaluation, we assert that the Organization was in compliance with the provisions of Exhibit A of the Agreement as described below:
Exhibit A of the Agreement requires the Organization to “develop, plan, carry out, and supervise a program to market and promote the Newport Beach brand and to promote tourism in, and serve the needs of, visitors to Newport Beach and thereby drive up the amount of TOT collected and improve the overall tourism business and commerce throughout the City (‘Services’). Services shall, at a minimum, include the following:
• The maintenance of suitable office space and the employment of competent personnel to properly carry out promotional, branding, and marketing duties;
• The creation of marketing materials and information to promote tourism and inform prospective visitors of the recreational activities, cultural assets, shopping and dining opportunities, night-time stay opportunities, and natural beauty of Newport Beach. These materials may include, but are not limited to, website and digital content, brochures, publications, guides, online promotions, social media campaigns and various forms of print and digital advertising; • The dissemination of information described in this section by way of print and digital media, including direct mail, publications, social media, websites, mobile applications, direct digital advertising , events or other means of distribution;
• The development and implementation of specific marketing programs designed to increase awareness of the Newport Beach brand and to increase business and visitor trade in Newport Beach; and
• Any additional services as may be proposed by the City from time to time, subject to mutual agreement of the Parties, which are consistent with the promotion of tourism and the Newport Beach brand.”
Visit Newport Beach Inc.
By ____________________________
Gary Sherwin
President/CEO
By ____________________________
Lily Pearson
CFO
Docusign Envelope ID: 968C7CCD -CC02-4886 -9E3E-4DC3CD95AC24 VISIT
NEWPORT
BEACH
CALIFORNIA
14-39
July 1, 2024 -
June 30, 2025
2025 Expenses
Advertising Expenses
66101 - Advertising 1,286,016$
66121 - Promotional Gift Cards 1,875
66202 - Creative Production 373,887
67101 - Research 271,970
Total Advertising Expenses 1,933,748
Marketing Expenses
Community Relations
A 66212 - Community Sponsorships 90,325
67104 - Annual Marketing Outlook Event -
67105 - Awards 4,320
67107 - Promotional Items 42,426
67108 - Company-Sponsored Events -
67111 - Community Partnerships 137,461
Total Community Relations 274,532
Event Marketing
67102 - Christmas Boat Parade 176,244
67103 - Community Partner Events 512,109
Total Event Marketing 688,353
Marketing Collateral
67309 - Business Plan 2,405
67311 - Collateral Production Expenses 3,642
Total Marketing Collateral 6,047
Digital Marketing
67501 - Social Media 106,965
67502 - Website Maintenance 23,976
67503 - SEO/SEM 120,570
67508 - Website Redesign Expenses -
66211 - CRM Maintenance & Platform Subscrip 25,917
Total Digital Marketing 277,428
Communications/Public Relations
67601 - PR Agency/Tracking/Copywriting 233,807
67602 - Media FAM Tours 56,278
67605 - Media Opportunities 35,637
67607 - Media Relations 2,105
Total Communications/Public Relations 327,827
Total Marketing Expenses 1,574,187
International Marketing Initiatives
67401 - International Brand Activations 26,909
67402 - International FAM Tours 8,059
67404 - International Trade Shows 20,633
67405 - International Airfare 47,420
67406 - International Accommodations 48,654
67407 - International Meals 2,273
67408 - International Transportation Costs 4,351
67409 - International Other Travel Costs 308
67410 - International Business Meals/Entertainm 201
67411 - International Promotional Items 1,509
67412 - International Brand Events 663,113
Total International Marketing Initiatives 823,430
NB&Company Fees
B 68001 - NB&Co Fees 2,117,563
Total NB&Company Fees 2,117,563
Direct Sales Initiatives
Sponsorships
66232 - Hosted Industry Events 129,793
Total Sponsorships 129,793
VISIT NEWPORT BEACH, INC.
2025 Expenditures Report
VISIT
NEWPORT
BEACH
CALIFORNIA
14-40
July 1, 2024 -
June 30, 2025
VISIT NEWPORT BEACH, INC.
2025 Expenditures Report
Total Direct Sales Initiatives 1 29,793
Total Expenses 6,578,721
Other Expenditures:
Fixed asset additions capitalized -
Website development costs capitalized -
Change in other prepaid expenses and current (253,557)
liabilities, net
(253,557)
6,325,164$
NOTES:
A Included in this account are expenditures for or contributions to special events and not-for-profit organizations in Newport Beach as follows:
Vendor Event Amount
City of Newport Beach Program Sponsorships 75,000$
75,000$
B Consist of reimbursements for costs incurred by Newport Beach & Company as follows:
Class of Expense Amount
Salaries/Benefits 1,614,833$
G & A Overhead 502,730
2,117,563$
VISIT
NEWPORT
BEACH
CALIFORNIA
14-41