Attachment C
Auditors’ Required on Internal Control Over Financial Reporting and on Compliance Matters
1 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
The Honorable Mayor and
Members of the
City Council
City of Newport Beach
Newport Beach
, California
We have audited, in accordance with the auditing standards generally accepted 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
(
Government
Auditing Standards
)
, the financial statements
of the governmental activities, the business
-
type activities, each major fund, and the aggregate remaining fund information of the City of
Newport Beach (City)
, as of and for the year ended June 30
, 20
2 5
, and the related notes to
the financial statements, which collectively comprise
the City’s
basic financial statements, and
have issued our report thereon dated
January 28, 2026.
Report on
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s
internal control over financial reporting (internal control) as a basis for designing
audit
procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of
the City’s
internal control.
Accordingly, we do not express an opinion on the
effectiveness of
the City’s
internal control.
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 timel
y basis. 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.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies.
Given these limitations, during
our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses.
However, material weaknesses
or significant deficiencies
may exist that
were
not identified.
The Honorable Mayor and
Members of the
City Council
City of Newport Beach
Newport Beach, California
2 Report on
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s
financial statements are
free from 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 determinat
ion 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 no
instances of noncompliance or other matters that are required to be reported under Government Auditing Standards
.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance.
This report is an integral part of an audit
performed in accordance with
Government Auditing Standards
in considering the entity’s
internal control and compliance.
Accordingly, this communication is not suitable for any other purpose.
Irvine, California
January 28, 2026