Ci
CITY OF PASADENA, CALIFORNIA
FOOTHILL WORKFORCE DEVELOPMENT
BOARD
FOR THE YEAR ENDED JUNE 30, 2024 FINANCIAL STATEMENTS
Attachment I
FOOTHILL WORKFORCE DEVELOPMENT BOARD
Basic Financial Statements
with Independent Auditors’ Report
For the Year Ended June 30, 2024
FOOTHILL WORKFORCE DEVELOPMENT BOARD
Basic Financial Statements
with Independent Auditors’ Report
For the Year Ended June 30, 2024
Table of Contents
Page
FINANCIAL SECTION
Independent Auditors’ Report .................................................................................................................................... 1
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements:
Statement of Net Position ....................................................................................................................................... 4
Statement of Activities ............................................................................................................................................. 5
Fund Financial Statements:
Balance Sheet ................................................................................................................................................... 6
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ....................................................................................................................... 7
Statement of Revenues, Expenditures, and Change in Fund Balance ............................................................ 8
Reconciliation of the Statement of Revenues, Expenditures, and Change in Fund Balance to the Statement of Activities ................................................................................................. 9
Notes to Basic Financial Statements ................................................................................................................. 10
REQUIRED SUPPLEMENTARY INFORMATION
Budgetary Comparison Schedule ..................................................................................................................... 13
Notes to the Required Supplementary Information ............................................................................................ 14
OTHER REPORTS
Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Foothill Workforce Development Board Financial Statements Performed in Accordance with Government Auditing Standards .......................................... 15
LSLCPAS.COM
INDEPENDENT AUDITORS’ REPORT
To the Board of Directors
Foothill Workforce Development Board
City of Pasadena, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the go vernmental activities and the General Fund of the Foothill Workforce Development Board of the City of Pasadena, California (the “Board”), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the Board’s basic financial statements as listed in the table of contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Board, as of June 30, 2024, and the changes in financial position, and cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with 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, and the State Controller’s Minimum Audit Standards for California Special Boards. Our responsibilities unde r those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Board and to meet our other ethical responsibilities, in accordance with the rele vant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Board’s ability to continue as a going concern for twelve months beyond the financial statement date, includin g any currently known information that may raise substantial doubt shortly thereafter.
To the Board of Directors
Foothill Workforce Development Board
City of Pasadena, California
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to is sue an auditor’s report that includes our opinions.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the State Controller’s Minimum Audit Standards for Californ ia Special Boards will always detect a material misstatement when it exists. The risk of not detecting a materi al misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, f orgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted au diting standards and Government Auditing Standards, and the State Controller’s Minimum Audit Standards for California Special Boards, we:
• Exercise professional judgment and maintain professional skept icism throughout the audit.
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to th ose risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
• Obtain an understanding of inter nal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Board’s internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Board’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States o f America require that the budgetary comparison information be presented to supplement the basic financial stat ements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of fin ancial reporting for placing the basic financial statements in an appropriate operational, economic, or historic al context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of m anagement about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Management has omitted the management’s discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial stateme nts, is required by the Go vernmental Accounting 2 To the Board of Directors
Foothill Workforce Development Board
City of Pasadena, California
Standards Board who considers it to be an essential part of fin ancial reporting for placing the basic financial statements in an appropriate operational, economic, or historic al context. Our opinion on the basic financial statements is not affected by this missing information.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 23, 2024, on our consideration of the Board’s internal control over financia l reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant a greements and other matters. The purpose of that report is solely to describe the scope of our testing of intern al control over financial reporting and compliance and the results of that testing, and not to provide an opinion on t he effectiveness of the Board’s internal control over financial reporting or on compliance. That report is an integra l part of an audit performed in accordance with Government Auditing Standards in considering the Board’s internal control over financial reporting and compliance.
Irvine, California
December 23, 2024
3 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Statement of Net Position
Governmental
Activities
Assets:
Cash and investments 18,795$
Accounts receivable 942,293
Total Assets 961,088
Liabilities and Net Position
Liabilities:
Accounts payable 359,473
Due to other governments 546,051
Total Liabilities 905,524
Net Position:
Restricted 55,564
Total Net Position 55,564$
June 30, 2024
See Notes to Financial Statements.
4 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Statement of Activities
For the Year Ended June 30, 2024
Operating
Contributions Governmental
Functions/Programs Expenses and Grants Activities
Governmental Activities:
Foothill Workforce Development Program 3,918,277$ 4,922,816$ 1,004,539$ Total Governmental Activities 3,918,277$ 4,922,816$ 1,004,539 Change in Net Position 1,030,412
Net Position (deficit) at Beginning of Year (974,848)
Net Position at End of Year 55,564$
Program Revenues
Net (Expenses)
Revenue and
Changes in Net
Position
See Notes to Financial Statements.
5 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Balance Sheet
June 30, 2024
ASSETS
Cash and investments 18,795$
Accounts receivable 942,293
Total assets 961,088$
Liabilities and Fund Balance:
LIABILITIES
Accounts payable 905,524$
Total liabilities 905,524
FUND BALANCE
Restricted 55,564
Total Liabilities and Fund Balance 961,088$
Foothill
Workforce
Development
Board
See Notes to Financial Statements.
6 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position
June 30, 2024
Fund balances of governmental funds 55,564$
Amounts reported for governmental activities in the statement of net position are different because:
Revenues are reported as unavailable revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental fund activity. -
Net Position of Governmental Activities 55,564$
See Notes to Financial Statements.
7 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Statement of Revenues, Expenditures, and Changes in Fund Balance For the Year Ended June 30, 2024
REVENUES
Intergovernmental 4,089,815$
Miscellaneous 25,873
Total Revenues 4,115,688
EXPENDITURES
Foothill Workforce Development Board 3,918,277
Total Expenditures 3,918,277
Net Change in Fund Balance 197,411
Fund Balance (deficit), Beginning of Year (141,847)
Fund Balance, End of Year 55,564$
Foothill
Workforce
Development
Board
See Notes to Financial Statements.
8 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balance to the Statement of Activities
For the Year Ended June 30, 2024
Net change in fund balances - total governmental funds 197,411$ Amounts reported for governmental activities in the statement of activities are different because:
Revenues reported as unavailable revenue in the governmental funds and recognized in the Statement of Activities. These are included in the intergovernmental revenues in the governmental fund activity. 833,001
Change in Net Position of Governmental Activities 1,030,412$ See Notes to Financial Statements.
9 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Notes to the Financial Statements
For the Year Ended June 30, 2024
NOTE 1: ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Developed 35 years ago, the Foothill Workforce Development Boar d (The Board) was approved by the City Council of the City of Pasadena as a Joint Powers Agreemen t (JPA) among the cities of Arcadia, Duarte, Monrovia, Sierra Madre, South Pasadena, and Pasadena. The JPA created the Foothill Employment and Training Consortium (FETC) which the City of Pasadena is the fiscal agent and has the authority to receive and administer workforce development funds. FETC formed the Foothill Workforce Development Board (FWDB) to take the lead in developing the implementation plan for workforce development services for job seekers and businesses. The mission is to support economic growth in the San Gabriel Valley by investing in skill development and job training to ensure that businesses have qualified workforce talent and j ob seekers have career opportunities. The FWDB’s Americas Job Center of California is located at 1207 Eas t Green Street in Pasadena and is funded through the Workforce Innovation and Opportunity Act (WIOA).
A. Basis of Presentation
The Board’s basic financial statements are prepared in conformity with accounting principles generally accepted in the United States of America. The Government Accounting Stan dards Board is the acknowledged standard setting body for establishing accounting and financial reporting standards followed by governmental entities in the United States of America.
These standards require that the financial statements described below be presented.
Government-Wide Financial Statements
Government-wide financial statements display information about the reporting government as a whole.
Eliminations have been made in the statement of activities so t hat certain allocated expenses are recorded only once (by function to which they were allocated).
Government-wide financial statements are presented using the ec onomic resources measurement focus and the accrual basis of accounting. Under the economic resources measu rement focus, all economic resources and obligations of the reporting government (both current and long- term) are reported in the government-wide financial statements. Basis of accounting refers to when revenu es and expenditures are recognized in the accounts and reported in the financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, and liabilities are recognized in accordance with various GASB Statements.
Fund Financial Statements
The operations of the board are accounted for with a separate s et of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.
Fund financial statements are presented after the government-wide financial statements.
Governmental Funds
In the fund financial statements, governmental funds are presen ted using the modified-accrual basis of accounting. Their revenues are recognized when they become meas urable and available as net current assets.
Measurable means that the amounts can be estimated, or otherwis e determined. Available means that the amounts were collected during the reporting period or soon enou gh thereafter to be available to finance the expenditures accrued for the reporting period. The Board uses a ninety-day availability period.
10 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Notes to the Financial Statements
For the Year Ended June 30, 2024
NOTE 1: ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
In the fund financial statements, g overnmental funds are presen ted using the current financial resources measurement focus. This means t hat only current assets and curr ent liabilities are gene rally included on their balance sheets. The reported fund balance (net current assets) is considered to be a measure of “available spendable resources.” Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of “available spendable resources” during a period.
Because of their spending measurement focus, expenditure recogn ition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do no t affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities.
When both restricted and unrestricted resources are combined in a fund, expenses are considered to be paid first from restricted resources, and then from unrestricted resources.
B. Cash and Investments
Investments are reported in the accompanying financial statemen ts at fair value based on quoted market prices, except for certain certificates of deposit, money market investments that mature within one year of acquisition and investment contracts that are r eported at cost because they are not transferable, they have terms that are not affected by changes in market interest rates, and provided that the fair value of those investments is not significantly affected by the impairment of the credit standing of the issuer or by other factors.
Both realized and unrealized changes in fair value that occur d uring a fiscal year are recognized and recorded as net changes in fair value of investments. Investment earnings i nclude interest earnings and all other investment income.
The Board pools cash and investments with the City of Pasadena. Investment income earned by the pooled investments is allocated to the various funds based on each fund’s average cash and investment balance.
C. Accounts Receivable
In the government-wide statements, receivables consist of all r evenues earned at year-end and not yet received.
Receivables are recorded in the financial statements net of any allowance for doubtful accounts if applicable, and estimated refunds due. Federal and state grants are considered receivable and accrue as revenue when reimbursable costs are incurred.
D. Equity Classifications
Government-Wide Statements
Net position is the excess of all the Board’s assets over all i ts liabilities, regardless of fund. Net position is divided into three categories under GASB Statement No. 34. These categories apply only to net position, which is determined at the government-wide level, and are described below:
Unrestricted net position - Consists of total net position less net investment in capital assets and restricted net position.
Fund Statements
The governmental fund financial statements present fund balances based on classifications that comprise a hierarchy that is based primarily on the extent to which the Board is bound to honor constraints on the specific purposes for which amounts in the respective governmental funds can be spent. The classifications used in the governmental fund financial statements are as follows:
Restricted – Amounts that are s ubject to externally enforceable limitations by law, enabling legislation or limitations imposed by creditors or grantors.
11 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Notes to the Financial Statements
For the Year Ended June 30, 2024
NOTE 2: CASH AND INVESTMENTS
Equity in the Cash and Investment Pool of the City of Pasadena
The board has no separate bank accounts or investments other th an its equity in the cash and investment pool managed by the City. The Board has not adopted an investment po licy separate from that of the City. The fair value of the Board’s investment in this pool is reported in the accompanying financial statements at amounts based upon the Board’s pro rata share of the fair value calcula ted by the City for the entire City portion. The balance available for withdrawal is based on the accounting records maintained by the City. As of June 30, 2024, the Board’s equity in the City’s cash and investment pool was a balance of $18,795.
Disclosures Relating to the Investment Policy, Interest Rate Ri sk, Credit Risk and Custodial Credit Risk
Additional disclosures related to the investment policy, intere st rate risk, credit risk and custodial credit risk are available in the City of Pasadena’s Annual Comprehensive Financial Report.
NOTE 3: FUND BALANCE
In the fund financial statements, governmental fund balance is made up of the following components:
• Restricted fund balance is the portion of fund balance that is subject to externally enfor ceable limitations by law, enabling legislation or limitations imposed by creditors or grantors.
• Unassigned fund balance represents fund balance that has not been assigned to other funds and that has not been restricted, committed, or assigned to specific purposes. In a governmental fund, expenditures incurred for a specific purpose might exceed the amounts in the fund that ar e restricted, committed, and assigned to that purpose and a negative residual balance for that purpose may result.
The accounting policies of the Board consider restricted fund b alance to have been spent first when expenditures are incurred for purposes for which both the restricted and unr estricted fund balance is available. Similarly, when expenditures are incurred for purposes for which amounts in any of the unrestricted classifications of fund balance could be used, the Board considers committed amounts to be redu ced first, followed by assigned and then unassigned amounts.
As of June 30, 2024, the Board had a restricted fund balance of $55,563.
12 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Budgetary Comparison Schedule
Fot the Year Ended June 30, 2024
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Resources (Inflows):
Intergovernmental 4,685,475$ 5,073,280$ 4,089,815$ (983,465)$ Miscellaneous 30,000 30,000 25,873 (4,127) Amounts Available for Appropriations 4,715,475 5,103,280 4,115,688 (987,592) Charges to Appropriation (Outflow):
Foothill Worforce Development Program 4,746,595 5,134,400 3,918,277 1,216,123 Total Charges to Appropriations 4,746,595 5,134,400 3,918,277 1,216,123 Net Change in Fund Balance (31,120)$ (31,120)$ 197,411 228,531$ Fund Balance (deficit) at Beginning of Year (141,847)
Fund Balance at End of Year 55,564$
See Notes to the Required Supplementary Information.
13 FOOTHILL WORKFORCE DEVELOPMENT BOARD
Notes to the Required Supplementary Information
For the Year Ended June 30, 2024
NOTE 1: BUDGETS AND BUDGETARY ACCOUNTING
As required by the laws of the State of California, the Board p repares and legally adopts a final operating budget on or before July 1 of each fiscal year for the funds, which is prepared on the modified accrual basis of accounting. Expenditures may not legally exceed appropriations at the fund level, which is the legal level of control.
Supplemental appropriations may be made during the fiscal year. All budget amounts in the accompanying financial statements have been adjusted for legally authorized revisions of the annual budget during the year.
As of June 30, 2024, the Board did not incur expenditures exceeding appropriations.
14 LSLCPAS.COM
INDEPENDENT AUDITORS’ 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
To the Board of Directors
Foothill Workforce Development Board
City of Pasadena, California
We have audited, in accordance with the auditing standards gene rally 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, the financial stateme nts of the governmental activities and the General Fund of the Foothill Workforce Development Board (the “Board”) of the City of Pasadena, California (the “City”), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the Board’s basic financial statements, and have issued our report thereon dated December 23, 2024.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statement s, we considered the Board’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 Board’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Board’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allo w 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 b asis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less s evere 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 contr ol 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.
Report on Compliance and Other Matters
As part of obtaining reasonable as surance about whether Board’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 ma terial effect on the financial statements.
However, providing an opinion on compliance with those provisio ns 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.
To the Board of Directors
Foothill Workforce Development Board
City of Pasadena, California
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 Board’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 Board’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Irvine, California
December 23, 2024
16