PASADENA COMMUNITY ACCESS CORPORATION
(A COMPONENT UNIT OF THE
CITY OF PASADENA, CALIFORNIA)
FOR THE YEAR ENDED JUNE 30, 2025
FINANCIAL STATEMENTS
WITH INDEPENDENT AUDITORS’ REPORT
Attachment E
PASADENA COMMUNITY ACCESS CORPORATION
(A COMPONENT UNIT OF THE
CITY OF PASADENA, CALIFORNIA)
Financial Statements With
Independent Auditors’ Report
For the Year Ended June 30, 2025
PASADENA COMMUNITY ACCESS CORPORATION
(A COMPONENT UNIT OF THE
CITY OF PASADENA, CALIFORNIA)
Financial Statements With
Independent Auditors’ Report
For the Year Ended June 30, 2025
Table of Contents
Page
Number
INDEPENDENT AUDITORS’ REPORT ................................................................................................................. 1
MANAGEMENT’S DISCUSSION AND ANALYSIS ...................................................................................................... 4
BASIC FINANCIAL STATEMENTS
Statement of Net Position ....................................................................................................................................... 8
Statement of Revenues, Expenses, and Changes in Net Position .................................................................. 9
Statement of Cash Flows ............................................................................................................................... 10
Notes to the Basic Financial Statements ....................................................................................................... 11
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 .................................................................................................... 20
LSLCPAS.COM
INDEPENDENT AUDITORS’ REPORT
To the Board of Directors
Pasadena Community Access Corporation
Pasadena, California
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statements of the Pa sadena Community Access Corporation (hereafter, the Corporation), a component unit of the City of Pasadena, California (hereafter, the City) as of and for the year ended June 30, 2025, and the related notes to the fina ncial statements, which collectively comprise the Corporation’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 of the Corporation as of June 30, 2025, and the changes in financial position and its cash flows for the year
then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
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. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial State ments section of our report. We are required to be independent of the Corporation and to meet our other ethical responsibilities, in accordance with the relevant 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 opinion.
Emphasis of Matter
Change in Accounting Principle
As described in Note 14 to the financial statements, in 2025, the Corporation adopted new accounting guidance, GASB Statement No. 101, Compensated Absences. Our opinion is not modified with respect to this matter.
Component Unit Reporting
As discussed in Note 1, the fi nancial statements present only t he Corporation and do not purport to, and do not, present fairly the financial position of the City as of June 30 , 2025, the changes in its financial position, or, where applicable, its cash flows for t he year then ended in accordanc e with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.
To the Board of Directors
Pasadena Community Access Corporation
Pasadena, California
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 Corporation’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditors’ 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 auditors’ 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 a uditing standards and Government Auditing Standards will always detect a material m isstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, 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, 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 Corporation’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 Corporation’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.
2 To the Board of Directors
Pasadena Community Access Corporation
Pasadena, California
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis be presented to supplement the basic financial sta tements. 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.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated October 22, 2025, on our consideration of the Corporation’s internal control over fi nancial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements 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 the effectiveness of the Corporation’s internal control over financial reporting or on compliance. That report is an in tegral part of an audit performed in accordance with Government Auditing Standards in considering the Corporation’s internal control over financi al reporting and compliance.
Irvine, California
October 22, 2025
3 PASADENA COMMUNITY ACCESS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
Our discussion and analysis of the Pasadena Community Access Corporation’s (a component unit of the City of Pasadena, California) (the Corporation) financial performance p rovides an overview of the Corporation’s financial activities for the fiscal year ended June 30, 2025. Please read it in conjunction with the Corporation’s financial statements, which begin on page 8.
FINANCIAL HIGHLIGHTS
• The Corporation’s net position for the fiscal year ending June 30, 2025, was $668,600, a decrease of $134,998, including the restatement of beginning net position, or 16.8% from the prior year.
• During the year, the Corporation had operating expenses that were $26,535 more than the $1,219,560 generated from the operating agreement, service contracts, and other revenues from the Corporation’s programs from the fiscal year ended June 30, 2025.
• The total operating cost of all the Corporation’s programs wa s $1,246,095. The programmatic activities of the Corporation remained unchanged.
USING THIS ANNUAL REPORT
This annual report consists of a series of financial statements. The Statement of Net Position and the Statement of Revenues, Expenses, and Changes in Net Position (on pages 8 and 9) provide information about the activities of the Corporation as a whole and present a long-term view of the Corporation’s finances. As the Corporation operates as a business-type activity, no additional fund statements are necessary. When the Corporation charges customers for the services it provides—whether to outside customers or to the City of Pasadena or other governments—these services are reported similarly to the way a business operates.
A Statement of Cash Flows is also presented using the direct me thod, which portrays inflows and outflows for specific classes of operations along with an indirect reconciliation of increases to net cash provided by operations.
There were no non-cash entries during the year.
Reporting the Corporation’s Results as a Whole
Our analysis of the Corporation as a whole begins on page 5. One of the most important questions asked about the Corporation’s finances is, “Is the Corporation as a whole better off or worse off as a result of the year’s activities?” The Statement of Net Position and the Statement of Revenues, Ex penses, and Changes in Net Position report information about the Corporation as a whole and about its activities in a way this helps answer this question. These statements include all assets and liabilities using the accrual basis of accounting, which is similar to the accounting used by most private-sector companies. All of the current year’ s revenues and expenses are taken into account regardless of when cash is received or paid.
These two statements report the Corporation’s net position and changes in them. You can think of the Corporation’s net position—the difference between assets and liabilities—as o ne way to measure the Corporation’s financial health, or financial position. Over time, increases or decreases in the Corporation’s net position are one indicator of whether its financial health is improving or deteriorating. You will need to consider other nonfinancial factors, however, such as changes in the Corporation’s long-term contrac tual revenues and the condition of the Corporation’s equipment and other assets, to assess the overall health of the Corporation.
4 THE CORPORATION AS A WHOLE
The Corporation’s net position decreased from a year ago, from a restated balance of $781,638 to $668,600. Our analysis below focuses on the net position (Table 1) and change s in net position (Table 2) of the Corporation’s activities.
Table 1
June 30, 2025
June 30, 2024
Current and other assets $582,156 $634,103
Capital assets, net 438,768 678,518
Total assets 1,020,924 1,312,621
Current liabilities (277,918) (279,848)
Noncurrent liabilities (74,406) (229,175)
Total liabilities (352,324) (509,023)
Net position:
Net investment in capital assets 209,592 273,391
Restricted 91,926 182,052
Unrestricted 367,082 348,155
Total Net Position $668,600 $803,598
Unrestricted net position—the part of net position that can be used to finan ce day-to-day operations without constraints established by debts, contribution restrictions, or other legal requirements—changed from a restated balance of $326,195 at June 30, 2024, to $367,082 at the end of this fiscal year. This increase is a result of the Corporation’s normal operation. Unless restricted by donation or grant covenant (of which the Corporation has no such restrictions at the present time), the Corporation general ly can use this net position to finance continuing operations in the coming fiscal year.
5 Table 2
For the Year
Ended
For the Year
Ended
Percentage
Change
June 30, 2025 June 30, 2024 From 2024
Revenues
Operating revenues:
Operating Agreement $1,155,000 $1,095,000 5.5%
Service contracts 29,100 22,000 32.3%
Production and other operating revenue 35,460 22,320 58.9% Total operating revenues 1,219,560 1,139,320 7.0%
Nonoperating revenues:
Public, education & gov’t (PEG) revenue 153,164 217,187 -29.5% Interest income 4,333 62 6988.7%
Total nonoperating revenues 157,497 217,249 -27.5%
Total revenues 1,377,057 1,356,569 1.5%
Operating expenses:
Salaries and benefits 844,594 811,951 4.0%
Production expense 22,108 29,519 -25.1%
Occupancy expense 52,110 42,396 22.9%
Contractual services 25,400 43,040 -41.0%
General and administrative 62,134 49,105 26.5%
Depreciation and amortization 239,749 213,797 12.1%
Total operating expenses 1,246,095 1,189,808 4.7%
Nonoperating expenses:
PEG expense 243,290 332,315 -26.8%
Interest expense 710 1,366 -48.0%
Total nonoperating expenses 244,000 333,681 -26.9%
Total expenses 1,490,095 1,523,489 -2.2%
Changes in net position -113,038 -166,920 32.3%
Net position at beginning of year, as
previously reported 803,598 970,518 -17.2%
Restatement -21,960 0 N/A
Net position at beginning of year, as
restated
781,638 0 N/A
Net position at end of year $668,600 $803,598 -16.8%
Although the Corporation’s total cost of programs and services had a net decrease of 2.2% ($33,394), a closer look shows that Operating expenses in creased just 4.7% ($56,287), while PEG expenses decreased 26.8% from $332,315 to $243,290. The Corporation’s revenues had a net increase of 1.5% ($20,488), resulting from increased Operating revenues despite decreased PEG revenue received from the City of Pasadena in nonoperating revenue.
Budgetary Highlights
Over the course of the year, the Board of Directors reviewed th e budget during meetings. There were no budget reforecasts submitted for approval.
The Corporation's adopted operating budget was $1,206,000 for the fiscal year ended June 30, 2025. Actual operating revenues were $13,560 more than budget, and operating expenses were $26,221 more than budget. 6 CAPITAL ASSETS
At the end of 2025, the Corporation had $438,768 invested in ca pital assets, net of accumulated depreciation. (See Table 3 below.) This amount represents a net decrease (inc luding additions and disposals) of $239,750 or 35% less than last year.
Table 3
June 30, 2025 June 30, 2024
Production equipment $708,934 $708,934
Leasehold improvements 101,091 101,091
Right-to-use leased building 546,521 546,521
Accumulated depreciation and amortization (917,778) (678,028) Property and equipment, net $438,768 $678,518
More detailed information about the Corporation’s capital assets is presented in Note 3 to the financial statements.
LONG-TERM LIABILITIES
The outstanding balance of the lease payable related to its leased office and production facilities was $229,176 and $405,127 as of June 30, 2025 and 2024, respectively.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
The Corporation’s Board of Directors considered many factors when setting the fiscal year 2026 budget. The most significant budget expense increase is in personnel cost-of-living adjustments.
CONTACTING THE CORPORATION’S FINANCIAL MANAGEMENT
This financial report is designed to provide our stakeholders i ncluding donors, customers, and the City of Pasadena’s officials with a general overview of the Corporation’s finances and to show the Corporation’s accountability for the money it receives. If you have questions about this report or need additional financial information, contact the Corporation Office at 150 S. Los Robles Avenue, Suite 101, Pasadena, California, 91101.
Our main office number is 626-794-8585 and our email is [email protected]. 7 PASADENA COMMUNITY ACCESS CORPORATION
Statement of Net Position
June 30, 2025
ASSETS
Current assets:
Cash and cash equivalents 337,897$
Investments 128,379
Accounts receivable 1,480
Prepaid items 6,034
Deposits 16,440
Restricted cash and cash equivalents 91,926
Total current assets 582,156
Noncurrent:
Capital assets, net 438,768
Total noncurrent assets 438,768
Total assets 1,020,924
LIABILITIES
Current liabilities:
Accounts payable and other liabilities 19,167
Accrued salaries and benefits 35,413
Compensated absences 43,464
Lease payable 179,874
Total current liabilities 277,918
Noncurrent liabilities:
Compensated absences 25,104
Lease payable 49,302
Total noncurrent liabilities 74,406
Total liabilities 352,324
NET POSITION
Net investment in capital assets 209,592
Restricted for public, educational and governmental access 91,926 Unrestricted 367,082
Total net position 668,600$
See Notes to Financial Statements.
8 PASADENA COMMUNITY ACCESS CORPORATION
Statement of Revenues, Expenses and Changes in Net Position For the Year Ended June 30, 2025
OPERATING REVENUES
Operating agreement 1,155,000$
Service contracts 29,100
Production and other operating revenue 35,460
Total operating revenues 1,219,560
OPERATING EXPENSES
Salaries and benefits 844,594
Production expense 22,108
Occupancy expense 52,110
Contractual services 25,400
General and administrative 62,133
Depreciation/amortization 239,750
Total operating expenses 1,246,095
Operating loss (26,535)
NONOPERATING REVENUES (EXPENSES)
Public, education, and government (PEG) revenue 153,164 Interest expense (710)
PEG expense (243,290)
Interest income 4,333
Total nonoperating revenues (expenses) (86,503)
Change in net position (113,038)
Net position-beginning of year, as previously reported 803,598 Restatement, change in accounting principal (GASB 101) (21,960) Net position-beginning of year, as restated 781,638
Net position-ending 668,600$
See Notes to Financial Statements.
9 PASADENA COMMUNITY ACCESS CORPORATION
Statement of Cash Flows
For the Year Ended June 30, 2025
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 35,029$
Receipts from contracts 1,184,100
Payments to employees for services (842,345)
Payments to suppliers for goods and services (161,353)
Net cash provided by operating activities 215,431
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Public, education, and government (PEG) revenue received from City of Pasadena 153,164 Public, education, and government (PEG) eligible expenses paid (243,290) Net cash used for noncapital financing activities (90,126)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Principal paid on lease liability (175,952)
Interest paid on lease liability (710)
Net cash used for capital and related financing activities (176,662)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income 4,333
Purchase of investments (128,379)
Net cash used for investing activities (124,046)
Net cash decrease in cash and cash equivalents (175,403) Cash and cash equivalents - Beginning 605,226
Cash and cash equivalents - Ending 429,823$
RECONCILIATION OF CASH AND CASH EQUIVALENTS
TO THE STATEMENT OF NET POSITION
Cash and cash equivalents 337,897$
Restricted cash and cash equivalents 91,926
Total cash and cash equivalents 429,823$
RECONCILIATION OF OPERATING LOSS TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
Operating loss (26,535)$
Adjustments to reconcile operating loss to
net cash provided by operating activities:
Depreciation/amortization expense 239,750
Increase in accounts receivable (431)
Decrease in prepaid items 5,354
Decrease in accounts payable and other liabilities (4,955) Decrease in accrued salaries and benefits (1,824)
Increase in compensated absences 4,072
Total adjustments 241,966
Net cash provided by operating activities 215,431$
See Notes to Financial Statements.
10 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Pasadena Community Access Corpo ration (the Corporation), a component unit of the City of Pasadena, California (the City), have been prepared in conformity with accounting principles generally accepted in the United States of America, as applied to governm ent units (hereinafter referred to as generally accepted accounting principles (GAAP)). The Governmental Accounting Standards Board (GASB) is the accepted standard‐setting body for establishing governmental accounting and financial reporting principles. The Pasadena Community Access Corporation’s significant accounting policies are described below.
A. Reporting Entity
The Corporation was organized in 1983 as a nonprofit telecommun ications resource for the City. The Corporation was organized to perform the community access function of the Pasadena telecommunications system pursuant to the Cable Communications Ordinance of the City. In 2011, the City Council determined that the Corporation should be reported as a discretely presented component unit of the City in accordance with accounting principles generally accepted in the United States of America (GAAP).
The Board of Directors consists of eleven members with represen tatives from each of the seven City Council Districts, the Mayor, the City Manager, Pasadena Community College (PCC), and Pasadena Unified School District (PUSD). Residency is required except for the City Manager, PCC, and PUSD representatives. These operations constitute part of the overall financial reporting entity of th e City and are accounted for as a discretely presented component unit in the City’s Annual Comprehensive Financial Rep ort consistent with GAAP. Revenues and expenses of the Corporation include direct revenues and expenses and certain allocations from the City.
B. Basis of Presentation
The Corporation’s basic financi al statements are presented in c onformance with Governmental Accounting Standards Board (GASB) Statement No. 34, which established standards for external financial reporting for all state and local governmental entities. The basic financial statements include the statement of net position, statement of revenues, expenses, and changes in net position, and statement of cash flows.
C. Basis of Accounting
The Corporation is accounted for as an enterprise fund (proprie tary fund type). A fund is an accounting entity with a self-balancing set of accounts established to record the fina ncial position and results of operations of a specific governmental activity. The activities of enterprise funds closely resemble those of ongoing businesses in which the purpose is to conserve and add to basic resources while meeting operating expenses from current revenues.
Enterprise funds account for operations that provide services on a continuous basis and are substantially financed by revenues derived from user charges. The Corporation utilizes the economic resources measurement focus and the accrual basis of accounting. Revenues are recognized when earned and expenses are recognized as they are incurred.
D. Assets, Liabilities, and Net Position
1. Cash and Investments
The Corporation’s cash and cash equivalents include cash on hand , a n d s h o r t‐term investments with original maturities of three months or less from the date of acquisition . For purposes of the statement of cash flows, the Corporation considers its demand deposits and all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.
The Corporation’s investments are held in the California Asset Management Program (CAMP). CAMP is a public joint powers authority which provides California Public Agencie s with investment management services. CAMP investments are reported at amortized costs.
11 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items. The cost of prepaid items is recorded as expenses when consumed rather than when purchased.
3. Capital Assets
The Corporation capitalizes assets having an estimated useful life in excess of one year and acquisition cost of at least $5,000. Capital assets are recorded either at acquisition cost or initial lease liability amount (for lease assets) and are depreciated or amortized (for lease assets) over the estimated useful life of the asset using the straight-line method of depreciation/ amortization. Donated capital assets are recorded at acquisition value as of the date of the donation. All significant expenditures exceeding $5,000 for rep airs, renewals, and betterments that materially prolong the useful lives of the asset or remeasurements of lease liability (for lease assets) are capitalized.
Land and construction in progress are not depreciated. The other tangible and intangible property, equipment, the leased building, and infrastructure of the Corporation are depreciated/amortized using the straight‐line method over the following estimated useful lives:
4. Net Position
The difference between assets and deferred outflows of resources less liabilities and deferred inflows of resources is called net position. Net position is comprised of three comp onents: net investment in capital assets, restricted, and unrestricted.
• Net investment in capital assets consists of capital assets, net of accumulated depreciation/amo rtization and reduced by outstanding balance s of bonds, notes, and other debt that are attributable to the acquisition, construction, or improvement of those assets. Deferred outflows of resources and deferred inflows of resources that are attributable to the acquisition, construction, or improvement of those assets or related debt are included in this component of net position.
• Restricted net position consists of restricted assets reduced by liabiliti es and deferred inflows of resources related to those assets. Assets are reported as restricted when constraints are placed on asset use either by external parties or by law through constitutional provision or enabling legislation.
• Unrestricted net position is the net amount of the assets, deferred outflows of resources, liabilities, and deferred inflows of resources that does not meet the definition of the two preceding categories.
Sometimes the Corporation will fu nd outlays for a particular pu rpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calcula te the amounts to report as restricted net position and unrestricted net position in the financial statements, a flow assumption must be made about the order in which the resources are considered to be applied.
Capital asset classes
Estimated
useful
lives
Leasehold improvements 6 years
Furniture and fixtures 5 years
Production equipment 5 years
Leased Building 3 years
12 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
It is the Corporation’s policy to consider restricted net position to have been depleted before unrestricted net position is applied.
5. Leases
Lessee: The Corporation is a lessee for a noncancellable lease of office and production facilities. The Corporation recognizes a lease liability and an intangible right‐to‐use lease asset (lease asset) in the financial statements. The Corporation recognizes lease liabilities with an initial, individual value of $5,000 or more.
At the commencement of a lease, the Corporation initially measu res the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is r educed by the principal portion of lease payments made. The lease asset is initially me asured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commenc ement date, plus certain initial direct costs.
Subsequently, the lease asset is amortized on a straight‐line basis over its useful life. Key estimates and judgments related to leases include how the Corporation determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments.
• The Corporation uses the interest rate charged by the lessor a s the discount rate. When the interest rate charged by the lessor is not provided, the Corporation generally uses its estimated incremental borrowing rate as the discount rate for leases.
• The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are compos ed of fixed payments and purch ase option price that the Corporation is reasonably certain to exercise.
The Corporation monitors changes in circumstances that would re quire a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.
Lease assets are reported with other capital assets and lease l iabilities are reported wi th long-term debt on the statement of net position.
E. Revenues and Expenditures/Expenses
1. Compensated Absences
The Corporation recognizes a liability for compensated absences for leave time that (1) has been earned for services previously rendered by employees, (2) accumulates and is allowed to be carried over to subsequent years, and (3) is more likely than not to be used as time off or settled (for example paid in cash to the employee or payment to an employee flex spending account) during or upon separation from employment. Based on the criteria listed, two types of leave qualify for liability recognition for compensated absences – vacation and sick leave. The liability for compensated absences is reported as incurred in the financi al statements. The liability for compensated absences includes salary-related benefits, where applicable.
Vacation
The Corporation’s policy permits employees to accumulate earned but unused vacation benefits, which are eligible for payment at the employee’s current pay rate upon separation from employment.
Sick Leave
The Corporation’s policy permits employees to accumulate earned but unused sick leave. All sick leave lapses when employees leave the employ of the Corporation and, upon se paration from service, no monetary obligation exists. However, a liability for estimated value of sick leave that will be used by employees as time off is included in the liability for compensated absences.
13 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2. Operating and Nonoperating Revenues and Expenses
The statement of revenues, expenses, and changes in net position distinguishes operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with the Corporation’s princ ipal ongoing operations. The principal operating revenues are charges to customers for sales and services. Opera ting expenses include the cost of sales and services, administrative expenses, and depreciation/amortization on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.
NOTE 2: CASH AND INVESTMENTS
As of June 30, 2025, cash and cash equivalents were reported in the accompanying financial statements:
A. Deposits
At June 30, 2025, the carrying amount of the Corporation’s depo sits was $429,823 and the bank balance was $434,141. These matching amounts represent no outstanding checks or other reconciling items. Balances in the bank are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000.
B. Restricted Deposits
Restricted deposits, as further described in Notes 6C and 7, are to be utilized for eligible PEG capital expenditures.
The total amount of restricted deposits at June 30, 2025 was $91,926.
C. Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the eve nt of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are the possession of another party. The California Government Code does not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposit made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial instituti ons to secure the Corporation’s deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.
Cash on hand 200$
Deposits with financial institutions 337,697
Deposits with financial institutions - Restricted 91,926 Total cash and cash equivalents 429,823$
14 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
D. Investments Authorized by th e California Government Code and the Corporation’s Investment Policy
The table below identifies the investment types that are authorized for the Corporation by the California Government Code and the Corporation’s invest ment policy. The table also id entifies certain provisions of the California Government Code (or the Corporation’s investment policy, if more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the C orporation, rather than the general provisions of the California Government Code or the Corporation’s investment policy.
E. California Asset Management Program (CAMP)
The California Asset Management Program (CAMP) is a public join t powers authority which provides California Public Agencies with investment management services for surplus funds and comprehensive investment management, accounting and arbitrage rebate calculation service s for proceeds of tax-exempt financings. The CAMP currently offers the Cash Reserve Portfolio, a short-term investment portfolio, as a means for Public Agencies to invest these funds. Public Agencies that invest in the Pool (Participants) purchase shares of beneficial interest.
Participants may also establish individual, professionally managed investment accounts (Individual Portfolios) by separate agreement with the Investment Advisor.
Investments in the Pools and Individual Portfolios are made only in investments in which Public Agencies generally are permitted by California statute. The CAMP may reject any in vestment and may limit the size of a Participant's account. The Pool seeks to maint ain, but does not guarantee, a constant net asset value of $1.00 per share. A Participant may withdraw funds fro m its Pool accounts at any ti me by check or wire transfers. Requests for same-day wire transfers must be made by 11:00 a.m. that day. Fa ir value of the of the Pool is determined by the fair value per share of the Pool's underlying portfolio. The Co rporation’s investment in the Pool is measured on uncategorized inputs not defined by the fair value hierarchy. T his Corporation’s investment in the Pool as of June 30, 2025 was $128,379.
F. Disclosures Relating to Interest Rate
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment.
Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the Corporation manages it s exposure to interest rate risk is by purchasing short-term investments. The City’s investments in CAMP had a Weighted Average Maturity and Weighted Average Life Maturity as of June 30, 2025 of 41 and 81 days, respectively.
Inv estment Types
Authorized by the
California Government Code
Authorized by
Inv estment
Policy
Maximum
Maturity
Maximum
Percentage
of Portfolio
Maximum
Investment in
One Issuer
Local Agency Bonds Yes 5 Years None None
U.S. Treasury Obligations Yes 5 Year None None
U.S. Agency Securities Yes 5 Years None None
Bankers’ Acceptances Yes 180 Days 40% 30%
Commercial Paper Yes 270 Days 25% 10%
Negotiable Certificates of Deposit Yes 5 Years 30% None Repurchase Agreements Yes 1 Year None None
Reverse Repurchase Agreements Yes 92 Days 20% None
Medium-Term Notes Yes 5 Years 30% None
Mutual Funds Yes N/A 20% 10%
Money Market Mutual Funds Yes N/A 20% 10%
Mortgage Pass-Through Securities Yes 5 Years 20% None
County Pooled Investment Funds Yes N/A None None
Local Agency Investment Fund Yes N/A None None
Joint Power Agency Pools
(Other Investment Pools) Yes N/A None None
15 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
G. Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investm ent will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization.
The Corporation’s investments in CAMP are rated AAAm by S&P Global.
H. Concentration of Credit Risk
In accordance with GASB Statement No. 40 requirements, the Corp oration is considered to be exposed to the concentration of credit risk whenever they have invested more than 5% of their total investments in any one issuer.
Investments guaranteed by the U.S. Government and investments in mutual funds and external investment pools are excluded from this requirement. The Corporation’s investment in CAMP are excluded from this requirement.
NOTE 3: CAPITAL ASSETS
Capital assets for the year ended June 30, 2025, were as follows:
NOTE 4: DEFINED CONTRI BUTION RETIREMENT PLAN
Effective April 4, 2017, the Corporation adopted a Savings Incentive Match Plan for Employees Individual Retirement Account Plan (the Plan) for which all employees who have completed 90 days of service are eligible to participate.
The employees of the Corporation may elect to contribute to the Plan (subject to overall limits) in any one plan year.
Each year the Corporation will make a matching contribution to the Plan on a dollar-for-dollar basis up to 3% of the employee's compensation, for the employees who are contributing to the Plan.
The Corporation contributed $19,431 to the Plan for the year ended June 30, 2025.
Balance at Balance at
June 30, 2024 Additions Dispositions June 30, 2025
Capital assets being depreciated
and amortized:
Production equipment 708,934$ -$ -$ 708,934$ Leasehold improvements 101,091 - - 101,091 Leased building 546,521 - - 546,521 Total capital assets being
depreciated and amortized 1,356,546 - - 1,356,546 Less accumulated depreciation
and amortization for:
Production equipment (436,142) (62,020) - (498,162) Leasehold improvements (94,178) (480) - (94,658) Leased building (147,708) (177,250) - (324,958) Total accumulated depreciation
and amortization (678,028) (239,750) - (917,778) Total capital assets 678,518$ (239,750)$ -$ 438,768$ 16 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 5: LEASE PAYABLE
Changes in the lease payable as of June 30, 2025, were as follows:
The Corporation leases office and production facilities in Pasa dena, California, under a noncancellable lease agreement. The lease term expires September 30, 2026. The lease payable was determined utilizing an estimated discount rate of 0.218%. Effective September 1, 2024, the monthly payment was $16,119.
The minimum annual lease payments due during the term of the lease are as follows:
NOTE 6: OTHER PROVISIONS OF REVENUE AND CONTRACTS
A. Franchise Fees
On December 2,1983, a 15-year cable franchise agreement (the Agreement) was entered into by and between the City and a cable communications operator (Cable Operator). Acco rding to the terms of the Agreement, the Corporation is entitled to receive 2% of the Cable Operator's gross revenues (as defined in the Agreement) in return for providing the public access and public service programming function of the Cable Operator's communications system. This agreement expired during the year ended June 30, 1999. The City committed to continue to fund the agreement, after expiration, until a new agreement could be reached.
Effective October 1, 2000, the City and the Cable Operator ente red into a new nonexclusive franchise agreement to operate a cable television system in the City. The agreement expired on October 17, 2005, and was extended on a month-to-month basis under mutual agreement with the Cable Operator while negotiating a franchise renewal.
This agreement ended prior to statewide franchising that took effect in 2008.
The City now receives 5% of the state franchise holders' gross revenues derived from the provision of video service pursuant to California Public Utilities Code Section 5840. This franchise fee is considered General Fund revenue for the City and the funding amount for the Corporation is at the discretion of the Pasadena City Council.
B. Management and Operating Agreement
On February 10, 2015, the Corpor ation entered into an agreement with the City to provide operation and day-to-day management of the local PEG access system, for a period of twenty-five (25) years, commencing as of the date of the Agreement, and ending July 1, 2040.
C. 1% Public, Education, and G overnment (PEG) Allocation
Pursuant to Pasadena Municipal Code 18.04.060, it was establish ed that a fee would be paid to the City for the support of public, educational, and governmental access facilit ies and activities within the City. The Pasadena Municipal Code states that this fee shall be one percent (1%) of a cable provider's gross revenues, as defined in California Public Utilities Code Section 5860.
Balance of
June 30, 2024 Additions Reductions
Balance of
June 30, 2025
Amount
Due Within
One Year
Amount Due
in More than
One Year
405,127$ - $ 175,951$ 229,176 $ 179,874 $ 49,302 $ Year Ending June 30, Amount
2026 179,874 $
2027 49,302
Total 229,176 $
17 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 6: OTHER PROVISIONS OF REVENUE AND CONTRACTS (CONTINUED)
The Corporation serves as a receiving, holding, and disbursing entity for monies intended to promote noncommercial uses of the cable telecommunication medium. These funds are allocated as grants solely for PEG related purposes.
D. Other Contracts
The Corporation earns additional service contract revenue by providing various production services to Los Angeles County for Altadena Town Council Meetings.
NOTE 7: PEG FUNDING FROM CITY OF PASADENA
As described in Note 6, the Corporation received $153,164 of PE G funding during the year ended June 30, 2025.
Unspent PEG funding is classified as restricted cash and net position has been restricted to the extent that no related expenses have been incurred on the statement of net position.
The changes in restricted cash (unspent PEG funding) for the year ended June 30, 2025, were as follows:
NOTE 8: CONCENTRATIONS OF REVENUE
For the year ended June 30, 2025, revenues derived from the City of Pasadena from the management and operating agreement described in Note 6B and the 1% PEG Allocation described in Note 6C accounted for 95% of the Corporation’s total revenue.
NOTE 9: COMPENSATED ABSENCES
Changes in compensated absences as of June 30, 2025, were as follows:
NOTE 10: RISK MANAGEMENT
The Corporation is covered under Special Liability and Property policies through Nonprofits Insurance Alliance of California (NIAC), a Participant Accident policy through Allian t Insurance Services, Inc., and a Workers’ Compensation policy through Hartford Accident and Indemnity Company. Liability, Participant Accident, and Workers' Compensation claims are insured up to $1,000,000 per occurrence for any amount over the Corporation’s deductible amount of $1,000. Property claims are insured up to $475,000 for any amount over the Corporation’s deductible amount of $1,000. Settled claims have not exceeded any of the Corporation’s coverage amounts in any of the last three fiscal years.
Beginning Restricted Cash/Net Position 182,052$
PEG Grant:
PEG Revenue Received 153,164
PEG Disbursements for Capital Grants/Equipment (243,290) PEG Grant, net current year activ ity (90,126)
Ending Restricted Cash/Net Position 91,926$
As Restated
Balance at
June 30, 2024 Net change*
Balance at
June 30, 2025
Amount
due within
one year
Amount due
within more
than
one year
64,496$ 4,072 $ 68,568 $ 43,464 $ 25,104 $ *- The change in compensated absences above is a net change for the year. 18 PASADENA COMMUNITY ACCESS CORPORATION
Notes to the Basic Financial Statements
For the Year Ended June 30, 2025
NOTE 11: INCOME TAXES
The Corporation is exempt from f ederal income taxes under Section 501(c)(3) of the Internal Revenue Code and applicable state law.
The accounting standard on accounting for uncertainty in income taxes addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return shou ld be recorded in the financial statements. Under that guidance, the Corporation may recognize the tax benefit fr om an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities based on the technical merits of the position. Examples of tax positions include the tax-exempt status of the Corporation and various positions related to the potential sources of unrelated business taxable income ( UBIT). The tax benefits recognized in the financial statements from such a position are measured based on the large st benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement. There were no unrecognized tax benefits identified or recorded as liabilities for the fiscal year ending June 30, 2025.
The Corporation files Form 990 in the U.S. federal jurisdiction and Form 199 in the State of California.
NOTE 12: AMOUNTS PAID TO CITY OF PASADENA
The City bills the Corporation for advances and services render ed on the Corporation’s behalf. The Corporation paid the City $20,000 for advances and services provided to the Corporation for the year ended June 30, 2025.
NOTE 13: SUBSEQUENT EVENTS
The Corporation evaluated subsequent events for recognition and disclosure through October 22, 2025, the date on which these financial statements were available to be issued . Management concluded that no material subsequent events have occurred since June 30, 2025, that required recognition or disclosure in these financial statements.
NOTE 14: RESTATEMENT OF BEGINNING BALANCES
During the current yea r, the Corporation implemented GASB State ment No. 101, Compensated Absences . In addition to the value of unused vacation time owed to employees upon separation of employment, the Corporation now recognizes an estimated amount of sick leave earned as of year-end that will be used by employees as time off in future years as part of the liability for compensated absences. The effects of the change in accounting principle resulted in a decrease of $21,960 in the beginning net position as of July 1, 2024.
19 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
Pasadena Community Access Corporation
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 of the Pasadena Community Access Corporation (hereafter, the Corporation), a component unit of the City of Pasadena, California (hereafter, the City), as of and for the year ended June 30, 2025, and the related not es to the financial statements, which collectively comprise the Corporation’s basic financial statements, and have issued our report thereon dated October 22, 2025.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statement s, we considered the Corporation’s internal control over financial reporting (internal control) as a basis for desi gning audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Corporation’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 assurance about whether the Cor poration’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 financial statements. 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.
To the Board of Directors
Pasadena Community Access Corporation
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 Corporation’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 Corporation’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Irvine, California
October 22, 2025
21