CITY OF PATTERSON
Presentation to the City CouncilFor the Fiscal Year Ended June 30, 2024May 6, 2025 2 CONTENTS
• Scope of Work• Required Communications (AU-C 260)• Audit Responsibilities• Approach to the Audit• Overview of Financial Statements• Financial Indicators and Key Pension/OPEB Information• Audit Results – City• Audit Results – PPFA• Audit Results - WPFA• Thank You! 3 Scope of Work
4 Scope Of Work
• Financial Audit
• City of Patterson’s Annual Comprehensive Financial Report• Patterson Public Financing Authority Financial Statements• West Patterson Public Financing Authority Financial Statements • Single Audit (Uniform Guidance)• Compliance Examination Engagement Reports • Transportation Development Act Compliance• Abandoned Vehicle Abatement Program Compliance • Agreed-Upon Procedures Engagement Report
• GANN Limit – FY24/25
• Other Non-Audit Services
• Assistance in Preparing Financial Statements
5 Required Communications (AU-C 260)
6 Required Communications (AU-C 260)
• Significant Accounting Policies
• The City disclosed the summary of significant accounting policies in Note 1 to the financial statements.
• The City implemented GASB Statement No. 100, Accounting Changes and Error Corrections – an Amendment of GASB Statement No. 62
• Significant Estimates
• Fair Value on Investments• Depreciation on Capital Assets• Net Pension Liability• Net OPEB Liability 7 Required Communications (AU-C 260)
• Sensitive Disclosures
• Note 1 – Summary of Significant Accounting Policies• Note 3 – Leases Receivable• Note 13 – Pension Plans• Note 14 – Other Postemployment Benefits• Note 16 – Other Required Disclosures• Note 19 – Commitments and Contingencies 8 Required Communications (AU-C 260)
• Misstatements
• There were no corrected or uncorrected misstatements reported. • Consultation with Other Accountants
• Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and other matters. • Significant Difficulties
• We encountered no significant difficulties in dealing with management. • Disagreement with Management
• We did not have any disagreement with management in terms of accounting treatments nor audit procedures performed.
9 Audit Responsibilities
10 Management Auditors
Responsible for preparation of the financial Perform the auditstatements Ensure the audit is in conformity with Auditing Standards Generally Accepted in the United States of America and standards applicable to Financial Audits contained in Government Auditing Standards Present the financial statements in accordance with accounting principles generally accepted in the United States of America Communicate with “Those Charged with Governance”
Adopt sound accounting policies
Assess audit risk of internal control over financial reporting and compliance Establish and maintain internal controls over financial reporting and compliance Determine fairness presentation of the financial statements Provide evidence supporting the amounts and disclosures in the financial statements Prevent and detect fraud Render opinions Audit Responsibilities
11 Approach to the Audit
12 The Pun Group’s Approach to the Audit
• Phase I – Detailed Planning• Phase II – Risk Based Review of Internal Controls Over Systems and Compliance (Interim)
• Phase III – Validation and Testing of
Account Balances (Year-End)
• Phase IV – Review Financial Statements
and Issue Audit Opinions
Initiation
&
Planning
Meeting
Risk
Assessment,
Controls &
Review Entity
/ Environment
Assess,
Analyze,
and
Transaction
Testing
Reporting
& Project
Closure
13 OVERVIEW OF THE FINANCIAL STATEMENTS
14 2024 2023 Change
Assets $ 180,598,431 202,025,263 $ 21,426,832 $
Deferred Outflows of Resources 6,266,891 6,427,990 161,099 Liabilities 91,598,089 98,145,591 6,547,502
Deferred Inflows of Resources 6,115,310 5,164,282 (951,028) Net Position:
Net investments in capital assets 67,129,360 67,681,454 (552,094) Restricted 28,261,493 14,864,418 13,397,075
Unrestricted 9,752,527 6,606,051 3,146,476
Total Net Position $ 83,218,328 105,143,380 $ 15,991,457 $ Net Position @ June 30
(Governmental Activities)
15 2024 2023 Total
Program Revenues
Charges for services 10,934,845 $ 7,150,547 $ 3,784,298 $ Operating grants and contributions 5,561,697 3,200,329 2,361,368 Capital grants and contributions 4,449,223 9,699,274 (5,250,051) Total program revenues 20,050,150 20,945,765 895,615
Expenses $ 41,609,496 38,757,581 $ (2,851,915) $
Net Cost of Services (21,559,346) (17,811,816) 3,747,530 General Revenues 31,079,935 26,137,673 4,942,262
Transfers 2,723,338 2,939,075 (215,737)
Change in Net Position $ 7,517,402 15,991,457 $ 8,474,055 $ Change in Net Position
(Governmental Activities)
16 2024 2023 Change
Assets $ 79,218,139 80,321,185 $ 1,103,046 $
Deferred Outflows of Resources 2,879,905 2,914,011 34,106 Liabilities 30,179,059 32,267,059 2,088,000
Deferred Inflows of Resources 3,443,738 2,955,174 (488,564) Net Position:
Net investments in capital assets 48,241,694 48,865,099 (623,405)Restricted 3,219,807 3,137,525 82,282Unrestricted (3,448,538) (3,527,377) 78,839 Total Net Position $ 48,475,247 48,012,963 $ (462,284) $ Net Position @ June 30
(Business-Type Activities)
17 2024 2023 Total
Program Revenues
Charges for services 18,570,675 $ 16,829,284 $ 1,741,391 $ Capital grants and contributions 975,414 6,156,519 (5,181,105) Total program revenues 22,985,803 19,546,089 (3,439,714) Expenses $ 18,523,159 18,278,267 $ (244,892) $
Net Cost of Services 4,462,644 1,267,822 (3,194,822)
General Revenues 993,232 1,984,266 (991,034)
Transfers (2,723,338) (2,939,075) 215,737
Change in Net Position $ 3,507,835 (462,284) $ (3,970,119) $ Change in Net Position
(Business-Type Activities)
18 2024 2023 Change
Assets $ 27,882,858 34,822,976 $ 6,940,118 $
Liabilities $ 9,470,771 10,346,209 $ 875,438 $
Deferred Inflows of Resources $ 248,924 210,074 $ (38,850) $ Fund Balance
Nonspendable 249,161 138,149 111,012Restricted 624,198 560,761 63,437Committed 10,759,106 9,838,576 920,530Assigned 7,449,656 6,236,338 1,213,318Unassigned 5,184,572 1,389,339 3,795,233 Total Fund Balance 18,163,163 24,266,693 6,103,530Total Liabilities, Deferred Inflows of Resources, and Fund Balance $ 27,882,858 34,822,976 $ 6,940,118 $ General Fund – Fund Balance @ June 30
19 2024 2023 Change
Revenues $ 25,000,791 29,762,783 $ 4,761,992 $
Expenditures (26,748,476) (30,352,721) (3,604,245)
Revenues over Expenditures (1,747,685) (589,938) 1,157,747 Other Financing Sources and Uses 3,072,274 6,693,468 3,621,194 Change in Fund Balance $ 1,324,589 6,103,530 $ 4,778,941 $ General Fund – Change in Fund Balance
20 Financial Indicators and Key Pension/OPEB Information 21 2024 2023
Net Cost of Services $ 21,559,346 17,811,816 $
Less: Interest Expenses (3,962,077) (3,611,271)
17,597,269 14,200,545
Tax Revenues 20,779,758 20,779,758
Ratio 68.34% 84.68%
Net Cost of Services to Tax Revenues
(Governmental Activities)
22 2024 2023
Unassigned Fund Balance 5,184,572 $ 1,389,339 $
Committed for Contingencies 10,759,106 9,838,576Available Fund Balance 11,227,915 15,943,678 Annual Expenditures 26,748,476 30,352,721
Ratio 52.53% 41.98%
Available Fund Balance to Annual Expenditures
(General Fund)
23 Miscellaneous Safety
Plan Plan Total
Net Pension Liabilities/(Assets) @ 5.90% 14,932,284 $ 6,757,317 $ 21,689,601 $ Net Pension Liabilities/(Assets) @ 6.90% 9,037,628 $ 4,376,468 $ 13,414,096 $ Net Pension Liabilities/(Assets) @ 7.90% 4,185,821 $ 2,429,955 $ 6,615,776 $ Plan's Proportionate Share of theFiduciary Net Position as a Percentageof the Total Pension Liability 79.26% 74.78%Prior year 79.66% 75.57% Net Pension Liability Sensitivity Analysis
24 OPEB
Net OPEB Liabilities @ 4.50% 9,117,032 $ Net OPEB Liabilities @ 5.50% 8,017,480 $ Net OPEB Liabilities @ 6.50% 7,087,091 $ Fiduciary Net Position as a Percentageof the Total OPEB Liability 11.39% Net OPEB Liability Sensitivity Analysis
25 Audit Results - City
26 Audit Results – City Audit• Unmodified Opinions – By Opinion Unit • Financial Statements are fairly presented in all material respects • In conformity with GAAP• Significant accounting policies have been consistently applied • Estimates are reasonable• Disclosures are properly reflected in the financial statements • Transportation Development Act Report – In Compliance• Abandoned Vehicle Abatement Program Report – In Compliance• Single Audit – Unmodified Opinions are issued to all Major Program(s) • The City complied, in all material respect, with the types of compliance requirements that could have a direct and material effect
• GANN Limit AUP Report (FY24/25) – Procedures performed without exception 27 Audit Results – City Audit
• Other Results
• No disagreement with Management• No material weaknesses and/or significant deficiencies were identified in internal control over financial reporting
• No accounting issues• No inappropriate activities were noted 28 Audit Results – Patterson Public Financing Authority 29 Audit Results – PPFA Audit
• Opinion
• Unmodified Opinion
• Financial Statements are fairly presented in all material respect• Accounting policies have been consistently applied• Estimates are reasonable• Disclosures are properly reflected in the financial statements • Other Results
• No disagreement with Management• No material weaknesses and/or significant deficiencies were identified in internal control over financial reporting
• No accounting issues• No inappropriate activities were noted 30 Audit Results – West Patterson Financing Authority
31 Audit Results – WPFA Audit
• Opinion
• Unmodified Opinion
• Financial Statements are fairly presented in all material respect • Accounting policies have been consistently applied• Estimates are reasonable• Disclosures are properly reflected in the financial statements • Other Results
• No disagreement with Management• No material weaknesses and/or significant deficiencies were identified in internal control over financial reporting
• No accounting issues• No inappropriate activities were noted
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