CITY OF SALINAS
Presentation to the City CouncilFor the Fiscal Year Ended June 30, 2022September 12, 2023
CONTENTS
Required Communications (AU-C 260)
Audit Responsibilities
Overview of Financial Statements
Financial Indicators and Key Pension/OPEB Information
Audit Results
REQUIRED COMMUNICATIONS (AU-C 260)
Required Communications (AU-C 260)
Independence
We complied with ALL relevant requirements regarding independence Significant Accounting Policies
The City disclosed all significant accounting policies in Note 1 to the financial statements.
The City implemented GASB Statement No. 87, Leases
Significant Estimates
Fair value on investments
Depreciation on capital assets
Net pension liability actuarial inputs
Net other postemployment benefit liability actuarial inputs
Required Communications (AU-C 260)
Sensitive Disclosures
Note 1 – Reporting Entity and Summary of Significant Accounting Policies Note 2 – Stewardship, Compliance, and Accountability
Note 8 – Leases Receivable
Note 9 – Loans and Notes Receivable
Note 17 – Retirement Programs
Note 18 – Other Postemployment Healthcare Benefits
Note 19 – Net Position and Fund Balances
Note 23 – Prior Period Adjustments
Misstatements
There were no 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.
Required Communications (AU-C 260)
Significant Difficulties
We encountered no significant difficulties in dealing with management.
Disagreements with Management
We did not have any disagreements with management in terms of accounting treatments or audit procedures performed.
AUDIT RESPONSIBILITIES
Management’s Responsibilities
Responsible for the financial statements
Present the financial statements in accordance with accounting principles generally accepted in the United States of America Adopt sound accounting policies
Establish and maintain internal controls over financial reporting and compliance Provide evidence supporting the amounts and disclosures in the financial statements Prevent and detect fraud
OUR RESPONSIBILITY IN ACCORDANCE WITH PROFESSIONAL STANDARDS Form and express an opinion about whether the financial statements that have been prepared by management with Board oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America Plan and perform the audit to obtain “reasonable” assurance (not “absolute” assurance) about whether the financial statements are free of material misstatements.
Consider internal control over financial reporting. Such considerations were solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control.
OVERVIEW OF THE FINANCIAL STATEMENTS
City of SalinasGovernment-WideCondensed Statement of Net PositionJune 30, 2022 and 2021
City of SalinasGovernment-Wide SummaryStatement of Activities For the Years Ended June 30, 2022 and 2021
City of SalinasGeneral FundCondensed Balance SheetJune 30, 2022 and 2021
City of SalinasGeneral FundCondensed Statement of Revenues, Expenditures and Changes in Fund Balance For the Years Ended June 30, 2022 and 2021
FINANCIAL INDICATORS AND KEY PENSION AND OPEB INFORMATION
City of SalinasGovernmental ActivitiesNet Cost of Services to Tax Revenues
City of SalinasGeneral FundUnassigned Fund Balance to Annual Expenditures
GASB 68 – The Pension StandardAs of June 30, 2021 (Measurement Date)
GASB 75 – The OPEB StandardAs of June 30, 2021 (Measurement Date)
AUDIT RESULTS
Audit Results
Opinions
Unmodified Opinions issued to all Opinion Units
Financial statements are fairly presented in all material respects Accounting policies have been consistently applied
Estimates used are reasonable
Disclosures are properly reflected in the financial statements
Audit Issues Noted - General
Management and staff turnover in the finance department Timeliness of fiscal year closing procedures, audit preparation, and financial reporting Misapplication of GASB 54, Fund Balance Reporting and Governmental Fund Type Definitions in previous years Federal Single Audit still to be completed
Audit Issues Noted – Financial
Prior period adjustments necessary at government-wide and fund level for GASB 54 reporting Prior period adjustments necessary to adjust capital assets and land and properties held for resale balances Reconciling supporting documentation to the general ledger prior to providing to auditors Other miscellaneous adjusting entries necessary for pension/OPEB, long term debt, accrued interest, etc.
Other Results
No disagreements with management
Material weaknesses/significant deficiencies were identified in internal control over financial reporting and will be written up formally with the federal Single Audit report No accounting issues where there was a question on authoritative guidance noted No inappropriate activities were noted
Thank you!