10.a Presentation 2022 Audit - ScandiaCity of Scandia, Minnesota
Presentation of the Audited Financial Statements
Fiscal Year Ended December 31, 2022
Audit Process and Opinion
Unmodified (Clean) Opinion
General Procedures
Obtain
Records Inquiries Analytical
Procedures Sampling Detail
Testing
Required
Communications
Audit went smoothly
Positive Working Relationship with
Management
Nothing unusual noted in terms of recorded
transactions or accounting policies/treatments
Significant estimates for
- Net Pension Liability/Balances
New Accounting Standard Adopted
- GASB 87 Leases
Internal Controls Over Financial
Reporting
AUDIT ADJUSTMENTS SEGREGATION OF DUTIES FINANCIAL STATEMENT
PREPARATION
•Various adjustments
recorded during our
audit process
•Your City has a lack
of proper segregation
of duties, which is
very common for a
City of your size
•We have prepared the
financial statements on
behalf of the City
Minnesota Legal
Compliance
•Areas Reviewed
•Contracting and Bidding
•Depositories of Public Funds
•Conflicts of Interest
•Public Indebtedness
•Claims and Disbursements
•Miscellaneous Provisions
•Findings:
•Open Meeting Law – closed meetings
are to be electronically recorded
❑Revenues exceeded budget by
$30,700
❑Expenditures exceeded
budget by $57,300
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
2018 2019 2020 2021 2022 2022 Budget
General Fund -Trend Analysis & Budgetary Comparison
Revenues Expenditures Fund Balance
2021 2022 2022 Budget
Revenues 1,837,292$ 1,942,093$ 1,911,393$
Expenditures 1,739,530 1,942,600 1,885,300
Other Sources (Uses)(282,690) - -
Change in Fund Balance (184,928) (507) 26,093
Fund Balance 1,350,294$ 1,349,787$ N/A
Detailed Revenue AnalysisGeneral
Fund
Detailed Expenditure AnalysisGeneral
Fund
❑City policy is to maintain a minimum unassigned
general fund balance equal to 35%-50% of the total
annual General Fund operating expenditures
50.0%
55.0%
60.0%
65.0%
70.0%
75.0%
80.0%
85.0%
90.0%
95.0%
100.0%
2018 2019 2020 2021 2022
Unassigned Fund Balance as a Percentage of the Annual Budget
Year Percentage
2018 93.0%
2019 74.2%
2020 83.8%
2021 74.9%
2022 70.7%
Cash Trend AnalysisGeneral
Fund
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
2018 2019 2020 2021 2022
General Fund
Financial Highlights
Remaining Governmental Funds
Capital
Improvement
Fund
Local Road
Improvement
Fund
Revenues 220,462$ 239,259$
Expenditures 291,631 595,069
Other Sources (Uses)- -
Change in Fund Balance (71,169) (355,810)
Fund Balance 564,735$ 896,739$ $-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
$900,000
$1,000,000
Capital Improvement Fund Local Road Improvement Fund
Revenues Expenditures Fund Balance
Cash Trend Analysis
Remaining
Governmental
Funds
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
2018 2019 2020 2021 2022
Capital
Improvement
Fund
Local Road
Improvement
Fund
Financial Highlights
Remaining Governmental Funds
*Financial data for remaining nonmajor governmental funds can be found beginning on page 67 in the Audited Financial Statements.
Debt Service
Fund
COVID Relief
Fund
Nonmajor
Governmental
Funds
446,248$ 228,182$ 172,301$
424,785 - 313,440
6,731 - (6,731)
28,194 228,182 (147,870)
74,157$ 456,363$ 377,766$
Revenues
Expenditures
Other Sources (Uses)
Change in Fund Balance
Fund Balance $-
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
$500,000
Debt Service Fund COVID Relief Fund Nonmajor Governmental
Funds
Revenues Expenditures Fund Balance
Cash Trend Analysis
Remaining
Governmental
Funds
Historical Trends
Big Marine
Sewer
Fund
2018 2019 2020 2021 2022
Operating Revenues 85,518$ 81,238$ 83,175$ 98,001$ 101,783$
Operating Expenses 98,411 118,015 120,995 101,246 117,062
Operating Income (Loss)(12,893) (36,777) (37,820) (3,245) (15,279)
Nonoperating Revenues & Transfers In 1,519 8,085 54,949 8,832 11,841
Change In Net Position (11,374) (28,692) 17,129 5,587 (3,438)
Ending Net Position 839,668$ 810,976$ 828,105$ 833,692$ 830,254$
Historical Trends
Uptown
Sewer
Fund
2018 2019 2020 2021 2022
Operating Revenues 21,347$ 20,535$ 12,546$ 15,132$ 17,442$
Operating Expenses 17,405 14,180 12,293 19,582 21,515
Operating Income (Loss)3,942 6,355 253 (4,450) (4,073)
Nonoperating Revenues & Transfers In 97 11 252 71 84
Nonoperating Expenses & Transfers Out - 2,640 - - -
Change In Net Position 4,039 3,726 505 (4,379) (3,989)
Ending Net Position 165,217$ 168,943$ 169,448$ 165,069$ 161,080$
Cash Trend Analysis
Business-
Type
Funds
Government-Wide Assets
$- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000
2018
2019
2020
2021
2022
2018 2019 2020 2021 2022
Current Assets $4,686,545 $4,858,856 $4,970,693 $4,738,187 $4,468,956
Capital/Noncurrent 15,459,071 15,019,220 15,241,235 15,899,654 16,185,188
Government-Wide Liabilities
$- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000
2018
2019
2020
2021
2022
2018 2019 2020 2021 2022
Current Liabilities $480,594 $214,110 $438,005 $523,441 $598,068
Debt/Noncurrent 4,441,483 4,139,249 3,795,689 3,480,490 3,142,000
Net Pension Liability 316,213 309,611 412,196 286,330 676,594
Governmental FundsFuture Debt
Payments
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Governmental Funds Future Debt Payments
Gov Activities Principal Gov Activities Interest
Upcoming Accounting Standard – GASB 96
Subscription-Based Information Technology
Arrangements (SBITA’s)
•Record subscription expenses over the life of the arrangement
Old Method
Questions?
Ryan Schmidt, CPA
Partner
rschmidt@schlennerwenner.cpa
320-251-0286