HomeMy Public PortalAbout2014-2015 Audit Issued Financial StatementsMoab City Corporation
Grand County, Utah
ANNUAL FINANCIAL REPORT
For the Year Ended June 30, 2015
Moab City Corporation
TABLE OF CONTENTS
June 30, 2015
Beginning
on page
INDEPENDENT AUDITORS' REPORT 1
MANAGEMENT'S DISCUSSION AND ANALYSIS 3
BASIC FINANCIAL STATEMENTS 13
Government -wide Financial Statements:
Statement of Net Position 15
Statement of Activities 16
Fund Financial Statements:
Balance Sheet - Governmental Funds 18
Statement of Revenues, Expenditures, and Changes
in Fund Balances - Governmental Funds 19
Reconciliation of the Balance Sheet of Governmental
Funds to the Statement of Net Position 20
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental
Funds to the Statement of Activities 21
Statement of Net Position - Proprietary Funds 22
Statement of Revenues, Expenses, and Changes
in Net Position - Proprietary Funds 23
Statement of Cash Flows - Proprietary Funds 24
Notes to Financial Statements 26
REQUIRED SUPPLEMENTARY INFORMATION 45
Notes to Required Supplementary Information 47
Schedule of Revenues, Expenditures, and Changes
in Fund Balances - Budget and Actual - General Fund 48
Schedule of the Proportianate Share of the Net Pension Liability - Utah Retirement Systems 49
Schedule of Contributions - Utah Retirement Systems 50
Notes to Required Supplementary Information - Utah Retirement Systems 51
(Continued on following page)
Moab City Corporation
TABLE OF CONTENTS
June 30, 2015
OTHER REPORTS
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
Beginning
on page
53
Independent Auditors' Report on Compliance in Accordance
with the State Compliance Audit Guide 55
J Larson
•• CERTIFIES PUBLIC ACCORITAIT
INDEPENDENT AUDITORS' REPORT
Honorable Mayor
Members of the City Council
Moab, Utah
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, each major fund, and the aggregate remaining fund information of Moab City, Utah (herein
referred to as the "City"), as of and for the year ended June 30, 2015, and the related notes to the
financial statements, which collectively comprise the City's basic financial statements as listed in the table
of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
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.
Auditors' Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America.
Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity's
preparation and fair presentation of the financial statements 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 entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business -type activities, each major fund,
and the aggregate remaining fund information of Moab City, as of June 30, 2015, and the respective
changes in financial position and, where applicable, cash flows thereof for the year then ended in
accordance with accounting principles generally accepted in the United States of America.
Larson & Company
765 North Main, Spanish Fork, Utah 84660
Main: (801) 798-3545 Fax: (801) 798-3678
www.larsco.com
1
1!ember of
CPAR
ICA
INT#RNATIONAL
In accordance with Government Auditing Standards, we have also issued a report dated November 13,
2015 on our consideration of Moab City's internal control over financial 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 to describe the scope of our testing of internal control over financial
reporting and compliance and the results of that testing, and not to provide an opinion on internal control
over financial reporting or on compliance. That report is an integral part of an audit performed in
accordance with Government Auditing Standards in considering Moab City's internal control over financial
reporting and compliance.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis and other required supplementary information on pages 3-11 and 47-51 be
presented to supplement the basic financial statements. Such information, 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 financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical 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 management 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.
Larson & Company, PC
Spanish Fork, Utah
November 13, 2015
2
MANAGEMENT'S DISCUSSION AND ANALYSIS
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4
Moab City Corporation
Management's Discussion and Analysis
June 30, 2015
As management of Moab City Corporation (the City), we offer readers of the City's financial
statements this narrative overview and analysis of financial activities of the City for the fiscal year
ended June 30, 2015.
FINANCIAL HIGHLIGHTS
*Total net position for the City as a whole increased by $1,333,338.
*Total unrestricted net position for the City as a whole increased by $1,241,494.
*Total net position for governmental activities increased by $1,087,881.
*Total net position for business -type activities increased by $245,457.
BASIC FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to the basic financial statements of
Moab City Corporation. The basic financial statements comprise three components: (1) government
wide financial statements, (2) fund financial statements, and (3) notes to the financial statements.
Government -wide financial statements. The government -wide financial statements are designed to
provide readers with a broad overview of the City's finances, in a manner similar to a private -sector
business.
The statement of net position presents information on all of the City's assets, deferred outlfows,
liabilities, and deferred inflows, with the difference between them reported as net position. Over time,
increases or decreases in net position may serve as a useful indicator of whether the financial position
of the City is improving or deteriorating.
The statement of activities presents information showing how the City's net position changed during
the fiscal year reported. All changes in net position are reported as soon as the underlying event
giving rise to the change occurs, regardless of the timing of related cash flows. Thus revenues and
expenses are reported in this statement for some items that will only result in cash flows in future
fiscal periods.
Both of the government -wide financial statements distinguish functions of the City that are
principally supported by taxes and intergovernmental revenues (governmental activities) from other
functions that are intended to recover all or a significant portion of their costs through user fees and
charges (business -type activities). The statement of activities is presented on two pages. The first page
reports the extent to which each function or program is self-supporting through fees and
intergovernmental aid. The second page identifies the general revenues of the City available to cover
any remaining costs of the functions or programs.
5
Moab City Corporation
Management's Discussion and Analysis
June 30, 2015
Fund financial statements. A fund is a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The City also uses fund
accounting to ensure and demonstrate compliance with finance -related legal requirements. All of the
funds of the City can be divided into two categories: governmental funds and proprietary funds.
Governmental funds. These funds are used to account for the same functions reported as governmental
activities in the government -wide financial statements. Governmental fund financial statements focus
on near -term inflows and outflows of spendable resources, as well as on balances of spendable
resources available at the end of the fiscal year.
Because of the focus of governmental funds is narrower than that of the government -wide financial
statements, it is useful to compare the information presented for government funds with similar
information presented for governmental activities in the government -wide financial statements. By
doing so, readers may better understand the long-term impact of the government's near -term financing
decisions. Both the government fund balance sheet and the government fund statement of the
revenues, expenditures, and changes in fund balances provide reconciliation to facilitate this
comparison between governmental funds and governmental activities.
The City maintains two major governmental funds, the general fund and the capital projects fund.
The City adopts an annual appropriated budget for its general fund. A budgetary comparison schedule
has been provided to demonstrate legal compliance with the adopted budget for the general fund.
The basic governmental fund financial statements can be found later in this report; see Table of
Contents.
Proprietary funds. The City maintains one type of proprietary fund. Enterprise funds are used to report
the same functions presented as business -type activities in the government -wide financial statements.
The City uses two enterprise fund to account for the operations of the water, sewer and storm drain
activities.
Proprietary funds provide the same type of information as the government -wide financial statements,
only in more detail. The enterprise funds are considered major funds of the City.
The proprietary fund financial statements can be found later in this report; see Table of Contents.
Notes to the financial statements. The notes provide additional information that is essential to a full
understanding of the data provided in the government -wide and fund financial statements. The notes to
the financial statements are reported later in this report; see Table of Contents.
Other information. In addition to the basic financial statements and accompanying notes, this report
also presents certain required supplementary information concerning the City.
6
Moab City Corporation
Management's Discussion and Analysis
June 30, 2015
FINANCIAL ANALYSIS
Moab City Corporation's Net Position
Governmental Business -type
Activities Activities
Total Total
Current Previous Current Previous Current Previous
Year Year Year Year Year Year
Current and other assets $ 5,482,678 4,129,654 4,383,582 4,721,834 9,866,260 8,851,488
Net capital assets 16,747,875 17,511,397 7,036,938 6,485,584 23,784,813 23,996,980
Deferred outflows 289,783 257,536 28,307 25,157 318,090 282,693
Total assets and
deferred outflows 22,520,336 21,898,587 11,448,827 11,232,574 33,969,163 33,131,162
Current and other liabilities 2,012,675 2,428,274 189,840 240,092 2,202,515 2,668,365
Long-term liabilities 5,377,000 5,643,000 - 5,377,000 5,643,000
Deferred inflows 215,467 21,047 - 236,514
Total liabilities and
deferred inflows 7 605 141 8 071 274 210.887 240.092 7 816 029 8 311 365
Net position:
Net investment in
capital assets 11,370,875 11,868,397 7,036,938 6,485,584 18,407,813 18,353,980
Restricted 118,848 80,836 2,413,127 2,413,127 2,531,975 2,493,963
Unrestricted 3,425,472 1,878,081 1,787,874 2,093,772 5,213,347 3,971,853
Total net position $ 14,915,195 13,827,314 11,237,939 10,992,482 26,153,134 24,819,796
As noted earlier, net position may serve over time as a useful indicator of financial position. Total
assets and deferred outflows exceeded total liabilities and deferred inflows at the close of the year by
$26,153,134, an increase of $1,333,338 from the previous year. This change is equivalent to the net
income for the year, in private sector terms.
Total unrestricted net position at the end of the year is $5,213,347, which represents an increase of
$1,241,494 from the previous year. Unrestricted net position are those resources available to finance
day-to-day operations without constraints established by debt covenants, enabling legislation, or other
legal requirements.
The amount of current and other assets represent the amounts of cash and receivables on hand at the
end of each year. Other liabilities are the amounts of current and other liabilities due, at year end, for
goods and services acquired.
Changes in capital assets are the result of the difference, in the current year, of the cost of acquisition
of capital assets and any depreciation charges on capital assets. Change in long-term debt is the
difference in the amount of debt issued and that which has been paid during the year.
7
Moab City Corporation
Management's Discussion and Analysis
June 30, 2015
FINANCIAL ANALYSIS (continued)
Moab City Corporation's Change in Net Position
Governmental Business -type
Activities Activities
Total Total
Current Previous Current Previous Current Previous
Year Year Year Year Year Year
Program revenues:
Charges for services $ 1,715,090 1,762,655 1,662,543 1,568,967 3,377,632 3,331,622
Operating grants 210,589 214,807 - 210,589 214,807
Capital grants 477,215 575,877 12,346 477,215 588,223
General revenues:
Sales tax 1,738,623 1,559,020 - 1,738,623 1,559,020
Other taxes 5,336,833 4,653,190 - 5,336,833 4,653,190
Other revenues 149,610 222,571 172,124 274,057 321,733 496,629
Total revenues 9,627,960 8,988,119 1,834,666 1,855,370 11,462,626 10,843,489
Expenses:
General government 2,011,390 2,229,657 - 2,011,390 2,229,657
Public safety 2,202,531 2,363,296 - 2,202,531 2,363,296
Highways and improvements 2,327,991 2,253,083 - 2,327,991 2,253,083
Parks and recreation 2,373,273 2,256,605 - 2,373,273 2,256,605
Interest on long-term debt 34,894 41,745 - 34,894 41,745
Water, sewer and storm drain - - 1,179,209 1,187,483 1,179,209 1,187,483
Total expenses 8,950,079 9,144,386 1,179,209 1,187,483 10,129,288 10,331,869
Excess (deficiency) before
transfers and contributions 677,881 (156,267) 655,457 667,887 1,333,338 511,621
Transfers (410,000) (410,000) 410,000 410,000
Change in net position $ 1,087,881 253,733 245,457 257,887 1,333,338 511,621
Total revenues increased by $619,137, while total expenses decreased by $202,580. The total net
increase for the year of $1,333,338 is an increase from the previous year of $821,717.
Governmental activities revenues of $9,627,960 is an increase of $639,841 from the previous year.
This is primarily due to an increase in tax revenues compared to the previous year. Governmental
activities expenses of $8,950,079 is a decrease of $194,307 from the previous year. While spending
within the the highways and improvements and parks and recreation departments increased during the
year, spending within the general government and public safety departments decreased.
Business -type activities revenues of $1,834,666 is a decrease of $20,704 from the previous year.
Business -type activities expenses of $1,179,209 is a decrease of $8,273 from the previous year.
8
Moab City Corporation
Management's Discussion and Analysis
June 30, 2015
BALANCES AND TRANSACTIONS OF INDIVIDUAL FUNDS
Some of the more significant changes in fund balances and fund net position and any restrictions on
those amounts is described below:
General Fund
The fund balance of $2,428,450 reflects an increase of $242,538 from the previous year. Total
revenues increased by $824,879. Tax revenues increased by $863,246. Revenue from licenses and
permits decreased by $67,239. Intergovermnetal revenues increased by $47,465. Revenue from
charges for services decreased by $12,864. Revenue from fines and forfeitures increased by $32,493.
All other revenues decreased by $38,228.
Total expenditures, excluding transfers out, decreased by $104,660. Expenditure changes from the
previous year, by depaitment, were: general government decreased by $99,829; public safety
decreased by $84,768; streets and highways increased by $50,875; and parks and recreation increased
by $52,288. Capital outlay expenditures increased by $126,620. Expeditures for principal decreased
by $143,861, while expenditures for interest decreased by $5,985.
The fund balance restricted for Class C roads is $118,848. The unassigned fund balance amounts to
$2,309,602.
Capital Projects Fund
The fund balance of $2,678,094 reflects an increase of $1,156,935 from the previous year. Total
revenue, excluding transfers, decreased by $158,082. In the prior year, revenues from grants were
higher. Expenses decreased during the year by $223,463. A transfer in was made during the year from
the general fund for $1,733,500.
Water and Sewer Fund
Net income amounted to $172,918, which is an increase of $7,756 from the previous year net income.
The amount restricted for construction is $2,413,127. Unrestricted net position amounts to $598,966.
Storm Drain Fund
The change in net position (net income) was $72,539. Unrestricted net position amounts to
$1,213,600.
GENERAL FUND BUDGETARY HIGHLIGHTS
Revenues for the current year, exclusive of transfers and fund balance appropriations, were originally
budgeted in the amount of $7,984,800. Budgeted revenues were amended during the year to
$8,061,038. Actual revenues amounted to $9,042,668.
Expenditures for the current year, excluding transfers, were originally budgeted in the amount of
$8,419,577. Budgeted expenditures were amended during the year to $8,495,815. Actual expenditures
amounted to $7,335,232.
9
Moab City Corporation
Management's Discussion and Analysis
June 30, 2015
CAPITAL ASSETS AND DEBT ADMINISTRATION
Moab City Corporation's Capital Assets (net of depreciation)
Governmental Business -type
Activities Activities
Total Total
Current Previous Current Previous Current Previous
Year Year Year Year Year Year
Net Capital Assets:
Land and water rights $ 476,884 476,884 262,935 262,935 739,819 739,819
Buildings 10,038,564 10,341,483 - 10,038,564 10,341,483
Improvements other
than buildings 1,820,408 2,032,155 - 1,820,408 2,032,155
Machinery and equipment 1,556,156 1,720,838 345,663 413,911 1,901,819 2,134,748
Infrastructure 2,436,076 2,577,978 - 2,436,076 2,577,978
Water system 2,135,723 2,244,897 2,135,723 2,244,897
Sewer system 3,052,518 3,172,680 3,052,518 3,172,680
Work in progress 419,787 362,059 1,240,098 391,160 1,659,886 753,219
Totals $ 16,747,875 17,511,397 7,036,938 6,485,584 23,784,813 23,996,980
The total amount of capital assets, net of depreciation, of $23,784,813 is a decrease of $212,168 from
the previous year.
Governmental activities capital assets, net of depreciation, of $16,747,875 is a decrease of $763,522
from the previous year.
Business -type activities capital assets, net of depreciation, of $7,036,938 is an increase of $551,354
from the previous year.
Additional information regarding capital assets may be found in the notes to financial statements.
Moab City Corporation's Outstanding Debt
Current Previous
Year Year
Governmental activities:
2003 Sales Tax Revenue $ 1,377,000 1,452,000
2009 Sales Tax Revenue 4,000,000 4,191,000
Total outstanding debt
$ 5,377,000 5,643,000
Additional information regarding long-term liabilities may be found in the notes to financial
statements.
10
Moab City Corporation
Management's Discussion and Analysis
June 30, 2015
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
No significant economic changes that would affect the City are expected for the next year. Budgets
have been set on essentially the same factors as the current year being reported.
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the Moab City Corporation's
finances for all those with an interest in the City's finances. Questions concerning any information
provided in this report or requests for additional financial information should be addressed to: City
Recorder, 217 East Center Street, Moab, UT 84532.
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12
BASIC FINANCIAL STATEMENTS
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14
Moab City Corporation
STATEMENT OF NET POSITION
June 30, 2015
ASSETS AND DEFERRED OUTFLOWS
OF RESOURCES:
Assets:
Current assets:
Cash and cash equivalents
Accounts receivable, net of allowances
Due from other governments
Other current assets
Total current assets
Non -current assets:
Restricted cash and cash equivalents
Capital assets:
Not being depreciated
Net of accumulated depreciation
Net pension asset
Total non -current assets
Total assets
Deferred outlfows of resources - pensions
Total assets and deferred outlfows of resources
LIABILITIES AND DEFERRED INFLOWS
OF RESOURCES:
Liabilities:
Current liabilities:
Accounts payable and accrued liabilities
Customer security deposits
Accrued interest payable
Revenue bond due within one year
Total current liabilities
Non -current liablities:
Compensated absences
Revenue bonds due after one year
Net pension liability
Total non -current liablities
Total liabilties
Deferred inflows of resources - pensions
Total liabilities and deferred inflow of resources
NET POSITION:
Net investment in capital assets
Restricted:
Class C roads
Construction
Unrestricted
Total net position
Total liabilities, deferred inflows of resources,
and net position
Governmental Business -type
Activities Activities
$ 4,496,803
102,901
760,603
878
3,523,259
111,665
Total
8,020,062
214,566
760,603
878
5,361,185 3,634,924 8,996,109
118,848
896,671
15,851,203
2,646
748,400
1,503,034
5,533,904
258
867,248
2,399,705
21,385,108
2,904
16,869,368 7,785,596 24,654,965
22,230,553 11,420,520 33,651,073
289,783
$ 22,520,336
236,820
25,819
268,000
530,639
395,066
5,109,000
1,354,969
6,859,036
7,389,675
215,467
7,605,141
11,370,875
118,848
3,425,472
28,307 318,090
11,448,827 33,969,163
26,042
2,925
28,967
262,862
2,925
25,819
268,000
559,606
28,517 423,583
5,109,000
132,357 1,487,326
160,874 7,019,909
189,840 7,579,515
21,047
236,514
210.887 7.816.029
7,036,938 18,407,813
2,413,127
1,787,874
118,848
2,413,127
5,213,347
14.915.195 11.237.939 26.153.134
$ 22,520,336 11,448,827
The notes to the financial statements are an integral part of this statement.
33.969.163
15
Moab City Corporation
STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2015
Net
(Expense)
Charges Operating Capital Revenue
for Grants and Grants and (To Next
Expenses Services Contributions Contributions Page)
FUNCTIONS/PROGRAMS:
Primary government:
Governmental activities:
Administration $ 2,011,390 1,233,115
Public safety 2,202,531 24,345
Streets and highways 2,327,991
Parks and recreation 2,373,273 457,629
Interest on long-term debt 34,894
24,057
186,532
105,801 (672,473)
(2,154,129)
(2,141,458)
371,414 (1,544,230)
- (34,894)
Total governmental activities 8,950,079 1,715,090 210,589 477,215 (6,547,185)
Business -type activities:
Water and sewer utilities 1,155,833 1,521,627 159,533 525,328
Storm drain utility 23,377 140,916 117,539
Total business -type activities 1,179,209 1,662,543 159,533 642,867
Total primary government $ 10,129,288 3,377,632 210,589 636,748 (5,904,318)
(The statement of activities continues
on following page)
The notes to the financial statements are an integral part of this statement.
16
Moab City Corporation
STATEMENT OF ACTIVITIES (continued)
For the Year Ended June 30, 2015
Governmental Business -type
Activities Activities
CHANGES IN NET POSITION:
Total
Net (expense) revenue
(from previous page) $ (6,547,185) 642,867 (5,904,318)
General revenues:
Sales tax 1,738,623 1,738,623
Other taxes 5,336,833 5,336,833
Unrestricted investment earnings 33,361 12,590 45,951
Miscellaneous 89,923 89,923
Transfers in (out) 410,000 (410,000)
Total general revenues and transfers 7,635,066 (397,410) 7,237,656
Change in net position 1,087,881 245,457 1,333,338
Net position - beginning, restated 13,827,314 10,992,482 24,819,796
Net position - ending $ 14,915,195 11,237,939 26,153,134
The notes to the financial statements are an integral part of this statement.
17
Moab City Corporation
BALANCE SHEET - GOVERNMENTAL FUNDS
June 30, 2015
Capital Other Total
General Projects Governmental Governmental
Fund Fund Funds Funds
ASSETS
Cash and cash equivalents $ 1,655,354 2,699,602 141,847 4,496,803
Accounts receivable, net of allowances 863,504 863,504
Other current assets 878 - 878
Restricted cash and cash equivalents 118,848 118,848
TOTAL ASSETS
$ 2,638,584 2,699,602 141,847 5,480,033
LIABILITIES
Accounts payable $ 148,604 10,408 5,179 164,190
Accrued liabilities 61,531 11,100 72,630
TOTAL LIABILITIES
210.134 21.507 5.179 236.820
FUND BALANCES:
Restricted for:
Class C roads 118,848 118,848
Assigned for:
Capital projects - 2,303,094 2,453,094
USU Set -aside - 375,000 225,000
Recreation 133,568 133,568
Youth city council 3,100 3,100
Unassigned 2,309,602 2,309,602
TOTAL FUND BALANCES
2,428,450 2,678,094 136,668 5,243,212
TOTAL LIABILITIES AND FUND BALANCES $ 2,638,584 2,699,602 141,847 5,480,033
The notes to the financial statements are an integral part of this statement.
18
Moab City Corporation
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
For the Year Ended June 30, 2015
Capital Other Total
General Projects Governmental Governmental
Fund Fund Funds Funds
REVENUES:
Taxes:
Sales $ 1,738,623 1,738,623
Other taxes 5,336,833 5,336,833
Licenses and permits 185,284 - 185,284
Intergovernmental revenues 316,390 284,750 86,664 687,804
Charges for services 1,291,815 151,629 1,443,444
Fines and forfeitures 86,362 86,362
Interest 23,273 9,764 324 33,361
Miscellaneous revenue 64,087 41,924 10,237 116,249
Total revenues 9,042,668 336,437 248,855 9,627,960
EXPENDITURES:
General government 1,728,988 1,728,988
Public safety 2,197,083 - 2,197,083
Highways and public improvements 2,065,647 60,563 2,126,210
Parks, recreation and public property 1,187,679 453,803 392,620 2,034,101
Capital outlay 155,835 96,337 252,171
Debt service:
Prinicpal 266,000 266,000
Interest 36,300 36,300
Total expenditures
Excess (Deficiency) of Revenues over
(Under) Expenditures
7,335,232 913,002 392,620 8,640,854
1,707,436 (576,565) (143,765) 987,106
Other Financing Sources and (Uses):
Transfers in 410,000 1,733,500 141,398 2,284,898
Transfers (out) (1,874,898) (1,874,898)
Total other financing sources and (uses) (1,464,898) 1,733,500 141,398 410,000
Net Change in Fund Balances 242,538 1,156,935 (2,367) 1,397,106
Fund balances - beginning 2,185,911 1,521,159 139,036 3,846,106
Fund balances - end of year $ 2,428,450 2,678,094 136,668 5,243,212
The notes to the financial statements are an integral part of this statement.
19
Moab City Corporation
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
For the Year Ended June 30, 2015
Total Fund Balances for Governmental Funds $ 5,243,212
Total net position reported for governmetnal activities in the statement
is different because:
Capital assets used in governmental funds are not financial resources and
therefore are not reported in the funds.
Capital assets, at cost 25,162,424
Less accumulated depreciation (8,414,549)
Net capital assets 16,747,875
Net pension assets are not financial resources and, therefore, are
not reported in the funds. 2,646
Deferred outflows of resources, a consumption of net position that
applies to future periods, is not shown in the funds statements. 289,783
Long-term liabilities, for funds other than enterprise funds are recorded in
the government -wide statements but not in the fund statements.
General long-term debt
Interest accrued but not yet paid on long-term debt
Compensated absences
Net pension liabilitiy
Deferred inflows of resources - pensions
(5,377,000)
(25,819)
(395,066)
(1,354,969)
(215,467)
Total Net Position of Governmetnal Activities $ 14,915,195
The notes to the financial statements are an integral part of this statement.
20
Moab City Corporation
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2015
Net Change in Fund Balances - Total Governmental Funds $ 1,397,106
Amounts reported for governmental activities in the statement of
activities are different because:
Governmental funds report capital outlays as expenditures. However,
in the statement of activities, assets with a material cost are
capitalized and the cost os allocated over their estimated useful
lives and reported as depreciation expenses.
Capital outlays 252,171
Depreciation expense (1,015,693)
Net (763,522)
The Statement of Activities show pension benefits and pension expenses
from the adoption of GASB 68 that are not shown in the fund statements. 171,100
Repayment of debt principal is an expenditure in the governmental funds, but
the repayment reduces long-term liabilities in the statement of net position.
Long-term debt principal repayments 266,000
Accrued interest for long-term debt is not reported as and expenditure for
the current period, while it is recorded in the statement of activities.
Change in accrued interest 1,406
Compensated absences expenses reported in the statement of activities do
not require the use of current financial resources and are not reported as
expenditures in governmental activites.
Change in compensated absences liability 15,790
Change in Net Position of Governmental Activities $ 1,087,881
The notes to the financial statements are an integral part of this statement.
21
Moab City Corporation
STATEMENT OF NET POSITION - PROPRIETARY FUNDS
June 30, 2015
Water & Sewer Storm Drain
Fund Fund
Total
ASSETS AND DEFERRED OUTFLOWS OF RESOURCES:
Assets:
Current assets:
Cash and cash equivalents $ 2,348,166 1,175,092 3,523,259
Accounts receivable, net 97,849 13,816 111,665
Total current assets 2,446,015 1,188,909 3,634,924
Non -current assets:
Resricted cash and cash equivalents 748,400 748,400
Capital assets:
Not being depreciated 1,478,343 24,691 1,503,034
Net of accumulated depreciation 5,533,904 5,533,904
Net pension asset 258 258
Total non -current assets 7,760,905 24,691 7,785,596
Total assets 10,206,920 1,213,600 11,420,520
Deferred outflows of resources - pensions
Total assets and deferred outflows of resources
28,307 28,307
$ 10,235,227 1,213,600 11,448,827
LIABILITIES AND DEFERRED INFLOWS
OF RESOURCES:
Liabilities:
Current liabilities:
Accounts payable $ 26,042 26,042
Customer security deposits 2,925 2,925
Total current liabilities 28,967 28,967
Non -current liablities:
Compensated absences
Net pension liability
Total non -current liabilities
Total liabilities
Deferred inflows of resources - pensions
Total liabilities and deferred inflows of resources
28,517 - 28,517
132,357 132,357
160,874 160,874
189,840 189,840
21,047 21,047
210.887 210.887
NET POSITION:
Net investment in capital assets 7,012,247 24,691 7,036,938
Restricted for:
Construction 2,413,127 - 2,413,127
Unrestricted 598,966 1,188,909 1,787, 874
Total net position 10,024,340 1,213,600 11,237,939
Total liabilities, deferred inflows of resources,
and net position $ 10,235,227 1,213,600 11,448,827
The notes to the financial statements are an integral part of this statement.
22
Moab City Corporation
STATEMENT OF REVENUES, EXPENSES, AND CHANGES
IN NET POSITION - PROPRIETARY FUNDS
For the Year Ended June 30, 2015
Water & Sewer Storm Drain
Fund Fund
Total
Operating income:
Charges for sales and service $ 1,352,917 140,916 1,493,833
Connection fees 34,293 34,293
Other operating income 134,417 134,417
Total operating revenue 1,521,627 140,916 1,662,543
Operating expenses:
Personnel services 269,439 269,439
Utilities 101,954 101,954
Repair & maintenance 45,479 23,377 68,856
Other supplies & expenses 427,506 - 427,506
Insurance expense 1,560 - 1,560
Depreciation expense 309,895 - 309,895
Total operating expense 1,155,833 23,377 1,179,209
Net operating income (loss) 365,795 117,539 483,333
Non -operating income (expense):
Impact fees 159,533 - 159,533
Interest income 12,590 - 12,590
Transfers in (out) (365,000) (45,000) (410,000)
Total non -operating income (expense) (192,876) (45,000) (237,876)
Change in net position 172,918 72,539 245,457
Net position - beginning, restated 9,851,421 1,141,061 10,992,482
Net position - ending $ 10,024,340 1,213,600 11,237,939
The notes to the financial statements are an integral part of this statement.
23
Moab City Corporation
STATEMENT OF CASH FLOWS - PROPRIETARY FUNDS
For the Year Ended June 30, 2015
Cash flows from operating activities:
Cash received from customers - service
Cash paid to suppliers
Cash paid to employees
Net cash provided (used) in operating activities
Cash flows from noncapital financing activities:
Change in customer deposits
Net interfund activity
Net cash provided (used) in
noncapital financing activities
Cash flows from capital and
related financing activities:
Cash from impact fees
Cash payments for capital assets
Net cash provided (used) in capital
and related financing activities
Cash flows from investing activities:
Cash received from interest earned
Net cash provided (used) in investing activities
Net increase (decrease) in cash
Cash balance, beginning
Cash balance, ending
Cash reported on the statement of net position:
Cash and cash equivalents
Non -current restricted cash
Total cash and cash equivalents
Water & Sewer Storm Drain
Fund Fund
$ 1,524,194
(560,189)
(311,387)
140,304
(29,526)
Total
1,664,498
(589,716)
(311,387)
652.619 110.777 763.396
(750)
(365,000)
- (750)
(45,000) (410,000)
(365,750) (45,000) (410,750)
159,533
(861,249)
(701,716)
12,590
12,590
(402,257)
3,498,823
159,533
(861,249)
- (701,716)
12,590
12.590
65,777 (336,480)
1,109,315 4,608,139
$ 3,096,566 1,175,092 4,271,659
$ 2,348,166
748,400
1,175,092 3,523,259
748,400
$ 3,096,566 1,175,092 4,271,659
The notes to the financial statements are an integral part of this statement.
24
Moab City Corporation
STATEMENT OF CASH FLOWS - PROPRIETARY FUNDS (continued)
For the Year Ended June 30, 2015
Reconciliation of Operating Income to Net
Cash Provided (Used) in Operating Activities:
Net operating income (loss)
Adjustments to reconcile operating
income or (loss) to net cash provided (used)
in operating activities:
Depreciation and amortization
Water & Sewer Storm Drain
Fund Fund Total
$ 365,795 117,539 483,333
309,895 309,895
Changes in assets and liabilities:
(Increase) decrease in receivables 2,567 (612) 1,955
(Increase) decrease in non -current assets (183) (183)
(Increase) decerase in deferred outflows (3,150) - (3,150)
Increase (decrease) in payables (43,352) (6,150) (49,502)
Increase (decrease) in deferred inflows 21,047 21,047
Net cash provided (used) in operating activities
$ 652,619 110,777 763,396
The notes to the financial statements are an integral part of this statement.
25
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1-A. Reporting entity
Moab City Corporation (the City), a municipal corporation located in Grand County, Utah, operates under
a Mayor -Council form of government. The accompanying financial statements present the financial
activities of the City.
1-B. Government -wide and fund financial statements
Government -wide Financial Statements
The government -wide financial statements, consisting of the statement of net position and the statement
of changes in net position report information on all of the non -fiduciary activities of the primary
government and its component units. For the most part, the effect of inter -fund activity has been removed
from these statements. Governmental activities, which normally are supported by taxes and
intergovernmental revenues, are reported separately from business -type activities, which rely to a
significant extent on fees and charges for support.
The statement of net position reports the financial position of the governmental and business -type
activities of the City at year-end.
The statement of activities reports the expenses of a given function offset by program revenues directly
connected with the functional program. A function is an assembly of similar activities and may include
portions of a fund or summarize more than one fund to capture the expenses and program revenues
associated with a distinct functional activity. Direct expenses are those that are clearly identifiable with a
specific function or segment. Indirect expenses are not allocated. All expenses are included in the
applicable function. Program revenues include (1) charges to customers or applicants who purchase, use,
or directly benefit from goods, services, or privilege provided by a given function or segment and (2)
grants and contributions that are restricted to meeting the operational or capital requirements of a
particular function or segment. Taxes and other items not properly included among program revenues are
reported instead as general revenues.
Fund Financial Statements
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds,
if any, even though the latter are excluded from the government -wide financial statements. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in
the fund financial statement.
1-C. Measurement focus, basis of accounting and financial statement presentation
The financial statements of the City are prepared in accordance with generally accepted accounting
principles (GAAP).
26
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
1-C. Measurement focus, basis of accounting and financial statement presentation (continued)
The government -wide statements are reported using the economic resources measurement focus and the
accrual basis of accounting, generally including the reclassification of internal activity (between or within
funds). However, internal eliminations do not include utility services provided to City departments or
payments to the general fund by other funds for providing administrative and billing services for such
funds. Reimbursements are reported as reductions to expenses. Proprietary and any fiduciary fund
financial statements are also reported using this same focus and basis of accounting although internal
activity is not eliminated in these statements. Revenues are recorded when earned and expenses are
recorded when a liability is incurred, regardless of the timing of related cash flows.
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both
measurable and available. Revenues are considered to be available when they are collectible within the
current period or soon enough thereafter to pay liabilities of the current period. The City considers
revenues to be available if they are collected within 60 days of the end of the current fiscal period.
Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However,
debt service expenditures, as well as expenditures related to compensated absences and claims and
judgments, are recorded only when payment is due.
Sales taxes, intergovernmental revenues, and interest associated with the current fiscal period are all
considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal
period. Only the portion of special assessments, if any, receivable within the current fiscal period is
considered to be susceptible to accrual as revenue of the current period. All other revenue items are
considered to be measurable and available only when cash is received by the government.
Proprietary funds distinguish operating revenues and expenses from non -operating items. Operating
income and expense reported in proprietary fund financial statements include those revenues and
expenses related to the primary, continuing operations of the fund. Principal operating revenues for
proprietary funds are charges to customers for sales or services. Principal operating expenses are the costs
of providing goods or services, including administrative expenses and depreciation of capital assets. Other
revenues and expenses are classified as non -operating in the financial statements.
Policy regarding use of restricted resources
When both restricted and unrestricted resources are available for use, it is the City's policy to use
restricted resources first, then unrestricted resources as needed. Restricted assets and liabilities payable
from restricted assets current in nature are reported with current assets and current liabilities. Restricted
assets, non -current reports assets restricted for acquisition or construction of non -current assets, or are
restricted for liquidation of long-term debt.
27
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
1-D. Fund types and major funds
Governmental funds
The City reports the following major governmental funds:
The general fund is the government's primary operating fund. It accounts for all financial resources of the
general government, except those required to be accounted for in another fund.
The capital projects fund accounts for financial resources used for the acquisition or construction of the
capital facilities of the City (other than those of the enterprise funds).
The City reports the following as non -major governmental funds:
The recreation fund accounts for the revenues and expenditures for the activities relation to recreation.
The youth city council fund accounts for revenues and expenditures for activities with the youth city
council.
Proprietary funds
The City reports the following major proprietary funds:
The water and sewer fund is used to account for the activities of water and sewer utilities.
The storm drain fund is used to account for the revenues and expenditures of the storm drain utility.
1-E. Assets, Liabilities, and Net Position or Equity
1-E-1. Deposit and Investments
Investments are reported at fair value. Deposits are reported at cost, which approximates fair value.
Investments of the City are accounts at the Utah Public Treasurers Investments Fund. Additional
information is contained in Note 2.
1-E-2. Cash and Cash Equivalents
The City's cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term
investments with original maturities of three months or less from the date of acquisition.
1-E-3. Receivables and Payables
Accounts receivable other thanintergovernmental receivables are from customers primarily for utility
services. Intergovernmental receivables are considered collectible. Customer accounts are reported net of
an allowance for uncollectible accounts. The allowance amount is estimated using accounts receivable
past due more than 90 days.
28
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
1-E. Assets, Liabilities, and Net Position or Equity (continued)
1-E-3. Receivables and Payables (continued)
During the course of operations, there may be transactions occur between funds that are representative of
lending/borrowing arrangements outstanding at year-end. These are reported as either due to or due from
other funds.
1-E-4. Restricted Assets
In accordance with certain revenue bond covenants, resources may be required to be set aside for the
repayment of such bonds, and, on occasion, for the repair and maintenance of the assets acquired with the
bond proceeds. These resources are classified as restricted assets on the balance sheet because of their
limited use. Most capital grant agreements mandate that grant proceeds be spent only on capital assets.
Unspent resources of this nature are also classified as restricted. The limited use resources described
above involve a reported restriction of both cash and net position.
Unspent proceeds of bonds issued to finance capital assets are also reported as restricted cash
1-E-5. Inventories and Prepaid items
Inventories in governmental funds are not reported. These consist of immaterial amounts of expendable
supplies for consumption. Such supplies are acquired as needed. Proprietary fund inventories, where
material, are stated at the lower of cost or market, using the first -in, first -out basis.
Prepaid items record payments to vendors that benefit future reporting and are reported on the
consumption basis. Both inventories and prepayments are similarly reported in government -wide and
fund financial statements.
1-E-6. Capital Assets
Capital assets includes property, plant, equipment, and infrastructure assets (e.g., roads, bridges,
sidewalks, and similar items), and are reported in the applicable governmental or business -type activities
columns in the government -wide financial statements. Capital assets are defined by the government as
assets with an initial, individual cost of $5,000 and an estimated useful life in excess of two years. Such
assets are recorded at historical cost or at estimated historical cost if purchased or constructed. Donated
capital assets are recorded at estimated fair market value at the date of donation. Infrastructure is
depreciated.
The cost of normal maintenance and repairs that does not add to the value of an asset or materially extend
the assets' life is not capitalized. Major outlays for capital assets and improvements are capitalized as
projects are constructed. Interest incurred during the construction phase of capital assets of business -type
activities is included as part of the capitalized value of the assets constructed.
29
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
1-E. Assets, Liabilities, and Net Position or Equity (continued)
1-E-6. Capital Assets (continued)
Upon retirement or disposition of capital assets, the cost and related accumulated depreciation are
removed from the respective accounts. Depreciation of capital assets is computed using the straight-line
method over their estimated useful lives.
Property, plant, and equipment of the primary government, as well as the component units if any, is
depreciated using the straight line method over the following estimated useful lives:
Assets Years
Building and structures 30-45
Infrastructure 30
Vehicles and equipment 5-15
1-E-7. Long-term Obligations
In the government -wide and proprietary fund financial statements, long-term debt and obligations are
reported as liabilities in the applicable governmental activities, business -type activities, or proprietary
fund statement of net position.
The governmental fund financial statements recognize the proceeds of debt and premiums as other
financing sources of the current period. Issuance costs are reported as expenditures.
1-E-8. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position will sometimes include a separate section for deferred
outflows of resources. This separate financial statement element, deferred outflows of resources,
represents a consumption of net position that applies to a future period(s) and so will not be recognized
as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of net position will sometimes include a separate section for
deferred inflows of resources. This separate financial statement element, deferred inflows of resources,
represents an acquisition of net position that applies to a future period(s) and so will not be recognized as
an inflow of resources (revenue) until then.
1-E-9. Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows
of resources related to pensions, and pension expense, information about the fiduciary net position of the
Utah Retirement Systems Pension Plan (URS) and additions to/deductions from URS's fiduciary net
position have been determined on the same basis as they are reported by URS. For this purpose, benefit
payments (including refunds of employee contributions) are recognized when due and payable in
accordance with the benefit terms. Investments are reported at fair value.
30
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
1-E. Assets, Liabilities, and Net Position or Equity (continued)
1-E-10. Fund Equity
When both restricted and unrestricted resources are available for use, it is the City's policy to use
restricted resources first, then unrestricted resources as they are needed. When both committed, assigned,
or unassigned resources are available for use, it is the City's policy to use committed resources first,
followed by assigned resources and then unassigned resources as they are needed.
Equity is classified in the government -wide financial statements and in the proprietary fund financial
statements as net assets and is displayed in three components as follows:
Net investment in capital assets represents capital assets, net of accumulated depreciation and
reduced by the outstanding balances of any long-term debt attributable to the acquisition,
construction, or improvement of those assets.
Restricted net position is net position with constraints placed on the use either by (1) external groups
such as creditors, grantors, contributors, or laws or regulations of other governments; or (2) law
through constitutional provisions or enabling legislation.
Unrestricted net position are all other resources that do not meet the definition of "restricted" or "net
investment in capital assets."
Equity is classified in governmental fund financial statements as fund balance and is further classified as
nonspendable, restricted, committed, assigned or unassigned as follows:
Nonspendable fund balance cannot be spent because it is either (a) not in spendable form, or (b)
legally or contractually required to be maintained intact.
Restricted fund balance is fund balance with constraints placed on the use either by (1) external
groups such as creditors, grantors, contributors, or laws or regulations of other governments; or (2)
law through constitutional provisions or enabling legislation.
Committed fund balance includes amounts that can only be used for specific purposes established
by formal action of the City Council, with is the City's highest level of decision making authority.
Fund balance commitments can only be removed or changed by the same type of action (for example
resolution) of the City Council. This classification also includes contractual obligations to the extent
that existing resources have been specifically committed for use in satisfying those contractual
requirements.
Assigned fund balance is constrained by the government's intent to be used for specific purposes, but
is neither restricted nor committed. The City Recorder is authorized to assign amounts to a specific
purpose in accordance with the City's budget policy.
Unassigned fund balance is a residual classification of the General Fund. This classification
represents fund balance that has not been assigned to other funds and that has not been restricted,
committed, or assigned to a specific purpose within the General Fund.
31
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
1-F. Estimates
The preparation of financial statements, in conformity with generally accepted accounting principles,
requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those estimates.
NOTE 2 - STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
2-A. Budgetary data
Annual budgets are prepared and adopted by ordinance by total for each department, in accordance with
State law, by the Mayor and City Council on or before June 22 for the following fiscal year beginning
July 1. Estimated revenues and appropriations may be increased or decreased by resolution of the City
Council at any time during the year. A public hearing must be held prior to any proposed increase in a
fund's appropriations. Budgets include activities in the General Fund. The level of the City's budgetary
control (the level at which the City's expenditures cannot legally exceed appropriations) is established at
the department level. Each department head is responsible for operating within the budget for their
department. All annual budgets lapse at fiscal year end.
Utah State law prohibits the appropriation of unreserved General Fund balance to an amount less than
5% of the General Fund revenues. The 5% reserve that cannot be budgeted is used to provide working
capital until tax revenue is received, to meet emergency expenditures, and to cover unanticipated deficits.
Any unassigned General Fund balance greater than 25% of the current year's actual revenues must be
appropriated within the following two years.
Once adopted, the budget may be amended by the City Council without hearing provided the budgeted
expenditures do not exceed budgeted revenues and appropriated fund balance. A public hearing must be
held if the budgeted expenditures will exceed budgeted revenues and any fund balance which is available
for budgeting. With the consent of the Mayor, department heads may reallocate unexpended appropriated
balances from one expenditure account to another within that department during the budget year.
Budgets for the General Fund are prepared on the modified accrual basis of accounting. Encumbrances
are not used.
2-B. Deficit fund net assets
None of the City's funds have deficit balances.
32
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
NOTE 3 - DETAILED NOTES
3-A. Deposits and investments
Cash and investments as of June 30, 2015 consist of the following:
Fair Value
Demand deposits $ 522,477
Savings 1,433,552
Investments - PTIF 6,931,281
Total cash $ 8,887,310
Cash and investments listed above are classified in the accompanying government -wide statement of net
position as follows:
Cash and cash equivalents (current)
Restricted cash and cash equivalents (non -current)
$ 8,020,062
867,248
Total cash and cash equivalents $ 8,887,310
Cash equivalents and investments are carried at fair value in accordance with GASB Statement No. 31.
The Utah Money Management Act (UMMA) establishes specific requirements regarding deposits of
public funds by public treasurers. UMMA requires that city funds be deposited with a qualified
depository which includes any depository institution which has been certified by the Utah State
Commissioner of Financial Institutions as having met the requirements specified in UMMA Section 51,
Chapter 7. UMMA provides the formula for determining the amount of public funds which a qualified
depository may hold in order to minimize risk of loss and also defines capital requirements which an
Institution must maintain to be eligible to accept public funds. UMMA lists the criteria for investments
and specifies the assets which are eligible to be invested in, and for some investments, the amount of time
to maturity.
UMMA enables the State Treasurer to operate the Public Treasurer's Investment Pool (PTIF). PTIF is
managed by the Utah State Treasurer's investment staff and comes under the regulatory authority of the
Utah Money Management Council. This council is comprised of a select group of financial professionals
from units of local and state government and financial institutions doing business in the state. PTIF
operations and portfolio composition is monitored at least semi-annually by the Utah Money Management
Council. PTIF is unrated by any nationally recognized statistical rating organizations. Deposits in PTIF
are not insured or otherwise guaranteed by the State of Utah. Participants share proportionally in any
realized gains or losses on investments which are recorded on an amortized cost basis. The balance
available for withdrawal is based on the accounting records maintained by PTIF. The fair value of the
investment pool is approximately equal to the value of the pool shares. The City maintains monies not
immediately needed for expenditure in PTIF accounts.
33
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
3-A. Deposits and investments (continued)
Deposit and Investment Risk
The City maintains no investment policy containing any specific provisions intended to limit the City's
exposure to interest rate risk, credit risk, and concentration of credit risk other than that imposed by
UMMA. The City's compliance with the provisions of UMMA addresses each of these risks.
Interest rate risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an
investment. All deposits and investments of the City are available immediately.
Credit risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligations. Custodial
credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a
government will not be able to recover its deposits. At June 30, 2015, $500,000 of the City's demand
deposits are covered by FDIC insurance.
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 in the possession of another party. This risk is addressed through the policy of
investing excess monies only in PTIF.
Concentration of credit risk
Concentration of credit risk is the risk of loss attributed to the magnitude of a government's investment in
a single issuer. PTIF falls under the constraints of UMMA in limiting concentrations of investments.
3-B. Receivables
The allowance policy is described in Note 1-E-3. Receivables as of year end for the City's funds are
shown below:
Governmental Business -type
Activities Activities Total
Customers $ 92,288 111,665 203,953
Intergovernmental receivables 760,603 760,603
Other receivables 10,613 10,613
Total $ 863,504 111,665 975,169
34
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
3-D. Capital Assets
Capital asset activity for the governmental activities was as follows:
Beginning Ending
Balance Additions Retirements Balance
Governmental activities:
Capital assets, not being depreciated:
Land and rights $ 476,884 476,884
Construction in progress 362,059 57,729 419,787
Total capital assets, not being depreciated
838.943 57.729 896.671
Capital assets, beind depreciated:
Buildings 12,116,787 12,116,787
Improvements other than buildings 3,796,221 3,796,221
Machinery and equipment 4,436,519 187,368 4,623,887
Infrastructure 3,721,782 7,075 3,728,857
Total capital assets, being depreciated
24,071,310 194,443 - 24,265,753
Less accumulated depreciation for:
Buildings 1,775,304 302,920 2,078,224
Improvements other than buildings 1,764,066 211,747 1,975,813
Machinery and equipment 2,715,682 352,050 3,067,731
Infrastructure 1,143,804 148,977 1,292,781
Total accumulated depreciation 7,398,856 1,015,693 8,414,549
Total capital assets being depreciated, net 16,672,454 (821,251.1 - 15,851,203
Governmental activities capital assets, net $ 17,511,397 (763,522) - 16,747,875
Depreciation expense was charged to functions/programs of the primary government governmental
activities as follows:
Governmental activities:
General government $ 345,584
Public safety 76,258
Highways and public improvements 227,149
Parks, recreation and public property 366,702
Total $ 1,015,693
35
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
3-D. Capital assets (continued)
Capital asset activity for business -type activities was as follows:
Beginning Ending
Balance Additions Retirements Balance
Business -type activities:
Capital assets, not being depreciated:
Land and water shares $ 262,935 262,935
Construction in progress 391,160 848,938 1,240,098
Total capital assets, not being depreciated 654,096
848,938 - 1,503,034
Capital assets, being depreciated:
Water system 5,483,679 12,311 5,495,990
Sewer system 6,931,477 - - 6,931,477
Machinery & equipment 1,290,692 1,290,692
Total capital assets, being depreciated
13.705.847 12.311 13.718.158
Less accumulated depreciation for:
Water system 3,238,782 121,485 3,360,267
Sewer system 3,758,797 120,162 3,878,959
Machinery & equipment 876,781 68,248 945,029
Total accumulated depreciation 7,874,359 309,895 8,184,254
Total capital assets being depreciated, net 5,831,488 (297,584) 5,533,904
Business -type activities capital assets, net $ 6,485,584 551,354 7,036,938
Depreciation expense was charged to functions/programs of the primary government business -type
activities as follows:
Business -type activities:
Water $ 160,124
Sewer 149,771
Total $ 309,895
36
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
3-E. Long-term debt
Long-term debt activity for the year was as follows:
Governmental activities:
2003 Sales Tax Revenue
Matures 10/1/2029
2009 Sales Tax Revenue Bonds
Matures 10/1/2035
Total governmental activity
long-term liabilities
Due
Original % Within
Principal Rate 6/30/2014 Additions Reductions 6/30/2015 One Year
$ 2,050,000 2.50$ 1,452,000 75,000 1,377,000 77,000
4,764,000
- 4,191,000 - 191,000 4,000,000 191,000
$5,643,000 - 266,000 5,377,000 268,000
Principal Interest Total
2016 $ 268,000 34,425 302,425
2017 270,000 32,500 302,500
2018 272,000 30,525 302,525
2019 274,000 28,500 302,500
2020 276,000 26,425 302,425
2021 - 2025 1,412,000 99,225 1,511,225
2026 - 2030 1,470,000 39,275 1,509,275
2031 - 2035 955,000 955,000
2036 - 2035 180,000 180,000
Other long-term liabilities:
Total $5,377,000 290,875 5,667,875
Increase
Beginning (Decrease) Ending
Compensated absences:
Governmental $ 410,857 (15,791) 395,066
Business -type 53,751 (25,234) 28,517
Total $ 464,608 (41,025) 423,583
37
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
3-F. Interfund receivable, payables and transfers
Interfund transfers:
Transfers In Transfers Out
General fund $ 410,000 1,874,898
Recreation 141,398
Community development 6,000
Millcreek project 27,500
Capital projects 1,700,000
Water and sewer fund 365,000
Storm drain fund 45,000
Total $ 2,284,898 2,284,898
Transfers are used to move unrestricted general fund revenues to finance various programs that the
government must account for in other funds in accordance with budgetary authorizations, including
amounts provided as subsidies or matching funds for various grant programs.
NOTE 4 - OTHER INFORMATION
4-A. Risk management
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; and natural disasters. The City participates in the Utah Local Government Trust, a
public agency insurance mutual, which provides coverage for property damage and general liability. The
City is subject to a minimal deductible for claims. There have been no significant reductions in insurance
coverage from coverage in the prior year. Amounts of settlements have not exceeded insurance coverage
in any of the past three fiscal years.
4-B. Subsequent Events
In preparing these financial statements, the City has evaluated events and transactions for potential
recognition or disclosure through November 13, 2015, the date the financial statements were available to be
used.
4-C. Landfill agreement
Moab City entered into an agreement with the Grand County Solid Waste Management Special Service
District No. 1 and Grand County in which the City agreed to guarantee the performance of closure and
post -closure care at the Klondike and Moab Landfills. Should the escrow moneys set aside by the District
not cover all costs associated with the closure and post -closure of the landfill, Moab would be liable for
one half of the uncovered costs. Total closure and post -closure costs are currently estimated to be no
more than $175,400 for the Klondike Landfill and for the Moab Landfill.
38
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
4-D. Rounding Convention
A rounding convention to the nearest whole dollar has been applied throughout this report, therefore the
precision displayed in any monetary amount is plus or minus $1. These financial statements are computer
generated and the rounding convention is applied to each amount displayed in a column, whether detail item
or total. As a result, without the overhead cost of manually balancing each column, the sum of displayed
amounts in a column may not equal the total displayed. The maximum difference between any displayed
number or total and its actual value will not be more than $1.
4-E. General Information about the Pension Plan
Plan description:
Eligible plan participants are provided with pensions through the Utah Retirement Systems. The Utah
Retirement Systems are comprised of the following pension trust funds:
Public Employees Contributory Retirement System (Contributory System); is a multiple employer, cost
sharing, public employee retirement system.
The Public Safety Retirement System (Public Safety System) is a mixed agent and cost -sharing, multiple -
employer retirement system;
Tier 2 Public Employees Contributory Retirement System (Tier 2 Public Employees System); and Tier 2
Public Safety Firefighter Contributory System (Tier 2 Public Safety and Firefighters System) is a multiple
employer, cost sharing, public employee retirement system.
The Tier 2 Public Employees System became effective July 1, 2011. All eligible employees beginning on or
after July 1, 2011, who have no previous service credit with any of the Utah Retirement Systems, are
members of the Tier 2 Retirement System.
The Utah Retirement Systems (Systems) are established and governed by the respective sections of Title 49 of
the Utah Code Annotated 1953, as amended. The Systems' defined benefit plans are amended statutorily by
the State Legislature. The Utah State Retirement Office Act in Title 49 provides for the administration of the
Systems under the direction of the Board, whose members are appointed by the Governor. The Systems are
fiduciary funds defined as pension (and other employee benefit) trust funds. URS is a component unit of the
State of Utah. Title 49 of the Utah Code grants the authority to establish and amend the benefit terms. URS
issues a publicly available financial report that can be obtained by writing Utah Retirement Systems, 560 E.
200 S, Salt Lake City, Utah 84102 or visiting the website: www.urs.org.
Benefits provided:
URS provides retirement, disability, and death benefits. Retirement benefits are as follows:
39
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
4-E. General Information about the Pension Plan (continued)
Summary of Benefits by System
Final Average Years of service required and/or Benefit percent per year of
System Salary age eligible for benefit service COLA**
Noncontributory System Highest 3 years 30 years any age 2.0% per year all years Up to 4%
25 year any age*
20 years age 60*
10 years age 62*
4 years age 65
Public Safety System Highest 3 years
20 years any age
10 years age 60
4 years age 65
2.5% per year up to 20 years; Up to 2.5% to
2.0% per year over 20 years 4% depending
on the
employer
Tier 2 Public Employees Highest 5 years 35 years any age 1.5% per year all years Up to 2.5%
System 20 years any age 60*
10 years age 62*
4 years age 65
Tier 2 Public Safety and Highest 5 years
Firefighter System
25 years any age
20 years any age 60*
10 years age 62*
4 years age 65
1.5% per year all years Up to 2.5%
* with actuarial reductions
** All past -retirement cost -of -living adjustments are non -compounding and are based on the original benefit except for
Judges, which is a compounding benefit. The cost -of -living adjustments are also limited to the actual Consumer Price
Index (CPI) increase for the year, although unused CPI increases not met may be carried forward to subsequent years.
Contributions:
As a condition of participation in the Systems, employers and/or employees are required to contribute
certain percentages of salary and wages as authorized by statute and specified by the URS Board.
Contributions are actuarially determined as an amount that, when combined with employee contributions
(where applicable) is expected to finance the costs of benefits earned by employees during the year, with an
additional amount to finance any unfunded actuarial accrued liability. Contribution rates are as follows:
Utah Retirement Syste ms
Employee Pay by Employer Employer
Paid for Employee Contribution Rates
Contribution System
111 - Local Governmental Divis ion Tier 2 N/A N/A 14.830%
Noncontributory System
15 - Local Governmental Division Tier 1 N/A N/A 18.470%
Public Safety Retiremeny System
43 - Other Division A Noncontributory Tier 1 N/A N/A 34.040%
122 - Other Division A Contributory Tier 2 N/A N/A 22.550%
40
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
4-E. General Information about the Pension Plan (continued)
Pension Assets, Liabilities, Expense, and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions
At December 31, 2014, we reported a net pension asset of $2,904 and a net pension liability of $1,487,326.
Proportionate Net Pension Net Pension
Share Asset Liability
Noncontributory System 0.2429667% $ $ 1,055,019
Public Safety System 0.3437599% $ - $ 432,307
Tier 2 Public Employees System 0.0260728% $ 790 $
Tier 2 Public Safety and Firefighter System 0.1428958% $ 2,114 $
Total Net Pension Asset/Liability $ 2,904 $ 1,487,326
The net pension asset and liability was measured as of December 31, 2014, and the total pension liability used
to calculate the net pension asset and liability was determined by an actuarial valuation as of January 1, 2014
and rolled -forward using generally accepted actuarial procedures. The proportion of the net pension asset and
liability was based upon actual historical employer contributions to the plan from the census data submitted to
the plan for pay periods ending in 2014.
For the year ended December 31, 2014, we recognized pension expense of $381,946. At December 31, 2014,
we reported deferred outflows of resources and deferred inflows of resources related to pensions from the
following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual experience $ 69 $ 75,326
Changes in assumptions $ $ 161,188
Net difference between projected and actual earnings on pension plan
investments $ 34,229 $
Changes in proportion and differences between contributions and
proportionate share of contributions $ - $
Contributions subsequent to the measurement date $ 283,792 $
Total $ 318,090 $ 236,514
$283,792 was reported as deferred outflows of resources related to pensions results from contributions made
by us prior to our fiscal year end, but subsequent to the measurement date of December 31, 2014. These
contributions will be recognized as a reduction of the net pension liability in the upcoming fiscal year. Other
amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will
be recognized in pension expense as follows:
Deferred Outflows
Year Ended December 31, (inflows) of Resources
2015 $ (54,770)
2016 $ (54,770)
2017 $ (54,770)
2018 $ (36,963)
2019 $ (144)
Thereafter $ (799)
41
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
4-E. General Information about the Pension Plan (continued)
Actuarial assumptions:
The total pension liability in the December 31, 2014, actuarial valuation was determined using the following
actuarial assumptions, applied to all periods included in the measurement:
Inflation 2.75 Percent
Salary increases 3.50 — 10.50 percent, average, including inflation
Investment rate of return 7.50 percent, net of pension plan investment expense,
Including inflation
Active member mortality rates are a function of the member's gender, occupation, and age and are developed
based upon place experience. Retiree mortality assumption are highlighted in the table below.
Retired Member Mortality
Class of Member
Educators
Men EDUM (90%)
Women EDUF (100%)
Public Safety andFrefightings
Men RP 2000mWC (100%)
Women EDUF (120%)
Local Government, Public Employees
Men RP 2000mWC (100%)
Women EDUF (120%)
EDUM= Constructed mortality table based on actual experience ofmale educators multiplied by given percentage
EDUF= Constructed mortality table based on actual experience offemale educators multiplied by given percentage
RP 2000mWC = RP 2000 Combined mortality table for males with white collar adjustments multiplied by given percentage
The actuarial assumptions used in the January 1, 2014, valuation were based on the results of an actuarial
experience study for the five year period of January 1, 2008 - December 31, 2013.
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best- estimate ranges of expected future real rates of return (expected returns, net of pension
plan investment expense and inflation) are developed for each major asset class. These ranges are combined
to produce the long-term expected rate of return by weighting the expected future real rates of return by the
target asset allocation percentage and by adding expected inflation.
The target allocation and best estimates of arithmetic real rates of return for each major asset class are
summarized in the following table:
42
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
4-E. General Information about the Pension Plan (continued)
Asset class
Equity securities
Debt securities
Real as sets
Private equity
Absolute return
Cash and cash equivalents
Totals
Expected Return Arithmetic Basis
Real Return Long -Term expected
Target Asset Arithmetic portfolio real
Allocation Basis rate of return
40% 7.06% 2.82%
20% 0.80% 0.16%
13% 5.10% 0.66%
9% 11.30% 1.02%
18% 31.50% 0.57%
0 0.00% 0.00%
100% 5.23%
Inflation 2.75%
Expected arithmetic nominal retum 7.98%
The 7.50% assumed investment rate of return is comprised of an inflation rate of 2.75%, a real return of
4.75% that is net of investment expense.
Discount rate:
The discount rate used to measure the total pension liability was 7.50 percent. The projection of cash flows
used to determine the discount rate assumed that employee contributions will be made at the current
contribution rate and that contributions from all participating employers will be made at contractually
required rates that are actuarially determined and certified by the URS Board. Based on those assumptions,
the pension plan's fiduciary net position was projected to be available to make all projected future benefit
payments of current active and inactive employees. Therefore, the long-term expected rate of return on
pension plan investments was applied to all periods of projected benefit payments to determine the total
pension liability.
Sensitivity of the proportionate share of the net pension asset and liability to changes in the discount
rate:
The following presents the proportionate share of the net pension liability calculated using the discount rate of
7.50 percent, as well as what the proportionate share of the net pension liability would be if it were calculated
using a discount rate that is 1-percentage-point lower (6.50 percent) or 1-percentage-point higher (8.50
percent) than the current rate:
1%
Decrease
(6.50%)
Discount
Rate
(7.50%)
1%
Increase
(8.50%)
Proportionate share of
Net pension (asset) / liability $ 3,634,776 $ 1,484,422 $ (293,307)
Pension plan fiduciary net position:
Detailed information about the pension plan's fiduciary net position is available in the separately issued URS
financial report.
43
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2015
4-F. Prior period adjustments
The requirement to apply GASB 68 this fiscal year resulted in adjustments to the prior period net positions.
This is due to the required disclosure of a Net Pension Liability, Deferred Outflows and Inflows of Resources,
and if applicable, a Net Pension Asset.
The results to beginning net positions are as follows:
Net position - beginning
GASB 68 adjustments
Net position - restated
$
$
Governmental
Activities
15,276,421
(1,449,108)
13,827,313
Business -type Activities
Water & Sewer
Fund Total
9,992,974 25,269,395
(141,552) (1,590,660)
$ 9,851,422 23,678,735
44
REQUIRED SUPPLEMENTAL INFORMATION
(Unaudited)
45
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46
Moab City Corporation
Notes to Required Supplementary Information
June 30, 2015
Budgetary Comparison Schedules
The Budgetary Comparison Schedules presented in this section of the report are for the City's General
Fund.
Budgeting and Budgetary Control
Budgets for the General Fund are legally required and are prepared and adopted on the modified
accrual basis of accounting.
Original budgets represent the revenue estimates and spending authority authorized by the City
Council prior to the beginning of the year. Final budgets represent the original budget amounts plus
any amendments made to the budget during the year by the Council through formal resolution. Final
budgets do not include unexpended balances from the prior year because such balances automatically
lapse to unreserved fund balance at the end of each year.
Current Year Excess of Expenditures over Appropriations
For the year ended June 30, 2015 was within the budget appropriations.
47
Moab City Corporation
SCHEDULE OF REVENUES, EXPENDITUES AND
CHANGED IN FUND BALANCES - BUDGET AND ACTUAL - GENERAL FUND
(Unaudited)
For the Year Ended June 30, 2015
Revenues
Taxes
Licenses and permits
Intergovernmental revenues
Charges for services
Fines and forfeitures
Interest
Miscellaneous revenue
Budgeted
Original
$ 6,130,000
115,200
261,000
1,334,400
45,000
40,500
58,700
Budgeted
Final
6,130,000
115,200
285,498
1,354,400
50,990
40,500
84,450
Variance with
Actual Final Budget
7,075,456
185,284
316,390
1,291,815
86,362
23,273
64,087
Total revenues 7,984,800 8,061,038 9,042,668
Expenditures
General government
Public safety
Highways and public improvements
Parks and recreation
1,988,207
2,531,567
2,562,668
1,337,135
1,977,327
2,580,275
2,592,468
1,345,745
Total expenditures 8,419,577 8,495,815
Excess (Deficiency) of Revenues
Over (Under) Expenditures (448,577)
Other Financing Sources and (Uses)
Transfers in
Transfers out
410,000
(474,898)
1,745,016
2,304,848
2,097,689
1,187,679
945,456
70,084
30,892
(62,585)
35,372
(17,227)
(20,363)
981,630
232,311
275,427
494,779
158,066
7.335.232 1.160.583
(448,577) 1,707,436 2,156,013
410,000 410,000
(1,874,898) (1,874,898)
Total Other Financing Sources and (Uses) (64,898) (1,464,898) (1,464,898)
Net Change in Fund Balances (513,475) (1,913,475)
Fund Balances - beginning of year 2,185,911 2,185,911 2,185,911
Fund Balances - end of year
242,538 2,156,013
$ 1,672,436 272,436 2,428,450 2,156,013
48
Moab City Corporation
SCHEDULE OF THE PROPORTIONATE SHARE OF THE NET PENSION LIABILITY
UTAH RETIREMENT SYSTEMS
June 30, 2015
Last 10 Fiscal Years*
Tier 2 Public
Tier 2 Public Safety and
Noncontributory Public Safety Employees Firefighter
System System System System
Proportion of the net pension liability (asset) 0.2429667 % 0.3437599 % 0.0260728 % 0.1428958 %
Proportionate share of the net pension liability
(asset) $ 1,055,019 $ 432,307 $ (790) $ (2,114)
Covered employee payroll
$ 2,145,537 $ 567,252 $ 128,012 $ 59,035
Proportionate share of the net pension liability
(asset) as a percentage of its covered -
employee
payroll 49.2 % 76.2 % -0.6 % -3.6 %
Plan fiduciary net position as a percentage of the
total pension liability
90.2 % 90.5 % 103.5 % 120.5 %
* In accordance with paragraph 81.a of GASB 68, employees will need to disclose a 10-year history of their
proportionate share of the Net Pension Liability (Asset) in their RSI. The 10-year schedule will need to be built
prospectively. The schedule above is only for the current year. Prior year numbers are available from your prior
year not disclosure confirmation.
49
Moab City Corporation
SCHEDULE OF CONTRIBUTIONS
UTAH RETIREMENT SYSTEMS
June 30, 2015
Last 10 Fiscal Years*
Contractually required contribution
Tier 2 Public
Tier 2 Public Safety and
Noncontributory Public Safety Employees Firefighter
System System System System
$ 381,876 $ 169,321 $ 10,757 $ 6,439
Contributions in relation to the contractually
required contribution $ (381,876) $ (169,321) $ (10,757) $ (6,439)
Contribution deficiency (excess)
Covered employee payroll $ 2,145,537 $ 567,252 $ 128,012 $ 59,035
Contributions as a percentage of covered -
employee
payroll ** 17.80 % 29.85 % 8.40 % 10.91 %
* Amounts presented were determined as of calendar year January 1 - December 31. Employers will be required
to prospectively develop this table in future years to show 10-years of information. The schedule above is only
for the current year. Prior year numbers are available from your prior year note disclosure confirmation.
** Contributions as a percentage of covered -employee payroll may be different than the Board certified rate due
to rounding or other administrative issues.
50
Moab City Corporation
Notes to Required Supplementary Information
Utah Retirement Systems
For the Year Ended June 30, 2015
Other information that is not required as part of RSI
This information below is not required as part of GASB 68 but is provided for information purposes.
The schedule below is a summary of the Defined Contribution Savings Plans for pay periods January 1
- December 31.
Defined Contribution System
401(k) Plan
457 Plan
Roth IRA Plan
Traditional IRA Plan
HRA Plan
Employee
Paid
Contributions
$ 77,390
$ 51,958
$ 3,985
Employer
Paid
Contributions
$ 27,007
* The employer paid 401(k) contributions include the totals paid for employees enrolled in the Tier 2 Defined
Contribution 401(k) Plan.
51
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52
_■
Larson
EERIFIEN PUBLIC iCGOUN711N7E
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
The Honorable Mayor, and
Members of the City Council
Moab City, Utah
We have audited, in accordance with the 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, the financial statements of the governmental
activities, the business -type activities, each major fund, and the aggregate remaining fund information of
Moab City, Utah (herein referred to as the "City"), as of and for the year ended June 30, 2015, and the
related notes to the financial statements, which collectively comprise the City's basic financial statements
and have issued our report thereon dated November 13, 2015.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal control
over financial reporting (internal control) to determine the 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 City's internal control. Accordingly, we do
not express an opinion on the effectiveness of the City's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
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 basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control
that is less severe 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 control that might be material
weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may
exist that were not identified. 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 may exist
that have not been identified. We did identify certain deficiencies in internal control, described in the
accompanying management letter that we consider to be significant deficiencies. See finding IC-2015.1
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City'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 determination of financial statement amounts. 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
Larson & Company
765 North Main, Spanish Fork, Utah 84660
Main: (801) 798-3545 Fax: (801) 798-3678
www.larsco.com
53
Member of
CPAMI=CA
INi#RNATRIIONAL
Crowe f awalh I,IlemaboRi
The City's Response to Findings
The City's response to the findings identified in our audit is described in the accompanying management
letter. The City's response was not subjected to the auditing procedures applied in the audit of the
financial statements and, accordingly, we express no opinion on it.
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 entity'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 entity's internal control and compliance. Accordingly,
this communication is not suitable for any other purpose.
Larson & Company, PC
Spanish Fork, Utah
November 13, 2015
54
_�
Larson
CERTIFIES FlRIG ■ C C i il7Al7 i
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE
AND ON INTERNAL CONTROLS OVER COMPLIANCE
IN ACCORDANCE WITH THE STATE COMPLIANCE AUDIT GUIDE
The Honorable Mayor, and
Members of the City Council
Moab City, Utah
REPORT ON COMPLIANCE WITH GENERAL STATE COMPLIANCE REQUIREMENTS AND FOR
EACH MAJOR STATE PROGRAM
We have audited Moab City's (herein referred to as the "City") compliance with the applicable general and
major state program compliance requirements described in the State Compliance Audit Guide, issued by
the Office of the Utah State Auditor, that could have a direct and material effect on the City or each of tis
major state programs for the year ended June 30, 2015.
General state compliance requirements were tested for the year ended June 30, 2015 in the following
areas:
Budgetary Compliance
Fund Balance
Utah Retirement Systems Compliance
Transfers from Utility Enterprise Funds
Open and Public Meetings Act
The City did not have any state funding classified as a major program for the year ended June 30,
2015
Management's Responsibility
Management is responsible for compliance with the general state requirements referred to above and
the requirements of laws, regulations, contracts, and grants applicable to its state programs.
Auditors' Responsibility
Our responsibility is to express an opinion on the City's compliance based on our audit of the
compliance requirements referred to above.
We conducted our audit of compliance in accordance with auditing standards generally accepted in
the United States of America; the standards applicable to financial audits contained in Government
Auditing Standards issued by the Comptroller General of the United States; and the State
Compliance Audit Guide. Those standards and the State Compliance Audit Guide require that we
plan and perform the audit to obtain reasonable assurance about whether noncompliance with the
compliance requirements referred to above that could have a direct and material effect on the City
or its major state programs occurred. An audit includes examining, on a test basis, evidence about the
City's compliance with those requirements and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion
on compliance with general state compliance requirements and for each major state program.
However, our audit does not provide a legal determination of the City's compliance.
Larson & Company
765 North Main, Spanish Fork, Utah 84660
Main: (801) 798-3545 Fax: (801) 798-3678
www.larsco.com
55
Member of
CPAMERIIOA
INTERNATIONAL
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Opinion on General State Compliance Requirements and Each Major State Program
In our opinion, Moab City, complied, in all material respects, with the compliance requirements referred to
above that could have a direct and material effect on the City or on each of its major state programs for
the year ended June 30, 2015.
Other Matters
The results of our auditing procedures disclosed no instances of noncompliance, which are required to be
reported in accordance with the State Compliance Audit Guide.
REPORT ON INTERNAL CONTROL OVER COMPLIANCE
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the compliance requirements referred to above. In planning and performing our audit, we
considered the City's internal control over compliance with the compliance requirements that could have a
direct and material effect on the City or on each major state program to determine the auditing
procedures that are appropriate in the circumstances for the purpose of expressing an opinion on
compliance with general state compliance requirements and for each major state program and to test and
report on internal control over compliance in accordance with the State Compliance Audit Guide, but not
for the purpose of expressing an opinion on the effectiveness of the City's internal control over
compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance on a timely basis. A material weakness in
internal control over compliance is a deficiency, or combination of deficiencies in internal control over
compliance, such that there is a reasonable possibility that material noncompliance with a general state
or major state program compliance requirement will not be prevented, or detected and corrected, on a
timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination
of deficiencies, in internal control over compliance with a general state or major state program compliance
requirement that is less severe than a material weakness in internal control over compliance, yet
important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be material weaknesses or significant deficiencies. We did not identify any
deficiencies in internal control over compliance that we consider to be material weaknesses. However,
material weaknesses may exist that have not been identified.
Purpose of Report
The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control and compliance and the results of that testing based on the requirements of the
State Compliance Audit Guide. Accordingly, this report is not suitable for any other purpose.
Larson & Company, PC
Spanish Fork, Utah
November 13, 2015
56