HomeMy Public PortalAbout2006-2007 annual final auditCITY OF MOAB, UTAH
INDEPENDENT AUDITORS' REPORT
BASIC FINANCIAL STATEMENTS
YEAR ENDED JUNE 30, 2007
CITY OF MOAB, UTAH
TABLE OF CONTENTS
YEAR ENDED JUNE 30, 2007
Pages
INDEPENDENT AUDITORS' REPORT 1-2
MANAGEMENT'S DISCUSSION AND ANALYIS MDA-1 thru MDA-6
BASIC FINANCIAL STATEMENTS:
Government -wide Financial Statements:
Statement of Net Assets 3
Statement of Activities 4
Fund Financial Statements:
Balance Sheet — Governmental Funds 5
Reconciliation of Total Governmental Fund Balances to
Net Assets of Governmental Activities 6
Statement of Revenues, Expenditures, and Changes in
Fund Balance — Governmental Funds 7
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances of Governmental Funds to the Statement of Activities 8
Statement of Revenues, Expenditures, and Changes in
Fund Balances — Budget and Actual — General Fund 9-10
Statement of Net Assets — Proprietary Funds 11
Statement of Revenues, Expenses, and Changes in
Fund Net Assets — Proprietary Funds 12
Statement of Cash Flows — Proprietary Funds 13
Notes to the Financial Statements 14-35
SUPPLEMENTARY INFORMATION:
Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet — Non -major Governmental Funds 36
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances — Non -major Governmental Funds 37
Impact Fee Schedule 38
11!
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LARSON & COMPANY
CERTIFIED PUBLIC ACCOUNTANTS
INDEPENDENT AUDITORS' REPORT
September 20, 2007
Honorable Mayor
Members of the City Council
City of Moab, Utah
Mayor and Council Members:
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 the
City of Moab, as of and for the year ended June 30, 2007, which collectively comprise the City of
Moab's basic financial statements as listed in the table of contents. These financial statements are
the responsibility of the City of Moab's management. 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 and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our 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 the City of Moab, as of June 30,
2007, and the respective changes in financial position and cash flows, where applicable, and the
budgetary comparison for the general fund thereof for the year then ended in conformity with
accounting principles generally accepted in the United States of America.
1
SANDY, OFFICE
9065 SOUTH 1300 EAST
SANDY, UTAH 84094
1801) 313-1900
FAX (801) 313-1912
SPANISH FORK OFFICE
765 NORTH MAIN
SPANISH FORK, UTAH 84660
(801 ) 798-3545
FAX (B01) 798-3678
MOAB OFFICE
121 EAST 100 SOUTH SUITE 10d
MOAB. UTAH 84532
(435) 259-9100
FAX (801) 259-91 00
MEMBER OF THE INTERNATIONAL ACCOUNTING GROUP (TIAG) + WWW.LARSCO.COM
The Management's Discussion and Analysis on pages MDA-1 through MDA-6 is not a required part
of the basic financial statements but is supplementary information required by accounting principles
generally accepted in the United States of America. Additionally, the State of Utah requires the
information in the Impact Fee Schedule on page 38, but it is not a required part of the basic financial
statements. We have applied certain limited procedures, which consisted principally of inquiries of
management regarding the methods of measurement and presentation of the required supplementary
information. However, we did not audit the information and express no opinion on it.
In accordance with Government Auditing Standards, we have also issued a report dated September
20, 2007, on our consideration of the City of Moab's internal control over financial reporting and on
our tests of its compliance with certain provisions of laws, regulations, contracts, and grants. That
report is an integral part of an audit performed in accordance with Government Auditing Standards
and should be read in conjunction with this report in considering the results of our audit.
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City of Moab's basic financial statements. The combining non -major fund
financial statements are presented for purposes of additional analysis and are not a required part of
the basic financial statements. The combining non -major fund financial statements have been
subjected to the auditing procedures applied in the audit of the basic financial statements and, in our
opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a
whole.
Larson & Company
Certified Public Accountants
2
MANAGEMENT'S DISCUSSION AND ANALYSIS
As management of the City of Moab, we offer readers of the City of Moab financial
statements this narrative overview and analysis of the financial activities of the City for
the fiscal year ended June 30, 2007. It is designed to provide an overview of the City's
financial activity. It is also intended to assist the reader in focusing on significant
financial issues including identifying changes in the City's financial position (its ability
to address the next and subsequent years' challenges), identifying any material deviations
from the approved budget, and identifying individual fund issues or concerns. We
encourage readers to consider the information presented here in conjunction with the
Transmittal Letter and the City's financial statements.
FINANCIAL HIGHLIGHTS
• The total net assets of City of Moab increased by $1,117,315 to $19,908,058.
The governmental net assets increased by $732,492 and the business -type net
assets increased by $384,823.
• The total net assets of $19,908,058 are made up of $14,416,145 in capital
assets net of related debt and $5,491,913 in other net assets.
• The General Fund (the primary operating fund) had an increase in its fund
balance of $915,864, due to an increase in revenue and significant revenue
over expenditures.
REPORTING THE CITY AS A WHOLE
The discussion and analysis is intended to serve as an introduction to the City of Moab's
basic financial statements. The City of Moab's basic financial statements comprise three
components: 1) government -wide financial statements, 2) fund financial statements, and
3) notes to the financial statements. This report also includes other supplementary
information in addition to the basic financial statements.
The government -wide financial statements are designed to provide readers with a broad
overview of the City of Moab's finances, in a manner similar to a private -sector business.
• The statement of net assets presents information on all of the City of Moab's
assets and liabilities, with the difference between the two reported as net
assets. Over time, increases or decreases in net assets may serve as a useful
indicator of whether the financial position of the City of Moab is improving or
deteriorating. However, other non -financial factors will need to be
considered.
• The statement of activities presents information showing how the City's net
assets changed during the fiscal year reported. All changes in net assets are
reported as soon as the underlying event giving rise to the change occurs,
MDA-1
regardless of the timing of related cash flows. Thus, all of the current year's
revenues and expenses are taken into account regardless of when cash is
received or paid.
Both of the government -wide financial statements distinguish functions of the City of
Moab 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 government -wide financial statements can be found on pages 3-4 of this report.
REPORTING THE CITY'S MOST SIGNIFICANT FUNDS
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 of
Moab 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 three
categories: governmental funds, proprietary funds, and fiduciary funds.
• Governmental funds — These funds are used to account for the same functions
reported as governmental activities in the government -wide financial
statements. These fund statements focus on how money flows into and out of
these funds and the balances left at year-end that are available for spending.
These funds are reported using an accounting method called modified accrual
accounting, which measures cash and other financial assets that can be readily
converted to cash. The governmental fund statements provide a detailed
short-term view of the City's general government operations and the basic
services it provides. Governmental fund information helps interested persons
determine whether there are more or fewer financial resources that can be
spent in the near future to finance the City's programs. We describe the
relationship (or differences) between governmental activities (reported in the
Statement of Net Assets and the Statement of Activities) and governmental
funds in a reconciliation included with the fund financial statements.
The only major governmental fund (as determined by generally accepted
accounting principles) is the General Fund. The balance of the governmental
funds are determined to be non -major and are included in the combining
statements within this report.
• Proprietary funds — The only type of proprietary fund that the City of Moab
maintains is the Water and Sewer Enterprise Fund.
As determined by generally accepted accounting principles, the Water and
Sewer enterprise fund meets the criteria for major fund classification.
MDA-2
" F i d u c i a r y f u n d s T h e s e f u n d s a r e u s e d t o a c c o u n t f o r r e s o u r c e s h e l d f o r t h e
b e n e f i t o f p a r t i e s o u t s i d e t h e g o v e r n m e n t . F i d u c i a r y f u n d s a r e n o t r e f l e c t e d i n
t h e g o v e r n m e n t - w i d e f i n a n c i a l s t a t e m e n t s b e c a u s e t h e r e s o u r c e s o f t h o s e
f u n d s a r e n o t a v a i l a b l e t o s u p p o r t t h e C i t y ' s o w n p r o g r a m s . T h e a c c o u n t i n g
m e t h o d u s e d f o r t h e s e f u n d s i s m u c h l i k e t h a t u s e d f o r p r o p r i e t a r y f u n d s .
G O V E R N M E N T - W I D E F I N A N C I A L A N A L Y S I S
A s n o t e d e a r l i e r , n e t a s s e t s m a y s e r v e o v e r t i m e a s a u s e f u l i n d i c a t o r o f a
g o v e r n m e n t ' s f i n a n c i a l p o s i t i o n . I n t h e c a s e o f t h e C i t y o f M o a b , a s s e t s e x c e e d
l i a b i l i t i e s b y $ 1 9 , 9 0 8 , 0 5 8 .
T h e l a r g e s t p o r t i o n o f t h e C i t y o f M o a b ' s n e t a s s e t s ( 7 2 % ) r e f l e c t s i t s i n v e s t m e n t i n
c a p i t a l a s s e t s ( e . g . , l a n d , b u i l d i n g s , i n f r a s t r u c t u r e a s s e t s , a n d m a c h i n e r y a n d
e q u i p m e n t ) , l e s s a n y r e l a t e d d e b t u s e d t o a c q u i r e t h o s e a s s e t s t h a t i s s t i l l o u t s t a n d i n g .
T h e C i t y u s e s t h e s e c a p i t a l a s s e t s t o p r o v i d e s e r v i c e s t o c i t i z e n s ; c o n s e q u e n t l y , t h e s e
a s s e t s a r e n o t a v a i l a b l e f o r f u t u r e s p e n d i n g . A l t h o u g h t h e C i t y ' s i n v e s t m e n t i n i t s
c a p i t a l a s s e t s i s r e p o r t e d n e t o f r e l a t e d d e b t , i t s h o u l d b e n o t e d t h a t t h e r e s o u r c e s
n e e d e d t o r e p a y t h i s d e b t m u s t b e p r o v i d e d f r o m o t h e r s o u r c e s , s i n c e t h e c a p i t a l a s s e t s
t h e m s e l v e s c a n n o t b e u s e d t o l i q u i d a t e t h e s e l i a b i l i t i e s .
A s u m m a r y f i n a n c i a l i n f o r m a t i o n f o r J u n e 3 0 , 2 0 0 6 a n d 2 0 0 7 f o l l o w :
N e t A s s e t s
J u n e 3 0 , 2 0 0 7 a n d 2 0 0 6
C u r r e n t a n d o t h e r a s s e t s
C a p i t a l a s s e t s
T o t a l a s s e t s
O t h e r l i a b i l i t i e s
L o n g - t e r m l i a b i l i t i e s o u t s t a n d i n g
T o t a l l i a b i l i t i e s
N e t a s s e t s :
I n v e s t e d i n c a p i t a l a s s e t s , n e t
o f r e l a t e d d e b t
R e s t r i c t e d
U n r e s t r i c t e d
T o t a l n e t a s s e t s
G o v e r n m e n t a l A c t i v i t i e s B u s i n e s s - t y p e A c t i v i t i e s T o t a l
2 0 0 7 2 0 0 6 2 0 0 7 2 0 0 6 2 0 0 7 2 0 0 6
$ 3 , 7 3 1 , 9 4 6 $ 3 , 3 4 0 , 5 2 2 $ 2 , 2 1 0 , 8 1 7 $ 1 , 8 5 0 , 2 6 1 $ 5 , 9 4 2 , 7 6 3 $ 5 , 1 9 0 , 7 8 3
9 , 7 1 8 , 1 5 5 9 , 3 7 4 , 4 5 2 7 , 0 2 8 , 1 3 9 7 , 2 9 8 , 4 0 6 1 6 , 7 4 6 , 2 9 4 1 6 , 6 7 2 , 8 5 8
1 3 , 4 5 0 , 1 0 1 1 2 , 7 1 4 , 9 7 4 9 , 2 3 8 , 9 5 6 9 , 1 4 8 , 6 6 7 2 2 , 6 8 9 , 0 5 7 2 1 , 8 6 3 , 6 4 1
4 1 0 , 8 7 3 3 6 4 , 0 7 1 3 1 4 , 2 2 3 3 2 2 , 0 9 0 7 2 5 , 0 9 6 6 8 6 , 1 6 1
1 , 9 4 0 , 4 2 2 1 , 9 8 4 , 5 8 9 1 1 5 , 4 8 1 4 0 2 , 1 4 8 2 , 0 5 5 , 9 0 3 2 , 3 8 6 , 7 3 7
2 , 3 5 1 , 2 9 5 2 , 3 4 8 , 6 6 0 4 2 9 , 7 0 4 7 2 4 , 2 3 8 2 , 7 8 0 , 9 9 9 3 , 0 7 2 , 8 9 8
7 , 7 9 0 , 1 5 5
3 5 4 , 8 0 6
2 , 9 5 3 , 8 4 5
7 , 3 8 4 , 4 5 2
4 2 3 , 0 5 9
2 , 5 5 8 , 8 0 3
$ 1 1 , 0 9 8 , 8 0 6 $ 1 0 , 3 6 6 , 3 1 4
6 , 6 2 5 , 9 9 0 6 , 6 0 7 , 2 5 8 1 4 , 4 1 6 , 1 4 5 1 3 , 9 9 1 , 7 1 0
1 , 4 4 4 , 6 2 8 1 , 4 9 2 , 3 6 5 1 , 7 9 9 , 4 3 4 1 , 9 1 5 , 4 2 4
7 3 8 , 6 3 4 3 2 4 , 8 0 6 3 , 6 9 2 , 4 7 9 2 , 8 8 3 , 6 0 9
$ 8 , 8 0 9 , 2 5 2 $ 8 , 4 2 4 , 4 2 9 $ 1 9 , 9 0 8 , 0 5 8 $ 1 8 , 7 9 0 , 7 4 3
M D A - 3
Changes in Net Assets
June 30, 2007 and 2006
Governmental Activities
Business -type Activities Total
2007 2006 2007 2006 2007 2006
Revenues:
Program revenues:
Charges for services $ 1,621,091 $ 1,384,835 $ 1,419,919 $ 1,336,316 $ 3,041,010 $ 2,721,151
Operating grants and contribs 723,652 337,302 - - 723,652 337,302
Capital grants and contribs 41,650 98,378 160,441 146,354 202,091 244,732
General revenues:
General sales and use tax 1,293,975 1,187,549 - - 1,293,975 1,187,549
Franchise tax 222,599 164,658 222,599 164,658
Highway tax 403,153 351,220 - - 403,153 351,220
Transient room tax 272,001 241,710 272,001 241,710
Resort community tax 2,275,687 1,989,433 2,275,687 1,989,433
Energy tax 57,887 59,998 - - 57,887 59,998
Unrestricted investment earning 174,560 122,793 86,906 69,130 261,466 191,923
Other 184,047 1,047,216 - - 184,047 1,047,216
Transfers -
Total revenues 7,270,302 6,985,092 1,667,266 1,551,800 8,937,568 8,536,892
Expenses:
General government 1,670,428 1,553,662 1,670,428 1,553,662
Public safety 2,030,682 1,040,397 - - 2,030,682 1,040,397
Highways and public works 1,391,382 1,075,719 1,391,382 1,075,719
Sanitation 764,138 693,413 - - 764,138 693,413
Parks and recreation 654,680 772,370 654,680 772,370
Community and economic devel 26,500 24,895 - - 26,500 24,895
Water Utility 698,444 678,614 698,444 678,614
Sewer Utility - - 583,999 506,773 583,999 506,773
Total expenses 6,537,810 5,160,456 1,282,443 1,185,387 7,820,253 6,345,843
Increase in net assets 732,492 1,824,636 384,823 366,413 1,117,315 2,191,049
Net assets - beginning 10,366,314 8,541,678 8,424,429 8,058,016 18,790,743 16,599,694
Net assets - ending $ 11,098,806 $ 10,366,314 $ 8,809,252 $ 8,424,429 $ 19,908,058 $ 18,790,743
FINANCIAL ANALYSIS OF GOVERNMENT'S FUNDS
The focus of the City's governmental funds is to provide information on near -term
inflows, outflows, and balances of spendable resources. Such information is useful in
assessing the City's financing requirements.
As of June 30, 2007, the City's governmental funds (General, Capital Projects, &
Special Revenue) reported combined fund equity of $3,693,720. This represents an
increase of $391,979 from last year's ending balances
MDA-4
The General Fund is the chief operating fund of the City. All activities that are not
required to be accounted for in separate funds either by state or local ordinance or by
a desire to maintain a matching of revenues and expenses are accounted for in this
fund. Taxes continue to be the largest source of revenue in the General Fund and
represent 71 % of total general fund revenues.
As stated earlier, the City maintains an enterprise fund to account for the business -
type activities of the City. The fund statements included in this report provide the
same information for business -type activities as is provided in the government -wide
financial statements. However, the difference is that the fund statements provide
much more detail.
GENERAL FUND BUDGETARY HIGHLIGHTS
During the fiscal year, the General Fund budget was amended from an original budget
expenditure total of $5,493,522 to a final budget of $5,601,642. This increase was
made because of an emergency equipment purchase for the Police Department, an
increase in the sanitation department expenses and revenues and an increase in
collections of the Real Estate Transfer Assessment.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital assets — The City of Moab's investment in capital assets for its governmental
and business -type activities as of June 30, 2007, amounts to $14,416,145 (net of
accumulated depreciation). This investment in capital assets includes land, buildings
and systems, improvements, infrastructure (streets, sidewalks, curb and gutter, etc.),
and machinery and equipment.
Major capital asset events during this fiscal year included the following:
o North Area Trunk Sewer $37,892
o Municipal Building Project $71,946
o City Center/Center Street Project $397,162
o Ball Park Improvements $126,298
o Animal Shelter $551,537
Long-term debt — At June 30, 2007, the City had total bonded debt outstanding of
$2,461,856. All of this debt is revenue bond debt. The City of Moab has no general
obligation debt.
MDA-5
ECONOMIC FACTORS AND NEXT YEAR'S BUDGET AND RATES
• The unemployment rate for Grand County was 4.9% compared with a state
unemployment rate of 2.7% and a national rate of 4.7%. (Source: Utah Dept
of Workforce Services).
• Some capital improvements expected in the FY 2007-08 budget include:
o Construction of Aquatic Center
o Reconstruction of 500 West
o Reconstruction of 100 East and 200 North
o Millcreek Drive Pathway
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City of Moab's
finances for all those with an interest in the City's finances. Questions concerning any
information provided in this report or request for additional financial information should
be addressed to: City Recorder, City of Moab of Moab, 217 East Center Street, UT
84532.
MDA-6
BASIC FINANCIAL STATEMENTS
City of Moab
Statement of Net Assets
June 30, 2007
Primary Government
Governmental Business -type
Activities Activities
Total
ASSETS
Cash and cash equivalents $ 2,304,889 $ 656,688 $ 2,961,577
Accounts receivable - (net of allowance) 519,713 102,988 622,701
Deposits 6,119 - 6,119
Note receivable 546,419 546,419
Restricted cash and cash equivalents 354,806 1,451,141 1,805,947
Capital assets (net of accumulated depreciation):
Land (Not being depreciated) 371,977 244,935 616,912
Buildings 4,182,858 209,888 4,392,746
Improvements 1,314,800 6,425,569 7,740,369
Machinery and equipment 801,080 123,864 924,944
Automobiles and trucks 820,940 5,633 826,573
Office equipment 401,267 250 401,517
Water shares (Not being depreciated) - 18,000 18,000
Infrastructure 1,825,233 - 1,825,233
Total assets 13,450,101 9,238,956 22,689,057
LIABILITIES
Accounts payable and accrued liabilities
Customer deposits
Compensated absences
Noncurrent liabilities:
Due within one year
Due in more than one year
Total liabilities
38,226
253,362
119,285
1,940,422
2,351,295
6,513
21,042
286,668
115,481
38,226
6,513
274,404
405,953
2,055,903
429,704 2,780,999
NET ASSETS
Invested in capital assets, net of related debt 7,790,155 6,625,990 14,416,145
Restricted for:
Class "C" roads 195,404 195,404
Bond requirements 674,723 674,723
Impact fees - 769,905 769,905
Capital projects 159,402 - 159,402
Unrestricted 2,953,845 738,634 3,692,479
Total net assets $ 11,098,806 $ 8,809,252 $ 19,908,058
The Notes to the Financial Statements are an integral part of this statement. 3
Function/Programs
Primary government:
Governmental activities:
General government
Public safety
Highways and public works
Sanitation
Parks, recreation and public property
Community and economic development
Total governmental activities
Business -type activities:
Water Utility
Sewer Utility
Total business -type activities
Total primary government
Expenses
$1,670,428
2,030,682
1,391,382
764,138
654,680
26,500
City of Moab
Statement of Activities
For the Year Ended June 30, 2007
Program Revenues
Charges for
Services
$ 372,871
161,982
802,566
283,672
6,537,810 1,621,091
698,444 639,221
583,999 780,698
1,282,443 1,419,919
Operating
Grants and
Contributions
Capital
Grants and
Contributions
$ 453,514 $
200,202
69,936 41,650
723,652 41,650
$7,820,253 $ 3,041,010 $ 723,652
General revenues:
General sales and use tax
Franchise tax
Highway tax
Transient room tax
Resort community tax
Energy tax
Unrestricted investment earnings
Miscellaneous
Total general revenues
Change in net assets
Net assets - beginning
Net assets - ending
46,553
113,888
160,441
$ 202,091
Net (Expense) Revenues and Changes in Net Assets
Primary Government
Governmental Business -type
Activities Activities
$ (844,043)
(1,868,700)
(1,191,180)
38,428
(259,422)
(26,500)
(4,151,417)
(4,151,417)
1,293,975
222,599
403,153
272,001
2,275,687
57,887
174,560
184,047
4,883,909
732,492
10,366,314
$ 11,098,806
$
(12,670)
310,587
297,917
297,917
86,906
86,906
384,823
8,424,429
Total
$ (844,043)
(1,868,700)
(1,191,180)
38,428
(259,422)
(26,500)
(4,151,417)
(12,670)
310,587
297,917
(3,853,500)
1,293,975
222,599
403,153
272,001
2,275,687
57,887
261,466
184,047
4,970,815
1,117,315
18,790,743
$ 8,809,252 $
19,908,058
The Notes to the Financial Statements are and integral part of this statement.
ASSETS
Cash and cash equivalents
Receivables (net):
Garbage
Franchise tax
Sales and use tax
Other
Deposits
Notes receivable
Restricted assets:
Cash and cash equivalents
Total assets
City of Moab
Balance Sheet
Governmental Funds
June 30, 2007
Capital Other Total
General Projects Governmental Governmental
Fund Fund Funds Funds
$1,403,530 $ 795,947 $ 105,412 $ 2,304,889
69,187
15,702
416,647
16,399
6,119
- 69,187
- 15,702
- 416,647
- 1,778 18,177
- 6,119
546,419 546,419
195,404 159,402
354,806
$2,122,988 $ 1,501,768 $ 107,190 $ 3,731,946
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable $ 38,226 $ - $ $ 38,226
Total liabilities 38,226 - 38,226
Fund Balances:
Fund balances reserved for:
Class "C" roads 195,404 - 195,404
Recreation - 104,353 104,353
Youth city council - - 2,837 2,837
Capital projects - 159,402 159,402
Unreserved, reported in:
General fund 1,889,358 - 1,889,358
Capital projects funds - 1,342,366 1,342,366
Total fund balances 2,084,762 1,501,768 107,190 3,693,720
Total liabilities and fund balances $2,122,988 $ 1,501,768 $ 107,190 $ 3,731,946
The Notes to the Financial Statements are an integral part of this statement. 5
City of Moab
Reconciliation of Total Governmental Fund Balances to
Net Assets of Governmental Activities
June 30, 2007
Amounts reported for governmental activities in the statement of net assets are
different because:
Total fund balances - governmental fund types (page 5): $ 3,693,720
Capital assets used in governmental activities are not financial resources and, therefore,
are not reported in the funds. 9,718,155
Long-term liabilities, including bonds payable, are not due and payable in the current
period and therefore are not reported in the funds. (2,313,069)
Net assets of government activities (page 3): $ 11,098,806
The Notes to the Financial Statements are an integral part of this statement. 6
City of Moab
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2007
Capital Other Total
General Projects Governmental Governmental
Fund Fund Funds Funds
REVENUES
Taxes $ 4,525,302 $ $ $ 4,525,302
Licenses and permits 160,091 - - 160,091
Intergovernmental 200,202 453,514 69,936 723,652
Charges for services 895,826 - 190,412 1,086,238
Fines and forfeitures 49,762 - - 49,762
Contributions and donations - 41,650 - 41,650
Interest Income - 74,116 208 74,324
Miscellaneous revenue 559,559 49,724 - 609,283
Total revenues 6,390,742 619,004 260,556 7,270,302
EXPENDITURES
Current:
General government 1,246,598 254,506 1,501,104
Public safety 1,508,579 411,214 - 1,919,793
Highways and public works 1,212,526 38,906 - 1,251,432
Sanitation 764,138 - - 764,138
Parks, recreation and public property 302,084 308,434 610,518
Community and economic development 26,500 - - 26,500
Capital outlay 133,404 586,615 - 720,019
Debt service:
Principal retirement 48,187 62,000 110,187
Interest and fiscal charges - 49,750 - 49,750
Total expenditures 5,242,016 1,402,991 308,434 6,953,441
Excess revenues over (under)
expenditures
1,148,726 (783,987) (47,878) 316,861
OTHER FINANCING SOURCES (USES)
Proceeds from debt issuance 75,118 - - 75,118
Transfers in - 217,000 90,980 307,980
Transfers out (307,980) - - (307,980)
Total other financing sources and uses (232,862) 217,000 90,980 75,118
Excess of revenues and other sources
over (under) expenditures and other uses 915,864 (566,987) 43,102 391,979
Fund balances - beginning 1,168,898 2,068,755 64,088 3,301,741
Fund balances - ending $ 2,084,762 $ 1,501,768 $ 107,190 $ 3,693,720
The Notes to the Financial Statements are an integral part of this statement. 7
City of Moab
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, 2007
Amounts reported for governmental activities in the statement of activities are
different because:
Net changes in fund balances - total governmental funds $ 391,979
Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their estimated
useful lives and reported as depreciation expense.
Capital outlay
Depreciation expense
Repayment of the principal on capital leases is an expenditure in the governmental
funds, but the repayment reduces the liability in the statement of net assets.
The issuance of new debt in the form of a capital leases and a bond is shown as revenue
in the statement of revenues, expenditures and changes in fund balance, but the issuance
increases the long term liabilities in the statement of net assets.
Some expenses reported in the statement of activities do not require the use of
current financial resources and, therefore, are not reported as expenditures in
governmental funds:
Increase in Compensated Absences
720,019
(376,316)
110,187
(75,118)
(38,259)
Change in net assets of governmental activities $ 732,492
The Notes to the Financial Statements are an integral part of this statement. 8
City of Moab
Statement of Revenues, Expenditures and Changes in Fund Balance -- Budget and Actual
General Fund
For the Year Ended June 30, 2007
Taxes:
Sales and use taxes
Franchise taxes
Highway taxes
Transient room taxes
Resort community taxes
Energy taxes
Total Taxes
Budgeted Amounts
Original Final Variance with
Budget Budget Actual Final Budget
$ 1,109,982 $ 1,134,982 $ 1,293,975 $ 158,993
132,000 132,000 222,599 90,599
327,240 327,240 403,153 75,913
227,250 227,250 272,001 44,751
1,899,000 1,899,000 2,275,687 376,687
58,000 58,000 57,887 (113)
3,753,472 3,778,472 4,525,302 746,830
Licenses and permits:
Beer licenses 8,000 8,000 7,060 (940)
Flat business licenses 48,000 48,000 47,212 (788)
Building permits - city 25,000 25,000 90,045 65,045
Building permits - commercial 15,000 15,000 10,617 (4,383)
Plan check fees 2,000 2,000 4,498 2,498
Other licenses and permits 1,000 1,000 659 (341)
Total licenses and permits 99,000 99,000 160,091 61,091
Intergovernmental revenue:
Local grants
State grants
Total intergovernmental revenue
Charges for services:
Refuse collection charges
Swimming pool
Other
Total charges for services
Fines and forfeitures
30,000 30,000 - (30,000)
187,000 187,000
217,000 217,000
743,750
32,600
52,900
803,750
32,600
52,900
829,250 889,250
62,500 62,500
200,202 13,202
200,202 (16,798)
802,566
38,567
54,693
(1,184)
5,967
1,793
895,826 6,576
49,762 (12,738)
Miscellaneous:
Interest 30,000 30,000 100,236 70,236
Other 150,400 173,520 134,323 (39,197)
Administration charges 325,000 325,000 325,000 -
Total Miscellaneous 505,400 528,520 559,559 31,039
Total Revenues $ 5,466,622 $ 5,574,742 $ 6,390,742 $ 816,000
The Notes to The Financial Statements are an integral part of this statement.
City of Moab
Statement of Revenues, Expenditures and Changes in Fund Balance -- Budget and Actual (continued)
General Fund
For the Year Ended June 30, 2007
Budgeted Amounts
Original Final Variance with
Budget Budget Actual Final Budget
General Government:
Executive and central $ 142,030 $ 142,030 $ 131,114 $ (10,916)
Administrative 219,365 219,365 207,782 (11,583)
Recorder 264,250 264,250 244,986 (19,264)
General government 163,100 163,100 161,163 (1,937)
Planning 247,500 247,500 199,886 (47,614)
Engineering 86,439 86,439 85,057 (1,382)
Treasurer 147,856 147,856 142,129 (5,727)
Attorney 75,000 75,000 74,481 (519)
Total General government 1,345,540 1,345,540 1,246,598 (98,942)
Public Safety:
Police department
Building inspection
Animal control
Total public safety
1,349,054
63,000
177,446
1,374,054
63,000
177,446
1,589,500 1,614,500
1,339,925
60,875
107,779
(34,129)
(2,125)
(69,667)
1,508,579 (105,921)
Highways and public improvements:
Storm drains 7,000 7,000 6,135 (865)
Streets 936,341 936,341 894,958 (41,383)
Safety 28,235 28,235 26,489 (1,746)
Class C road 425,837 425,837 284,944 (140,893)
Total highways and public improvements 1,397,413 1,397,413 1,212,526 (184,887)
Parks, recreation and public property 214,031 214,031 178,818 (35,213)
Sanitation 708,340 768,340 764,138 (4,202)
Swimming Pool 148,464 148,464 123,266 (25,198)
Community and economic development 26,500 26,500 26,500
Capital outlay 133,404 133,404 133,404
Debt service 48,187 48,187 48,187
Total expenditures - general fund 5,611,379 5,696,379 5,242,016 (454,363)
Excess (Deficiency) of Revenues over
(under) Expenditures: (144,757) (121,637) 1,148,726 1,270,363
Proceeds from debt 75,118 75,118
Transfers out (62,143) (62,143) (307,980) (245,837)
Sale of equipment 13,000 13,000 - (13,000)
Total other financing sources (uses) (49,143) (49,143) (232,862) (183,719)
Net change in fund balance: (193,900) (170,780) 915,864 1,086,644
Fund Balance - beginning of year 1,168,898 1,168,898 1,168,898
Fund Balance - end of year $ 974,998 $ 998,118 $ 2,084,762 $ 1,086,644
The Notes to The Financial Statements are an integral part of this statement.
10
City of Moab
Statement of Net Assets
Proprietary Funds
June 30, 2007
Business -Type Activities - Enterprise Funds
Water
Sewer Total
ASSETS
Current assets:
Cash and cash equivalents $ - $ 656,688 $ 656,688
Due from other funds - 811,177 811,177
Accounts receivable (net) 55,706 47,282 102,988
Total current assets 55,706 1,515,147 1,570,853
Noncurrent assets:
Restricted cash and cash equivalents
Capital assets
Less: Accumulated depreciation
Total noncurrent assets
Total assets
LIABILITIES
Current liabilities:
Compensated absences
Customer deposits
Due to other funds
Current portion of bonds payable
Total current liabilities
599,038
5,489,724
(2,567,110)
3,521,652
3,577,358
852,103
7,050,815
(2,945,290)
1,451,141
12,540,539
(5,512,400)
4,957,628 8,479,280
6,472,775 10,050,133
10,521 10,521 21,042
6,513 - 6,513
811,177 - 811,177
78,000 208,668 286,668
906,211
219,189 1,125,400
Noncurrent liabilities:
Bonds payable 115,481 115,481
Total noncurrent liabilities 115,481 - 115,481
Total liabilities 1,021,692 219,189 1,240,881
NET ASSETS
Invested in capital assets, net of related debt 2,729,133 3,896,857 6,625,990
Restricted for bond requirements 329,519 345,204 674,723
Restricted for impact fees 263,006 506,899 769,905
Unrestricted (765,992) 1,504,626 738,634
Total net assets $ 2,555,666 $ 6,253,586 $ 8,809,252
The Notes to the Financial Statements are an integral part of this statement. 11
City of Moab
Statement of Revenues, Expenses, and Changes in Fund Net Assets
Proprietary Funds
For the Year Ended June 30, 2007
Business -Type Activities - Enterprise Funds
Water
Sewer Total
Operating revenues:
Charges for service $ 508,537 $ 645,943 $ 1,154,480
Other operating income 130,684 134,755 265,439
Total operating revenues 639,221 780,698 1,419,919
Operating expenses:
Salaries and wages
Employee benefits
Contractual services
Materials and supplies
General fund overhead
Special department supplies
Depreciation
Other expenses
Total operating expenses
Operating income
Nonoperating revenues (expenses):
Interest revenue
Interest expense
Impact fees
Total nonoperating revenues (expenses)
157,815
83,982
10,939
13,319
150,000
70,537
162,075
49,777
698,444
(59,223)
66,368
37,155
34,903
16,262
175,000
35,429
168,305
42,248
224,183
121,137
45,842
29,581
325,000
105,966
330,380
92,025
575,670 1,274,114
205,028 145,805
39,682 47,224 86,906
(8,329) (8,329)
46,553 113,888 160,441
86,235 152,783 239,018
Change in net assets 27,012
Total net assets - beginning
357,811 384,823
2,528,654 5,895,775 8,424,429
Total net assets - ending $ 2,555,666 $ 6,253,586 $ 8,809,252
The Notes to the Financial Statements are an integral part of this statement. 12
City of Moab
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2007
Cash Flows From Operating Activities
Receipts from customers
Payments to suppliers
Payments to employees
Net cash provided (used) by
operating activities
Business -Type Activities - Enterprise Funds
Water Sewer Total
$ 645,931 $ 780,472 $ 1,426,403
(293,847) (310,102) (603,949)
(241,797) (103,523) (345,320)
110,287 366,847 477,134
Cash Flows From Capital and Related
Financing Activities
Purchases of capital assets (45,201) (14,912) (60,113)
Principal paid on capital debt (77,999) (211,000) (288,999)
Interest paid on capital debt (8,329) (8,329)
Increase/decrease in due to/from other funds (21,955) 21,955 -
Impact fees collected 46,553 113,888 160,441
Net cash provided (used) by capital
and related financing activities (98,602) (98,398) (197,000)
Cash Flows From Investing Activities
Interest and dividends received
Net cash provided (used) by
investing activities
Net increase (decrease) in cash and
cash equivalents
Cash and cash equivalents - beginning
Cash and cash equivalents - ending
39,682 47,224 86,906
39,682 47,224 86,906
51,367 315,673 367,040
547,671 1,193,118 1,740,789
$ 599,038 $ 1,508,791 $ 2,107,829
Reconciliation of operating income to
net cash provided (used) by operating
activities:
Operating income $ (59,223) $ 205,028 $ 145,805
Adjustments to reconcile operating
income to net cash provided (used) by
operating activities:
Depreciation expense 162,075 168,305 330,380
(Increase)/decrease in accounts receivable 6,710 (226) 6,484
Increase (decrease) in customer deposits 725 725
Increase (decrease) in accrued interest payable (6,260) (6,260)
Total adjustments 169,510 161,819 331,329
Net cash provided (used) by
operating activities $ 110,287 $ 366,847 $ 477,134
The Notes to the Financial Statements are an integral part of this statement. 13
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
INDEX
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Financial Reporting Entity
B. Basis of Presentation
C. Measurement Focus and Basis of Accounting
D. Assets, Liabilities, and Equity
E. Revenues, Expenditures, and Expenses
NOTE 2. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. Fund Accounting Requirements
B. Deposits and Investments Laws and Regulations
C. Revenue Restrictions
D. Debt Restrictions and Covenants
E. Fund Equity Restrictions
F. Budgetary Basis of Accounting
NOTE 3. DETAIL NOTES ON TRANSACTION CLASSES/ACCOUNTS
A. Cash and Investments
B. Restricted Assets
C. Accounts Receivable
D. Capital Assets
E. Accounts Payable
F. Long-term Debt
G. Interfund Transactions and Balances
H. Fund Equity
NOTE 4. OTHER NOTES
A. Employee Pension and Other Benefit Plans
B. Risk Management
C. Landfill Agreement
14
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City complies with generally accepted accounting principles (GAAP). GAAP includes all relevant
Governmental Accounting Standards Board (GASB) pronouncements. In the government -wide financial
statements and the fund financial statements for the proprietary funds, Financial Accounting Standards
Board (FASB) pronouncements and Accounting Principles Board (APB) opinions issued on or before
November 30, 1989, have been applied unless those pronouncements conflict with or contradict GASB
pronouncements, in which case, GASB prevails. For enterprise funds, GASB Statement Nos. 20 and 34
provide the City the option of electing to apply FASB pronouncements issued after November 30, 1989.
The City has elected not to apply those pronouncements. The accounting and reporting framework and the
more significant accounting policies are discussed in subsequent subsections of this Note.
1.A. FINANCIAL REPORTING ENTITY
Moab City is a political subdivision of the State of Utah. The City is governed by a mayor and an elected
board of five council members. The financial statements of Moab City may include those of separately
administered organizations that are controlled by or are dependent on the City (component units.) Control
or dependence is determined on the basis of financial interdependence, selection of governing authority,
designation of management ability to significantly influence operations and accountability for fiscal
matters. Using these criteria no potential component units are included in the City's financial statements.
The accounting policies of Moab City, Utah, conform to generally accepted accounting principles as
applicable to governmental units. The following is a summary of the more significant of such policies.
The City's financial reporting entity comprises the following:
Primary Government:
Component Units:
City of Moab
None
1.B. BASIS OF PRESENTATION
Government -wide Financial Statements:
The Statement of Net Assets and Statement of Activities display information about the reporting
government as a whole. They include all funds of the reporting entity except for fiduciary funds. The
statements distinguish between governmental and business -type activities. Governmental activities
generally are financed through taxes, intergovernmental revenues, and other non -exchange revenues.
Business -type activities are financed in whole or in part by fees charged to external parties for goods or
services.
Fund Financial Statements:
Fund financial statements of the reporting entity are organized into funds, each of which is considered to
be separate accounting entities. Each fund is accounted for by providing a separate set of self -balancing
accounts that constitute its assets, liabilities, fund equity, revenues, and expenditure/expenses. Funds are
organized into three major categories: governmental, proprietary, and fiduciary. An emphasis is placed on
major funds within the governmental and proprietary categories. A fund is considered major if it is the
primary operating fund of the City or meets the following criteria:
15
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
a. Total assets, liabilities, revenues, or expenditures/expenses of that individual governmental or
enterprise fund are at least 10 percent of the corresponding total for all funds of that category
or type; and
b. Total assets, liabilities, revenues, or expenditures/expenses of the individual governmental fund
or enterprise fund are at least 5 percent of the corresponding total for all governmental and
enterprise funds combined.
The funds of the financial reporting entity are described below:
Governmental Funds
General Fund
The General Fund is the primary operating fund of the City and always classified as a major
fund. It is used to account for all activities except those legally or administratively required to
be accounted for in other funds.
Special Revenue Funds
Special Revenue Funds are used to account for the proceeds of specific revenue sources that
are legally restricted to expenditures for certain purposes.
Capital Project Fund
The Capital Project Fund is used to account for resources designated for the acquisition or
construction of specific capital projects or items. The reporting entity includes only one
Capital Project Fund and it is used to account for the acquisition of capital assets with
transfers made from the General Fund.
Proprietary Fund
Enterprise Fund
Enterprise funds are used to account for business -like activities provided to the general
public. These activities are financed primarily by user charges and the measurement of
financial activity focuses on net income measurement similar to the private sector. The
reporting entity includes the Water and Sewer funds.
Major and Nonmajor Funds
The funds are further classified
Fund
Major:
General
Capital Projects Fund:
Community Development Fund
Mill Creek Project Fund
Capital Project Fund
Sanitation Capital Project Fund
as major or non -major as follows:
Brief Description
See above for description.
Accounts for activity with the City's
capital improvements.
16
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Enterprise Funds:
Water and Sewer Accounts for revenues and expenditures of
water and sewer utilities.
Nonmajor:
Special Revenue Funds:
Recreation Fund
Arts and Recreation Center
Youth City Council
Accounts for revenues and expenditures for
activities with the recreation, arts and
recreation center and youth city council.
1.C. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING
Measurement focus is a term used to describe "which" transactions are recorded within the various
financial statements. Basis of accounting refers to "when" transactions are recorded regardless of the
measurement focus applied.
Measurement Focus
On the government -wide Statement of Net Assets and the Statement of Activities, both governmental and
business -like activities are presented using the economic resources measurement focus as defined in item
b. below.
In the fund financial statements, the "current financial resources" measurement focus or the "economic
resources" measurement focus is used as appropriate:
a. All governmental funds utilize a "current financial resources" measurement focus. Only
current financial assets and liabilities are generally included on their balance sheets. Their
operating statements present sources and uses of available spendable financial resources during
a given period. These funds use fund balance as their measure of available spendable financial
resources at the end of the period.
b. The proprietary fund utilizes an "economic resources" measurement focus. The accounting
objectives of this measurement focus are the determination of operating income, changes in net
assets (or cost recovery), financial position, and cash flows. All assets and liabilities (whether
current or noncurrent) associated with their activities are reported. Proprietary fund equity is
classified as net assets.
c. Agency funds are not involved in the measurement of results of operations; therefore,
measurement focus is not applicable to them.
Basis of Accounting
In the government -wide Statement of Net Assets and Statement of Activities, both governmental and
business -like activities are presented using the accrual basis of accounting. Under the accrual basis of
accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred
17
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
or economic asset used. Revenues, expenses, gains, losses, assets, and liabilities resulting from exchange
and exchange -like transactions are recognized when the exchange takes place.
In the fund financial statements, governmental funds and agency funds are presented on the modified
accrual basis of accounting. Under this modified accrual basis of accounting, revenues are recognized
when "measurable and available." Measurable means knowing or being able to reasonably estimate the
amount. Available means collectible within the current period or within sixty days after year end.
Expenditures (including capital outlay) are recorded when the related fund liability is incurred, except for
general obligation bond principal and interest which are reported when due.
All proprietary funds utilize the accrual basis of accounting. Under the accrual basis of accounting,
revenues are recognized when earned and expenses are recorded when the liability is incurred or economic
asset used.
1.D. ASSETS, LIABILITIES, AND EQUITY
Cash and Investments
For the purpose of the Statement of Net Assets, "cash, including time deposits" includes all demand,
savings accounts, and certificates of deposits of the City. For the purpose of the proprietary fund
Statement of Cash Flows, "cash and cash equivalents" include all demand and savings accounts, and
certificates of deposit or short-term investments with an original maturity of three months or less.
Investments of promissory note trustee accounts are not considered cash equivalents.
Investments are carried at fair value except for short-term U.S. Treasury obligations with a remaining
maturity at the time of purchase of one year or less. Those investments are reported at amortized cost. Fair
value is based on quoted market price. Additional cash and investment disclosures are presented in Notes
2.B. and 3.A.
Interfund Receivables and Payables
During the course of operations, numerous transactions occur between individual funds that may result in
amounts owed between funds. Those related to goods and services type transactions are classified as "due
to and from other funds." Short-term interfund loans are reported as "interfund receivables and payables."
Long-term interfund loans (noncurrent portion) are reported as "advances from and to other funds."
Interfund receivables and payables between funds within governmental activities are eliminated in the
Statement of Net Assets. See Note 3.G. for details of interfund transactions, including receivables and
payables at year-end.
Receivables
In the government -wide statements, receivables consist of all revenues earned at year-end and not yet
received. Allowances for uncollectible accounts receivable are based upon historical trends and the
periodic aging of accounts receivable. Major receivable balances for the governmental activities include;
sales taxes, garbage utilities, franchise taxes, and business licenses. Business -type activities report utilities
as their major receivables.
In the fund financial statements, material receivables in governmental funds include revenue accruals such
as sales tax, franchise tax, and grants and other similar intergovernmental revenues since they are usually
18
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
both measurable and available. Non -exchange transactions collectible but not available are deferred in the
fund financial statements in accordance with modified accrual, but not deferred in the government -wide
financial statements in accordance with the accrual basis. Interest and investment earnings are recorded
when earned only if paid within 60 days since they would be considered both measurable and available.
Proprietary fund material receivables consist of all revenues earned at year-end and not yet received.
Utility accounts receivable and interest earnings compose the majority of proprietary fund receivables.
Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging
of accounts receivable.
Fixed Assets
The accounting treatment over property, plant, and equipment (fixed assets) depends on whether the assets
are used in governmental fund operations or proprietary fund operations and whether they are reported in
the government -wide or fund financial statements.
Election Not to Report Infrastructure Retroactively
Management of Moab City has elected not to report infrastructure retroactively. This is allowed by
provisions of GASB Statement 34 for all governments with less than $10 million in revenues. The City
began to report infrastructure prospectively during the fiscal year ended in 2004.
Government -wide Statements
In the government -wide financial statements, fixed assets are accounted for as capital assets. All fixed
assets are valued at historical cost, or estimated historical cost if actual is unavailable, except for donated
fixed assets which are recorded at their estimated fair value at the date of donation.
Depreciation of all exhaustible fixed assets is recorded as an allocated expense in the Statement of
Activities, with accumulated depreciation reflected in the Statement of Net Assets. Depreciation is
provided over the assets' estimated useful lives using the straight-line method of depreciation. The range
of estimated useful lives by type of asset is as follows:
Governmental Business -Type
Activities Activities
Description Estimated Lives Estimated Lives
Buildings and Improvements 30-45 years 30-45 years
Machinery and Equipment 10-15 years 10-15 years
Vehicles 5-10 years 5-10 years
Infrastructure 30 years 30 years
Fund Financial Statements
In the fund financial statements, fixed assets used in governmental fund operations are accounted for as
capital outlay expenditures of the governmental fund upon acquisition. Fixed assets used in proprietary
fund operations are accounted for the same as in the government -wide statements.
19
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Restricted Assets
Restricted assets consist of various cash balances that are restricted as to their use. Certain cash balances
are restricted by provisions of the bond resolutions. These include the bond, and emergency repairs
accounts in the enterprise funds. Customer deposits are also restricted in the enterprise funds. Amounts
are held in the agency fund for future burial and cemetery costs. Class C Road revenue not spent is
restricted in the general fund to be used for future roadwork.
Long-term Debt
The accounting treatment of long-term debt depends on whether the assets are used in governmental fund
operations or proprietary fund operations and whether they are reported in the government -wide or fund
financial statements.
All long-term debt to be repaid from governmental and business -type resources is reported as liabilities in
the government -wide statements. The long-term debt consists primarily of notes payable, accrued
compensated absences, and a court -assessed judgment.
Long-term debt for governmental funds is not reported as liabilities in the fund financial statements. The
debt proceeds are reported as other financing sources and payment of principle and interest reported as
expenditures. The accounting for proprietary fund is the same in the fund statements as it is in the
government -wide statements.
Compensated Absences
It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay
benefits. No liability is reported for unpaid accumulated sick leave. The liability for these compensated
absences is recorded as long-term debt in the government -wide statements. The current portion of this
debt is estimated based on historical trends. In the fund financial statements, governmental funds report
only the compensated absence liability payable from expendable available financial resources, while the
proprietary funds report the liability as it is incurred.
20
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Equity Classifications
Government -wide Statements
Equity is classified as net assets and displayed in three components:
a. Invested in capital assets, net of related debt —Consists of capital assets including restricted
capital assets, net of accumulated depreciation and reduced by the outstanding balances of
any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition,
construction, or improvement of those assets.
b. Restricted net assets —Consists of net assets 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.
c. Unrestricted net assets —All other net assets that do not meet the definition of "restricted"
or "invested in capital assets, net of related debt."
Fund Statements
Governmental fund equity is classified as fund balance. Fund balance is further classified as reserved and
unreserved, with unreserved further split between designated and undesignated. Proprietary fund equity is
classified the same as in the government -wide statements. See Note 3.H. for additional disclosures.
1.E. REVENUES, EXPENDITURES, AND EXPENSES
Franchise taxes, licenses, interest and special assessments are susceptible to accrual. Sales taxes collected
and held by the state at year-end on behalf of the City are also recognized as revenue. Other receipts and
taxes become measurable and available when cash is received by the City and are recognized as revenue at
that time.
Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual
criteria are met. Expenditure -driven grants are recognized as revenue when the qualifying expenditures
have been incurred and all other grant requirements have been met.
The City does not levy property taxes. Sales taxes are collected by the Utah State Tax Commission and
are remitted to the City monthly.
Operating Revenues and Expenses
Operating revenues and expenses for proprietary funds are those that result from providing services and
producing and delivering goods and/or services. It also includes all revenue and expenses not related to
capital and related financing, noncapital financing, or investing activities.
Expenditures/Expenses
In the government -wide financial statements, expenses are classified by function for both governmental
and business -type activities.
21
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
In the fund financial statements, expenditures are classified as follows:
Governmental Funds —By Character:
Current (further classified by function)
Debt Service
Capital Outlay
Proprietary Fund —By Operating and Non -operating
In the fund financial statements, governmental funds report expenditures of financial resources.
Proprietary funds report expenses relating to use of economic resources.
Interfund Transfers
Permanent reallocation of resources between funds of the reporting entity are classified as interfund
transfers. For the purposes of the Statement of Activities, all interfund transfers between individual
governmental funds have been eliminated.
NOTE 2. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
By its nature as a local government unit, the City is subject to various federal, state, and local laws and
contractual regulations. An analysis of the City's compliance with significant laws and regulations and
demonstration of its stewardship over City resources follows.
2.A. FUND ACCOUNTING REQUIREMENTS
The City complies with all state and local laws and regulations requiring the use of separate funds. The
legally required funds used by the City include the following:
Fund
General Fund
Required By
State Law
2.B. DEPOSITS AND INVESTMENTS LAWS AND REGULATIONS
The City maintains a cash and investment pool that is available for use by all funds. In addition,
investments are separately held by several of the City funds. Deposits are not collateralized, nor are they
required to be by State statute.
The City follows the requirements of the Utah Money Management Act (Utah Code Annotated 1953,
Section 51, Chapter 7) in handling its depository and temporary investment transactions. This law
requires the deposit of City funds in a "qualified depository." The Act defines a "qualified depository" as
any financial institution whose deposits are insured by an agency of the federal government and which has
been certified by the Commissioner of Financial Institutions as meeting the requirements of the Utah
Money Management Act and adhering to the rules of the Utah Money Management Council.
22
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
The Utah Money Management Act also defines the types of securities allowed as appropriate temporary
investments for the City and the conditions for making investment transactions. Investment transactions
are to be conducted through qualified depositories or primary reporting dealers.
Deposits
Custodial Credit Risk is the risk that, in the event of a bank failure, the City's deposits may not be
returned to it. The City does not have a formal deposit policy for custodial credit risk. As of June 30,
2007, $684,781 of the City's bank balances of $884,781 were uninsured and uncollateralized.
At June 30, 2007, the carrying amount and the bank balance of the City's bank deposits was $555,514,
and $884,781 respectively.
Investments
Certain assets are restricted by provisions of the revenue bond resolutions. The resolutions also describe
how these restricted assets may be deposited and invested. Restricted cash may only be deposited in state
or national banks meeting certain minimum net worth requirements or invested in securities representing
direct obligations of or obligations guaranteed by the U.S. government, agencies of the U.S. government,
any state within the territorial United States of America, repurchase agreements or interest bearing time
deposits with state or national banks meeting certain minimum net worth requirements, or certain other
investments.
The Utah Public Treasurers' Investment Fund (UPTIF) is an external deposit and investment pool wherein
governmental entities are able to pool the moneys from several entities to improve investment efficiency
and yield. These moneys are invested primarily in money market securities and contain no withdrawal
restrictions. As such, the moneys invested in this fund are not insured and are subject to the same market
risks as any similar investment in money market funds.
Interest Rate Risk — Interest rate risk is the risk that changes in interest rates will adversely affect the fair
value of an investment. The City's policy for managing its exposure to fair value loss arising from
increasing interest rates is to comply with the State's Money Management Act. Section 51-7-11 of the Act
requires that the remaining term to maturity of investments may not exceed the period of availability of
the funds to be invested.
Credit Risk — The City follows the requirements of the Utah Money Management act (Section 61, chapter
7 of the Utah Code) in handling its depository and investing transactions. City funds are deposited in
qualified depositories as defined by the Act. The Act also authorizes the City to invest in the Utah Public
Treasurers' Investment Fund (UPTIF), trade commercial paper, bankers' acceptances, repurchase
agreements, corporate bonds, restricted mutual funds, and obligation of government entities within the
State of Utah. The UPTIF is invested in accordance with the Act. The State Money Management Council
provides regulatory oversight for the UPTIF. The degree of risk of the UPTIF depends upon the
underlying portfolio. The act and Council rules govern the financial reporting requirements of qualified
depositories in which public funds may be deposited and prescribe the conditions under which the
designation of a depository shall remain in effect. If a qualified depository should become ineligible to
hold public funds, public treasurers are notified immediately. The City considers the actions of the
Council to be necessary and sufficient for adequate protection of its investments. The City has no
investment policy that would further limit its investment choices. The UPTIF is unrated.
23
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
2.C. REVENUE RESTRICTIONS
The City has various restrictions placed over certain revenue sources from state or local requirements. The
primary restricted revenue sources include:
Revenue Source
Sales Tax
Water and Sewer
B & C Road Funds
Federal & State Grants
Legal Restrictions of Use
See Note 1.E.
Debt Service and Utility Operations
Eligible B & C Roads
Specific to Grant
For the year ended June 30, 2007, the City complied, in all material respects, with these revenue
restrictions.
2.D. DEBT RESTRICTIONS AND COVENANTS
General Obligation Debt
No debt in excess of total revenue for the current year shall be created by any city unless the proposition
to create such debt shall have been submitted to a vote of qualified electors. Cities shall not contract for
debt to an amount exceeding four percent of the fair market value of taxable property in their jurisdictions.
For the year ended June 30, 2007, the City had $319,879 of outstanding general obligation debt.
Other Long-term Debt
Cities may incur a larger indebtedness for the purpose of supplying such city water, sewer, or electricity
when such public works are owned and controlled by the municipality. The additional indebtedness shall
not exceed four percent for first and second class cities and eight percent for third class cities. For the year
ended June 30, 2007, the City had $2,330,149 of such indebtedness.
Notes Payable
The various loan agreements relating to the notes payable issuances contain some restrictions or covenants
that are financial related. These include covenants such as debt service coverage requirement and required
reserve account balances. The following schedule presents a brief summary of the most significant
requirements and the Authority's level of compliance thereon as of June 30, 2007.
Requirement Level of Compliance
a. Note Payable Coverage:
1. Net water operating revenues (excluding depreciation) must equal 1.25 (1.20 for the
1996 Bonds) times the annual debt service plus the unfunded portion of the Debt Service
Reserve Requirement to be due and payable for the forthcoming year on the 1993 Water
Revenue Bonds, Series A & B and the 1996 Sewer Revenue Bond.
b. Reserve Account Requirement:
Various escrows are set up as reserves to make the annual debt payments. Minimum
balances are required to be kept in each of the escrows.
24
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
2.E. FUND EQUITY RESTRICTIONS
Deficit Prohibition
Utah Code 10-6-116(4) indicates that only the "fund balance in excess of 5% of total revenues of the
general fund may be utilized for budget purposes." The remaining 5% must be maintained as a minimum
fund balance. The maximum in the general fund may not exceed 18% of the total estimated revenue of the
general fund. (10-6-116(2)) The City exceeded the limitations allowed by law by $615,226
2.F. BUDGETARY BASIS OF ACCOUNTING
While the City is reporting financial position, results of operations and changes in fund balance on the
basis of generally accepted accounting principles (GAAP), the budgetary basis as provided by law is
based upon accounting for certain transactions on a basis of cash receipts, disbursements and
encumbrances. The Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and
Actual presented for the general fund is presented on the budgetary basis to provide a meaningful
comparison of actual results with the budget.
NOTE 3. DETAIL NOTES ON TRANSACTION CLASSES/ACCOUNTS
The following notes present detail information to support the amounts reported in the basic financial
statements for its various assets, liabilities, equity, revenues, and expenditures/expenses.
3.A. CASH AND INVESTMENTS
As of June 30, 2007 the government had the following investments and maturities:
Fair Value
Investment Maturity in Years
Less
Than 1
1-5 6-10
More
Than 10
Investments in Public
Treasurers' Investment Fund $4,211,359 $ 4,211,359 $ - $ $
Total Fair Value $ 4,211,359 $ 4,211,359 $ - $ $
25
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Reconciliation to Government -wide Statement of Net Assets:
Investments $ 4,211,359
Cash on hand 651
Deposits (overdraft) 555,514
Total $ 4,767,524
Government -wide Statement of Net Assets
Cash and Cash Equivalents $ 2,961,577
Restricted Cash and Cash Equivalents 1,805,947
$ 4,767,524
3.B. RESTRICTED ASSETS
The restricted assets as of June 30, 2007, are as follows:
Type of Restricted Asset Cash/Time Deposits Investments Accrued Int. Total
Business -Type Activities:
Bond Requirements $ 674,723 $ - $ - $ 674,723
Customer Deposits 6,513 - - 6,513
Impact Fees 769,905 - - 769,905
Total 1,451,141 - - 1,451,141
Governmental Activities:
Capital projects 159,402 - - 159,402
Class "C" Roads 195,404 - - 195,404
Total
354,806 - - 354,806
Grand Totals $ 1,805,947 $ - $ - $ 1,805,947
3.C. ACCOUNTS RECEIVABLE
Accounts receivable for the business -type activities consist of utilities receivable from the water and sewer
utilities. Accounts receivable of the governmental activities consist of sales tax, garbage utilities, franchise
taxes, and business licenses. Receivables detail at June 30, 2007, is as follows:
Governmental Activities Business -Type Activities Total
Accounts Receivable $ 519,713 $ 108,488 $ 628,201
Allowance for
Doubtful Accounts - (5,500) (5,500)
Net Accounts Receivable $ 519,713 $ 102,988 $ 622,701
26
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
3.D. CAPITAL ASSETS
Capital asset activity for the year ended June 30, 2007, was as follows:
Governmental Activities:
Land
Buildings
Improvements Other Than Bldgs
Machinery & Equipment
Autos & Trucks
Office Equipment
Infrastructure
Totals at historical cost
Less Accum. Depreciation
Buildings
Improvements Other Than Bldgs
Machinery & Equipment
Autos & Trucks
Office Equipment
Infrastructure
Total Accum. Depreciation
Governmental Activities
capital assets, net
Business -type activities:
Land
Water Shares
Sewage Plant
Improvements
Machinery & Equipment
Autos & Trucks
Office Furniture
Totals at historical cost
Less Accum. Depreciation
Sewage Plant
Improvements
Machinery & Equipment
Autos & Trucks
Office Furniture
Total Accum. Depreciaiton
Business -type activities
capital assets, net
Balance at
July 1, 2006
$ 371,977
4,725,751
1,511,474
1,083,810
1,136,243
393,593
1,941,197
11,164,045
(530,308)
(376,134)
(273,909)
(361,150)
(7,770)
(240,326)
(1,789,597)
Additions
Disposals
$ - $
71,947
143,631
31,635
161,496
17,116
294,194
720,019
(84,533)
(61,570)
(40,456)
(115,649)
(1,673)
(72,436)
(376,317)
$ 9,374,448 $ 343,702 $
$ 244,935 $
18,000
1,426,706
10,122,667
490,317
164,714
13,088
12,480,427
(1,182,064)
(3,474,614)
(364,348)
(148,454)
(12,540)
(5,182,020)
30,289
29,823
60,112
(34,753)
(252,775)
(31,927)
(10,627)
(299)
(330,381)
$
$ 7,298,407 $ (270,269) $
Balance at
June 30, 2007
$ 371,977
4,797,698
1,655,105
1,115,445
1,297,739
410,709
2,235,391
11,884,064
(614,841)
(437,704)
(314,365)
(476,799)
(9,443)
(312,762)
(2,165,914)
$ 9,718,150
$ 244,935
18,000
1,426,706
10,152,956
520,140
164,714
13,088
12,540,539
(1,216,817)
(3,727,389)
(396,275)
(159,081)
(12,839)
(5,512,401)
$ 7,028,138
27
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Depreciation expense was charged to governmental activities as follows:
General Government $ 81,315
Public Safety 110,889
Highways and Streets 139,950
Parks, Recreation and Public Property 44,162
Total depreciation expense $ 376,316
Depreciation on capital assets acquired under a capital lease:
Equipment $ 220,762
Accumulated Amortization 72,078
Net Book Value $ 148,684
Amortization of capital leases is included in depreciation expense.
3.E. ACCOUNTS PAYABLE
Payables in the general fund and non -major governmental funds are composed of
payables that have to do with the building inspector and a parking escrow.
3.F. LONG-TERM DEBT
The reporting entity's long-term debt is segregated between the amounts to be repaid
from governmental activities and amounts to be repaid from business -type activities.
28
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Governmental Activities:
As of June 30, 2007, the City had $2,193,784 governmental long-term debt detailed as
follows:
Compensated Absences $ 253,362
Sales Tax Revenue Bond 1,865,000
Capital Leases
2007 Dodge Chargers - Wells Fargo
Original Amt $75,118, Pmts $27,326
51,172
2006 F353 - Wells Fargo
Original Amt $27,485, Pmts $9,886 9,514
2 - 2006 Ford F150 Trucks
Original Amt $44,207, Pmts $15,960 14,736
Total Governmental Long -Term Debt $ 2,193,784
Business -type Activities:
As of June 30, 2007, the long-term debt payable from proprietary fund resources
consisted of the following:
Compensated Absences: $ 21,042
Water Revenue Bonds:
Water Revenue Bonds, Series A, Dated 1993
0%, (original amount $765,000)
Water Revenue Bonds Series A, Dated 1993
0%, (Original amount $764,000)
$ 43,240
72,240
Total Business -type debt $ 136,522
29
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Changes in Long-term Debt
The following is a summary of changes in long-term debt for the year ended June 30,
2007:
Type of Debt
Governmental Activities:
Compensated Absences $ 215,103
Capital Leases Payable 56,589
Sales Tax Revenue Bonds 1,928,000
Due Within One Year 110,187
Total Governmental Debt $ 2,309,879
Business -type Activities:
Compensated Absences $ 21,043
Revenue Bonds Payable 402,149
Due Within One Year 289,000
Total Enterprise Fund Debt
Balance
July 1, 2006
Balance
Additions Deductions June 30, 2007
$ 38,259
75,118
9,098
$ -
(56,285)
(63,000)
$ 253,362
75,422
1,865,000
119,285
$ 122,475 $ (119,285) $ 2,313,069
$
$ (1)
(286,668)
(2,332)
$ 21,042
115,481
286,668
$ 712,192 $ $ (289,001) $ 423,191
The revenue bonds are payable only from the net revenues of the water and sewer systems,
as defined in the bond ordinances. The ordinances further provide that the City establish
certain accounts and reserves for bond payment and that all revenues of the system are to
be used for operation and maintenance costs of the systems, principal and interest on the
bonds, and establishment of the defined debt repayment reserves and capital facilities
replacement account.
Annual Debt Service Requirements
The annual debt service requirements to maturity, including principal and interest, for
long-term debt as of June 30, 2007, are as follows:
Capital Leases:
June 30
Governmental
Activities
2008 $ 61,931
2009 53,171
2010 27,326
2011
Thereafter
Total Commitment 142,428
Less Interest Portion 10,721
Net Capital Lease $ 131,707
30
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Bonds and Notes Payable:
Business -type Activities Governmental Activities
Year Ending
June 30 Principal Interest Principal Interest
2008 287,669 9,945 63,000 48,200
2009 81,240 - 65,000 46,625
2010 33,240 - 66,000 45,000
2011 68,000 43,350
2012-2016 - - 366,000 155,975
2017-2021 - - 415,000 117,950
2022-2026 - 468,000 74,925
2027-2030 - 417,000 26,400
Total $ 402,149 $ 9,945 $ 1,928,000 $ 558,425
3.G. INTER -FUND TRANSACTIONS AND BALANCES
Operating Transfers
The City had the following inter -fund transactions for the year ended June 30, 2007:
FUND TRANSFERS OUT TRANSFERS IN
General Fund $ 307,980 $ -
Recreation 90,980
Community Development - 217,000
TOTALS $ 307,980 $ 307,980
31
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Due to/from other funds
The City had the following inter -fund transactions for the year ended June 30, 2007:
Fund
Water Fund
Sewer Fund
3.H. FUND EQUITY
Restricted Fund Equity
Due From
Other Funds
811,177
Due To
Other Funds
$ 811,177
$ 811,177 $ 811,177
Government Business -Type
Activities Activites
Totals
Net Assets
Invested in Capital Assets, Net of Related Debt $ 7,829,189 $ 6,625,990 $ 14,455,179
Restricted for:
Class "C" Roads 195,404 - 195,404
Bond Requirements - 674,723 674,723
Impact Fees 769,905 769,905
Capital Projects 159,402 - 159,402
Unrestricted (Deficit) 2,953,845 738,634 3,692,479
Total Net Assets $ 11,137,840 $ 8,809,252 $ 19,947,092
32
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
NOTE 4. OTHER NOTES
4A. EMPLOYEE PENSION AND OTHER BENEFIT PLANS
The City participates in the following employee pension systems:
Local Governmental - Cost Sharing Defined Benefits Pension Plans
Plan Description
The City of Moab contributes to the Local Governmental Contributory Retirement
System and Local Governmental Noncontributory Retirement System, Public Safety
Retirement System for employers with Social Security coverage, cost -sharing multiple -
employer defined benefit pensions plans administered by the Utah Retirement Systems
(Systems). Utah Retirement Systems provide refunds, retirement benefits, annual cost of
living adjustments, and death benefits to plan members and beneficiaries in accordance
with retirement statutes.
The Systems are established and governed by the respective sections of Chapter 49 of the
Utah Code Annotated 1953, as amended. The Utah State Retirement Office Act, in
Chapter 49, provides for the administration of the Utah Retirement Systems and Plans
under the direction of the Utah State Retirement Board whose members are appointed by
the Governor. The Systems issue a publicly available financial report that includes
financial statements and required supplementary information for the Local Governmental
Contributory Retirement System, Local Governmental Noncontributory Retirement
System, and Public Safety Retirement System for employers with Social Security
coverage. A copy of the report may be obtained by writing to the Utah Retirement
Systems, 540 East 200 South, Salt Lake City, UT 84102 or by calling 1-800-365-8772.
Funding Policy
In the Local Governmental Noncontributory Retirement System, Moab City is required to
contribute 11.59% of their annual covered salary. In the Public Safety Noncontributory
Retirement System for employers with Social Security coverage, Moab City is required to
contribute 22.38% of their annual covered salary. The contribution rates are the
actuarially determined rates. The contribution requirements of the Systems are
authorized by statute and specified by the Board.
33
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
Moab City's contributions to the various systems for the years ending June 30, 2007, 2006,
and 2005 were as follows:
Employer Paid Total
Contributory System: for employee Employer Employer
Local Government Division Contributions Contributions Contributions
2007 $ $ $
2006 1,800 2,711 4,511
2005 1,741 2,623 4,364
Noncontributory System:
Local Government Division
2007
2006
2005
$
$ 162,836 $ 162,836
152,457 152,457
139,737 139,737
Public Safety System:
Other Division A Noncontributory
2007 $ - $ 96,588 $ 96,588
2006 - 73,063 73,063
2005 - 81,679 81,679
The contributions were equal to the required contributions for each year.
457 Deferred Compensation Plan
The Utah Retirement Systems (URS) have adopted Governmental Accounting Standards
Board Statement 32, "Accounting and Financial Reporting for Internal Revenue Code
Section 457 Deferred Compensation Plans." This resulted in reporting the 457 Plans as a
"Trust Fund" of URS rather than previously reported as an "Agency Fund" of Moab City.
The assets and income of the 457 Plan are held in trust for the exclusive benefit of the
participants or their beneficiaries and are not the assets of the employer.
4.B. 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; injuries to employees; and natural disasters.
The City has purchased comprehensive general liability insurance through the Utah Local
Governments' Trust. The City pays premiums to the Trust for its general insurance
coverage, automobile liability, and personal injury protection. The Trust is self
sustaining through member premiums. The City is subject to a minimal deductible for
claims.
34
CITY OF MOAB, UTAH
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2007
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 $295,000 for the Klondike Landfill and $20,000 for the Moab Landfill.
35
SUPPLEMENTARY INFORMATION
City of Moab
Combining Balance Sheet for Nonmajor Funds
June 30, 2007
ASSETS
Cash and cash equivalents
Accounts receivable
Total assets
Special Revenue Funds Total
Arts and Nonmajor
Recreation Recreation Youth City Governmental
Fund Center Council Funds
$ 100,557 $ 2,018 $ 2,837 $ 105,412
1,778 - - 1,778
$ 102,335 $ 2,018 $ 2,837 $ 107,190
LIABILITIES AND FUND BALANCES
Liabilities:
Total liabilities
FUND BALANCES
Fund balances reserved for:
Recreation
Youth city council
Total fund balances
Total Liabilities and fund balance
102,335
102,335
$ 102,335
2,018
2,018
104,353
2,837 2,837
2,837 107,190
$ 2,018 $
2,837 $ 107,190
The Notes to the Financial Statements are an integral part of this statement. 36
City of Moab
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Non -major Governmental Funds
For the Year Ended June 30, 2007
Special Revenue Funds Total
Arts and Nonmajor
Recreation Recreation Youth City Governmental
Fund Center Council Funds
REVENUES
Intergovernmental revenues $ 69,936 $ - $ $ 69,936
Charges for service 190,412 - 190,412
Interest income - - 208 208
Total 260,348 - 208 260,556
EXPENDITURES
Parks, recreation and public property 308,434 - 308,434
Total 308,434 - 308,434
Excess of revenues over
(under) expenditures (48,086) - 208 (47,878)
OTHER FINANCING SOURCES (USES)
Transfers in
Total other financing sources (uses)
90,980 - 90,980
90,980 90,980
Excess of revenues and other sources
over (under) expenditures and other uses 42,894 - 208 43,102
Fund balances - beginning
Fund balances - ending
59,441 2,018 2,629 64,088
$ 102,335 $ 2,018 $ 2,837 $ 107,190
The Notes to the Financial Statements are an integral part of this statement. 37
City of Moab
Schedule of Impact Fees Collected and Spent
and Capital Facilities Budget for 2008 thru 2013
June 30, 2007
Water Sewer
Capactiy Treatment
Fiscal Facilities Facilities
Year Impact Fee Impact Fee
1999 Collected 3,693 11,273
Spent
2000 Collected 75,308 145,686
Spent (9,072)
2001 Collected 57,159 204,373
Spent (6,568) (456)
2002 Collected 14,818 43,139
Spent (5,050) (775)
2003 Collected 22,592 38,769
Spent (8,405) (10,762)
2004 Collected 22,323 39,889
Spent (10,000) (10,000)
2005 Collected 32,839 71,930
Spent
2006 Collected 23,864 122,490
Spent (2,173) (4,707)
2007 Collected 46,553 113,888
(2,894) (225,589)
Ending Balance $ 254,988 $ 539,149
Capital Facilities Budget - 2007 thru 2012
Project 2008 2009 2010 2011 2012 2013
Water Projects 67,500 1,200,000 -
Sewer Projects 143,000 - 1,600,000
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CITY OF MOAB, UTAH
INDEPENDENT AUDITORS' REPORT IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS,
INDEPENDENT AUDITORS' REPORT
ON LEGAL COMPLIANCE AND
MANAGEMENT LETTER
JUNE 30, 2007
CITY OF MOAB, UTAH
TABLE OF CONTENTS
JUNE 30, 2007
GOVERNMENT AUDITING STANDARDS REPORT
Independent Auditors' Report on Compliance and on
Internal Control Over Financial Reporting Based on an
Audit of Basic Financial Statements Performed
in Accordance With Government Auditing Standards
STATE COMPLIANCE REPORT
Independent Auditors' Report on Legal Compliance with
Applicable Utah State Laws and Regulations
CURRENT YEAR FINDINGS
STATUS OF PRIOR YEAR FINDINGS
Pages
1-2
3-4
5-6
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GOVERNMENT AUDITING STANDARDS REPORT
LARSON COMPANY
CERTIFIED PUBLIC ACCOUNTANTS
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE AND ON
INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN
AUDIT OF BASIC FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
September 20, 2007
Honorable Mayor and
City Council Members
City of Moab, Utah
We have audited the accompanying basic financial statements of the City of Moab, Utah
(herein referred to as the "City"), as of and for the year ended June 30, 2007, and have issued
our report thereon dated September 20, 2007. We conducted our audit in accordance with
auditing standards generally accepted in the United States of America and the standards
applicable to financial audits contained in Government Auditing Standards issued by the
Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether the City's basic financial statements
are free of material misstatement, we performed tests of its compliance with certain
provisions of laws, regulations, contracts and grants, 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 that are required to be reported under Government Auditing
Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial
reporting as a basis for designing our auditing procedures 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 over financial reporting. Accordingly, we do not
express an opinion on the effectiveness of the City's internal control over financial reporting.
SANDY. OFFICE
9065 SOUTH 1300 EAST
SANDY, UTAH 84094
(801) 313-1900
FAX (801) 313-1912
SPANISH FORK OFFICE
765 NORTH MAIN
SPANISH FORK, UTAH 84660
(801 ) 798-3545
FAX (B01) 798-3678
1
MOAB OFFICE
121 EAST 100 SOUTH SUITE 10d
MOAB. UTAH 84532
(435) 259-9100
FAX (801) 259-91 00
MEMBER OF THE INTERNATIONAL ACCOUNTING GROUP (TIAG) + WWW.LARSCO.COM
Our consideration of internal control over financial reporting was for the limited purpose
described in the preceding paragraph and would not necessarily identify all deficiencies in
internal control over financial reporting that might be significant deficiencies or material
weaknesses. However, as discussed below, we identified certain deficiencies in internal
control over financial reporting that we consider to be significant deficiencies.
A control deficiency 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 misstatements on a timely basis. A significant deficiency is a control
deficiency, or combination of control deficiencies, that adversely affects the City's ability to
initiate, authorize, record, process, or report financial data reliably in accordance with
generally accepted accounting principles such that there is more than a remote likelihood that
a misstatement of the City's financial statements that is more than inconsequential will not be
prevented or detected by the City's internal control. We consider the deficiencies described in
the accompanying management letter to be significant deficiencies in internal control over
financial reporting.
A material weakness is a significant deficiency, or combination of significant deficiencies,
that results in more than a remote likelihood that a material misstatement of the financial
statements will not be prevented or detected by the City's internal control.
Our consideration of the internal control over financial reporting was for the limited purpose
described in the first paragraph of this section and would not necessarily identify all
deficiencies in the internal control that might be significant deficiencies and, accordingly,
would not necessarily disclose all significant deficiencies that are also considered to be
material weaknesses. However, we believe that none of the significant deficiencies described
above is a material weakness.
This report is intended for the information of the Mayor and City Council, management, and
various federal and state funding and auditing agencies and is and is not intended to be and
should not be used by anyone other than these specified parties.
Larson & Company
Certified Public Accountants
2
STATE COMPLIANCE REPORT
Al
LARSON & COMPANY
INDEPENDENT AUDITORS' REPORT ON LEGAL COMPLIANCE WITH
APPLICABLE UTAH STATE LAWS AND REGULATIONS
September 20, 2007
Honorable Mayor and
City Council Members
City of Moab, Utah
We have audited the basic financial statements of the City of Moab, Utah, as of and for the
year ended June 30, 2007, and have issued our report thereon dated September 20, 2007. As
part of our audit, we have audited the City of Moab's compliance with the requirements
governing types of services allowed or un-allowed; eligibility; matching, level of effort, or
earmarking; reporting; special tests and provisions applicable to each of its major State
assistance programs as required by the State of Utah Legal Compliance Audit Guide for the
year ended June 30, 2007. The City received the following major State assistance programs
from the State of Utah:
B and C Road Funds (Department of Transportation)
Liquor Law Enforcement (State Tax Commission)
Our audit also included test work on the City's compliance with those general compliance
requirements identified in the State of Utah Legal Compliance Audit Guide, including:
Public Debt
Cash Management
Purchasing Requirements
Budgetary Compliance
Other General Compliance Requirements
Uniform Building Code Standards
Impact Fees and Other Development Fees
Asset Forfeiture
The management of the City of Moab is responsible for the City's compliance with all
compliance requirements identified above. Our responsibility is to express an opinion on
compliance with those requirements based on our audit.
3
SANDY. OFFICE
9065 SOUTH 1300 EAST
SANDY. UTAH 84094
(801) 313-1900
FAX (801) 313-1912
SPANISH FORK OFFICE
765 NORTH MAIN
SPANISH FORK. UTAH 84660
(801 ) 798-3545
FAX (801) 798-367B
MOAB OFFICE
121 EAST 100 SOUTH SUITE 104
MOAB. UTAH 84532
(4351 259-9100
FAX (801 ) 259-9100
MEMBER OF THE INTERNATIONAL ACCOUNTING GROUP (TIAG) i WW1N.LAR5CO.COM
We conducted our audit in accordance with generally accepted auditing standards,
Government Auditing Standards issued by the Comptroller General of the United States.
Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether material noncompliance with the requirements referred to above occurred. An
audit includes examining, on a test basis, evidence about the City's compliance with those
requirements. We believe that our audit provides a reasonable basis for our opinion.
The results of our audit procedures disclosed immaterial instances of noncompliance with the
requirements referred to above, which are described in the management letter. We considered
these instances of noncompliance in forming our opinion on compliance, which is expressed
in the following paragraph.
In our opinion, the City of Moab, Utah, complied, in all material respects, with the general
compliance requirements identified above and the requirements governing types of services
allowed or un-allowed; eligibility; matching, level of effort, or earmarking; reporting; and
special tests and provisions that are applicable to each of its major State assistance programs
for the year ended June 30, 2007.
Larson & Company
Certified Public Accountants
4
CITY OF MOAB, UTAH
CURRENT YEAR FINDINGS
FOR THE YEAR ENDED JUNE 30, 2007
STATE COMPLIANCE FINDINGS
FINDING — GENERAL FUND BALANCE OVER LEGAL LIMIT
The fund balance in the general fund exceeds the amount allowed by state law. The fund
balance in the general fund may not exceed 18% of the total estimated revenue of the general
fund. The ending fund balance in the general fund is $1,889,358 which is $615,226 over the
maximum allowed ($1,274,132).
RECOMMENDATION:
We recommend that the City monitor its general fund balance more closely so as to
make any necessary adjustments to ensure that it stays within the legal limits.
CLIENT RESPONSE:
Management is aware of the requirement and will take appropriate action in the future.
FINDING — TREASURER'S BOND IS UNDER FUNDED:
According to Utah State Code 51-7-15, every public treasurer shall secure a fidelity
bond based on the previous years budgeted gross revenues, in the amount set by the
State. For an entity with budgeted revenues between $10,000,001 and $25,000,000 the
amount shall be 4% but not less than 500,000.4% of Moab's gross budgeted revenue
for 2006 is $497,014. Current Treasurer's Bond is $460,000 which is $40,000 under
funded.
RECOMMENDATION:
We recommend that the City increase their Treasurer's Bond to comply with state
regulations.
CLIENT RESPONSE:
Management is aware and will take appropriate action to become compliant.
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CITY OF MOAB, UTAH
CURRENT YEAR FINDINGS (continued)
FOR THE YEAR ENDED JUNE 30, 2007
INTERNAL CONTROL FINDINGS
FINDING — YEAR END ADJUSTMENTS (significant deficiency):
Management does not currently post year end adjusting entries. Currently the Auditor,
with oversight from Management, proposes adjusting entries to adjust necessary
accounts, funds, and financial statements.
RECOMMENDATION:
It is recommended that Management work with Auditors to receive training on posting
year end adjusting entries.
CLIENT RESPONSE:
Management will work with the Auditors to post closing journal entries in the future.
FINDING: DRAFTING FINANCIAL STATEMENTS (significant deficiency):
Management does not currently draft the City's basic financial statements and related
footnotes. The Auditor, with oversight from Management, drafts the financial
statements and footnotes. Management then reviews, approves and accepts
responsibility for the financial statements.
RECOMMENDATION:
Management should work both independently and with the Auditors to receive the
training that will enable them to draft the financial statements and related footnotes.
CLIENT RESPONSE:
Management will consider the possibility of drafting the financial statements and work
with the Auditor toward a viable solution.
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CITY OF MOAB, UTAH
STATUS OF PRIOR YEAR FINDINGS
FOR THE YEAR ENDED JUNE 30, 2007
NO PRIOR YEAR FINDINGS NOTED
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