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HomeMy Public PortalAboutCAFR 1993.pdfCOMPREHENSIVE ANNUAL FINANCIAL REPORT of the Village of Key Biscayne, Florida for the Fiscal Year Ended September 30, 1993 Prepared by The Finance Department VILLAGE OF KEY BISCAYNE, FLORIDA COUNCIL - MANAGER FORM OF GOVERNMENT VILLAGE COUNCIL Rafael Conte, Mayor Michael Hill, Councilman Clifford Brody, Vice-Mayor Betty Q. Sime, Councilwoman Joe 1. Rasco, Councilman Raymond P. Sullivan, Councilrrpn Mortimer Fried, Councilman VILLAGE MANAGER C. Samuel Kissinger VILLAGE CLERK Guido H. Inguanzo, Jr. VILLAGE ATTORNEY Weiss, Serota & Helfman, P.A. FINANCE DIRECTOR Jack Neustadt INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS Rachlin & Cohen VILLAGE OF KEY BISCAYNE, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED SEPTEMBER 30, 1993 TABLE OF CONTENTS I. INTRODUCTORY SECTION PAGE Letter of Transmittal i Certificate of Achievement viii Village of Key Biscayne Organization Chart ix II. FINANCIAL SECTION INDEPENDENT AUDITOR'S REPORT GENERAL PURPOSE FINANCIAL STATEMENTS (COMBINED STATEMENTS - OVERVIEW): 1 Combined Balance Sheet - All Fund Types and Account Groups 3 Statement of Revenues, Expenditures and Changes in Fund Balance - General Fund 4 Statement of Revenues and Expenditures - Budget and Actual - General Fund (,Budgetary Basis) 5 Statement of Revenues, Expenses and Changes in Retained Earnings - Stormwater Utility System 6 Statement of Cash Flows - Stormwater Utility System 7 Index to Notes to Financial Statements 9 Notes to Financial Statements 11 COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUPS - STATEMENTS AND SCHEDULES GENERAL FUND: Balance Sheet 19 Schedule of Revenues and-Expenditures - Budget and Actual (Budgetary Basis)20 FIDUCIARY FUND: Combining Balance Sheet - Agency Funds 23 Statement of Changes in Assets and Liabilities - Deferred Compensation Plan 24 Statement of Changes in Assets and Liabilities - Defined Contribution Plan 25 ACCOUNT GROUPS: GENERAL FIXED ASSETS ACCOUNT GROUP: Schedule of General Fixed Assets By Source 27 Schedule of General Fixed Assets By Function and Activity 28 Schedule of Changes in General Fixed Assets By Function and Activity 29 GENERAL LONG-TERM DEBT ACCOUNT GROUP: Schedule of General Long-Term Debt 31 VILLAGE OF KEY BISCAYNE, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED SEPTEMBER 30, 1993 TABLE OF CONTENTS (CONTINUED) III. STATISTICAL TABLES (SUPPLEMENTAL DATA): AGE Comments on the Statistical Tables 33 General Government Expenditures by Function 35 General Revenues By Sourcq 36 Assessed and Estimated Actual Value of All Taxable Property 37 Property Values, Construction and Bank Deposits 38 Utilities Service Tax Revenue By Source 39 Franchise Revenue By Source 40 Interest Revenue By Source 41 Principal Taxpayers 42 Demographic Statistics 43 Miscellaneous Statistical Data 44 e IV. SUPPLEMENTARY AUDITOR'S REPORTS SECTION: Independent Auditor's Report on Internal Control Structure in Accordance With Government Auditing Standards 45 Independent Auditor's Report on Compliance in Accordance With Government Auditing Standards 47 Independent Auditor's Report on Schedule of Federal Financial Assistance 49 Schedule of Federal Financial Assistance 50 Independent Auditor's Report on Internal Control Structure Used In Administering Federal Financial Assistance Programs 51 J Independent Auditor's Report on Compliance with General Requirements 54 Independent Auditor's Report on Compliance with Specific Requirements Applicable to Major Federal Financial Assistance Programs 55 I J Introductory Section VILLAGE OF KEY BISCAAl NE Department of Finance and Administrative Services Village counctl John F Festa 11a1•or Joe I Rasco i ice.llavor Mortimer Fried Raul Llorente Beth sine Rai mond P Sulln an John Vi aid December 2, 1993 The Mayor and Honorable Members of the Village Council Village of Key Biscayne, Florida The Comprehensive Annual Financial Report of the Village of Key Biscayne for The fiscal year ended September 30, 1993, is hereby submitted. Responsibility for both the accuracy of the data, and the completeness and fairness of the presentation, including all disclosures, rests with the Village. To the best of our knowledge and belief, the enclosed data are accurate in all material respects and are reported in a manner designed to present fairly the financial position and results of operations of the various funds and account groups of the Village. All disclosures necessary to enable the reader to gain an understanding of the Village's financial activities have been included. The comprehensive annual financial report is presented in four sections. The introductory section includes this transmittal letter, the Village's organizational chart and a list of principal officials, The financial section includes the auditor's report on the financial statements and the individual fund and account group financial statements and schedules. The statistical section includes selected financial and demographic information. The fourth section contains the Report on Internal Control Structure and the Report on Compliance with Laws and Regulations and the Single Audit Reports submitted by our auditors. Government Structure The Village of Key Biscayne was incorporated on June 18, 1991, and operates under a Council-Manager form of government. The Village Council is comprised of the Mayor and six members and is responsible for enacting ordinances, resolutions and regulations governing the Village as well as appointing the members of various advisory boards, the Village Manager, Village Attorney and Village Clerk. As Chief Administrative Officer, the Village Manager is responsible for enforcement of laws and ordinances and appoints and supervises the department heads of the Village. 85 West McIntyre Street - hey Biscayne, Florida 33149 - (305) 365-8903 - Fax (305) 365-5556 \1151,10\ cTATEME\T "TO PRO\71)E A S\FE Qf ALM 10\1\11 \IT) E\l IRO\\fE\7 FOR A11 1SL4\DERS THROt GH RESPO\SIBLE GOVER ME\ f ECONOMIC CONDITIONS AND OUTLOOK General Information Location Key Biscayne is a barrier island situated between the Atlantic Ocean to the east and Biscayne Bay to the west. The island is located just south of Virginia Key, a separate island connected to the mainland south of downtown Miami by the Rickenbacker Causeway. The 1990 U.S. Census population was 8,854 and another 4,000 reside on the island seasonally. The Village, an incorporated municipality of approximately 1.25 square miles, is located on the Island of Key Biscayne and is bordered to the north by Crandon Park, a 960 acre county park administered by Dade County, and to the south by Bill Baggs Cape Florida State Recreation Area, q, park of approximately 600 acres. DISLOCATION EVENT AND ITS IMPACT; On Monday, August 24, 1992, Hurricane Andrew paid a visit to Key Biscayne making an impact that will be felt for decades. Water caused flooding of homes, schools, businesses, hotels, streets, and landscaping. Wind did additional damage to structure and vegetation. MAJOR INCENTIVES: During the initial year of incorporation, most services were provided by Dade County. Property taxes for the year were assessed, collected, and retained by Dade County. The Village advised Dade County, as provided in the interlocal agreement with the county, that the Village Police Department would be activated on March 1, 1993, and the Village Fire Rescue Department would be activated on October 1, 1993. The Village Council adopted the 1993-94 General Fund Budget on September 27, 1993. P 1-1 FINANCIAL INFORMATION Accounting System, Internal and Budgetary Control The Village's accounting records for governmental funds operations are maintained on a modified accrual basis, with revenues being recorded when available and measurable, and expenditures being recorded when the services or goods are received and the liabilities are incurred. Budgetary control is maintained at the fund level. Expenditures that could result in an overextended balance are not released until additional appropriations are made available. Internal accounting controls have been designed to provide reasonable, but not absolute, assurance regarding safeguarding of assets against loss from unauthorized use or disposition and the reliability of financial records for preparing financial statements and maintaining accountability. The concept of reasonable assurance recognizes that the cost of control should not exceed the benefits likely to be derived and the evaluation of costs and benefits requires estimates and judgement by management. All internal control evaluations occur within the above framework. We believe the Village's internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. Reporting Entity and its Services The Village includes for financial reporting purposes, in conformance with NCGA Statement 3, all funds and account groups that are controlled by or dependent upon the Village Council. The Village currently provides the following services for its citizens: Public Safety, Police and Fire Rescue, Planning and Zoning, Building Permits, Public Works, Parks and recreation facilities, Development, General and Administrative services. iii Reportins Standards The form and content of the Comprehensive Annual Financial Report and the accompanying financial statements and statistical tables were prepared in conformance with standards set forth by: 1. Governmental Accounting Standards Board (GASB) 2. Financial Accounting Standards Board (FASB) 3. National Council on Governmental Accounting (NCGA) 4. The Auditor General, State of Florida 5. The Charter of the Village of Key Biscayne 6. The Government Finance Officers Association of the United States and Canada General Government Functions The General Fund is the general operating fund of the Village. General tax revenues and other receipts that are not allocatyd by law or contractual agreement to some other fund are accounted for in this fund. General operating expenditures, fixed charges and capital improvement costs not paid through other funds are paid from this fund. The amount of revenues from various sources and their percent to total are shown in the following schedule: Revenues: Revenue Sources Percent Amount of Total Utility Taxes $1,212,084 12.6% Franchise Fees 625,015 6.5% Property Taxes 3,536,480 36.8% Intergovernmental 718,366 7.5% Licenses and Permits 308,676 3.2% Charges for Services 50,057 .5% Impact Fees 1,100,000 11.4% 2%Donations 21,343 . Other 63,889 .7% Interest 121,676 1.3% FEMA 1,165,864 12.1% Hurricane Loss Grant Revenue 552,749 5.8% Economic Development Grant 50,000 .5% Gain on Sale of Investments 83.197 .9% Total Revenues 59.6 low The Intergovernmental revenue source represents state shared revenues for which the Village qualified as of July 1, 1992. Expenditures: (Budgetary Basis) Function Percent Amount of Total General Government $ 495,454 8.2% Public Works 185,257 3.1% Economic Development 36,952 .6% Community Development 406,055 6.7% Parks and Recreation 240,794 4.0% Public Safety 2,790,379 46.0% Hurricane 1,251,264 20.6% Non-Departmental 421,619 7.0% ital outlayca 237.513 3.8%p Total Expenditures S6,0®65,287 10 An analysis of changes from fiscal 1992 is not meaningful since fiscal 1993 is the first full year of operations. Fiduciary Funds Fiduciary Funds are Trust and Agency Funds established for the purpose of accounting for assets held in a trustee capacity or as an agent for individuals, private organizations and other government. As of September 30, 1993, the following were recorded as Fiduciary Funds: Deferred Compensation The Deferred Compensation Fund accounts for certain deferred compensation plans offered by the Village for its employees. These plans were created in accordance with Internal Revenue Codes Sections 457 and 401. The plans, managed by independent plan administrators, permit employees to defer a portion of their salary until future years. The Deferred Compensation fund had $25,647 in investments for the fiscal year ended September 30, 1993. Cash Management The Village had two cash management vehicles in this first fiscal year; an investment account or money market account in the Key Biscayne Bank under an agreement which provides for overnight investments of both the investment account and the operating account. In addition, the Village has an investment account with the Florida Local Government Trust Fund administered by the State Board of Administration, which as of September 30, 1993 had a balance of $5,121,802. This will be the primary cash management vehicle for surplus funds. V Department Administration The Village established a one million dollar line of credit with the Key Biscayne Bank. The Village, on September 22, 1992, borrowed $250,000 against that Credit Line to pay contractors hired to remove debris caused by Hurricane Andrew. This loan was repaid on October 23, 1992. Risk Management The Village is insured with the Florida Municipal Insurance Trust for liability and property coverages; and with the Florida Municipal Self Insurance Fund for Workers Compensation coverage. The liability limit under the policy is $5,000,000. Enterprise Funds Enterprise Funds are established to finance and account for the acquisition, operation and maintenance of facilities and services, and the cost of providing these goods and services on a continuing basis is financed through the collection of charges from users. For the 1993-94 Fiscal Year, the Village Council established a budget for the Stormwater Management Utility Fund. The Village is in the process of having the engineering firm of Williams, Hatfield and Stoner design and prepare plans for the Stormwater Management System. General Fixed Assets The general fixed assets of the Village are those assets used in the performance of general governmental functions. In accordance with generally accepted accounting principles for local governments, the Village does not record depreciation on general fixed assets nor does it record roads, bridges, curbs and gutters, streets and sidewalks, drainage systems, and similar assets that.are immovable and of value only to the Village. Assets are recorded at cost except donations which are recorded at fair market value at the date of receipt. As of September 30, 1993, the general fixed assets acquired amount,to $480,229. Independent Audit Provisions in the State Statutes require an annual audit of the books of account, financial records and transactions of all administrative departments of the Village by independent Certified Public Accountants. This requirement has been complied with and the auditor's report has been included in this report. Certificate of Achievement for Excellence in Financial Reporting The Government Finance Officers Association of the United States and Canada (GFOA) awards a Certificate of Achievement for Excellence in Financial Reporting. The Certificate of Achievement is the highest form of recognition for excellence in state and local government financial reporting. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report whose contents conform to program standards. Such reports must satisfy both generally accepted accounting principles and applicable legal requirements. The fiscal 1992 report received the Certificate, a copy of which is included in this report. Acknowledgements The preparation of this report could not have been accomplished without the efficient and dedicated services of the staff of the Village. We express our appreciation to all members of the Staff who assisted and contributed to the preparation of this report. A special vote of thanks and appreciation is also extended to the firm of Rachlin and 6ohen for their professional approach and high standards in the conduct of their independent audit of the Village's financial records and transactions. Respectfully submitted, C. Samuel Kissing Village Manager Jack Neustadt Finance Director vii Certificate of Achievement for Excellence in Financial Reporting Presented to Village of Key Biscayne, Florida Fop its Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 1992 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. President Z. ~; re4P Executive Director VILLAGE OF KEY BISCAYNE, FLORIDA ORGANIZATIONAL CHART VIL &ot ATTORNEY YMI AGE ouNaL l VILLAGE XAYOK MILEAGE M1 tAGEL ::: ~:E~ONO~z [GENERAL GOVERNMENT,PARKS & RECREATION .. ......... 1 UILDING,''LING K7 PIANNING INDEPENDENT AUDITOR'S REPORT Financial Section RACHLIN & COHEN CERTIFIED PUBLIC ACCOU\TA\TS & CO\SL LT,\\TS A PARTNERSHIP OF PROFESSIONAL ASSOCIATIONS 1320 SOUTH DIXIE HIGH%N 40 PE\ THOLSE CORAL GABLES, FLORIDA 33 1 46-2 964 TELEPHONES DADE (305) 667-0412 BRONti ARD (305) 764-7717 Fax (305) 665-7456 700 SO[ THLAST THIRD A\ FM E SLITS 400 FT LALDERDALF, FLORIDA 33316-1102 TFLEPHO \Es: BRO\A ARD (305) 764-7717 DADF (305) 667-0412 FAx (305) 764-7835 Independent Auditor's Report To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida We have audited the general purpose financial statements of the Village of Key Biscayne, Florida as of September 30, 1993 and for the year then ended, as listed in the table of contents. These general purpose financial statements are the responsibility of the Village's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards and 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 general purpose 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 opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the Village of Key Biscayne, Florida, at September 30, 1993 and the results of its operations and cash flows of its enterprise fund for the year then ended, in conformity with generally accepted accounting principles. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining and individual fund and account group financial statements and schedules for the year ended September 30, 1993 as listed in the table of contents are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the Village of Key Biscayne, Florida. Such information has been subjected to auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. The information shown in the statistical section listed in the table of contents has not been subjected to the auditing procedure applied in the audit of the general purpose financial statements and, accordingly, we express no opinion thereon. Coral Gables, Florida December 2, 1993 MEMBER OF SUIVIT I\TER\ATIO\ALASSOCIATES, I\C. KITH OFFICES 1\ PRI\CIPAL CITIES THROL GHOL T THE WORLD \IF %IRF.R OF THE AAIFRICA\ 1 \1;TITI TF OF CFRTIFIFO PI RI If Armi \TA\TS Fh\ ISIO\ FOR SEC PRACTICE SECTION A\D THE. PRI\ ATF COAIPA\IFS PRACTICE SFCTIO\ GENERAL PURPOSE FINANCIAL STATEMENTS (COMBINED STATEMENTS - OVERVIEW) COMBINED BALANCE SHEET ALL FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30, 1993 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1992) Totals Fund Type Fund Type Fund Tyne Account Groups (Memorandum Only) Governmental Proprietary Fiduciary General General General Enterprise Agency Fixed Assets Long-Term Debt 1993 1992 ASSETS AND OTHER DEBITS Cash $4,435,374 $ -$ -S -S -$4,435,374 $ 114,297 Investments, At Market 1 184,136 184,136 4,113 Due From FEMA 91,515 --91,515 1,887,674 Due From Other Funds 115,410 --115,410 - Deposits on Contracts 403,794 --403,794 50 Restricted Assets - Cash 1,100,000 --1,100,000 - General Fixed Assets 480,229 480,229 65,261 Amount to be provided for General Long-term Debt 1.000.000 1.000.000 Total Assets and Other Debits 6 146 093 ~_184 136 480 229 1 000 000 7 810 458 2 071 395 LIABILITIES. FUND BALANCE AND OTHER CREDITS LIABILITIES: Accounts Payable and Accrued Expenses $ 881,322 $ 26,507 e S -S -$ -$ 907,829 8 106,199 Due to Other Funds -115,410 ---115,410 - Note Payable ------250,000 Deferred FEMA Revenue 106,309 ----106,309 1,194,394 Deferred Rent 9,690 ----9,690 13,130 Deferred Benefits Payable --184,136 --184,136 4,113 Note Payable - FEMA ----1,000.000 1.000.000 Total Liabilities 997.321 141.917 184.136 -1.000.000 2,323.374 1,567,836 FUND BALANCE AND OTHER CREDITS: Investment in General Fixed Assets ---480,229 -480,229 65,261 Fund balance: Reserved for Future Debt Service 1,000,000 1,000,000 Reserved for Encumbrances 165,565 165,565 - Reserved For Beach Improvements 20,945 20,945 20,237 Reserved for Beautification of Crandon Blvd.1,100,000 1,100,000 Reserved for Recreation Facilities 1,100,000 1,100,000 Reserved for Police/Fire Equipment and Building 367,416 367,416 Reserved for Grant Audits 541.024 541.024 Total Reserved 4.294.950 -480-229 -4.775.179 85.498 Unreserved 853,822 ----711,905 418,061 Deficit -(141.917)-- Total Fund Balance and Other Credits 5.148.772 (141.917)-480.229 -5.487.084 503.559 Total Liabilities, Fund Balance and Other Credits 6 146 093 !184 136 480 229 1 000 000 7 810 458 2 071 395 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. VILLAGE OF KEY BISCAYNE, FLORIDA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - GENERAL FUND FISCAL YEAR ENDED SEPTEMBER 30, 1993 (WITH COMPARATIVE TOTALS FOR FISCAL YEAR ENDED SEPTEMBER 30, 1992) 1993 REVENUES: Utility Taxes Franchise Fees Property Taxes Intergovernmental Licenses and Permits Charges for Services Impact Fees Donations Other Interest FEMA Grants Gain on Sale of Investments Total Revenues EXPENDITURES: Current: General Government Public Works Economic Development Community Development Parks and Recreation Public Safety Hurricane Non-Departmental Capital Outlay Total Expenditures EXCESS REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES: Loan Proceeds from FEMA EXCESS REVENUES AND OTHER SOURCES OVER EXPENDITURES FUND BALANCE, BEGINNING OF YEAR FUND BALANCE, END OF YEAR $1,212,084 625,015 3,536,480 718,366 308,676 50,057 1,100,000 21,343 63,889 121,676 1,165,864 602,749 83.197 9,610.196 495,454 185,257 36,952 406,055 240,794 2,742,172 1,251,264 421,619 120.155 5.899.722 3,710,474 1.000.000 4,710,474 438.298 15,148,77722 438,298 S 438.298 1992 $ 979,236 151,392 60,738 15,766 23,276 4,480 783,280 2.018.168 484,051 86,580 45,408 11,779 13,511 783,280 90,000 65.261 1.579.870 J L SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. -4- VILLAGE OF KEY BISCAYNE, FLORIDA STATEMENT OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL - GENERAL FUND (BUDGETARY BASIS) FISCAL YEAR ENDED SEPTEMBER 30,1993 BUDGET ACTUAL VARIANCE FAVORABLE (UNFAVORABLE) REVENUES: Utility Taxes $ 850,000 $1,212,084 $ 362,084 Franchise Fees 490,000 625,815 135,815 Property Taxes 3,502,728 3,536,480 33,752 Intergovernmental 530,672 718,366 187,694 Licenses and Permits 121,000 308,676 187,676 Charges for Services 16,700 50,057 33,357 Impact Fees -1,100,000 1,100,000 Donations -21,343 21,343 Other 121100 63,889 51,789 Interest 5,000 121,676 116,676 FEMA -1,165,864 1,165,864 Grants 230,700 602,749 372,049 Gain on Sale of Investments 100 83.197 83.097 e Total Revenues 5.759.000 9.610.196 3.851.196 EXPENDITURES: Current: General Government 507,700 495,454 12,246 Public Works 431,200 185,257 245,943 Economic Development 75,000 36,952 38,048 Community Development 473,400 406,055 67,345 Parks and Recreation 322,500 240,794 81,706 Public Safety 3,050,000 2,790,379 259,621 Hurricane -1,251,264 (1,251,264) Non-Departmental 615,592 421,619 193,973 ital OutlayCa 283.608 237.513 46.095p Total Expenditures 5.759.000 6.065.287 ( 306.287) EXCESS REVENUES OVER EXPENDITURES S $3.544.909 53.544.909 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. -5- VILLAGE OF KEY BISCAYNE, FLORIDA STORMWATER UTILITY SYSTEM STATEMENT OF REVENUE, EXPENSES AND CHANGES IN RETAINED EARNINGS FISCAL YEAR ENDED SEPTEMBER 30, 1993 OPERATING REVENUE OPERATING EXPENSES 141.917 NET LOSS (141.917) RETAINED EARNINGS, BEGINNING OF YEAR RETAINED EARNINGS (DEFICIT), END OF YEAR 141 917) I SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. -6- VILLAGE OF KEY BISCAYNE, FLORIDA STORMWATER UTILITY SYSTEM STATEMENT OF CASH FLOWS FISCAL YEAR ENDED SEPTEMBER 30,1993 NET LOSS $(141.917) ADJUSTMENTS TO RECONCILE NET LOSS TO NET CASH PROVIDED BY OPERATING ACTIVITIES: Increase in Accounts Payable 26,507 crease in Due to General FundI 115.410n ustmentsl AdtT 141.917jao Net cash provided by operating activities CASH, BEGINNING OF YEAR PO CASH, END OF YEAR SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. -7- NOTES TO FINANCIAL STATEMENTS VILLAGE OF KEY BISCAYNE, FLORIDA INDEX TO NOTES TO FINANCIAL STATEMENTS FISCAL YEAR ENDED SEPTEMBER 30, 1993 PAGE NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (1)Financial Reporting Entity 11 (2)Basis of Presentation - Fund Accounting 12 (3)Financial Statement Measurement Focus 13 (4)Basis of Accounting 14 (5)Budgets And Budgetary Accounting 15 (6)Encumbrances 15 (7)Memorandum Only - Total Columns 15 NOTE B - DEPOSITS AND INVESTMENTS 16 NOTE C - PROPERTY TAXES 16 NOTE D - LONG-TERM DEBT 17 NOTE E - LITIGATION, COMMITMENTS AND CONTINGENCIES 17 NOTE F - DEFERRED COMPENSATION PLAN 18 NOTE G - DEFINED CONTRIBUTION PLAN 18 NOTE H - SUBSEQUENT EVENT 18 VILLAGE OF KEY BISCAYNE, FLORIDA NOTES TO FINANCIAL STATEMENTS FISCAL YEAR ENDED SEPTEMBER 30, 1993 A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of the Village of Key Biscayne's significant accounting policies is presented to assist the reader in interpreting the general purpose financial statements and other data in this report. The policies are considered essential and should be read in conjunction with the accompanying general purpose financial statements. The accounting policies of the Village of Key Biscayne conform to generally accepted accounting principles (GAAP) as applied to governmental units. This report, the accounting systems and classification of accounts conform to standards of the Governmental Accounting Standards Board (GASB) and the Government Finance Officers Association of the United States and Canada (GFOA), which is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. Accounting treatment and the financial statements also incorporate current recommendations of the National Committee on Governmental Accounting and auditing standards of the American Institute of Certified Public Accountants included in the Industry Audit Guide "Audits of State and Local Governmental Units". s 1. Financial Reporting Entity The Village of Key Biscayne (Village), located in Dade County, is a political subdivision of the State of Florida. The Village, which was incorporated in 1991, operates under a Council-Manager form of government. Under the initial government, six council members and the Mayor were elected by the voters. The Village held municipal elections for fiscal year 1993. Effective for fiscal year 1995, each council member will serve a four year term (limited to two consecutive terms). The Mayor will hold office for a two year term (limited to two consecutive terms). The Vice-Mayor is appointed by the council and Mayor for a one year term. During the absence or incapacity of the Mayor, the Vice-Mayor shall have all the powers, authority, duties and responsibilities of the Mayor. The Mayor serves as chairperson of public meetings and executes certain documents authorized by charter, ordinance or resolution. In addition to the general government function, the Village provides its residents with public works, public safety, parks and recreation, and community development functions. The Village does not provide educational or hospital facilities. Those services are provided by the Dade County School Board and Metropolitan Dade County, respectively. This report includes financial statements of the funds and account groups required to account for those financial activities which are related to the Village and are controlled by or dependent upon the Village's legislative body, the Village Council. Control or dependence upon the Village was determined on the basis of budget adoption, taxing authority, or the Village's legal responsibility to fund any deficits that may occur. The Village does not have component units. VILLAGE OF KEY BISCAYNE, FLORIDA NOTES TO FINANCIAL STATEMENTS (CONTINUED) FISCAL YEAR ENDED SEPTEMBER 30, 1993 A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 2. Basis of Presentation - Fund Accounting The Village's accounting systems are organized and operated on the basis of funds and account groups, which are the basic fiscal and accounting entities in governmental accounting. A fund is a separate accounting entity with a self-balancing set of accounts. An account group is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect net expendable available financial resources. The funds and account groups are classified as follows: GOVERNMENTAL FUND The GENERAL FUND is the general operating fund of the City. It is used to account for all financial resources except those that are required to be accounted for in specific funds. Resources are generated primarily from property taxes, local utilities service taxes, franchises, licenses and permits, intergovernmental revenue and charges for services. Expenditures are incurred to provide public safety, general government, recreation, community development and public works services. o' PROPRIETARY FUND The ENTERPRISE FUND is used to account for operations that are financed and operated in a manner similar to private business enterprises, where the intent of the governing body is that the costs (including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through users charges. The Village's enterprise operation consist solely of a stormwater utility system. AGENCY FUNDS The AGENCY FUNDS are used to account for assets that the Village holds on behalf of others as their agent. ACCOUNT GROUPS ACCOUNT GROUPS are used to establish accounting control and accountability over the Village's general fixed assets and the unmatured principal of its general long-term debt. Accordingly, the Village maintains a General Fixed Asset Account Group and a General Long-Term Debt Account Group. i e 0 P li -12- VILLAGE OF KEY BISCAYNE, FLORIDA NOTES TO FINANCIAL STATEMENTS (CONTINUED) FISCAL YEAR ENDED SEPTEMBER 30, 1993 A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 3. Financial Statement Measurement Focus The accounting and reporting treatment applied to the fixed assets associated with the general fund is determined by that fund's measurement focus. GOVERNMENTAL FUND This fund is used to account for the Village's expendable financial resources and related current liabilities. Measurement focus is upon financial flow and financial position (sources, uses and balances of resources), rather than upon net income determination. Only current assets and current liabilities are included on its balance sheet with fund balance representing available spendable resources. Basic financial statements necessary to fairly present financial position and operating results for this fund are the Balance Sheet and the Statement of Revenue, Expenditures and Changes in Fund Balance. PROPRIETARY FUND This fund is used to account for the Village's stormwater utility system. Financial activity is reported in essentially the same manner as in commercial accounting where net income and capital maintenance are measured. All assets and all liabilities (whether current or noncurrent) are included in their financial statements. Measurement focus is upon determination of net income, financial position and cash flows. The basic financial statements required for this fund are the Balance Sheet, the Statement of Revenue, Expenses and Changes in Retained Earnings and the Statement of Cash Flows. FIDUCIARY FUNDS Agency funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. GENERAL FIXED ASSETS ACCOUNT GROUP Fixed assets used in governmental fund type operations are accounted for in the General Fixed Assets Account Group, rather than in the governmental funds. General fixed assets purchased are initially reported as expenditures in the general fund and are capitalized at historical cost or estimated cost if actual historical cost is not available in the general fixed assets account group, except for certain infrastructure improvements which include streets, alleys, sidewalks, drainage and lighting systems. Depreciation is not required and has not been provided on general fixed assets. VILLAGE OF KEY BISCAYNE, FLORIDA NOTES TO FINANCIAL STATEMENTS (CONTINUED) FISCAL YEAR ENDED SEPTEMBER 30, 1993 A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 3. Financial Statement Measurement Focus (Continued) LONG-TERM DEBT ACCOUNT GROUP Noncurrent liabilities that are expected to be financed from governmental funds, are excluded from governmental fund financial statements because of the spending measurement focus of such funds. Net current assets of governmental funds are not affected by such liabilities, therefore, these long-term amounts are instead accounted for and reported as liabilities in the General Long-Term Debt Account Group. The Village's long-term liabilities that are reported in this manner consist of a note payable to FEMA. 4. Basis of Accounting The basis of accounting refers to the timing when revenues and expenditures are recognized in the accounts and reported in the financial statements. GOVERNMENTAL AND AGENCY FWNDS These funds use the modified accrual basis of accounting. Under the modified accrual basis of accounting revenues are recorded when susceptible to accrual; i.e., when both measurable and available. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Generally, revenues are recognized when earned except for certain revenue sources which are not susceptible to accrual. Revenues in the following categories are considered susceptible to accrual because they are both measurable and available to finance expenditures of the current period: • Property Taxes • Interest Earned • Intergovernmental Revenues and Grants The following revenues are not considered susceptible to accrual in the governmental fund because they are not both measurable and available to finance expenditures of the current period: Licenses and Permits • Utility Taxes • Franchise Fees The Village reports deferred revenues in its balance sheet. Deferred revenues arise when a potential revenue does not meet both the "measurable and available criteria" for recognition in the current period. In subsequent periods, when both revenue recognition criteria are met, the liability for deferred revenue is removed from the balance sheet and revenue is recognized. 7 a7 0 11 J a J 2 -14- VILLAGE OF KEY BISCAYNE, FLORIDA NOTES TO FINANCIAL STATEMENTS (CONTINUED) FISCAL YEAR ENDED SEPTEMBER 30, 1993 A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 4. Basis of Accounting (Continued) GOVERNMENTAL AND AGENCY FUNDS (CONTINUED) Expenditures are generally recognized when the related liability is incurred. Exceptions to this rule are: 1) accumulated unpaid vacation and sick pay, worker's compensation and capital leases, are not recognized in the General Fund since the amount to be liquidated from available spendable resources is recorded in the General Long-Term Debt Account Group; 2) principal and interest on general long-term debt which is recorded as an expenditure on its due date. Neither of the two exceptions noted above relate to the financial reporting of the Village. PROPRIETARY FUND The Proprietary Fund is accounted for using the accrual basis of accounting. Revenues are recognized when earned and expenses are recognized when incurred. 5. Budgets and Budgetary,Accounting The Village is legally required to adopt an annual budget for its General Fund. Budgets are controlled at the fund level. The Village Manager is authorized to transfer budgeted amounts within the departments, within any fund. Budgets can be amended during the fiscal year by Council adoption of the proposed amendments. The budget is prepared on a basis consistent with the basis of accounting utilized for the respective fund. There were no supplemental budgetary appropriations in the current fiscal year. 6. Encumbrances Encumbrance accounting is utilized under which purchase orders, contracts and other financial commitments for expenditures are recorded in order to reserve that portion of the appropriation. Encumbrances outstanding at year end are reported as reservations of fund balance. As of September 30, 1993 the following analysis reconciles expenditures reported on a GAAP basis versus budgetary basis: Excess Revenue over expenditures (Budgetary Basis)$3,544,909 Encumbrances 165.565 Excess Revenue over expenditures (GAAP Basis)$3.71 474 7. Memorandum Only - Total Columns Total columns on the various statements which are captioned "Memorandum Only", aggregate the columnar amounts presented by fund type and account group and are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Neither is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. 1 S NOTES TO FINANCIAL STATEMENTS (CONTINUED) FISCAL YEAR ENDED SEPTEMBER 30, 1993 B. DEPOSITS AND INVESTMENTS At September 30, 1993, the Village maintained deposits (cash) with book balances of $5,535,374. The total balance per bank was $826,136 and the balance of deposits held at the State Board of Administration was $5,121,802. The difference between the bank balance and the Village's book balance is due to outstanding checks and deposits in transit. In addition to insurance provided by the Federal Depository Insurance Corporation (FDIC), all deposits are held in banking institutions approved by the State Treasurer of the State of Florida, to hold public funds. Under Florida Statutes Chapter 280, Florida Security for Public Deposits Act, the State Treasurer requires all Florida qualified public depositories to deposit with the Treasurer or another banking institution eligible collateral equal to from 50% to 125% of the average daily balance for each month of all public deposits in excess of any applicable deposit insurance held. The percentage of eligible collateral (generally in the form of U.S. Government and agency securities, state or local government debt, or corporate bonds) to public deposits is dependent upon the depository's financial history and its compliance with Chapter 280. In the event of a failure of a qualified public depository, the remaining public depositories would be responsible for covering any resulting losses. Accordingly, all amounts reported as cash deposits are deemed as insured and are, therefore, not subject to classification by credit risk category under the provisions of GASB Statemgnt No. 3. Included in the agency funds are investments, which are stated at market value, and are held by the ICMA Retirement Trust. CARRYING MARKET VALUE VALUE Investments in mutual funds 184 136 $184,136 C. PROPERTY TAXES Property values are assessed on a county-wide basis by the Metropolitan Dade County Property Appraiser as of January 1, the lien date, of each year. Taxable value of property within the Village is certified by the Property Appraiser and the Village levies a tax millage rate upon the taxable value which will provide revenue required for the fiscal year beginning October 1. Property taxes levied each October 1, by the Village and all other taxing authorities within the County, are centrally billed and collected by Dade County, with remittances to the Village of their proportionate share of collected taxes. Taxes for the fiscal year beginning October 1 are billed in the month of November, subject to a 1% per month discount for the period November through February, and are due no later than March 31. On April 1, unpaid amounts become delinquent with interest and penalties added thereafter. Beginning June 1, tax certificates representing delinquent tax with interest and penalties are sold by Dade County, with remittance to the Village for its share of those receipts. h ur VILLAGE OF KEY BISCAYNE, FLORIDA NOTES TO FINANCIAL STATEMENTS (CONTINUED) FISCAL YEAR ENDED SEPTEMBER 30, 1993 D. LONG-TERM DEBT The Village obtained a $1,000,000 loan on June 7, 1993 from the Federal Emergency Management Agency (FEMA) at a rate of 5.68% per year. The principal and interest, less amounts that may be canceled pursuant to Section 417 of the Stafford Disaster Relief and Emergency Assistance Act are due on June 7, 1998 unless extended at the sole discretion of the lender. E. LITIGATION, COMMITMENTS, AND CONTINGENCIES Litigation The Village is involved in several lawsuits the outcome of which in the opinion of management should not have a material effect on the financial position of the Village. Commitments 1. The Village is obligated under a non-cancelable operating lease for office space for a period of three years commencing March 1, 1992. Rent expense was $38,000 for fiscal year 1993. The following is the commitment under the lease: Fiscal Year 1994 $44,000 1995 18,000 2. In August 1992, the Village entered into an interlocal agreement with Metropolitan Dade County in order to 1) delineate the responsibilities for service levels, and costs of municipal services to be provided to the Village by the County for the fiscal year 1992 transition year, and for future fiscal years, and 2) outline the general terms of future lease agreements between the County and the Village concerning specified capital assets. Contingent Liability Federal Programs in which the Village participates were audited in accordance with the provisions of U.S. Office of Management and Budget Circular A-128, Uniform Requirements for Grants to State and Local Government. Pursuant to the provisions of Circular A-128, certain major and non-major programs were tested for compliance with applicable grant requirements. While no matters of noncompliance were disclosed by audit, the Federal Government may subject grant programs to additional compliance tests which may result in disallowed expenditures. In the opinion of management, future disallowances of current grant expenditures, if any, would not have a material effect on the Village's financial statements. NOTES TO FINANCIAL STATEMENTS (CONTINUED) FISCAL YEAR ENDED SEPTEMBER 30, 1993 F. DEFERRED COMPENSATION PLAN The Village of Key Biscayne established a deferred compensation plan in fiscal year 1993. The plan is voluntary and the Village does not contribute. Employees may elect to defer up to 25% of their annual income, not to exceed $7,500 annually. Deferred compensation deposits are made into the employees' accounts through payroll deductions before income taxes are withheld. Contributions by the employees for the fiscal year ended September 30, 1993 were $25,647. It is the opinion of the Village that the Village has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. The plan assets are the property of the Village subject only to the claims of.the Village's general creditors. Participant rights under the plan are equal to those of general creditors in an amount equal to the fair market value of the deferred account of the participants. G. DEFINED CONTRIBUTION PLAN The Village of Key Biscayne is a single employer that contributes to the Village of Key Biscayne Money Purchase Plan, which is a defined contribution pension plan. The plan currently covers all full-time employees of the Village. Under this plan, the Village contributes 11% and the employee contributes 6%. Employer contributions for fiscal year ended September 30, 1993 were $96,318 while the employee contributions were $51,784. A defined contribution pension plan provides pension benefits in return for services rendered, provides an individual account for each participant and specifies how contributions to the individual's account are to be determined instead of specifying the amount of benefits the individual is to receive. Under a defined contribution pension plan, the benefits a participant's account will receive depends solely on the amount contributed to the participant's account, the returns earned on investments on those contributions, and forfeitures of other participants' benefits that may be allocated to such participant's account. Assets of the plan are considered assets of the Village. Although 100% vested from the first day of employment, the employees share equal risk with other general creditors of the Village in the unlikely event these assets would be needed to pay for liabilities of the Village. The Village's total payroll and covered payroll for fiscal year 1993 is $1,133,473. The Money Purchase Plan held no securities of the Village or other related parties during the year or as of the close of the fiscal year. H. SUBSEQUENT EVENT In December 1993, the Village obtained financing of $9.2 million from a bank for 10 years at the rate of 4.36%. The debt was incurred to purchase land and is collateralized by the pledge of utility tax revenues. 11 0 0 13 J 7 t -18- COMBINING AND INDIVIDUAL FUND AND ACCOUNT GROUPS STATEMENTS AND SCHEDULES GOVERNMENTAL FUND 0 GENERAL FUND GENERAL FUND .- • The General Fund is the principal fund of the Village and is used to account for resources traditionally associated with governments which are not required to be accounted for, in°N'nothertY,,fund. VILLAGE OF KEY BISCAYNE, FLORIDA GENERAL FUND BALANCE SHEET SEPTEMBER 30, 1993 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1992) ASSETS 1993 1992 Cash $4,435,374 $ 114,297 Due from FEMA 91,515 1,887,674 Due from other funds 115,410 - Deposits on contracts 403,794 50 Restricted Assets - cash 1.100.000 - Total Assets S6.146.093 52.002.021 LIABILITIES AND FUND BALANCE Liabilities: s Accounts payable and accrued expenses $ 881,322 $ 106,199 Note payable - 250,000 Deferred FEMA revenue 106,309 1,194,394 Deferred rent 9.690 13.130 Total Liabilities 997.321 1.563.723 Fund balance: Reserved for future debt service 1,000,000 - Reserved for encumbrances 165,565 - Reserved for beach improvements 20,945 20,237 Reserved for beautification of Crandon Blvd.1,100,000 - Reserved for recreation facilities 1,100,000 - Reserved for police/fire equipment and building 367,416 - Reserved for grants audits 541.024 Total Reserved 4.294.950 Unreserved 853,822 438,298 Total Fund Balance 5.148.772 Total Liabilities and Fund Balance $6.146.093 S2.0~02.0 11 VILLAGE OF KEY BISCAYNE, FLORIDA GENERAL FUND SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL (BUDGETARY BASIS) FISCAL YEAR ENDED SEPTEMBER 30, 1993 UTILITY TAXES FRANCHISE FEES PROPERTY TAXES VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) 850,000 $1,212,084 ,$ 362.084 490,000 625,815 135,818 3,502.728 3,536,480 33.752 INTERGOVERNMENTAL County Shared Revenue 97,000 117,555 20,555 State Shared Revenue 433,672 600.811 167.139 530,672 718,366 187.694 LICENSES AND PERMITS: Occupational Licenses 20,000 35,746 15,746 Building Permits 100,000 255,008 155,008 Water Meter Permits 1,000 17.922 16.922 121,000 308,676 187.676 CHARGES FOR SERVICES 16.700 50,057 33.357 OTHER: Donations 400 21,343 20,943 Miscellaneous 11.700 63,889 52.189 12,100 85.232 73.132 INTEREST IMPACT FEES GRANT REVENUE FEMA revenue Hurricane loss grant revenue Economic Development Grant GAIN ON SALE OF INVESTMENTS Total Revenue 5.000 121,676 116.676 1.100,000 1.100.000 - 1,165,864 1,165,864 180,700 552,749 372,049 50.000 50.000 230.700 1,768,613, 1,537,913 100 83,197 83,097 S5.7~59.00000 $9.610,196 $3,851,196 GENERAL GOVERNMENT: Legal: Current Expenditures 243.500 236,557 6,943 Council: Current Expenditures Administrative: Personal Services Current Expenditures Capital Outlay 15.000 9,312 5,688 202,250 206,308 (4,058) 46,950 43,277 3,673 283.608 237,513 46.095 532.808 487,098 45,710 7 sa 11 t u; Total General Government S 791.308 $ 732,967 58.341 VILLAGE OF KEY BISCAYNE, FLORIDA GENERAL FUND STATEMENT OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL (CONTINUED) (BUDGETARY BASIS) FISCAL YEAR ENDED SEPTEMBER 30, 1993 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) PUBLIC WORKS: Current Expenditures S 431.200 ,S 185.257 S 245.943 ECONOMIC DEVELOPMENT: Personal Services 50,000 17,365 32,635 Current Expenditures 25.000 19.587 5.413 75.000 36.952 38.048 COMMUNITY DEVELOPMENT: Personal Services 85,500 75,352 10,148 Current Expenditures 387,900 330.703 57.197 473,400 406.055 _ 67.345 PARKS & RECREATION: Personal Services 95,000 77,529 17,471 Current Expenditures 227.500 163.265 64.235 322.500 _ 240,794 81.706 PUBLIC SAFETY: Personal Services 992,574 1,008,418 ( 15,844) Current Expenditures 2.057.426 1.781.961 275.465 3.050.000 2.790.379 259.621 HURRICANE EXPENDITURES: Current Expenditures 1,251,264 (1.251.264) NON-DEPARTMENTAL 615.592 421.619 193.973 Total Expenditures S5.759.000 $6.065.287 S( 306.287) FIDUCIARY FUND 0 AGENCY FUNDS AGENCY FUNDS • These Funds are used to account for assets held for employees in accor- dance with the provisions of Internal Revenue Code Sections 401 and 457. VILLAGE OF KEY BISCAYNE, FLORIDA AGENCY FUNDS COMBINING BALANCE SHEET SEPTEMBER 30, 1993 Deferred Compensation Plan Defined Contribution Plan Total ASSETS at marketInvestments 25 647 $158,489 $184,136, LIABILITIES Deferred benefits payable 25 647 158 489 184 136 VILLAGE OF KEY BISCAYNE, FLORIDA DEFERRED COMPENSATION PLAN STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FISCAL YEAR ENDED SEPTEMBER 30, 1993 Balance Balance October 1, September 30, 1992 Additions Deletions 1993 ASSETS Investments, at market L.; . 25 647 2~~7 LIABILITIES Deferred benefits payable ~~ 25 647 .v J VILLAGE OF KEY BISCAYNE, FLORIDA DEFINED CONTRIBUTION PLAN STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FISCAL YEAR ENDED SEPTEMBER 30, 1993 Balance October 1, Balance September 30, 1992 Additions Deletions 1993 ASSETS Investments, at market 4 113 154 376 s $158,489 LIABILITIES Deferred benefits payable 4 113 154 376 158 489 GENERAL FIXED ASSETS ACCOUNT GROUP • To account for fixed assets used for general government purposes. VILLAGE OF KEY BISCAYNE, FLORIDA SCHEDULE OF GENERAL FIXED ASSETS BY SOURCE SEPTEMBER 30, 1993 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1992) 1993 1992 GENERAL FIXED ASSETS: Furniture and Equipment $ 71,946 $37,106 Equipment 262,444 28,155 Vehicles 145,839 Total General Fixed Assets 1480,229 65 261 INVESTMENT IN GENERAL FIXED ASSETS BY SOURCE: General Fund 48;5 0229 65 261 VILLAGE OF KEY BISCAYNE, FLORIDA SCHEDULE OF GENERAL FIXED ASSETS BY FUNCTION AND ACTIVITY SEPTEMBER 30, Furniture and Fixtures 1993 Equipment Total GENERAL GOVERNMENT: Administration $ 37,106 $ 28,155 $ 65,261 PUBLIC SAFETY 6,685 408.283 414.968 43 791 436 438 480 229 J k J, it VILLAGE OF KEY BISCAYNE, FLORIDA SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS BY FUNCTION AND ACTIVITY FISCAL YEAR ENDED SEPTEMBER 30, 1993 Balance October 1, Balance September 30, 1992 Additions Deletions 1993 GENERAL GOVERNMENT: Administration $65,261 $ -$ -$ 65,261 T PUBLIC SAFETY -414,968 -414.968 65 261 414 968 Ste,480 229 GENERAL LONG-TERM DEBT ACCOUNT GROUP GENERAL LONG-TERM DEBT ACCOUNT GROUP 0 To account for City's long term debt. VILLAGE OF KEY BISCAYNE, FLORIDA SCHEDULE OF GENERAL LONG-TERM DEBT SEPTEMBER 30, 1993 AMOUNT TO BE PROVIDED FOR PAYMENT OF GENERAL LONG-TERM DEBT: Loan from FEMA 51.000.000 GENERAL LONG-TERM DEBT PAYABLE: Loan from FEMA $1.000.000 Statistical section VILLAGE OF KEY BISCAYNE, FLORIDA COMMENTS ON THE STATISTICAL TABLES SEPTEMBER 30, 1993 The statistical tables in this section reflect the activities of fiscal year 1992 which was the Village's initial year and fiscal year 1993 which was the Village's first full year of operation. The following statistical tables recommended by the National Council on Governmental Accounting are not included for the reasons stated below: 1. Tables which concern general obligation debt are omitted because the Village has no general obligation debt as of September 30, 1993. 2. Computation of Legal Debt Margin - The Village's charter and the Constitution of the State of Florida, Florida State Statute 200.181 does not provide for a legal debt limit. 3. The table of Special Assessment Collections has been omitted because the Village has no outstanding assessments as of September 30, 1993. 4. Unless otherwise specified, the source of all information was developed within the Village. VILLAGE OF KEY BISCAYNE, FLORIDA GENERAL GOVERNMENT EXPENDITURES BY FUNCTION FISCAL YEAR GENERAL GOVERNMENT PUBLIC SAFETY PARKS AND RECREATION PUBLIC WORKS TOTAL 1992 $1,468,000 (1)$ 13,511 $ 11,779 $ 86,580 $1,579,870 1993 2,848,857 (2)2,790,379 240,794 185,257 6,065,287 (1) Includes $783,280 Hurricane Andrew Expenses to 9/30/92. (2) Includes $1,251,264 Hurricane related expenses 10/1/92 through 9/30/93. VILLAGE OF KEY BISCAYNE, FLORIDA GENERAL GOVERNMENT REVENUES BY SOURCE FISCAL PROPERTY FEES AND INTERGOVERN- UTILITY FRANCHISE YEAR TAXES (1) LICENSES MENTAL (2) TAXES FEES OTHER INTEREST TOTAL 1992 $ - $ 15,766 $ 934,018 $ 979,236 $151,392 $ 23,276 $ 4,480 $2,018,168 1993 3,536,480 1,458,733(4) 2,486,979(3) 1,212,084 625,815 169,429 121,676 9,610,196 The Village imposed property taxes for the first time for the 1992-93 fiscal year. Includes FEMA. Includes FEMA, Hurricane Recovery and Economic Development Grants. Includes building permit fees and impact fees. Note: General Fund Only VILLAGE OF KEY BISCAYNE, FLORIDA ASSESSED AND ESTIMATED ACTUAL VALUE OF ALL TAXABLE PROPERTY NET ASSESSED FISCAL REAL PERSONAL PROPERTY YEAR PROPERTY PROPERTY VALUE 1992-1993 $1,601,826,518 $15,314,570 $1,617,141,088 1993-1994 1,543,711,468 16,345,662 1,560,052,130 VILLAGE OF KEY BISCAYNE, FLORIDA PROPERTY VALUES, CONSTRUCTION AND BANK DEPOSITS TOTAL RESIDENTIAL COMMERCIAL FISCAL YEAR PERMITS ISSUED NUMBER OF UNITS VALUATION PERMITS ISSUED VALUATION TOTAL OF CONSTRUCTION BANK DEPOSITS (1) (000s OMITTED) 1992(2)35 25 S 638,483 10 S 401,058 $ 1,039,541 $20,282,998 1993 1,737 1,633 26,822,424 104 4,383,673 31,206,097 18,146,647 SOURCE:(1) Federal Reserve Bank Atlanta, GA. Information is for Metropolitan Dade County, which the Village of Key Biscayne is a part of. Information is not available for the Village of Key Biscayne alone. (2) Village began issuing permits on September 1, 1992. In VILLAGE OF KEY BISCAYNE, FLORIDA UTILITIES SERVICE TAX REVENUE BY SOURCE FISCAL YEAR ELECTRICITY TELECOMMUNICATIONS GAS FUEL OIL WATER TOTAL 1992 5676,919 5157,887 $35,552 53,048 (105,830 S 979,736 1993 857,002 199,308 24,184 4,708 126,882 1,212,084 Note: All Utility tax revenues are recorded in the General Fund. VILLAGE OF KEY BISCAYNE, FLORIDA FRANCHISE REVENUE BY SOURCE FISCAL CABLE YEAR ELECTRICITY TELEVISION TELEPHONE TOTAL 1992 $112,658 $38,734 $ - $151,392 1993 570,605 39,821 15,389 (1) 625,815 Note: All franchise fee revenues are included in the General Fund. (1) The franchise agreement with Southern Bell was effective October 1, 1992. VILLAGE OF KEY BISCAYNE, FLORIDA INTEREST REVENUE BY SOURCE FISCAL YEAR- GENERAL FUND TOTAL 1992 $ 4,480 $ 4,480 1993 121,676 121,676 VILLAGE OF KEY BISCAYNE, FLORIDA PRINCIPAL TAXPAYERS SEPTEMBER 30, 1993 TAXPAYER TAXABLE VALUATION PERCENTAGE OF TOTAL ASSESSED VALUATION KEY BISCAYNE HOTEL AND VILLAS $40,579,026 2.60% ROYAL BISCAYNE (SHERATON)37,388,651 2.40 BISCAYNE BEACH HOTEL ASSN. (SONESTA)32,199,108 2.06 FINIVEST INVESTMENT, ET AL (KEY COLONY)10,072,543 0.65 KEY BISCAYNE SHOPPING CENTER 5,689,659 0.36 RED DRAGON'S SANDS (301 OCEAN DRIVE)5,405,294 0.35 FERNWAY BUILDERS, INC. (GALLERIA MALL)5,198,970 0.33 PYRAMID DEVELOPMENT (SO. OCEAN LANE DRIVE)4,970,400 0.32 PICPAN, INC.4,936,397 0.32 C. G. REBOZO (2 HARBOR POINT)4,088,616 0.26 TOTAL $150,528,664 2.65% SOURCE: Dade County Property Appraisers Office VILLAGE OF KEY BISCAYNE, FLORIDA DEMOGRAPHIC STATISTICS POPULATION Estimates of Population by Age UNDER 18 YEARS 18 TO 64 YEARS 65 YEARS OR OLDER NUMBER PERCENT NUMBER PERCENT NUMBER PERCENT TOTAL 1990 1,646 19 5,684 64 1,524 17 8,854 Estimates of Population by Race ANGLO BLACK HISPANIC TOTAL 1990 5,028 36 3,790 INCOME * Per Capita Income ANGLO BLACK HISPANIC 8,854 AVERAGE PER CAPITA 1990 $44,615 $24,577 $28,341 $37,629 UNEMPLOYMENT RATES**(Percent) 1983 1984 1984 1986 1987 1988 1989 1990 1991 1992 1993 Dade County 9.8 7.8 7.5 6.7 5.8 5.3 6.3 7.0 8.8 10.0 7.7 Village of Key Biscayne - - - - - - - - - 3.8 3.6 * SOURCE: Bureau of Census, Income Division **SOURCE: State Department of Labor VILLAGE OF KEY BISCAYNE, FLORIDA MISCELLANEOUS STATISTICAL DATA SEPTEMBER 30, 1993 Date of Incorporation Form of Government Area Miles of Streets Fire Protection: Number of Stations Police Protection: Number of Stations Education: 1991 Council-Manager 1.2 Square Miles 20.2 Linear Miles 1 1 Elementary Attendance Centers Number of Students Number of Teachers Dade County Water & Sewer Authority Number of Customers Average Daily Consumption Sewers: Number of Customers Fire Hydrants Building Permits Issued Recreation and Culture: Number of Parks Number of Libraries Number of Tennis Centers Number of Recreational Centers Employees: Full Time 1 417 31 1,740 2,500,000 gallons 807 122 1,737 1 1 (Operated by Dade County) 1 1 70 Supplementary Auditor's Reports Section RACHLIN & COHEN CERTIFIED PUBLIC ACCOU\T4\TS & COMULTANTS A PARTNERSHIP OF PROFESSIONAL ASSOCIATIONS 1320 SOI TH DIXIE HIGHN A) PE\THOUSE CORAL GABLES, FLORIDA 33146-2964 TELEPHONES DADE (305) 667-0412 BRON ARD (305) 764-7717 FAx•(305)665-7456 700 SOI THEAST THIRD A~ Em F SUITE 400 F7 Lk(DERDALE, FLORIDA 33316-1102 TE LEPHONES' BRON ARD(305) 764-7717 DADE (305) 667-0412 FAX- (305) 764-7835 Independent Auditor's Report on Internal Control Structure in Accordance With Government Auditing Standards To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida We have audited the general purpose financial statements of the Village of Key Biscayne, Florida as of and for the year ended September 30, 1993, and have issued our report thereon dated December 2, 1993. We conducted our audit in accordance with generally accepted auditing standards and 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 general purpose financial statements are free of material misstatement. In planning and performing our audit of the general purpose financial statements of the Village of Key Biscayne, Florida for the year ended September 30, 1993, we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control structure. The management of the Village of Key Biscayne, Florida is responsible for establish- ing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures in the following categories: -45- \i-RI R OI SI AIAII I f\ 1 F RA> I u7AAI Awx IN FS IV( \AI I H 01 FI( FS 1A PRIA( HIM CI IIF, I HROI GIi()[I I HI A\ORI D To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida Page Two • General Ledger • Cash Receipts and Disbursements • Accounts Payable and Related Expenditures • Fixed Assets • Revenues and Receivables • Budget • Payroll and Personnel For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and we assessed control risks. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the financial statements. Accounting Software Due to the fundamental differences between governmental fund and non-governmental accounting, we strongly recommend that governmental software be utilized to process, record and summarize the transactions of the individual funds. Due to the expansion of the Village, the current accounting software will not properly serve the needs of the Village. We are available to assist you in acquiring an appropriate software package. A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe none of the reportable conditions described above is a material weakness. This report is intended for the information of management, the Mayor and Village Council. This restriction is not intended to limit the distribution of this report, which is a matter of public record. Coral Gables, Florida December 2, 1993 RACHLIN & COHEN CERTIFIED PUBLIC ACCOL'\TA\TS & CO\ST LTA\TS A PARTNERSHIP OF PROFESS10\41 ASSOCIATIONS 1320 SOT TH DIXIE HIGHN Al PF\THOUSE CORAL GABLES, FLORIDA 33146-2964 TELEPHOAES DADE (305) 667-0412 BROAAARD (305) 764-7717 FAx (305) 665-7456 700 SOT THEAST THIRD A\ F\T F STITF 400 F 7 LAT DFRDALE, FLORIDA 33316-1102 TF,LEPHO\ES. BRO\AARD (305) 764-7717 DADE (305) 667-0412 FAx:(305)764-7835 Independent Auditor's Report on Compliance in Accordance With Government Auditin¢ Standards To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida We have audited the general purpose financial statements of the Village of Key Biscayne, Florida as of and for the year ended September 30, 1993, and have issued our report thereon dated December 2, 1993. We conducted our audit in accordance with generally accepted auditing standards and 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 general purpose financial statements are free of material misstatement. Compliance with laws, regulations, contracts and grants applicable to the Village of Key Biscayne, Florida is the responsibility of the management of the Village of Key Biscayne. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we performed tests of the Village of Key Biscayne, Florida compliance with certain provisions of laws, regulations, contracts and grants. However, our objective was not to provide an opinion on overall compliance with such provisions. The results of our tests indicate that, with respect to the items tested, the Village of Key Biscayne, Florida complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Village of Key Biscayne, Florida had not complied, in all material respects, with those provisions. In connection with our audit of the general purpose financial statements of the Village of Key Biscayne, Florida for the year ended September 30, 1993, we report the following in accordance with Chapter 10.550, Rules of the Auditor General, Local Governmental Entity Audits which requires that this report specifically address, but not be limited to, the matters outlined in Rule 10.554(1)(f): 1. No irregularities were reported in the preceding annual financial report. 2. Recommendations made in the preceding annual financial audit have been followed expect for the matter relating to accounting software, as reported in the report on the internal control structure. 3. The Village, during fiscal year 1993, was not in a state of financial emergency as defined by Florida Statutes, Section 218.503(1). 4. Recommendations to improve the local governmental entity's present financial management, accounting procedures, and internal accounting controls have been addressed in the report on the internal control structure. \IFMKkOf SIA1AIII fVIFR\NI OAA1 -WXIATFS IV( \111HOFFK F~IAPRIVIFU CI11T` THRO1(,HOT I IHFNN ORID To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida Page Two 5. During the course of our audit, nothing came to our attention that caused us to believe that the Village of Key Biscayne, Florida: a. Was in violation of any laws, rules or regulations. b. Made any illegal or improper expenditures. c. Had improper or inadequate accounting procedures except as addressed in the report on the internal control structure. d. Failed to record financial transactions which could have a material effect on the Village's general purpose financial statements. e. Had other inaccuracies, irregularities, shortages and defalcations. Our audit was not directed primarily toward obtaining knowledge toward all possible improprieties and, accordingly, our study was limited as described in the second paragraph of this report. 6. The annual financial report for the year ended September 30, 1992 filed with the Department of Banking and Finance pursuant to Section 218.32 Florida Statutes was in agreement with the annual financial audit report for the same period. The annual financial report for the year ended September 30, 1993 was not yet filed with the Department of Banking and Finance as of the date of our report. This report is intended solely for use of management and the Auditor General of the State of Florida and should not be used for any other purpose. This restriction is not intended to limit the distribution of this report which, upon acceptance by the Council of the Village of Key Biscayne, Florida, is a matter of public record. A,Q, , 6,6, Coral Gables, Florida December 2, 1993 RACHLIN & COHEN CERTIFIED P I'BL]c Accot-\TA\TS & CO\SI LTA\TS A PART\ERSHIP OF PROFESSIO\AL ASSOCIATIONS 1320 SOl TH DIXIE HIGHA~ Al PF\THOISE CORAL GABLFs, FLORIDA 33146-2964 TELEPHO\Es DADE (305) 667-0412 BRON ARD (305) 764-7717 F" (305) 665-7456 700 So l FHEAST THIRD A\ F \E F S t ITE 400 FT. LAl DERDALE, FLORIDA 33316-1102 TFLEPHO\ES B RO\1 ARD (305) 764-7717 DAM (305) 667-0412 FAX (305) 764-7835 Independent Auditor's Report on Schedule of Federal Financial Assistance To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida We have audited the general purpose financial statements of the Village of Key Biscayne, Florida as of and for the year ended September 30, 1993, and have issued our report thereon dated December 2, 1993. These general purpose financial statements are the responsibility of the Village of Key Biscayne, Florida's management. Our responsibility is to express an opinion of these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards and 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 general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose 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 oui audit provides a reasonable basis for our opinion. Our audit was made for the purpose of forming an opinion on the general purpose financial statements of The Village of Key Biscayne, Florida taken as a whole. The accompanying Schedule of Federal Financial Assistance is presented for purposes of additional analysis and is not a required part of the general purpose financial statements. The information in that schedule has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. /?., ~- , 6 z , Coral Gables, Florida December 2, 1993 -49- X11 AIHFRiPr 51AI AIil 1VIFR\410AgI Ab,o(mFS IV( \MHOFFKFS1APRIM IMI (IIIFS IHROIC,HOI I [HE\~ORID VILLAGE OF KEY BISCAYNE, FLORIDA SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE FISCAL YEAR ENDED SEPTEMBER 30, 1993 Federal Grantor/ Pass-through Grantor/Program Title Federal CFDA Number Expenditure Federal Emergency Management Agency Department of Commerce, Economic 83.516 $1,165,864 Development Grant 11.305 50,000 Total Federal Assistance Expended State Program S1.215.864 Hurricane Andrew Recovery and Rebuilding Trust Fund (94-EO-2F-11-23-02-025-026)N/A S 191.725 RACHLIN & COHEN CERTIFIED PUBLIC Accou\TA\TS & COW LTAITS 4 PART ER%HIP OF PROF ESSIO\AL Assoc Ii I10\S 1320 SOL TH DIME HFGHR AI PE\IHOLSL CORAL GABLLS, FLORIDA 33146-2964 TELEPHONES DADE (305) 667-0412 BRM ARD (305) 764-7717 FAa (305)665-7456 700 Sot THEAS I THIRD Al F m f SL ITF 400 F! LAI DERDALE, FLORIDA 33316-1102 TELEPHO\FS BROPI ARD (305) 764-7717 DADE (305) 667-0412 Fk% (305) 764-7835 Independent Auditor's Report on the Internal Control Structure Used in Administering Federal Finance Assistance Programs To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida We have audited the general purpose financial statements of the Village of Key Biscayne, Florida as of and for the year ended September 30, 1993, and have issued our report thereon dated December 2, 1993. We have also audited the compliance of the Village of Key Biscayne, with requirements applicable to major federal financial assistance programs and have issued our report thereon dated December 2, 1993. We conducted our audits in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller Central of the United States; and Office of Management and Budget Circular A-128, Audits of State and Local Governments. Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether the Village of Key Biscayne, Florida complied with laws and regulations, noncompliance with which would be material to a major federal financial assistance program. In planning and performing our audit for the year ended September 30, 1993, we considered the internal control structure of the Village of Key Biscayne, Florida in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements of the Village of Key Biscayne, Florida and on the compliance of the Village of Key Biscayne, Florida with requirements applicable to major programs and to report on the internal control structure in accordance with OMB Circular A-128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated December 2, 1993. The management of the Village of Key Biscayne, Florida is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments made by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles, and that federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances -51- ~IIAIBF RnF5lVNII11VIFRV1110\4I~S(X IVF S, IV AIIIII OF I`KFSIAPRIA(I PA! (I I IF S 1HR01(,HOt I IM ~i ORID To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida Page Two of non compliance may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering federal financial assistance programs in the following categories: Accounting Applications • Cash • Revenues and Receivable • Accounts Payable and Related Expenditures • General Ledger • Payroll General Requirements • Political Activity • Davis-Bacon Act • Civil Rights • Cash Management • Drug-Fee Workplace • Federal Financial Reports Allowable Costs/Cost Principles Specific Requirements • Types of Services • Eligibility • Reporting • Claims for Reimbursement For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been place in operation, and we assessed control risk. During the year ended September 30, 1993, the Village of Key Biscayne, Florida expended one hundred percent of its total federal financial assistance under major federal financial assistance programs. We performed tests of controls, as required by OMB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with specific requirements, general requirements, and requirements governing claims for advances and reimbursements and amounts claimed or used for matching that are applicable to each of the Village of Key Biscayne, Florida's To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida Page Three major federal financial assistance programs, which are identified in the accompanying Schedule of Federal Financial Assistance. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our ,judgment, could adversely affect the Village of Key Biscayne, Florida's ability to administer federal financial assistance programs in accordance with applicable laws and regulations. Accounting Software Due to the fundamental differences between governmental fund and non- governmental accounting, we recommend that governmental software be utilized to process, record and summarize the transactions of the individual funds. Due to the expansion of the Village, the current accounting software will not properly serve the needs of the Village. At your request, we are available to recommend a governmental software package. A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material to a federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Our consideration of the internal control structure policies and procedures used in administering federal financial assistance would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, we believe that the reportable condition described above is not a material weaknesses. This report is intended for the information of management, the Mayor and Village Council. However, this report is a matter of public record and its distribution is not limited. Coral Gables, Florida December 2, 1993 RACHLIN & COHEN 1320 Sot TH D mF Hl(,HN AI P E\FHOLSF CORAL GABLEs, FLORIDA 33146-2964 TELEPHONES DADF (305) 667-0412 BROtiARD (305) 764-7717 FAa (305) 665-7456 CERTIFIED Pt BLIC Accot \T4\TS & CO\SL LTV TS A PARFvLRSHIV OF PROIEeSIOAAL ASSO, IATIOvS Independent Auditor's Report on Compliance with General Requirements 700 SOt IHFASi THIRD A\ F\1 F StItF400 FI LMDERDALF F LORIDA33316-1102 FFLFPHO\Fs: BRO\\ARD (305) 764-7717 DARE (305) 667-0412 FA-v (305) 764-7835 To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida We have audited the general purpose financial statements of the Village of Key Biscayne as of and for the year ended September 30, 1993, and have issued our report thereon dated December 2, 1993. We have applied procedures to test the Village of Key Biscayne Florida's compliance with the following requirements applicable to its federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended September 30, 1993. The general requirements tested were Political Activity, Davis-Bacon Act, Civil Rights, Cash Management, Federal Financial Reports, Allowable Costs/Cost Principles and Drug-Free Workplace. Our procedures were limited to the applicable procedures described in the Office of Management and Budget's Compliance Supplement for Single Audits of State and Local Government. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on The Village of Key Biscayne, Florida's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the Village of Key Biscayne, Florida had not complied, in all material respects, with those requirements. This report is intended for the information of management, the Mayor and Village Council. However, this report is a matter of public record and its distribution is not limited. 4L,c,~i,(u,. . -oz, Coral Gables, Florida December 2, 1993 -54- \1r vlRr u of SI \1\11 1 M i Rv mmAI AwX 1\11S ICI w m OFI 1( 1b Jv PRly( I'm (I I IF, I [mot (,HUI I i m A\ oRI D RACHLIN & COHEN CERTIFIED PUBLIC Acc oL \TA\TS & CO\SULTA\TS A PARTNERSHIP OF PROFESSIONAL ASSOC IATIONS 1320 S OL TH DIXIE H IGHU Al 700 SO L THEASi THIRD A\ EVl F P EvTHOESE SL IFE400 CORAL G ABLES, FLORIDA 33146-2964 F -T LAI DERDALE, FI ORIDA 33316-1102 TELEPHO\ES DADE (305) 667-0412 T FLEPHO\ES B RO\N ARD (305) 764-7717 BROI ARD (305) 764-7717 DADE (305) 667-0412 FAA (305) 665-7456 Independent Auditor's Report on Compliance With FA.\ (305) 764-7835 Specific Requirements Applicable to Major Federal Financial Assistance Program To the Honorable Mayor, Village Council and Village Manager Village of Key Biscayne, Florida We have audited the general purpose financial statements of the Village of Key Biscayne, Florida, as of and for the year ended September 30, 1993, and have issued our report thereon dated December 2, 1993. We have also audited the Village of Key Biscayne, Florida's compliance with the requirements governing types of services allowed or unallowed, eligibility, reporting and special tests and provisions and claims for reimbursement that are applicable to each of its major federal financial assistance programs, which are identified in the accompanying Schedule of Federal Financial Assistance, for the year ended September 30, 1993. The management of the Village of Key Biscayne, Florida, is responsible for the Village of Key Biscayne, Florida's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. We conducted our audit of compliance with those requirements in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-128, Audits of State and Local Governments. Those standards and OMB Circular A-128 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 Village of Key Biscayne, Florida's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the Village of Key Biscayne, Florida, complied, in all material respects, with the requirements governing types of services allowed or unallowed, eligibility, reporting and special tests and provisions and claims for reimbursement that are applicable to each of its major federal financial assistance programs for the year ended September 30, 1993. This report is intended for the information of management, the Mayor and Village Council. However, this report is a matter of public record and its distribution is not limited. Coral Gables, Florida December 2, 1993 -55- %1EVBERUFSt v1v1111vIFRvgIi0vV ANyxIgIE5,1v( \Mli0111(FSIvPRIM IPAIC111FNTHROI(,IiolI IHF\~ORID