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2018-2019 Issued financial statements - Moab City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overnment Auditing Standards  ,QGHSHQGHQW$XGLWRU V5HSRUWRQ&RPSOLDQFHDQG5HSRUW RQ,QWHUQDO&RQWURORYHU&RPSOLDQFHDV5HTXLUHGE\ WKHState Compliance Audit Guide  0RDE&LW\&RUSRUDWLRQ 7$%/(2)&217(176 -XQH 1 INDEPENDENT AUDITOR’S REPORT Honorable Mayor Members of the City Council Moab, Utah We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of Moab City, Utah (herein referred to as the “City”), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America 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 from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of Moab City, as of June 30, 2019, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. 2 Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and other required supplementary information as listed in the table of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise Moab City’s basic financial statements. The combining and individual nonmajor fund financial statements as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual nonmajor fund financial statements are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial are fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued a report dated November 12, 2019 on our consideration of Moab City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Moab City’s internal control over financial reporting and compliance. 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)XQGEDODQFHVEHJLQQLQJRI\HDU     )XQGEDODQFHHQGRI\HDU     0RDE&LW\&RUSRUDWLRQ &20%,1,1*67$7(0(172)5(9(18(6(;3(1',785(6$1' 1210$-25*29(510(17$/)81'6 &+$1*(6,1)81'%$/$1&(6 )RUWKH<HDU(QGHG-XQH 54 55 INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS The Honorable Mayor, and Members of the City Council Moab City, Utah We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of Moab City, Utah (herein referred to as the “City”), as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements and have issued our report thereon dated November 12, 2019. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards . 56 Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Larson & Company, PC Spanish Fork, Utah November 12, 2019 57 INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER COMPLIANCE AS REQUIRED BY THE STATE COMPLIANCE AUDIT GUIDE The Honorable Mayor, and Members of the City Council Moab City, Utah Report on Compliance with General State Compliance Requirements We have audited Moab City’s (herein referred to as the “City”) compliance with the applicable general state compliance requirements described in the State Compliance Audit Guide,issued by the Office of the Utah State Auditor, that could have a direct and material effect on the City for the year ended June 30, 2019. General state compliance requirements were tested for the year ended June 30, 2019 in the following areas: Budgetary Compliance Public Tresurer’sBond Fund Balance Cash Management Utah Retirement Systems Enterprise Fund Transfers, Reimbursements, Restricted Taxes and Related Revenues Loans, and Services Open and Public Meetings Act Impact Fees Management’s Responsibility Management is responsible for compliance with the general state requirements referred to above. Auditor’s Responsibility Our responsibility is to express an opinion on the City’s compliance based on our audit of the compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States; and the State Compliance Audit Guide. Those standards and the State Compliance Audit Guide require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the compliance requirements referred to above that could have a direct and material effect on the City occurred. An audit includes examining, on a test basis, evidence about the City’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance with general state compliance requirements. However, our audit does not provide a legal determination of the City’s compliance. Opinion on General State Compliance Requirements In our opinion, Moab City, complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on the City for the year ended June 30, 2019. 58 Other Matters The results of our auditing procedures disclosed instances of noncompliance, which are required to be reported in accordance with the State Compliance Audit Guide and which are described in our letter to management dated November 12, 2019.Our opinion is on compliance is not modified with respect to these matters. The City’s response to the noncompliance findings identified in our audit is described in our letter to management. The City’s response was not subjected to the auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response. Report on Internal Control Over Compliance Management of the City is responsible for establishing and maintaining effective internal control over compliance with the compliance requirements referred to above. In planning and performing our audit of compliance, we considered the City’s internal control over compliance with the compliance requirements that could have a direct and material effect on the City to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance with general state compliance requirements and to test and report on internal control over compliance in accordance with the State Compliance Audit Guide, but not for the purpose of expressing an opinion on the effectiveness of the internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a general state compliance requirement on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a general state compliance requirement will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a general state compliance requirement that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control and compliance and the results of that testing based on the requirements of the State Compliance Audit Guide. Accordingly, this report is not suitable for any other purpose. Larson & Company, PC Spanish Fork, Utah November 12, 2019