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Home My WebLink About1986 Audit Report CITY OF ST. JOSEPH, MINNESOTA TABLE OF CONTENTS December 31, 1986 Reference Page I. INTRODUCTORY SECTION City Officials 1 II. FINANCIAL SECTION A. General Purpose Financial Statements Auditor's Report 2 Combined Balance Sheet-All Fund Types and Account Groups Exhibit 1 3 Combined Statement of Revenues, Expenditures, and Changes In Fund Balance-All Government Fund Types Exhibit 2 4 Combined Statement of Revenue, Expenditures, and Changes in Fund Balance-Budget and Actual- General and Special Revenue Fund Types Exhibit 3 5 Statement of Revenues, Expenses, and Changes in Retained Earnings-Proprietary Fund Type Exhibit 4 6 Statement of Changes in Financial Position- Proprietary Fund Type Exhibit 5 7 Notes to the Financial Statements 8 B. Combining and Individual Fund and Account Group Statements and Schedules General Fund - Balance Sheet Exhibit A-l 20 Statement of Revenues, Expenditures and Changes in Fund Balances-Budgeted and Actual Exhibit A-2 21 Schedule of Revenues-Budgeted and Actual Exhibit A-3 22 Schedule of Expenditures-Budgeted and Actual Exhibit A-4 23 Special Revenue Funds - Balance Sheet Exhibit B-1 26 Statement of Revenues, Expenditures, and Changes in Fund Balance Exhibit B-2 27 Statement of Revenues, Expenditures, and Changes in Fund Balances-Budgeted and Actual Exhibit B-3 28 Capital Projects Funds - Combining Balance Sheet Exhibit C-l 29 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Exhibit C-2 30 Debt Service Funds - Combining Balance Sheet Exhibit D-l 31 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Exhibit D-2 32 Enterprise Funds - Combining Balance Sheet Exhibit E-l 33 Combining Statement of Revenues, Expenses, and Changes in Retained Earnings Exhibit E-2 34 Combining Statement of Changes in Financial Position Exhibit E-3 35 Schedule of Changes in Fixed Assets Exhib it E-4 37 General Fixed Asset Group of Accounts - Statement of General Fixed Assets by Fund Exhibit F-l 38 CITY OF ST. JOSEPH, MINNESOTA TABLE OF CONTENTS December 31, 1986 (Continued) Reference Page General Long-Term Debt Group of Accounts - Statement of General Long-Term Debt Exhibit G-l 39 Combined Schedule of Indebtedness Exhibit G-2 40 III. SINGLE AUDIT ACT REPORTS Audito:r's Report on Supplementary Information Schedule of Federal Financial Assistance 41 Schedule of Federal Grant Activity 42 Audito:r's Report on Compliance With State and Federal Laws 43 Audito:r's Report on Compliance With Laws and Regulations- Federal Programs 44 Audito:c's Report on Internal Accounting Control 46 Audito:c's Report on Internal Controls - Federal Programs 48 CITY OF ST. JOSEPH, MINNESOTA CITY OFFICIALS For the Year Ended December 31, 1986 ELECTED OFFICIALS TERM OF OFFICE TERM EXPIRES Mayor Michael Loso Two Years 12-31-86 Councilman Steven Dehler Four Years 12-31-86 Councilman Donald Reber Four Years 12-31-86 Councilman Ross Rieke Four Years 12-31-88 Councilman Leo Sadlo Four Years 12-31-88 OFFICIALS NOT ELECTED City Clerk/Administrator Rachel Stapleton City Treasurer David Weyrens -1- CERTIFIED PUBLIC ACCOUNTANT ~r1iu )~ 1InttJ!uu¡uu (THE CONVENT) WATKINS, MINNESOTA 55389 TEL. (612) 764-5822 To the Honorable City Mayor and Members of the City Council City of St. Joseph St. Joseph, Minnesota 56374 I have examined the combined financial statements of the City of St. Joseph, St. Joseph, Minnesota for the year ended December 31, 1986, as listed in Section II-A of the Table of Contents. My examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing pro- cedures as I considered necessary in the circumstances. In my opinion, the combined financial statements referred to above present fairly the financial position of the City of St. Joseph, Minnesota at December 31, 1986, and the results of its operations and the changes in financial position of its proprietary fund type for the year then ended, in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year. My examination was made for the purpose of forming an opinion on the com- bined financial statements taken as a whole. The combining individual fund, and account group financial statements and schedules listed in Sec- tion II-B of the Table of Contents are presented for purposes of additional analysis and are not a required part of the combined financial statements of the City of St. Joseph, Minnesota. The information has been subjected to the auditing procedures applied in the examination of the combined financial statements and, in my opinion, is fairly stated in all material respects in relation to the combined financial statements taken as a whole. Watkins, Minnesota ~~J~~# ~ June 24, 1987 MARLIN J. 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'-J '-J '-J N ~ \0 W 00 00 00 00 ~ 0 ~ 00 00 0 ~ I-' a I-' I" ........ .. .. .... .. .. .. I.... .. .. .. \oil .. .. .. .. .. .. .. .. .. .. .. .. \II .. '" .. .. .. .. rt \.0 t:::r t.....:::: II~ W W 0 \0 0 00 N'¡:'" 0 N \J1 II~ I-' \J1 I-' I-' '-J \J1 I-' I-' \0 \0 00 .¡:,.. \0 I-' \0 \0 00 00 00 I-' \0 0 0 00 ro 00 ro '-' 110 \J1 \J1 '-J \0 W 00 .¡:,.. \J1 0 0 \0 110 \0 ~ \J1 \J1 W 00 N \J1 0 0 '-J \J1 00 00 \0 \0 0 0 ~ I-' N .¡:,.. 0 \0 p.. \J1 ~ IIw .¡:,.. \0 00 \0 I-' \J1 \0 0 0 0 \0 IIW'¡:'" I-' \J1 ~ 0 .¡:,.. \0 \J1 \0 \0 \0 0 I-' I-' 00 00 00 00 ~ 00 W \J1 0 N '-' '-" '-' '-' '-' .......... '-' ......... EXHIBIT 2 CITY OF ST. JOSEPH, MINNESOTA COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE ALL GOVERNMENT FUND TYPES For the Year Ended December 31, 1986 Total Governmental Fund Types (Memorandum Only) Special Capi tal Debt December December General Revenue Projects Service 31, 1986 31, 1985 REVENUES: (Restated) Taxes $ 118,577 $ $ $ $ 118 ,577 $ 110,223 Licenses & Permits 17 , 746 17,746 18,665 Intergovernmental Revenue: Federal 19,123 300,534 319,657 41,397 State 329,028 329,028 301,165 Charges for Services 80,314 80,314 58,492 Fines & Forfeits 25,087 25,087 21,361 Assessments 8,561 233,078 241,639 36,565 Bond Proceeds 1,375,640 1,375,640 Other & Interest 30, 718 5,272 24,033 103,823 163,846 152,220 TOTAL REVENUES $ 610,031 $ 24,395 $1,700,207 $ 336,901 $2 ,671 ,534 $ 740,088 OTHER SOURCES: Transfers from Other Funds $ $ $ 5,897 $ 325,677 $ 331,574 $ 65,404 TOTAL REVENUES & OTHER SOURCES $ 610,031 $ 24,395 $1,706,104 $ 662,578 $3,003,108 $ 805,492 EXPENDITURES: General Government $ 134,401 $ $ $ $ 134,401 $ 111 ,969 Public Safety 188,666 188,666 163,716 Streets & Highways 119,560 119 , 560 271,285 Recreation 19,412 19,412 28,302 Capital Outlay - Equipment 30,640 30,640 625 Other 848,980 848,980 88 , 711 Other & Interest 4,436 8,176 160,390 173,002 66 , 110 TOTAL EXPENDITURES '$ 466,475 $ 38,816 $ 848,980 $ 160,390 $1,514,661 $ 730,718 OTHER USES: Transfers to Other Funds $ 19, 777 $ $ 325,677 $ 8,425 $ 353,879 $ 81,211 TOTAL EXPENDITURES & OTHER USES $ 486,252 $ 38,816 $1,174,657 $ 168,815 $1,868,540 $ 811 ,929 NET INCREASE (DECREASE) IN FUND BALANCE DURING THE YEAR $ 123,779 $ (14,421) $ 531,447 $ 493,763 $1,134,568 $ (6,437) FUND EQUITY TRANSFER IN (OUT) NOTE 10 194,597 (4,345) (190,252) FUND BALANCE, Jan. 1 (RESTATED) NOTE 8 497,967 147,770 (49,476) 743,176 1,339,437 1,345,874 FUND BALANCE, December 31 $ 816 343 $ 133 349 $ 477 626 ~l,1,2~~4,~~Z ~~J..~Z~J..ºº~ ~l,1,~~24,~~Z =====4,=== =====4,=== ======4,=== The notes to the financial statements are an integral part of this-~~~~~~~~~. -4- , EXHIBIT 4 CITY OF ST. JOSEPH, MINNESOTA STATEMENT OF REVENUES, EXPENSES, & CHANGES IN RETAINED EARNINGS PROPRIETARY FUND TYPES For the Year Ended December 31, 1986 1986 1985 OPERATING REVENUE: Water $ 56,728 $ 47, 001 Plant Operation and Maintenance 63,967 53,060 Sanitation 25,002 23,481 TOTAL $145,697 $123,542 OPERATING EXPENSES: Water $ 66, 787 $ 51,422 Plant Operation and Maintenance 57,951 46,961 Sanitation 44,349 38, 713 TOTAL $169,087 $13 7 , 096 OPERATING INCOME (LOSS) $(23,390) $(13,554) OTHER INCOME (EXPENSES): Transfers from Other Funds $ 22,304 $ 15,847 Interest Income 4,470 4,262 TOTAL OTHER INCOME $ 26,774 $ 20,109 NET INCOME (LOSS) $ 3,384 $ 6,555 RETAINED EARNINGS, (DEFICIT) January 1 (83,999) (90,554) RETAINED EARNINGS, (DEFICIT) December 31 $(80,615) $(83,999) -------- ======== -------- The notes to the financial statements are an integral part of this statement. -6- EXHIBIT 5 CITY OF ST. JOSEPH, MINNESOTA STATEMENT OF CHANGES IN FINANCIAL POSITION- PROPRIETARY FUND TYPE For the Year Ended December 31, 1986 1986 1985 RESOURCES PROVIDED: Operations: Net Income $ 3,384 $ 6,555 Add (deduct) Items Not Affecting Working Capital: Depreciation 16,765 16,986 Loss on Disposal of Equipment 393 658 Total Funds Provided by Operations $ 20,542 $ 24,199 OTHER SOURCES OF FINANCIAL RESOURCES: Contribution by Other Funds 848,980 $ TOTAL RESOURCES PROVIDED BY ALL SOURCES $869,522 $ 24,199 RESOURCES APPLIED: Operations: Net Income (Loss) for the Year $ $ Less: Items not requiring Current Outlay of Resources: Depreciation Equipment Disposal Total Resources Used By Operations $ 0 $ 0 OTHER USES OF FUNDS: Additions to Plant and Equipment 848,980 1,316 TOTAL RESOURCES USED $848,980 $ 1,316 INCREASE IN WORKING CAPITAL !=~Q~~~~ !=~~~~~~ REPRESENTED BY CHANGES IN: Current Assets - increase (decrease): Cash $ (33,990) $(7,295) Investments 27,000 15,000 Accounts Receivable 27,032 9,679 Interest Receivable (354 ) (16) Due From Other Funds 5,577 Due From Other Governmental Units 242 Total Current Assets $ 19,930 $ 22,945 Current Liabilities - increase (decrease): Accounts Payable $ 612 $ (62) Total Current Liabilities $ 612 $ (62) INCREASE (DECREASE) IN WORKING CAPITAL !=~Q~~~~ !=~~~§§~ The notes to the financial statements are an integral part of this statement. -7- CITY OF ST. JOSEPH, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 1986 Note 1 - Summary of Significant Accounting Policies The accounting policies of the City of St. Joseph conform to generally accepted accounting principles applicable to governmental units. The follow- ing is a summary of the significant accounting policies. A. Fund Accounting The accounts of the City are organized on the basis of funds and account group s , each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of se 1£ - balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures, or expense, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped, in the financial statements in this report into five generic fund types and two broad account group categories as described in the remainder of A and of F and H of this Note. 1. GOVERNMENTAL FUNDS: General Fund - The General Fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in ano th er fund. Special Revenue Funds - Special Revenue Funds are used to account for the proceeds of certain revenue sources that are legally restricted to expenditures for specified purposes. Capital Projects Funds - The Capital Projects Fund is us ed to account for financial resources to be used for the acquisition or construction of major capital facilities. Debt Service Funds - Debt Service Funds account for the accumulation of assets dedicated to future payment of existing long-term debt and the interest on that debt. PROPRIETARY FUNDS: Enterprise Funds - Enterprise Funds are used to account for operations that are financed and operated in a manner simi lar to private business enterprises where the intent is that the costs (expenses) of providing goods and services to the general public on a continuing basis be financed or recovered primarily through user charges. II. TYPES OF ACCOUNT GROUPS: Two different account groups are maintained. Account group c lass if i- cations are established to account for the city's general fixed assets -8- and general long-term indebtedness. The general fixed asset account group is comprised of the accounts maintained for the city's investment in land, bui ld ings , improvements other than buildings, machinery and equipment, office furniture, vehicles and other equipment. These assets are recorded in th i s account group at cost and not depreciated. The general long-term debt account group is comprised of th e ac coun ts maintained for outstanding bonds and loans payable. An account group is not a fund, but rather comprises a self-balancing group of accounts. B. Bases of Accounting The modified accrual basis of accounting is followed for the general, capital projects, debt service, and special revenue funds. Under this method of accounting, revenues are recognized when received in cash, except for material or available revenues which are accrued to reflect revenues earned and available to fund operations for that period. Expen- ditures, other than accrued interest on general long-term debt, are recorded at the time liabilities are incurred. The accrual basis of accounting is fo 11 owed in the proprietary funds. Under this method of accounting revenues are recognized when earned, and expenses are recorded as incurred. C. Budgetary Data Annual budgets approved by the City Council are adopted for the City. An object budget is used with emphasis on allocations of resources to given city units for specific revenues and expenditures. The budget is prepared on a basis consistent wi th the accounting utilized in each fund. Budgetary comparisons are included in the appropriate financial state- men ts in th is report. D. Cash and Temporary Investment Cash balances from all funds may be pooled and invested to the extent available in certificate of deposit or treasury bills. Earnings from such investments are allocated to the funds on the basis of applic- able cash balance participation by each of the fu nd s . E. Recognition of Property Taxes Property taxes are set by the City Council with the levy certified to the Comity, which acts as collection agent, in October prior to the year collectible. Such taxe s constitute a lien on the property on January 1 of the year collectible. The amount of uncollected property taxes for the City are immaterial. The delinquent amounts are collectible, so all delinquents are accrued at the end of each ye ar . -9- F. General Fixed Assets Group of Accounts General fixed asset purchases are recorded as expenditures in the various funds at the time of purchase. Such assets of $250 and over are capitalized at cost, or at appraisal if cost is not available, in the General Fixed Asset Group of Accounts. No depreciation is provided on these assets. Public domain assets are not capitalized. G. Enterprise Funds Fixed Assets and Depreciation Enterprise Funds fixed assets, including public domain type fixed assets, of $250 and over are capitalized. The assets, other than land, are de- preciated on a straight-line basis over lives of 5 to 50 years. H. General Long-Term Debt Group of Accounts General Long-Term Debt consists primarily of bonds payable incurred to pay for construction on special assessment projects. Though the bonds are the primary obligation of the benefitted assessees, the city's full faith and credit are committed in case of their default, so the bonds are recorded in the city's General Long-Term Debt Group of Accounts. I. Vacation and Sick Pay The City does not accrue for vacation and sick pay. The amount of the accrual would not be material. J. Total Columns and Combined Statements Total columns on the combined statements are captioned Memorandum Only to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in financial position in conformity with generally accepted accounting principles. Interfund eliminations have not been made in the aggregation of this data. K. Reporting Entity The Governmental Standards Board Statement #1 requires municipalities to apply certain criteria to determine whether related agencies should be included in the municipalities' financial statements. The City of St. Joseph has considered its oversight responsibilities to other agencies, financial interdependence with them, and the other criteria stipulated in Statement #1, and has concluded that no outside agencies' activity should be included in the city's financial statements. The city's con- clusions are consistent with the interpretations of the Minnesota Society of Certified Public Accountant's Technical Development Review Committee, as described on Pages 6 and 7 of its letter dated November 11, 1983. -10- L. Deferred Revenue Certain receivables are recognized, before they are currently due, at the time of levy. These receivables are offset by deferred revenue; deferred revenue is reduced as the amounts receivable become measurable and available. Note 2 - Retirement Plans The Volunteer Firemen's Fund is a pension plan financed by contributions from the State, City and St. Joseph and St. Wendell Townships. The City is obligated to contribute to the Fund according to a formula that compares the growth in the estimated pension liability to the annual estimated state aid and interest earnings of the pension fund. In 1985, the City accrued $9,463 for contributions to the fund. Early in 1984 the City Council passed an ordinance that approved the increase of the volunteer firemen's lump sum pension benefit from $8,000 to $12,000 for retirement after 20 years of service. The effect of this increase in benefits was to increase the deficit from full funding in the Firemen's retirement fund at 12-31-84 to $34,666 and the deficit has since been reduced to $31,793 at 12-31-84. All other City employees, with some minor exceptions such as students, must belong to the Public Employees Retirement Association (PERA). 1986 contributions to PERA were $13,627 by the city and $10,492 by the employees. Total 1986 salaries were $222,862, of which $191,292 were covered by PERA. The Public Employees Retirement Association is state-wide and an individual city's portion of unfunded reserves is not available because no city is directly liable for an unfunded liability under Minnesota Law. Note 3 - Reserved Funds The General Fund records as Reserved Funds money which has been received for three specific purposes, but which at year end has not yet been expended for those purposes. These activities are: Joint Operating Fire - The fund receives its revenue from the City of St. Joseph, St. Joseph Township, and St. Wendell Township and funds are used for operating expenses for those areas. Special Police - This fund's revenues come only from state aid and must be spent on policeman's retirement contributions (PERA). Street Maintenance - Street Maintenance records receipts and spending for activities closely related to the Highways Division of the General Fund. The expenditures are limited to street maintenance, improvements, and the machinery and equipment serving those purposes. In 1985 and 1986 the main expenditures were for blacktopping of Park Terrace streets and seal coating of streets. Revenues for this reserve fund are a special tax levy, contributions for snow removal, special assessments #19 and interest. -11- The December 31, 1986 reserved balances for each of the funds were: Joint Operating Fire $ 69,788 Special Police 1,682 Street Maintenance (52,855) Net Balance Reserved, per General Fund Balance Sheet $=è§~~è~ Note 4 - 1986 Improvement Construction Capital Projects Fund The City of St. Joseph has entered into an agreement with the City of St. Cloud to hook up with the latter's Sanitary Sewage Collection and Treatment Facility. Under this arrangement, the City of St. Joseph will discharge its sewage to the St. Cloud facility and pay a user fee for the sewage treatment. The St. Joseph facility will consist of pumping station, collector tank and lines. Last year the financial activity for this construction was recorded under "1985 Sewer" in the Special Assess- ment Funds, but now that Special Assessment Funds are being eliminated under generally accepted accounting principles, this activity has been moved to Capital Projects Funds. (See Note 8 to these statements.) Note 5 - Detailed Indebtedness Schedules Schedule A City of St. Joseph Schedule of Indebtedness - Bonds Payable December 31, 1986 Beginning Ending Bond New Retirement Bond Balance Bond of Balance Bonds Payable 1-01-86 Issues Bonds 12-31-86 1961 Sanitary Sewer $ 15,000 $ $ 15,000 $ 0 1965 Street Improvements 10,000 10,000 0 1972 Water & Sewer Improve- ment 55,000 10,000 45,000 1978 Improvement - East Side 145,000 15,000 130,000 1978-A Street Improvement 29,000 2,000 27,000 1983 Improvement 425,000 60,000 365,000 1986 Improvement Construct- ion 1,400,000 1,400,000 Total Bonds Payable *==~Z2~QQQ *è~~QQ~QQQ *==èè~~QQQ *è~2~Z~QQQ -12- - - - - - - - - - - - - - - - - - - - r-- r-- 0 5' H t::! ~ N I-' ~ :::J ~ '-' '-' I'"t ~ I'"t I'"t 0 H > () t-<:~ ro ro ~ ~ I-' I'"t ro ~ ~ :::J I'"t I-' ~ ~ I-' ro 0 I'"t ro :::J ~ () I-ti ~ p.. p.. 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II- -{ß. ~ 11\0 1-'1-'1-' I-' N'¡:'" n ~ II~ ~~~~\O\O\O\O\OOO\J1lJ1'-J\J1 · () 11\0 \J1\J1\J1\J1NNWNW'-JOONW'-JO II- .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 0 III-' 000000000000001-' I-ti 110 000000000000000 H 110 000000000000000 0 H H ~ 1K/7 -{ß. ~ 1100 1-'1-' rt CI) IIW I-'I-'NNW'¡:"''¡:'''lJ1~~'-J\OO~ ro 110 lJ10lJ10'-J'¡:"'I-''-J'¡:'''I-'\O\OO'-J~ ~ II- .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ro II~ OOOOI-'OO'-J'¡:"'\OW\Ow~OO () 1100 W'-JOOOON\O'¡:"''-JOW'¡:'''NI-'WO rt 110 "-I\J10\J100\OW\J10lJ1I-'\ONWoo Note 6 - Fund Deficiencies/Deficits Expenditures exceeded revenues in certain individual funds for the year ended December 31, 1986 as follows: Special Revenue Funds: Revenue Sharing . · · · · · · · · · · · · · · · · · · .$ 14,421 Debt Service Funds: 1983 Improvement. · · · · · · · · · · · · · · · · · · · 27,989 1972 Sewer · · · · · · · · · · · · · · · · · · · · · · 2,971 1965 Street · · · · · · · · · · · · · · · · · · · · · · 3,846 1961 Sewer · · · · · · · · · · · · · · · · · · · · · · 3,615 Enterprise Funds: Water . . . · · · · · · · · · · · · · · · · · · · · · · 5,148 No funds have deficit fund balances at December 31, 1986. Note 7 - Segment Information The City maintains three enterprise funds which provide water, sewer, and sanitation services. Segment information for the year ended December 31, 1986 is as follows: Plant Operation Total Sanitary Water and Enterprise Fund Fund Maintenance Funds Operating Revenue $ 25,002 $ 56,728 $ 63,967 $ 145,697 Operating Expenses 44,349 66,787 57,951 169,087 Operating Income (Loss) (19,347) (10,059) 6,016 (23,390) Other Income (Expenses) 19,777 4,911 2,086 26,774 Net Income (Loss) 430 (5,148) 8,102 3,384 Transfer from Other Funds 19,777 19,777 Fixed Assets: Additions 848,980 848,980 Deletions 393 393 Net Working Capital 4,945 54,413 79,870 139,228 Total Assets 8,584 318,468 1,258,244 1,585,296 Total Equity 4,945 315,936 1,253,514 1,574,395 Note 8 - Elimination of the Special Assessments Fund Governmental Accounting Standards Board Statement #6 has mandated elimin- ation of the Special Assessment Fund from the financial statements, and the City has elected to follow the Board's additional recommendation of early implementation of Statement #6. In compliance with these require- ments, the 12/31/85 balances in the Special Assessment Fund are recorded as of 1/01/86 in the Debt Service Funds General Fund, 1986 Improvement Construction Fund (Capital Projects) and General Long-Term Debt Group of Accounts, and accordingly the Special Assessment Fund does not appear in the 1986 financial statements. -15- The incorporation of the accounts into the three funds indicated above results in 1/01/86 Unadjusted Fund Balances that are subject to prior period adjustment that consists of two components: 1- Moving the bonds payable from the Special Assessment Fund to the General Long-Term Debt Group of Accounts increases the Fund Balances in the Debt Service Funds. 2. Fund balances in the General and Debt Service Funds are decreased for Special Assessment and Ad Valorem tax revenues that were previously recognized in the Special Assessment Fund but must be deferred in the General and Debt Service Funds. More specifically, special assessment and ad valorem taxes in the Special Assessment Fund were recognized as revenue when assessed; in the General and Debt Service Funds, however, those revenues cannot be recognized until the assessments and taxes come due. Those assessments and taxes coming due after 12/31/85, therefore, go to reduce Fund Balance in General and Debt Service. The effect of these on the various fund balances are described on the following page: -16- - - - - - - - - - - - - - - - - - - - ~ td I-' I-' n <: 0 H (")td > "U tr:I q r-- o ro \0 \0 o ~ I-ti a 0 ro p.. ~ I-ti ~ Z n þjOO 00 al-' ~ ~ n w_ ro I-ti ~ 0 CI)~ ro ~ :<:: \J1 ~Oþjl-' () ~ N~ t::!<: t""'ro p.. rt rt ~ n ero ~ ~ ro ro rt ~ .. 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The delinquencies in the 1983 Bond Improvement Debt Service Fund and its related debt, however, are $77,130 as of 12-31-86. Though these receivables are supported by liens on the I underlying property, the liens are not excercisable for a number of years, and the City has decided to make the conservative estimate of full allow- ance of the receivables as uncollectible. I Note 10 - Equity Transfers I During 1986, the final installments on two bond issues, 1961 Sewer Improve- ment and 1965 Street Improvement, were paid. The balance in the Debt Service Funds, in the amounts of $131,529 and $58,723 respectively, were transferred to the General Fund as the $190,252 equity transfer in Exhibit 2. I Another equity transfer resulted from the close out of the Millstream Park Capital Project Fund. This transfer, in the amount of $4,345 as described I in Exhibit 2, was effected as of 1-01-86, so no financial activity shows up in the Millstream Park Fund during 1986. I Note 11 - Changes in General Fixed Assets Jan. 1 Addi- Retire- Dec. 31 I Balance tions ments Balance Land $ 49,879 $ $ $ 49,879 I Buildings 234,129 7,313 241,442 Improvements other than Buildings 7,584 100 7,684 I Machinery & Equipment 172,723 10,950 3,500 180,173 I Office Furniture 14,296 9,530 23,826 Motor Vehicles 29,408 15,102 1,900 42,610 I Other Equipment 71,866 14,471 270 86,067 TOTAL GENERAL FIXED ASSETS ~~Z2~~~~ ~=~Z~~gg ~==~~gZQ ~g~1~g~1 I Note 12 - Due From Other Governments - Grants Receivable I Due from Other Government Units includes $227,859 due from the Federal Government on the Federal ~PA Grant. The remainder represents amounts due I from the county. I Note 13 - Interfund Receivable and Payable -18- I Interfund receivables and payables represent short-term interfund financing amount. Note 14 - Construction In Progress The City is in the process of constructing a Wastewater Facilities Modification/Pump Station and Forcemain. The project includes construct- ion of a new pump station and forcemain to transport wastewater to St. Cloud, Minnesota. Total construction costs are estimated to be $1,797,000. Financing for the project will be partially derived from a $715,000 Federal EPA Grant and a $165,100 Minnesota Pollution Control Agency Grant. The remaining financing was derived from a $1,400,000 bond issued during 1986; the bond will be repaid with special assessments from users of the wastewater facilities. Note 15 - Federally Assisted Programs - Compliance Audits Federally assisted programs for 1986 have been subjected to compliance audits. See the reports included in this report. -19- EXHIBIT A-l CITY OF ST. JOSEPH, MINNESOTA GENERAL FUND BALANCE SHEET December 31, 1986 1986 ASSETS Cash $176,921 Investments 557,000 Taxes Receivable - Delinquent 12,923 Interest Receivable 1,237 Special Assessments Receivable 28,740 Less: Deferred Revenue (28,740) Tax Levies Receivable 1,300 Less: Deferred Revenue (1,300) Due From Other Funds 98,965 Due From Other Governmental Units 20,318 TOTAL ASSETS !~~Z~~~~ LIABILITIES AND FUND BALANCE Liabilities: Accounts Payable $ 51,021 Due to Other Governmental Units 0 TOTAL LIABILITIES $ 51,021 Fund Balance: Reserved $ 18,615 Unreserved 797,728 TOTAL FUND BALANCE $816,343 TOTAL LIABILITIES AND FUND BALANCE !~~Z~~~~ The notes to the financial statements are an integral part of this statement. -20- EXHIBIT A-2 CITY OF ST. JOSEPH, MINNESOTA GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGETED AND ACTUAL For The Year Ended December 31, 1986 Actual Over (Under) Budgeted Actual Budget REVENUES: General Property Tax $131,000 $118,577 $(12,423) Licenses and Permits 17 ,300 17 , 746 446 Intergovernmental Revenue 329,190 329,028 (162) Charges for Services 75,570 80,314 4,744 Fines and Forfeits 23,500 25,087 1,587 Other 26,200 39,279 13,079 TOTAL REVENUE $602,760 $610,031 $ 7,271 OTHER SOURCES: Transfers from Other Funds $ $ $ TOTAL REVENUES AND OTHER SOURCES $602,760 $610,031 $ 7,271 EXPENDITURES: General Government $105,720 $134,401 $ 28,681 Public Safety 202,350 188,666 (13,684) Streets and Highways 127,000 119,560 (7,440) Recreation 20,000 19,412 (588) Debt Service 2,440 2,436 (4) Other 3,400 2,000 (1,400) TOTAL EXPENDITURES $460,910 $466,475 $ 5,565 OTHER USES: Transfers to Other Funds 31,920 19,777 (12,143) TOTAL EXPENDITURES AND OTHER USES $492,830 $486,252 $ (6,578) NET INCREASE (DECREASE) IN FUND BALANCE !1Q2~2~Q $123,779 !=1~~~~2 FUND EQUITY TRANSFER, Note 10 194,597 FUND BALANCE, January 1 (Restated) Note 8 497,967 FUND BALANCE, December 31 !~é~~~~~ The notes to the financial statements are an integral part of this statement. -21- EXHIBIT A-3 CITY OF ST. JOSEPH, MINNESOTA GENERAL FUND SCHEDULE OF REVENUES - BUDGETED AND ACTUAL For the Year Ended December 3l, 1986 Actual Over (Under) Budgeted Actual Budget TAXES: General Property Taxes $131,000 $116,109 $(14,891) Other 2,468 2,468 TOTAL TAXES $131,000 $118,577 $(12,423) LICENSES AND PERMITS: Business Licenses & Permits $ 11,000 $ 11,774 $ 774 Non-Business Licenses & Permits 6,300 5,972 (328) TOTAL LICENSES AND PERMITS $ 17,300 $ 17,746 $ 446 INTERGOVERNMENTAL REVENUE: State Grants: Local Government Aid $248,190 $248,190 $ Homestead Credit 60,000 61,139 1,139 Police 9,500 8,188 (1,312) Fire 10,000 10,066 66 Mobile Home Homestead Credit 1,000 986 (14) Other 500 459 (41) TOTAL INTERGOVERNMENTAL REVENUE $329,190 $329,028 $ (l62) CHARGES FOR SERVICES: General Government $ 2,620 $ 4,243 $ 1,623 Fire Protection 54,000 63,037 9,037 Highway Assessments 15,000 9,688 (5,312) Recreation Fees 3,400 3,072 (328 ) Other 550 274 (276) TOTAL CHARGES FOR SERVICES $ 75,570 $ 80,314 $ 4,744 FINES AND FORFEITS: County Court $ 20,000 $21,928 $ 1,928 Police Department 3,500 3,159 (341) TOTAL FINES AND FORFEITS $ 23,500 $ 25,087 $ 1,587 OTHER REVENUES: Interest $ 25,000 $ 30,718 $ 5,718 Special Assessments 8,561 8,561 Other 1,200 (1,200) TOTAL OTHER REVENUES $ 26,200 $ 39,279 $ 13,079 TOTAL REVENUES *g~é!:bg~ *gé~!:~~é *==b!:ébé The notes to the financial statements are an integral part of this statement. -22- EXHIBIT A-4 CITY OF ST. JOSEPH, MINNESOTA GENERAL FUND SCHEDULE OF EXPENDITURES - BUDGETED AND ACTUAL For the Year Ended December 31, 1986 Actual Over (Under) Budgeted Actual Budget GENERAL GOVERNMENT: Legislative: Council $ 6,020 $ 10,505 $ 4,485 Legislative Committees & Special Bodies 7,500 5,127 (2,373) Ordinance and Proceedings 300 17 (283) Executive: Mayor 2,600 2,907 307 City Clerk: Elections 2,400 4,604 2,204 Capital Outlay-Elections 500 (500) Salaries and Administration 40,400 55,433 15,033 Financial Administration: Audit 6,000 5,024 (976) Accounting 14,000 13,213 (787) Treasurer 2,700 2,176 (524) Assessor 2,800 2,798 (2) Other 3,520 3,520 Legal: Attorney Fees 7,600 12,510 4,910 General Government Buildings: Government Buildings 9,800 16,150 6,350 Other General Government: Planning and Zoning 3,100 417 (2,683) TOTAL GENERAL GOVERNMENT $105,720 $134,401 $ 28,681 PUBLIC SAFETY: Police Protection: Administration $125,000 $121,578 $ (3,422) Capital Outlay 5,000 (5,000) Continuing Education 500 502 2 Police Support Services: Communication Services 2,100 2,295 195 Automotive Services 7,100 6,190 (910) Fire Protection: Administration 2,500 1,325 (1,175) Fire Fighting 28,000 31,313 3,313 Fire Fighting-Capital Outlay 4,400 753 (3,647) Continuing Education 500 1,134 634 Fire Communications 3,500 3,018 (482) Fire Repair Services 2,500 2,240 (260) Fire Station Building 7,000 2,360 (4,640) -23- EXHIBIT A-4 CITY OF ST. JOSEPH, MINNESOTA GENERAL FUND SCHEDULE OF EXPENDITURES - BUDGETED AND ACTUAL For the Year Ended December 31, 1986 (Continued) Actual Over (Under) Budgeted Actual Budget Pension Relief Fund $ 10,000 $ 9,914 $ (86) Building Inspection: Administration 2,000 1,917 (83) Other 2,000 4,082 2,082 Animal Control 250 45 (205) TOTAL PUBLIC SAFETY $202,350 $188,666 $(13,684) STREETS AND HIGHWAYS: Streets and Alleys: Maintenance $ 82,400 $ 91,321 $ 8,921 Paved Streets 20,000 11,419 (8,581) Snow Removal 2,500 239 (2,261) Capital Outlay-Equipment 4,000 200 (3,800) Other 2,100 1,787 (313) Street Lighting: Power and Light 16,000 14,594 (1,406) TOTAL STREETS AND HIGHWAYS $127,000 $119,560 $ (7,440) RECREATION: Recreation Activities & Facilities: Supervision $ 10,550 $ 4,677 $ (5,873) Other 2,000 3,517 1,517 Parks and Playgrounds: Park Areas 7,250 4,803 (2,447) Capital Outlay-Equipment 200 6,415 6,215 TOTAL RECREATION $ 20,000 $ 19,412 $ (588) DEBT SERVICE: Other Long-Term Debt, Principal $ 2,100 $ 2,100 $ Other Long-Term Debt, Interest 340 336 (4) TOTAL DEBT SERVICE $ 2,440 $ 2,436 $ (4) OTHER: Historical Research $ 3,400 $ 2,000 $ (1,400) TOTAL OTHER $ 3,400 $ 2,000 $ (1,400) TOTAL EXPENDITURES $460,910 $466,475 $ 5,565 -24- EXHIBIT A-4 CITY OF ST. JOSEPH, MINNESOTA GENERAL FUND SCHEDULE OF EXPENDITURES - BUDGETED AND ACTUAL For the Year Ended December 31, 1986 (Continued) Actual Over (Under) Budgeted Actual Budget OTHER USES: Transfers to Other Funds: Sanitation Fund $ 16,920 $ 19,777 $ 2,857 Other 15,000 (15,000) TOTAL EXPENDITURES AND OTHER USES ~~2~~~~Q ~~~~~~~~ ~=~~~~b~) The notes to the financial statements are an integral part of this statement. -25- EXHIBIT B-1 CITY OF ST. JOSEPH, MINNESOTA SPECIAL REVENUE FUNDS BALANCE SHEET December 31, 1986 Federal Revenue Sharing ASSETS Cash $ 70,265 Investments 65,000 Interest Receivable 34 Entitlements Receivable 0 TOTAL ASSETS ~é~~:!:~22 LIABILITIES AND FUND BALANCE Liabilities: Accounts Payable $ 1,950 Fund Balance 133,349 TOTAL LIABILITIES AND FUND BALANCE ~é~~~~22 The notes to the financial statements are an integral part of this statement. -26- EXHIBIT B-2 CITY OF ST. JOSEPH, MINNESOTA SPECIAL REVENUE FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE For the Year Ended December 31, 1986 Federal Revenue Sharing REVENUES U.S. Treasury $ 19,123 Interest 5,272 TOTAL REVENUES $ 24,395 EXPENDITURES Capital Outlay: Equipment $ 30,640 Street Improvement 6,226 History of St. Joseph 0 Other 1,950 TOTAL EXPENDITURES $ 38,816 NET INCREASE (DECREASE) IN FUND BALANCE DURING THE YEAR $(14,421) FUND BALANCE, January 1 147,770 FUND BALANCE, December 31 t1~~:!:~~2 The notes to the financial statements are an integral part of this statement. -27- EXHIBIT B-3 CITY OF ST. JOSEPH, MINNESOTA SPECIAL REVENUE FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL For the Year Ended December 31, 1986 Federal Revenue Sharing Actual Over (Under) Budgeted Actual Budget REVENUES: U.S. Treasury $ 30,000 $ 19,123 $(10,877) Interest 6,000 5,272 (728) TOTAL REVENUES $ 36,000 $ 24,395 $ (11, 605) EXPENDITURES: Capital Outlay: Equipment $ 9,000 $ 30,640 $ 21,640 Street Improvement 17 ,000 6,226 (10,774) History of St. Joseph Other 10,000 1,950 (8,050) TOTAL EXPENDITURES $ 36,000 $ 38,816 $ 2,816 NET INCREASE (DECREASE) IN FUND BALANCE DURING THE YEAR *======Q $(14,421) *=é~~~~é FUND BALANCE, January 1 147,770 FUND BALANCE, December 31 *é~~~~~2 The notes to the financial statements are an integral part of this statement. -28- EXHIBIT C-l CITY OF ST. JOSEPH, MINNESOTA CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET December 31, 1986 Millstream 1986 Total Park Sewer ASSETS Cash $ $ 14,560 $ 14,560 Investments 674,380 674,380 Interest Receivable 8,926 8,926 Due From Other Governmental Units 228,313 228,313 TOTAL ASSETS 1========Q 12~~:?:1Z2 12~~:?:1Z2 LIABILITIES AND FUND BALANCE Accounts Payable $ $107,226 $107,226 Due To Other Funds 341,327 341,327 TOTAL LIABILITIES $ $448,553 $448,553 Fund Balance 0 477,626 477,626 TOTAL LIABILITIES AND FUND BALANCE 1========Q 12~~:?:1Z2 12~~:?:1Z2 The notes to the financial statements are an integral part of this statement. -29- EXHIBIT C-2 CITY OF ST. JOSEPH, MINNESOTA CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE For the Year Ended December 31, 1986 Millstream 1986 Park Sewer Total REVENUES: Bond Proceeds $ $1,375,640 $1,375,640 Federal Grant 300,534 300,534 Employee Aid - Township Special Assessments Interest 24,033 24,033 TOTAL REVENUES $ $1,700,207 $1,700,207 OTHER REVENUE Transfer From Other Funds 5,897 5,897 TOTAL REVENUES AND TRANSFERS $ 0 $1,706,104 $1,706,104 EXPENDITURES: Grant Refund $ $ $ Capital Outlay 848,980 848,980 Other TOTAL EXPENDITURES 0 848,980 848,980 OTHER USES: Transfers To Other Funds $ $ 325,677 $ 325,677 TOTAL EXPENDITURES AND OTHER USES $ 0 $1,174,657 $1,174,657 NET INCREASE (DECREASE) IN FUND BALANCE 531,447 531,447 FUND EQUITY TRANSFERS (OUT), NOTE 10 (4,345) (4,345) FUND BALANCE (DEFICIT) January 1 4,345 (53,821) (49,476) FUND BALANCE, December 31 !========Q !==~ZZ~~~~ !==~ZZ~~~~ The notes to the financial statements are an integral part of this statment. -30- - - - - - - - - - - - - - - - - - - - H ITj ITj ITj H Z tz::I þj ~ q q q ~ tr:I Þ<: tr:I (1) Z Z @ H "U <: t::! t::! 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JOSEPH, MINNESOTA ENTERPRISE FUNDS COMBINING BALANCE SHEET December 31, 1986 Plant Opera- tion and Sanitary Water Maintenance Total Fund Fund Fund 1986 1985 ASSETS Current Assets: Cash $ 60 $ 13,261 $ $ 13,321 $ 44,988 Investments 28,000 29,000 57,000 30,000 Accounts Receivable 8,476 15,464 50,015 73,955 46,923 Interest Receivable 26 8 34 388 Due From Other Funds 5,577 5,577 5,577 Due From Other Govern- mental Units 48 194 242 Total Current Assets $ 8,584 $ 56,945 $ 84,600 $ 150,129 $ 127,876 Fixed Assets: Land $ $ 2,336 $ 4,940 $ 7,276 $ 7,276 Treatment Plant & Lines 353,819 413,911 767,730 767,730 Less: Allow. for Depr. (112,653) (221,132) (333,785) (320,156) Machinery & Equipment 30,141 40,997 71,138 72,862 Less: Allow. for Depr. (12,120) (15 , 246 ) (27,366) (25,561) Construction in Progress 950,174 950,174 101,194 Total Fixed Assets $ 0 $261,523 $1,173,644 $1,435,167 $ 603,345 TOTAL ASSETS ~==~:!:~~~ ~~1~:!:~~~ =~1:!:~~~:!:~~~ ~1:!:~~~:!:~~~ ~==Z~1:!:~~1 LIABILITIES, CONTRIBUTIONS AND RETAINED EARNINGS Current Liabilities: Deficit Cash Balance $ $ $ 2,323 $ 2,323 $ Accounts Payable 3,639 2,532 2,407 8,578 9,189 Total Liabilities $ 3,639 $ 2,532 $ 4,730 $ 10,901 $ 9,189 Contributions From Other Funds 3,725 265,135 1,386,150 1,655,010 806,031 Retained Earnings, Unreserved 1,220 50,801 (132,636) (80,615) (83,999) Total Fund Equity $ 4,945 $315,936 $1,253,514 $1,574,395 $ 722,032 TOTAL LIABILITIES, CON- TRIBUTIONS & RETAINED EARNINGS ~==~:!:~~~ *~1~:!:~~~ =*1:!:~~~:!:~~~ *1:!:~~~:!:~~~ *==Z~1:!:~~1 The notes to the financial statements are an integral part of this statement. -33- I I EXHIBIT E-2 CITY OF ST. JOSEPH, MINNESOTA I ENTERPRISE FUNDS COMBINING STATEMENT OF REVENUES, EXPENSE AND CHANGES IN RETAINED EARNINGS For The Year Ended December 31, 1986 I Plant Opera- I tion and Sanitary Water Maintenance Total Fund Fund Fund 1986 1985 I REVENUES: Sales & Rental Charges $ 25,002 $ 53,979 $ 63,543 $ 142,524 $ 121,890 Service & Permits 2,696 350 3,046 1,310 I Miscellaneous 53 74 127 342 TOTAL REVENUES $ 25,002 $ 56,728 $ 63,967 $ 145,697 $ 123,542 I EXPENSES: General & Administrative $ $ 29,328 $ 21,975 $ 51,303 $ 42,489 Waste Collection Contract 44,349 44,349 38,669 I Pumping and Utilities 6,277 6,277 8,812 Water Purification 4,452 4,452 4,090 Water Distribution 3,165 3,165 5,715 I Repairs and Maintenance 14,918 14,918 1,178 Sewage Treatment Plant 27,465 27,465 18,455 Depreciation 8,647 8,118 16,765 16,986 I Miscellaneous 393 393 702 TOTAL EXPENSES $ 44,349 $ 66,787 $ 57,951 $ 169,087 $ 137,096 I OPERATING INCOME (LOSS) $(19,347) $(10,059) $ 6,016 $ (23,390) $ (13,554) OTHER INCOME (EXPENSES) I Transfer From Other Funds $ 19,777 $ 2,527 $ $ 22,304 $ 15,847 Interest Income 2,384 2,086 4,470 4,262 I OTHER INCOME - NET $ 19,777 $ 4,911 $ 2,086 $ 26,774 $ 20,109 NET INCOME (LOSS) $ 430 $ (5,148) $ 8,102 $ 3,384 $ 6,555 I RETAINED EARNINGS, (DEFICIT) January 1 790 55,949 (140,738) (83,999) (90,554) I RETAINED EARNINGS, (DEFICIT) December 31 *==~~~~~ *=~~~~~~ *=~~~~~g~g) *==~~~~g~~) *==~~~~222) I I The notes to the financial statements are an integral part of this statement. -34- I I EXHIBIT E-3 I CITY OF ST. JOSEPH, MINNESOTA ENTERPRISE FUNDS I COMBINING STATEMENT OF CHANGES IN FINANCIAL POSITION For The Year Ended December 31, 1986 I Plant Opera- tion and Sanitary Water Maintenance Total I Fund Fund Fund 1986 1985 SOURCES OF FINANCIAL RESOURCES: Operations I Net Income (Loss) for the Year $ 430 $ (5,148) $ 8,102 $ 3,384 $ 6,555 Add: Items Not Requiring Current Outlay of I Resources: Depreciation 8,647 8,118 16,765 16,986 Loss on Disposal of I Equipment 393 393 658 Total Resources Provided By Operations $ 430 $ 3,499 $ 16,613 $ 20,542 $ 24,199 I OTHER SOURCES OF FINANCIAL RESOURCES: I Contributions By Other Funds 848,980 848,980 I TOTAL RESOURCES PROVIDED BY ALL SOURCES $ 430 $ 3,499 $ 865,593 $ 869,522 $ 24,199 USE OF FINANCIAL RESOURCES: I Operations Net Income (Loss) For The Year $ $ $ $ $ I Less Items Not Requiring Current Outlay of Re- sources: I Depreciation Equipment Disposal I Total Resources Used By Operations $ $ $ $ $ OTHER USES OF FINANCIAL I RESOURCES: Acquisition of Fixed Assets 848,980 848,980 1,316 I TOTAL USES OF FINANCIAL RESOURCES $ 0 $ 0 $ 848,980 $ 848,980 $ 1,316 I NET INCREASE (DECREASE) IN WORKING CAPITAL !====~~Q !==~k~22 !===1~k~1~ !===~Qk~~~ $ 22 883 ======~=== I -35- I I EXHIBIT E-3 I CITY OF ST. JOSEPH, MINNESOTA ENTERPRISE FUNDS COMBINING STATEMENT OF CHANGES IN FINANCIAL POSITION I For The Year Ended December 31, 1986 I Plant Opera- tion and Sanitary Water Maintenance Total I Fund Fund Fund 1986 1985 COMPONENT ELEMENTS OF INCREASE (DECREASE) IN I WORKING CAPITAL: Cash $ 60 $ (3,720) $ (30,330) $ (33,990) $ (7,295) I Investments 8,000 19,000 27,000 15,000 Accounts Receivable 818 (893) 27,107 27,032 9,679 Interest Receivable (147) (207) (354 ) (16) Due From Other Funds 0 5,577 I Due From Other Govern- mental Units 48 194 242 0 Accounts Payable (496) 65 1,043 612 (62) I NET INCREASE (DECREASE) IN WORKING CAPITAL ~====~~~ ~==~.;~22 ~=:=:=1~.;~1~ ~:===~~.;~~~ ~===~~.;~~~ I I I I I I I I The notes to the financial statements are an integral part of this statement. -36- I I I EXHIBIT E-4 I CITY OF ST. JOSEPH, MINNESOTA ENTERPRISE FUNDS SCHEDULE OF CHANGES IN FIXED ASSETS I For The Year Ended December 31, 1986 I Jan. 1 Addi- Retire- Deprec- Dec. 31 Balance tions ments iation Balance I WATER FUND Land $ 2,336 $ $ $ $ 2,336 I Buildings 353,819 353,819 Less: Allow. for Depreciation (105,286) 7,367 (112,653) Machinery and Equipment 30,774 633 30,141 I Less: Allow. for Depreciation (11,473) (633) 1,280 (12,120) TOTAL WATER FUND $270,170 $ 0 $ 0 $ 8,647 $ 261,523 I PLANT OPERATION & MAINTENANCE I Land $ 4,940 $ $ $ $ 4,940 Buildings 413,91L 413,911 Less: Allow. for Depreciation (214,870) 6,262 (221,132) I Machinery and Equipment 42,,088 1,091 40,997 Less: Allow. for Depreciation (14,088) (698) 1,856 (15,246) Construction Work in Progress 101,194 848,980 950,174 I TOTAL PLANT OPERATION AND MAINTENANCE $333,175 $848,980 $ 393 $ 8,118 $1,173,644 I ALL ENTERPRISE FUNDS- TOTAL FIXED ASSETS ~~Q~~~~~ ~~~~~2~Q ~====~2~ ~=~~~Z~~ ~é~~~~~~~Z I I I I I The notes to the financial statements are an integral part of this statement. -37- I I I EXHIBIT F-l I CITY OF ST. JOSEPH, MINNESOTA STATEMENT OF GENERAL FIXED ASSETS BY FUND I December 31, 1986 I GENERAL FIXED ASSETS I Land $ 49,879 Buildings 241,442 I Improvements Other Than Buildings 7,684 Machinery and Equipment 180,173 Office Furniture 23,826 I Motor Vehicles 42,610 Other Equipment 86,067 TOTAL GENERAL FIXED ASSETS *g~1~g~1 I I INVESTMENT IN GENERAL FIXED ASSETS FROM: I General Revenue Fund $385,934 Special Assessments 59,013 I Revenue Sharing 185,540 Capital Projects 1,194 I TOTAL INVESTMENT IN GENERAL FIXED ASSETS *g~1~g~1 I I I I I The notes to the financial statements are an integral part of this statement. -38- I I I EXHIBIT G-l I CITY OF ST. JOSEPH, MINNESOTA STATEMENT OF GENERAL LONG-TERM DEBT December 31, 1986 I I AMOUNT AVAILABLE AND TO BE PROVIDED FOR THE PAYMENT OF GENERAL LONG-TERM DEBT: I NOTE PRINCIPAL I Amount To Be Provided In Future Years $ 2,100 TOTAL TO BE PROVIDED ~====~.!:1QQ I BOND PRINCIPAL I Amount Available in Debt Service Fund $1,046,687 Amount To Be Provided In Future Years 1,967,000 I TOTAL TO BE PROVIDED ~==2~Q.!:~1~ I GENERAL LONG-TERM DEBT PAYABLE: I GENERAL LONG-TERM DEBT Contract for Deed Notes $ 2,100 I TOTAL GENERAL LONG-TERM DEBT PAYABLE ~====~.;1QQ I BONDS PAYABLE Bonds Payable - Current Portion $ 88,000 I Bonds Payable - Noncurrent Portion 1,879,000 TOTAL BONDS PAYABLE !1.;2gb.;QQQ I I The notes to the financial statements are an integral part of this statement. 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JOSEPH, MINNESOTA REPORT ON SUPPLEMENTARY INFORMATION SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE I Honorable City Mayor and Members of the City Council I City of St. Joseph St. Joseph, Minnesota 56374 I I have examined the general purpose financial statements of the City of St. Joseph, Minnesota, for the year ended December 31, 1986, and have I issued my report thereon dated June 24, 1987. My examination of such general purpose financial statements was made in accordance with generally accepted auditing standards and the standards for financial and compliance audits contained in the Standards for Audit of Governmental Organizations, I Programs, Activities, and Functions, issued by the U.S. General Accounting Office, and accordingly, included such tests of the accounting records and such other auditing procedures as I considered necessary in the I circumstances. My examination was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The accompanying Schedule I of Federal Financial Assistance is presented for purposes of additional analysis and is not a required part of the general purpose financial state- ments. The information in that schedule has been subjected to the auditing I procedures applied in the examination of the general purpose financial statements and, in my opinion, is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. I ~ 4~~..._.. ~ Watkins, Minnesota I June 24, 1987 MARLIN J. BOECKMANN, C.P.A. I I I I -41- - - - - - - - - - - .. - - - - - - - - q q ITj . . ro CI) CI) p.. ITj . H(") . ro ro ~ 0 ~ p.. 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'-' 1K/7 -{ß. ~ II ro II n þj IIW W o ro IIN N 0 <: II'¡:'" .¡:,.. 0 :::J ro II- .. .. 1-" :::J 11\0 W \J1 N ~ IIN \0 W ro ro 11\0 \J1 .¡:,.. p.. tr:I X I -{ß. -{ß. II ro II :::J IIW W p.. IIW W 0 1-" II'-J ~ 0 rt II- .. .. ~ II'¡:'" 00 \J1 ~ 110 ~ W ro III-' '-J .¡:,.. 00 tJ> n t::! n ro ~ n ~ ro þj ro 1K/7 -{ß. a ro p.. II 0'<: Ih r-- ro ro 0 III-' I-' ~ :::J ~ IIW W ~ 1I\J1 \J1 wror-- II- .. I-' t::! IIN N .. ~ ro 11\0 \0 rtl-ti 11\0 \0 I-' ro '-' '-' \0 ~ 00 ~ ~ ro p.. '-' CERTIFIED PUBLIC ACCOUNTANT ~rHu )~ 1Inttkm:¡u (THE CONVENT) WATKINS, MINNESOTA 55389 TEL. (612) 764-5822 AUDITOR'S REPORT ON COMPLIANCE WITH STATE AND FEDERAL LAWS Honorable City Mayor and Members of the City Council City of St. Joseph St. Joseph, Minnesota 56374 I have examined the general purpose financial statements of the City of St. Joseph, Minnesota, for the year ended December 31, 1986, and have issued my report thereon dated June 24, 1987. My examination was made in accordance with generally accepted auditing standards and the standards for financial and compliance audits contained in the Standards For Audit of Governmental Organizations, Programs, Activities, and Functions issued by the U.S. General Accounting Office and the provisions of the Legal Compliance Audit Guide promulgated by the Legal Compliance Task Force pursuant to Minnesota Statute, Section 6.65, and accordingly included such tests of the accounting records and such other auditing procedures as I considered necessary in the circumstances. The management of the City of St. Joseph is responsible for the City's com- pliance with laws and regulations. In connection with my examination re- ferred to above, I selected and tested transactions and records to determine the City's compliance with laws and regulations noncompliance with which could have a material effect on the general purpose financial statements of the City. The results of my tests indicate that for the items tested, the City of St. Joseph, Minnesota, complied with those provisions of laws and regulations noncompliance with which could have a material effect on the general purpose financial statements. Nothing came to my attention that caused me to believe that for the items not tested, the City of St. Joseph, Minnesota, was not in compliance with laws or regulations noncompliance with which could have a material effect on the City's general purpose financial statements. Watkins, Minnesota ~~~ June 24, 1987 MARLIN J. BOECKMANN, C.P.A. -43- CERTIFIED PUBLIC ACCOUNTANT ~tHu )~ 1Inttkm:¡uu (THE CONVENT) WATKINS. MINNESOTA 55389 TEL. (61 2) 764-5822 AUDITOR'S REPORT ON COMPLIANCE WITH LAWS AND REGULATIONS RELATED TO MAJOR AND NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS Honorable City Mayor and Members of the City Council City of St. Joseph St. Joseph, Minneosta 56374 I have examined the general purpose financial statements of the City of St. Joseph, Minnesota, for the year ended December 31, 1986, and have issued my report thereon dated June 24, 1987. My examination was made in accordance with generally accepted auditing standards; the standards for financial and compliance audits contained in the Standards for Audits of Governmental Organizations, Programs, Activities, and Functions, issued by the U.S. General Accounting Office; the Single Audit Act of 1984; and the provisions of OMB Circular A-128, Audits of State and Local Governments and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. The management of the City of St. Joseph, Minnesota, is responsible for the City's compliance with laws and regulations. In connection with the examination referred to above, I selected and tested transactions and re- cords from the major federal financial assistance program and the nonmajor federal financial assistance programs. The purpose of my testing of trans- actions and records from those federal financial assistance programs was to obtain reasonable assurance that the City of St. Joseph, Minnesota, had, in all material respects, administered the major program, and executed the tested nonmajor program transactions, in compliance with laws and regula- tions, including those pertaining to financial reports and claims for advances and reimbursements, noncompliance with which I believe could have a material effect on the allowability of program expenditures. My testing of transactions and records selected from the major federal finan- cial assistance program disclosed no instances of noncompliance with those laws and regulations. In my opinion, the City of St. Joseph, Minnesota, administered its major federal financial assistance program in compliance, in all material respects, with laws and regulations, including those pertaining to financial reports and claims for advances and reimbursements, noncompliance with which I believe could have a material effect on the allowability of program expenditures. The results of my testing of transactions and records selected from the non- major federal financial assistance program indicate that for the transactions -44- and records tested the City of St. Joseph, Minnesota, complied with the laws and regulations referred to in the second paragraph of my report. My testing was more limited than would be necessary to express an opinion on whether the City of St. Joseph, Minnesota, administered those programs in compliance in all material respects with those laws and regulations non- compliance with which we believe could have a material effect on the allow- ability of program expenditues; however, with respect to the transactions and records that were not tested by me, nothing came to my attention to indicate that the City of St. Joseph, Minnesota, had not complied with laws and regulations. Watkins, Minnesota ~p~~~~ June 24, 1987 MARLIN J. BOECKMANN, C.P.A. -45- CERTIFIED PUBLIC ACCOUNTANT ~r1iu )~ 1InttJ!uttJ1I1I1I1t (THE CONVENT) WATKINS, MINNESOTA 55389 TEL. (612) 764-5822 AUDITOR'S REPORT ON INTERNAL ACCOUNTING CONTROLS BASED SOLELY ON A STUDY AND EVALUATION MADE AS A PART OF AN EXAMINATION OF THE GENERAL PURPOSE OR BASIC FINANCIAL STATEMENTS Honorable City Mayor and Members of the City Council City of St. Joseph St. Joseph, Minnesota 56374 I have examined the general purpose financial statements of the City of St. Joseph, Minnesota, for the year ended December 31, 1986, and have issued my report thereon dated June 24, 1987. As part of my examination, I made a study and evaluation of the system of internal accounting control of the City of St. Joseph, Minnesota, to the extent I considered necessary to evaluate the system as required by generally accepted auditing standards and the standards for financial and compliance audits contained in the U.S. General Accounting Office Standards for Audit of Governmental Organizations, Programs, Activities, and Functions. For the purpose of this report, I have classified the significant internal accounting controls in the following categories: * Financing * Revenue/receipts * Purchases/disbursements * External financial reporting My study included all of the control categories listed above. The purpose of my study and evaluation was to determine the nature, timing, and extent of the auditing procedures necessary for expressing an opinion on the entity's financial statements. My study and evaluation was more limited than would be necessary to express an opinion on the system of internal accounting control taken as a whole or on any of the categories of controls identified above. The management of the City of St. Joseph, Minnesota, is responsible for establishing and maintaining a system of internal accounting control. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of control pro- cedures. The objectives of a system 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 accord- ance 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 system of internal accounting control, errors or irregularities may nevertheless occur -46- and not be detected. Also, projection of any evaluation of the system to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the degree of compliance with the procedures may deteriorate. My study and evaluation made for the limited purpose described in the first paragraph would not necessarily disclose all material weaknesses in the system. Accordingly, I do not express an opinion on the system of internal accounting control of the City of St. Joseph, Minnesota, taken as a whole or on any of the categories of controls identified in the first paragraph. However, my study and evaluation disclosed no condition that I believe to be a material weakness. Non material weaknesses in internal controls have been communicated to the City Council in a letter. This report is intended solely for the use of management and state and federal regulatory bodies 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 state and federal regulatory bodies, is a matter of public record. ~þ.~).. .----- Watkins, Minnesota June 24, 1987 MARLIN J. BOECKMANN, C.P.A. -47- CERTIFIED PUBLIC ACCOUNTANT ~r1iu 1~ 1IntthmJ1IW (THE CONVENT) WATKINS, MINNESOTA 55389 TEL. (612) 764-5822 AUDITOR'S REPORT ON INTERNAL CONTROLS (ACCOUNTING AND ADMINISTRATIVE) BASED ON A STUDY AND EVALUATION MADE AS A PART OF AN EXAMINATION OF THE GENERAL PURPOSE OR BASIC FINANCIAL STATEMENTS AND THE ADDITIONAL TESTS REQUIRED BY THE SINGLE AUDIT ACT Honorable City Mayor and Members of the City Council City of St. Joseph St. Joseph, Minnesota 56374 I have examined the general purpose financial statements of the City of St. Joseph, Minnesota, for the year ended December 31, 1986, and have issued my report thereon dated June 24, 1987. As part of my examination, I made a study and evaluation of the internal control systems, including applicable internal administrative controls, used in administering federal financial assistance programs to the extent I considered necessary to eval- uate the systems as required by generally accepted auditing standards, the standards for financial and compliance audits contained in the Standards For Audit of Governmental Organizations, Programs, Activities, and Functions, issued by the U.S. General Accounting Office, the Single Audit Act of 1984, and the provisions of OMB Circular A-128, Audits of State and Local Govern- ments. For the purpose of this report, I have classified the significant internal accounting and administrative controls used in administering federal financial assistance programs in the following categories: * Financing * Revenue/receipts * Purchases/disbursements * External financial reporting The management of the City of St. Joseph, Minnesota, is responsible for establishing and maintaining internal control systems used in administering federal financial assistance programs. In fulfilling that responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of control procedures. The objectives of internal control systems used in administering federal financial assistance programs are to provide management with reasonable, but not absolute, assurance that, with respect to federal financial assistance programs, resource use is consis- tent with laws, regulations, and policies; resources are safeguarded against waste, loss, and misuse; and reliable data are obtained, maintained, and fairly disclosed in reports. Because of inherent limitations in any system of internal accounting and administrative controls used in administering federal financial assistance programs, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the systems to future periods is subject -48- to the risk that procedures may become inadequate because of changes in conditions or that the degree of compliance with the procedures may deteriorate. My study included all of the applicable control categories listed above. During the year ended December 31, 1986, the City of St. Joseph, Minnesota, expended 100% of its total federal financial assistance under the major federal financial assistance program. With respect to internal control systems used in administering major federal financial assistance programs, my study and evaluation included considering the types of errors and irregularities that could occur, determining the internal control procedures that should prevent or detect such errors and irregularities, determining whether the necessary procedures are prescribed and are being followed satisfactorily, and evalu- ating any weaknesses. With respect to the internal control systems used solely in administering the nonmajor federal financial assistance program of the City of St. Joseph, Minnesota, my study and evaluation was limited to a preliminary review of the systems to obtain an understanding of the control environment and the flow of transactions through the accounting system. My study and evaluation of the internal control systems used solely in administering the nonmajor federal financial assistance program of the City of St. Joseph, Minnesota, did not extend beyond this preliminary review phase. My study and evaluation was more limited than would be necessary to express an opinion on the internal control systems used in administering the federal financial assistance programs of the City of St. Joseph, Minnesota. Accord- ingly, I do not express an opinion on the internal control systems used in administering the federal financial assistance programs of the City of St. Joseph, Minnesota. Further, I do not express an opinion on the internal control systems used in administering the major federal financial assistance programs of the City of St. Joseph, Minnesota. Also, my examination, made in accordance with the standards mentioned above, would not necessarily disclose material weaknesses in the internal control systems used solely in administering nonmajor federal financial assistance programs. However, my study and evaluation and my examination disclosed no condition that I believe to be a material weakness in relation to a federal financial assistance program of the City of St. Joseph, Minnesota. This report is intended solely for the use of management and state and federal regulatory agencies and should not be used for any other purpose. This re- striction is not intended to limit the distribution of this report, which, upon acceptance by the City of St. Joseph, Minnesota, is a matter of public record. Watkins, Minnesota ~~ June 24, 1987 MARLIN J. BOECKMANN, C.P.A. -49-