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PUBLIC RESENTATION – 3B MEMORANDUM DATE: June 27, 2016 TO: Honorable Mayor and City Council FROM: Sue Iverson, Interim City Administrator/Director of Finance and Administrative Services SUBJECT: 2015 City Financial Statements Background/Discussion: The City’s 2015 Financial Statements have been completed and submitted to both the State Auditor and the GFOA. The City’s auditor, Aaron Nielsen from MMKR, will be present at the June 27, 2016, City Council meeting to give an overview and answer questions. The auditors have issued an unmodified (“clean”) opinion on our financial statements for the year ended December 31, 2015. The total general fund balance at December 31, 2015 was $3,082,410 with $2,806,930 of unassigned available balance ($23,983 of the ending balance was in prepaid items and $251,497 was assigned) or 62.9% of total general fund budgeted expenditures for 2016. The general fund balance increased by $736,468. The City’s total net position increased by $4,709,159. The combined ending fund balances for governmental funds were $7,894,582; the combined ending working capital balance for the enterprise funds were $238,381, and internal service funds were $478,952. We have completed the report in the form prescribed by the Government Finance Officers Association of United States and Canada (GFOA) for their Certificate of Achievement for Excellence in Financial Reporting. In order to qualify for this, the report has to be published in an easily readable and efficiently organized Comprehensive Annual Financial Report (CAFR) that satisfies both accounting principles generally accepted in the United States of America and applicable legal requirements. As a note of information, the Auditing Standards are constantly increasing and changing. With these changes, you may see increased findings. This does not mean that the City has done anything wrong compared to previous years, only that the reporting requirements have become much stricter. Many cities are experiencing these findings, and the findings are expected to increase for all cities as these standards become stricter. We are pleased to report that we did not experience any findings this year. We are pleased with the outcome of the audit.