HomeMy WebLinkAbout4. Annual Audit Review (CAFR) 12/31/2011Village of Mount Prospect
Mount Prospect, Illinois
INTEROFFICE MEMORANDUM
TO: MICHAEL E. JANONIS, VILLAGE MANAGER
FROM: FINANCE DIRECTOR
DATE: SEPTEMBER 19, 2012
SUBJECT: COMPREHENSIVE ANNUAL FINANCIAL REPORT— DECEMBER 31, 2011
PURPOSE:
To present the Comprehensive Annual Financial Report (CAFR) for the fiscal year ended
December 31, 2011.
BACKGROUND:
Each year the Village retains a CPA firm to audit the Village's financials and assist in the
preparation of the annual CAFR. Lauterbach & Amen performed the audit for the Village for
fiscal year ended December 31, 2011.
DISCUSSION:
The CAFR presents two kinds of financial statements, each with a different snapshot of Village
finances. The statements focus is on the Village as a whole (government -wide) and on the
major individual funds. Both perspectives allow the user to address relevant questions, broaden
a basis for comparison from year -to -year at the Village and also between governments and
enhance the Village's accountability.
Lauterbach & Amen has given its audit of the Village for year -end 2011 an "unqualified opinion ".
This means that their examination found our financial statements to be fairly presented and
prepared in accordance with generally accepted accounting principles. Their opinion can be
found on pages 1 and 2 in the financial section of the report.
A detailed overview of the financial results for the fiscal year is provided in the Management's
Discussion and Analysis, which is found immediately following the auditor opinion on page 3 of
the financial section. An electronic copy of the entire CAFR document is included with this
memo.
The following are a few of the more significant highlights for the General Fund, the village's main
operating fund.
General Fund revenues of $41,172,988 came in slightly higher than the final budget by $78,458
or 0.2 %. The following table shows the variance from final budget for revenues broken down by
major revenue category.
Comprehensive Annual Financial Report
September 19, 2012
Page 2
Revenue Type
Final Budget
Actual
$Variance
%Variance
Property Taxes
$ 11,746,500
$ 11,750,523
$ 4,023
0.03%
Other Taxes
6,861,000
7,163,253
302,253
4.41%
Licenses, Permits and Fees
3,410,200
3,356,816
(53,384)
(1.57 %)
Intergovernmental
16,578,000
16,401,311
(176,689)
(1.07 %)
Charges for Service
1,628,690
1,694,563
65,873
4.049/.
Fines and Forfeitures
555,500
548,993
(6,507)
(1.17 %)
Interest Earnings
23,600
23,067
(533)
(2.26 %)
Miscellaneous
291,040
234,462
(56, 578)
(19.44 9/.)
Total Revenue
$ 41,094,530
$ 41,172,988
$ 78,458
0.19%
Property tax revenues were up only slightly from the final budget by $4,023. The amount
collected by the County and remitted to the Village came in at 98.5% of the original levy. This is
slightly below the average collection ratio of 98.6% for the Village in the past ten years.
Revenue classified as Other Taxes exceeded the final budget by $302,253, or 4.4 %. The
surplus over budget can be attributed mostly to the telecommunication tax and food and
beverage tax, which exceeded their budgets $225,668 and $67,630 respectively. The
remaining revenues in this category had minor variances plus or minus budget.
Intergovernmental revenues fell short $176,689 or 1.1% from the $16,578,000 final budget
amount. The original budget was increased by $832,500 for adjustments to various revenue
line items. Although receipts from sales taxes were down $35,399 from the final budget, when
compared to the original budget they were up $385,601. The Village did receive a FEMA grant
totaling $142,767, reimbursement for expenses incurred during the extreme snow event that
occurred in February 2011.
General Fund expenditures totaled $40,786,107, representing a positive variance of $1,189,871,
or 2.8 %, under the final 2011 Budget. The following table presents a breakdown of actual
expenditures as compared to the final budget for each department.
Department
Final Budget
Actual
$ Variance
% Variance
Public Representation
$ 525,998
$ 454,868
$ (71,130)
(13.52 %)
Village Manager's Office
2,618,479.00
2,645,349.00
26,870
1.03%
Television Services
170,979
149,956
(21,023)
(12.30 %)
Village Clerk
155,426
144,417
(11,009)
(7.08 %)
Finance
1,618,137
1,561,764
(56,373)
(3.48 %)
Community Development
2,252,212
2,109,428
(142,784)
(6.34 %)
Human Services
1,030,431
981,386
(49,045)
(4.76 %)
Police
14,840,002
14,657,035
(182,967)
(1.23 %)
Fire
11,554,618
11,448,614
(106,004)
(0.92 %)
Public Works
1 7,163,833
1 6,587,428
1 (576,405)
(8.05 %)
Pensions
45,863
1 45,862
1 (1)
1 (0.00 %)
Total Expenditures
$ 41,975,978
1 $ 40,786,107
1 $ (1,189,871)
(2.83 %)
The results from operations of the General Fund for 2011 showed a surplus. Revenues
exceeded expenditures by $386,881. Fund balance as of December 31, 2011 was
$10,804,868, representing 26.0% of budgeted operating expenditures for 2012.
Comprehensive Annual Financial Report
September 19, 2012
Page 3
In addition to performing the audit on the Village's financials, Lauterbach & Amen also
conducted two separate audits referred to as the Single Audit and audit of the Downtown
Redevelopment TIF. The Single Audit is a compliance audit of the Village's federal and state
grant receipts pursuant to the U.S. Office of Management and Budget Circular A -133. The TIF
Audit is also a compliance audit required by the State of Illinois covering our tax increment
financing activities. Results from these two audits indicate the Village is in compliance with
requirements outlined in the Single Audit Act and TIF Statutes.
A final requirement of Lauterbach & Amen is to prepare various communications to the Village's
governing board. The communications include the Management Letter, Representation Letter,
SAS 114 — Auditor Findings, and SAS 115 — Internal Controls. The purpose of these
communications is to inform the board of any problems encountered during the audit, and to
report any potential fraud or deficiencies in internal controls uncovered during the course of the
audit. No material weaknesses in any of the areas were found during the course of the audit.
Electronic copies of these communications are also attached for your review.
RECOMMENDATION:
It is recommended the Village Board accept the Comprehensive Annual Financial Report and
accompanying communications for the fiscal year ended December 31, 2011.
David O. Erb
Finance Director
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