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Home My WebLink AboutAELR FY17Town of Fountain Hills, Arizona Annual Expenditure Limitation Report Year Ended June 30, 2017 TOWN OF FOUNTAIN HILLS, ARIZONA ANNUAL EXPENDITURE LIMITATION REPORT YEAR ENDED JUNE 30, 2017 CONTENTS PAGE Independent Accountant’s Report 1 Annual Expenditure Limitation Report - Part I 2 Annual Expenditure Limitation Report - Part II 3 Annual Expenditure Limitation Report - Reconciliation 4 Notes to Annual Expenditure Limitation Report 5 INDEPENDENT ACCOUNTANT’S REPORT The Auditor General of the State of Arizona The Honorable Mayor and Town Council of the Town of Fountain Hills, Arizona We have examined the accompanying Annual Expenditure Limitation Report of Town of Fountain Hills, Arizona for the year ended June 30, 2017, and the related notes to the report. The Town of Fountain Hills, Arizona’s management is responsible for presenting this report in accordance with the uniform expenditure reporting system as described in Note 1. Our responsibility is to express an opinion on this report based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we plan and perform the examination to obtain reasonable assurance about whether this report is presented in accordance with the uniform expenditure reporting system, in all material respects. An examination involves performing procedures to obtain evidence about the amounts and disclosures in the report. The nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material misstatement of the report, whether due to fraud or error. We believe that the evidence we obtained is sufficient and appropriate to provide reasonable basis for our opinion. In our opinion, the Annual Expenditure Limitation Report referred to above is presented, in all material respects, in accordance with the information prescribed by the uniform expenditure reporting system as described in Note 1. Heinfeld, Meech & Co., P.C. Phoenix, Arizona October 16, 2017 Page 1 Page 2 Internal Governmental Enterprise Service Fiduciary Funds Funds Funds Funds Total A. Amounts reported on the Reconciliation, Line D $ 21,608,124 $ - $ - $- $ 21,608,124 - B. Less exclusions claimed:- 1 Bond proceeds - Debt service requirements on bonded indebtedness 2,119,250 2,119,250 Proceeds from other long-term obligations - Debt service requirements on other long-term obligations - 2 Dividends, interest, and gains on the sale or redemption of investment securities 43,366 43,366 3 Trustee or custodian - 4 Grants and aid from the federal government - 5 Grants, aid, contributions, or gifts from a private agency, organization, or individual, except amounts received in lieu of taxes 121,904 121,904 6 Amounts received from the State of Arizona 191,169 191,169 7 Quasi-external interfund transactions 8,503 8,503 8 Amounts accumulated for the purchase of land, and the purchase or construction of buildings or improvemen - 9 Highway user revenues in excess of those received in fiscal year 1979-80 882,702 882,702 10 Contracts with other political subdivisions - 11 Refunds, reimbursements, and other recoveries 66,770 66,770 12 Voter-approved exclusions not identified above - 13 Prior years carryforward - 14 Total exclusions claimed 3,433,664 - - - 3,433,664 C.Amounts subject to expenditure limitation $ 18,174,460 $- $- $ - $ 18,174,460 TOWN OF FOUNTAIN HILLS, ARIZONA ANNUAL EXPENDITURE LIMITATION REPORT - PART II YEAR ENDED JUNE 30, 2017 Description See accompanying notes to report. Page 3 Internal Governmental Enterprise Service Fiduciary Description Funds Funds Funds Funds Total A. $ 22,463,548 $ - $- $ - $ 22,463,548 B. Subtractions: 1.Items not requiring the use of working capital - Depreciation - Loss on disposal of capital assets - Bad debt expense - Other postemployment benefits expense - Claims incurred but not reported - Pension expense - Landfill closure and postclosure care costs - 2.- 806,714 806,714 3.Required fees paid to the Arizona Department of Revenu 48,710 48,710 4.Involuntary court judgments - 5.Total subtractions 855,424 - - - 855,424 C. Additions: 1.Principal payments on long-term debt - 2.Acquisition of capital assets - 3.Other postemployment benefits paid in the current year but reported as expenses in previous years - 4.Claims paid in the current year but reported as expenses incurred but not reported in previous years - 5.Pension contributions paid in the current year - 6. - 7.Total additions - - - - - D. Amounts reported on Part II, Line A $ 21,608,124 $- $- $ - $ 21,608,124 See accompanying notes to report. TOWN OF FOUNTAIN HILLS, ARIZONA ANNUAL EXPENDITURE LIMITATION REPORT - RECONCILIATION YEAR ENDED JUNE 30, 2017 Total expenditures/expenses/deductions and applicable other financing uses, special items, and extraordinary items reported within the fund financial statements Expenditures of separate legal entities established under Arizona Revised Statues Landfill closure and postclosure care costs paid in the current year but reported as expenses in previous years Page 4 TOWN OF FOUNTAIN HILLS, ARIZONA NOTES TO ANNUAL EXPENDITURE LIMITATION REPORT YEAR ENDED JUNE 30, 2017 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Annual Expenditure Limitation Report (AELR) is presented as prescribed by the Uniform Expenditure Reporting System (UERS), as required by Arizona Revised Statutes §41-1279.07. The AELR excludes expenditures, expenses, or deductions of certain revenues specified in the Arizona Constitution, Article IX, §20, from the total expenditures, expenses, or deductions reported in the fund financial statements. In accordance with the UERS requirements, a note to the AELR is presented below for any exclusion claimed on Part II and each subtraction or addition in the Reconciliation that cannot be traced directly to an amount reported in the fund financial statements. All references to financial statement amounts in the following notes refer to the Statement of Revenues, Expenditures, and Changes in Fund Balances for the Governmental Funds. NOTE 2 - The exclusion claim for expenditures of separate legal entities established under Arizona Revised Statutes in the Governmental Funds consists of expenditures from the Municipal Property Corporation Debt Service Fund, Cottonwoods Maintenance Fund and the Eagle Mountain Debt Service Fund. Governmental Municipal Property Corporation Debt Service Fund $ 393,690 Cottonwoods Maintenance Fund 3,798 Eagle Mountain Debt Service Fund 409,226 $ 806,714 NOTE 3 - The subtraction of $48,710 for required fees paid to Arizona state agencies was paid to the Arizona Department of Administration pursuant to A.R.S. §42-5041 for administrative, program, and operating costs incurred in providing administrative and tax collection services to the Town. NOTE 4 - The exclusions claimed for debt service requirements on bonded indebtedness in the Governmental Funds consisted of principal retirement, interest and fiscal fees in the General Obligation Debt Service Fund. NOTE 5 - The exclusions claimed for dividends, interest, and gains on the sale or redemption of investment securities in the Governmental Funds consisted of investment earnings. The current year exclusion utilized is a follows: Governmental Carryforward exclusions as of 6/30/16 $ 25,974 Investment Earnings 55,127 Current year exclusion utilized 43,366 Carryforward exclusions as of 6/30/17 $ 37,735 Page 5 TOWN OF FOUNTAIN HILLS, ARIZONA NOTES TO ANNUAL EXPENDITURE LIMITATION REPORT YEAR ENDED JUNE 30, 2017 NOTE 6 - Grant revenues, contributions and sponsorships from private organizations are claimed as exclusions in the year the expenditure occurs and any unused amounts are carried forward for future years. The current year grant exclusion utilized is a follows: Proposition 202 $ 85,652 Contributions 28,544 Sponsorships 7,709 Current year exclusion utilized $ 121,904 NOTE 7 - State grant revenues are claimed as exclusions in the year the expenditure occurs and any unused amounts are carried forward for future years. The current year state grant exclusion utilized is a follows: Arizona Sports and Tourism Authority $ 138,576 Proposition 202 31,584 Local Transportation Assistance Fund 21,009 Current year exclusion utilized $ 191,169 NOTE 8 - Quasi-external interfund transactions are claimed as exclusions in the year the expenditure occurs and any unused amounts are carried forward for future years. The current year exclusion is $8,503 related to the Town's environmental fee paid from the General Fund to the Environmental Fee Fund. NOTE 9 - The highway user revenue (HURF) earned in excess of the amounts received in fiscal year 1979-80 is as follows: HURF Fund Intergovernmental Revenue $ 2,480,304 Less: Vehicle License Tax Revenues (941,364) Excludable Revenue $ 1,538,940 Carryforward HURF funds as of 6/30/16 $ 863,929 HURF Fund Expenditures 2,925,613 Less: Expenditures of Vehicle License Tax (941,364) Less: Expenditures of Non-excludable Revenue (901,547) Less: Amounts Transferred from the Capital Projects Fund (200,000) Fund for Eligible HURF Expenditures 882,702 Less: Current Year HURF Funds Utilized (882,702) Carryforward HURF Funds as of 6/30/17 $ 1,520,167 NOTE 10 - Refunds, reimbursements, and other recoveries are claimed as exclusions in the year the expenditure occurs and any unused amounts are carried forward for future years. The current exclusions utilized was $66,770. Page 6