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Home My WebLink About; ; 1978-79-80 Audit Report; 1980-09-12� ` . � M... F �, - - -...- -- ,ie r, i'. . ;: �� i .� �: f� .�, .� 5.9 t � b ( • c. i �5Y 4 ' tt . � �� CITY OF CARLSiuAn WAT�R DEpARTM�:IJT REPORT 01V FIT3ANCIAL STATEMENTS (WITH SUPPLEMENTAL NiATERIAL) TWO YEARS ENDED JUN� 30, 1.980 GEURGC A. PETEFtSON & CO. CERTIFIED PUHUC ACCOUNTANTS 7816 IVANHO� AV�NVE LA JdLLA, CALIFORNI^ 9L037 ,3 -. � � i � . , [ � � 2 � k � � .. : � - 1 � � � * , . , z � � . ; � . � , f , fi ` �� € � i a f Y 4 i i 5 + { ; � 4 ^ � , 1i J � m e 4 1� :� r, i: �' �; � � � _' ,� �� t' �• � � a, t s } �{ k r CITY OF CARI,SB�1D WATER DEPARTMEi�iT REPORT 02d Fr�ANCItAL STATE2dEVTS (WITH SUPPLEMENTAL MATERIAI,) TWO YEARS ENDED J'UNE 30, 1980 � � � , ; � ,; , � � � F t � � ' � 6CORUE A.pC7CPSON,C.P.A. RICNARD E.NANS�C,P,A. TMOMFy JR BRADY�A. p, �,,C, p.,� 6ENE R.NONRAD,C,P,A, GEORGE A. PETERSON & CO. CERTIFIED PUBLIC ACCOUNTAWTS 7816 IVANlsOE AVENUE lA JO�LA, CALIfORNtA 92037 TfLEPHONE (714) 454-61?6 AUDiTQRS' R�PORT Honorable City Council City of Carlsbad, Ca].ifornia ME?ABERS .114ERIGAN lil3T�7U:E OF C�RTIfI£O PUBI.IC ACCOUN7AN:S GALtFORNfA SOCIESY OF CER7IFIED PVBItC ACCOUNTANTS We have examined the baiance shee� of the City of Carlsbad Water Department as af June 30, 1980 and 1979, and the related statements o� iricame and retained earningG., and change� in financial position for the years then ended. Our examination was made in accordance with general2y accepted auditing standards, and accordingly includec such tests of the accounting records an�3 such other auditing procedures as we considered necessa�y in th� circums�ances. In our opinion, the afoxementioned financial fairly the financial position of the City of Department as of June 30, ?980 and 1979, and operations and changes in f3nancial position ended, in conformity with generally accepted ples applied on a basis consistent with that year. statemen�s present Carlsbad Water the results of for the years ther� accounting princi- o� the preceding The accompanying supplementai schedul�s are not necessary �or a fair presentation of the financial statements, but are ure- sented as additional analytical data. The supplemental sc�edules have been subjected to �he �ests and other auditing procedur�s applied in the examination of the financial statements listed in the foregoing table of cc�ntents ar�d, in our opinaon, are fai.rly stated in all material respects �n relation to the financia.'t statements taken, as a whole. GEORGE A. PETERS(7N & CO.• � �� ,�- �- �', . � Se�tember 12 , 1980 -1- �� s � i � � i ! f t f 'f � � � t � i ; 0 0 a H H f11 N X W ��i �� N w c �. O Nw H�� U3 v1hN v tt5 M P �p � M t� a� .i F [O f�'1 t� O� �C� 01 ti .i N N ..� K O M u G y � O � � M 01 h N O+ o m v ..� u� �I K. !.7 N .�1 P� -� � z .-� ., QM CJ Q N • cy w❑ az (tj M C 6t � �A O C1 H � rs a a �° a w dw NN 1�tlQ �7 ai ?� k N�i6U m w p,c aa�`�L a�eo�+ �e��aQ �GWW� 11 � Cl G ViCGiA v o, ro U C 7 7 O � O V�' 4D N V N n O C`� C�' b NI O~i t� O.-1 00 O O O N O O �'f M N( 11� N V1 tt! N N I+ O+ O O h 1� � sf� p� �+ m eV t0 f1. N v N US t!1 m � 00 10 +-f N Q t� f�'7 M�D �'1 eV f� �y� ' ^�I �"� M N N fp Li a1 C C' c 'a O C M O O M Yl .-1 .d ""� Ov tD N 4� N NON O O� r� p O O f'f rvf N h O� O� O 00 t0 00 m �1 v O �'e 1� .-1 t!5 l0 N vf ! N a W fh •y .-i M Pl �D v rf f� .t N M� CD � � � v v °>e E �.�i � u •.� .� W N� c� .., a � H x�i C X �.�i ry tJ edi }..W. Vf �.1 L� „�.� N C � � R �-Wi H...w �.�1 v� Q A ..1 a>, o cr o°�. �0 ,� fA 3J X r7 O �u .+ a w a •., a... °'vz°�° s, � � .."i �,�, c� ci �'�°..'n w M 11 q1 t7 V 07 O! i� 01 .1 %+/ U 7 ri M t H 0�1 L�i SM+ �-�i d 3i Q C7 A w�.%i ? v (�j �y l�i C �a m u � II E � �� .�i a C aui v ►zi s�r o m rt w.0 .0 ro v tn .. ri O U c� 4 vf 2 H V U �Q>.- av a•Km � � �c�r�`'�as�'+ � zv � �o�,."a m ° a a a, �a L c� �, $� s� � �s nr ., (.�-�i a a�i�a O E E�%R N � m av H � x .ZWWH:i S� G1� �NFGU�U p>�W Ny,�Uaai Zp a V f.Z v 4G V � y � � v Y 1� L � N � o+ rs �o ..± �+ u m � v. .ti w O ai N � C1 �D Q O G � � N � W 77 N � V .� r� O a o� a � a, e 7 u U ro W � � w � � G� f3 � N u ..�i H � M � u U �'J � U N 006�t�f Nr-iNOO�i 00 I O�OIN O aoonr�ro u� orcnv c.t ro 0o a oo in o�o � n w do �n ��W�I N MN O � �v �n � o� .a vr� � "� N N N tD Oi t�� .-i t� u1 N N �D Of eT N OP M O� R �O 01 OL �D '1 `P f� h O lf1 1[1 N O� .-i N N t� N O� fQ O� O!�� M Cf O 01 OD .y M V` h N Q/ fD M V' �O Ifl f`t M � I� rl O N rl '.{ � �.,� N O C'1 f7 1tY M N ln (� N N f+1 1/1 .�+ u� .� �c � �o .i � � �" M v h a` M t� O m � b N �'1 V1 O �D 4 V rl {(� M ri r1 t�1 r' =+ a N Cl .��t C7 tlf a.i [� d � ++ ro v7 5..'� D 3� O�4 N 7 C9 G � r, Z 9 N � Cl O tll � 17 V N Q EGJ a� V R3 �-Ui G O� � t�j N d Cl RS tf, O� t0 Q1 6� .> RS O•.1 r� o.� u a� m o:, �, x s+ ro m V S� uJ ,i.l i� V U 0] N W u1 Q 1� O N 4 .� .t �1 ..� � y Ry .a7 9 N U OJ 61 .it �C 1� t0 w �o •.� ¢+ oo w �.+ n ro m a� 2� e H o a v v a G � X:a �.tl1i v c�i ~ o � A � �Nc x�,' � �c�W�c s� ws'�i o�a o C � S� d .-1 L.0 G+1 nl � M .ti N r�i am �, R oo�a� a �o o..r ro E++ ro o�v +� w z� ro a+ a+-1 d 7 s, „ �u'',��cm �°+ �i�"a�� H N'M°a uo ° �t�oWm W ►�ttaiu E R�tDy UG� Q� p; Ntlf � U MXq/ a'Cpq �UHiC'a'iNW NWVUi-[tiS M�y� �U5 V a a, G � 'r 7 +. . { :; � , EXHIBIT B CITY OF �'ARLSBAD WATER DEPARTMF.iVT STATEME�IT OF OPERATTONS Year ended June 30, � ].980 I.979 OPEE2ATING REVENUES Water sa?es $1,479,826 $i.,308,601 Connection charges and other fees I1,98U 12,240 ; � Tota1 operating revenues $1,491,806 $1,320,841 • OPEX2ATING �XPENSES (Exhihit FF) 1, 333 ,560 1, 269, 836 , Operating income ].58,2�6 51,005 � , ; ' NON-OPEFA�ING REVENUE . . Earnings on �nvestm�nts S 233,385 $ 153,297 , , Sales oi fixed assets 81,626 - , -- � ', Tozal non-operating revenue $ 31S,OY1 $ 15:3,2.9? ; F NON-OPERATING EXPENSES �� ; Interest and �iscal agent's fees 77,573 85,602 � � ; , r' , � NET INCOME $ 395,684 $ 11$,700 See accompanying summary af accountinq policies aied notes to yinancial sta+�ements. -3- � ti t �, t ; � , , i , , F i i � � t : , , � i � 0 EXHIBT'� C CITY OF CARLSB.AD WATER DEPARTMENT STATEMENT OF CFiANGES IN RETATNED EARNiNU5 Balance at beginning of year Add net inco�nE for th� year Deduct Increase in reserve for bond clebt service Balance•at end oE year 0 Y�a� ended June 30, 1980 I979 $2,784,259 $2,731,749 395,685 iis,700 3,179,344 2,8�0,449 9J.,1&3 66,190 $3.088,78I $2,784,259 See accompanying swnmary of accoun�ing poli�ies and not�s to financial statements. -4- ; � , ; k � . �,i Q �;xhibit D CITY OF` CARLSBAD 69ATER DEPARTNSENT STATEMENT OF CHANGi,S IN FINANCIAL POSITTON � Yeax ended June 30, 1980 1979 , SOURCE OF �'UNDS Operations: Net incame Items riot requiring current outlay af funds: Depreciation and am�rtization Total operations Decrease in restricted assets Incxease in rEserve �or construction Inarease in contributions Decrease in w�rkin� capitai Tot�l APPLICATION �'UNDS Addition� to u�ility plant in service �tetixement of revenue bonds Increase in construction in progress Tncreas� in restricted assets Increase in working capital Total VARIOUS ELEMENTS UF NET TNCREASE (DECREASE) IN WOitKING CAPITAL Cash Investments Accounts rea�iv�ble Accx•ued interes� receivable Inventory Prepaid expenses Accounts payabl� Due to qeneral fund Bonds payable - current portion Accrued interest payable DepoSits Total $ 395,68S 140,702 536,387 -0- 49,561 _p_ -0- $ 585,948 $ 22,690 100,000 80,310 ].46, 507 23G,441 $ 585,948 $ 28,672 I.31, 732 $3,�57 10,783 4,834 (2,419) (23,123) 13,337 (5,000) 2,521 (7,953) $ 236,441 $ 118,700 133,?43 252,443 47,350 30,135 139,968 14,47,2 $ 464,358 $ 197,402 95,000 29,157 I.42,799 -0- $ 464,358 $ (31,471) 40,010 (�,481) 708 (30,928) ?,554 20,240 -0-� (5,000) 2,806 (2,850) $ (14,412) See accompanying summary o� accounting policies and notes tu financ:ial statements. -5- � , � � r a CITY OF CARLSBAD WAT�R DEPAitTMENT SUMMARY OF ACCOUNTING POLICIES The accounting policies of the Department conform to generally accepted accounting princzples. The following is a summary of the significant policies. , BASIS �OF ACCOUI3TING The Department's accounts are m«intained on an accrual basis of accouriting. Accordingly, revenues are recorded wh�n f earned and expenditures when incurred. � tJTILITY PLANT SN SIERVICE � Utility plant in servic� is stated at cost. Expenditures ' for addi�ions, renewals and betterments are capitalized, expen- ditures for maintenance and rppairs are charged �o expenses as ; incurred. Upon retirement or disgosal of assets, the cost ' _ ! and accumulated depreciatian are eliminated from the accounts � and the resu'lting gain or loss is i.ncluded in income. Depre- ' ; ciation is computed on the straight-line method over the esti- , � mated use�ul lives af th� assets. � t , ; r � . � J CITY O�' CARLSBAD WATER DEPARTMENT NOTES TO FINANCIAL STATEMENTS ; � i � NOTE 1--CASii AND INVESTMEI3TS The Department, in conjunctic� with the City, main�ains one general bank account fc�r a11 funds. Investments are purchased through this account and are then allocated to the respective tunds based up�n excess cash balances. NOTE 2--REVENUE BONDS PAYABLE Revenue bonds payable are special obliga�ions oi the City and are secured by a lien on gross revenues of the Water Depar�.- ment. At June 30, 1980, authorized but unissued 1970 xevenue bonds amounted to $575,Q00. The bond resolutions require the City to impose rates and charges suff icien� to maintai.n net revenue coverage of 1.35 times maximum debt service requireme:�ts in any Euture year and 1 times any other obligations payable by the Water Department. Net revenues for these purposes in the year ended June 30, 1980 fulfilled these requiremen�cs. Also, pursuant to the bond resolutions, the City has main�ained the required insurance coverage to the extent reason- ably necessary to protect the City and the bondholders. NOTE 3--VACATIQN AND SICK PAX BENEFITS ; As o� June 30, 19g0, employees of the Water Department � had earned but not taken vacati.on and sick leave benefits which, : at their current salary rates on such da�e, amounted �� approx- ; � imately $37,000. if annual leave is not taken by the e�rployees ' during their emg�.oyments, the Water Department is committed to ` make cash payments to them on termination or retirement a� �he salary rates then i.n effect. Under e�:istinq policy, Water Departmen� emplcayees ar� nnt gaid tor �hexr accumulated and unused sick leave upon �ermination or retiremen�. �� '+ i i I 4 i I � � E i � a� • � � - H � N W WF W fA O � � �� U�N�; wW�hih cz �+wob U3►y�t � N S.� � � �� "a'� VI W O W hL'1NN i0 Ci O� N, O• O� O O O 6� O 05 �D Q� d� rD ri .-� n o+ �r N .�1 O� M v ca o w a� .a ev �v n ro .0 r co ca in .-� c oo v ev in n r� o w co � H �-1 Q+ .-1 �-i N M W C1 � M�4 W tll � O N � r-1 ei N N, U N c v � � � � t�0 0 N ^: �: �"± M� v c t �' d' 'U C il C N N � a M M C � 3� ts� Vr ' .� � � � O � � � � N O C d C O6 cp 71 '.7 M f+1 N W f`1 N a N I� � � � � m ro O O � w Mi M N Np </i U 0� W t��l .N-i M O C � O) Q�i O�i 1D O�i ��f1 •' I� f� .-i i� �O G� It1 00 O CO ri h M M 1�i tA f� CS1 V� .-i �i eP �D N V1� '-I e-i e! � IA tn � �� tl N I tD 00 O\ f+ 'V' O tA r N � � vt � � N O N .i ,.� O m o� h �a �p � C� N N I!1 1A � C N� O�0 A Q` � Q � � � M t"1 � C V t� O lDl M �D O l0 M ' Q� O CD Op M er � Q� M 01 N M V� � d y �-i � ?�+ � c G A � it+ S! '.I •i� W y C1 G � ,~ t9 b� � U Sa ECJN � '�dj � �t N � � � N n��J e M U Q%) �[y � x� � Ri 1�1 Q R1 N L7 W �1 W•.i � � U U' �W' W W.� � W C W J � H N 0 M x +1 d fA iac: ro u o � � uK a � �",�,a � �y t�•�i �r p� N u! .0 «^i G 0 1� H � C+i ar t�n 3 a�.� d H x� y.�� Q F � a� [�• tat� � tj � H O F W N� z mao u s�.�n�w �i �ro � ma>o � uHa � w�;v w �a � uuH� (� q N i� � � G � � � 11 � 3J N .� ro .,� U C A C W � N d � O K C A N � .'{ V .� e-1 L1� tT F y � V � w O � � � N � � e b 2 O u u m e� � N < � � � � i 0 GA N � M x W i � ' Ui , ; , x w N z � � M �i N a .� , ��[�a� �OyM QI , va�"a , waz� � �+w�na U � 7�}t � ' U N � � � a O N N N i � � e i , 1 0 'd' N n V' M M N O O V1 N N N M .�1 O R �O qi i� Q N �O �B P IA N �f1 !`� �D v � � O� O M f0 N O a' �p O �p I Ci O� C'1 r�a �P O N OJ 'C N OD {� I C.1 N pf q, I ^.1 ih � N y N� � O k � �i � V � t4 f� ('1 rl .i h h e .-1 O et 0 .i r a+ �f o� M co rf N •.� co w o a ao ., v o 0 � M v Vl vf .-! .�l v vT N O O N t� N a LI N '� iL y n e� v �o o� w a� .s o � �'! CO GO Pl O� �-1 vi t0 M O �f �A O� �D �!1 e'1 C� N �D < �"1 01 �� f� M O c0 Of N O� 1p �� N r'1 � N N �"1 N f� ..1 ' M h ,,,� N y �O O� �t1 v v tA M �tf .-� f� lD N f� uf .r a� u .r �o a �o rn �o m � O 91 OD t0 tD �D O� \D �1D lff ''1 f M �'1 O m .-i �D O �O tC t� N N �A 6f 01 f'1 00 '-1 S'� O M C'1 t7 M < Q� � p a.-1 N N r/ W r-1 .�1 N OD OD h y ^� M b N q y � � � eo m y I-1 � h h a�,l � � o o � rn a P: N e-1 � G y N f L c C W C� m � n N � u rn r^. o .-� � 00 cO 1� O� V N � .� n O M L t"� 'a' O 'd � � y N ro e ro N � �.1 b N Vf r Y I!1 f"1 C� �7 U u1 t0 OD lD .�1 �D 'r tD 1(1 N tD O C� O (9 O� 1D �P tA Qf �O O� W �f U1 e�/ �O r�l t�f Q1 ♦ � . ♦ . • • ♦ . � � .� �v o �o m n c� o �n .-+ n c� n d o� � ao .a ci o c� r� ,�c o'f c rn a n �.-I N N rl �0 �-i .-i N N 1� U h ./ r� �p� � ? N J] C 7 O V U b W ,� 0 � � G � g p � w�. E! y C m Omi C�j q �I W O N e3 i0 � G Q1 M"'� M iT (�(�,, C N O �' C G C O N � b Q y � � G a�u t�n � � ..�iu y xs+ ua�i ��o E W �J rC d N .Y 0, tA N� fR 'O 17 H C 7 N C Rf O� l� � q G tll A O� C C W Cl fr .O T7 �0 p 3+1 d U N O •.� �+1 C tE d ./ � V u W p W � J1 N�1 M � �� li i. M V �� H l0 RI G 1Q e��1 O M �ri ',7 {( N W O7 � d� a � a s�°i �O � � oa w y� c�i � .�'i c�i a , E� at FC W O E M � N ! t, ! J � 1 i 1 t ' l i t i ,� r i i , i a 7 , a -_ � 'L ` • �� • ,� i ! i rXiJr.�Tm �� CITY OF CARLSBAD ��+r�� yy WATEIt DEPARTMENT A.NALYSIS OF RESERVES FOR BOND DEBT SBRVTCE Year ended June 30, 1980 i� � �� ; � ;� �� 6 1 ti Recenue Bonds 1958 1960 1970 Total Balances at beginning o£ y�ar: � Bc�nd debt service $ 19,837 $ 50,999 $348,1�0 $4I.8,996 Bond retirement 52,357 67�5?9 118,205 238,081 � , Totals 72,194 118,518 466,.365 657, ± 077 Add revenues: Earnings on investments 1,8Q9 6,6b2 43,�56 51,637 Trans£ers from water ' fund 46,682 19,511 148,710 214,90� Totals 48,491 26,173 191,876 266,54�J , � Less ea;penses : � Interes�t and fees 15,451 9,171 55,755 80,377 � � Principal payments 35�OQ0 5,000 55,000 95,004 � Totals 50,451 14,171 110,755 175,377 � Balances at er�d of year: ; Bond debt service 17,877 63,001 429,28i 510,155 Bond retirement 52,357 67,519 118,205 238,081 Totals $ 70,2� $130,520 5547,486 $7�8� See accompanying summary of accounting poZicies and notes to financial statements. -10- � " ,� � CITY OF CARL5BAD WA.�'ER DEPAR�MENT ANALYSIS OF RESERVE FQR CdNSTRUCTiON Year ended Jun� 3U, 19.80 Balance at beginning ot year Add: earnings on investments Balance a�k end of year EXHIBIT DD $3aQ,272 49,561 $429,833 �See accomganying summary of accounting policies and notes to fi.nancial statemen�s. --11- ; � �t � , s � .. . . �{ � � j c , � � ; P i � ± l: t I � i CT�'Y 0�' C1�IRLSBAD WATER DEPARTMFNT Jni13�LVLL Vi nL�3�iVtJL DULVUj YY1St1DLL June 30, 1980 Exhi�it CC Principal. Years of Interest Due Each Maturity Rate Year iong-Tezm Current WATERWORKS REVENUE AONDS, 1958 July 1, 1.98Q-81 4.25 $ 35,000 $ 35,OQ0 $ 35,000 1982-84 9.25 40,000 i20,000 -0- 1985 4.10 40,000 4�.,OOC -0- 1986-87 4.10 45,000 90,000 -0- 1988 4.10 �7,000 47,Q00 -0- T�TALS 332,000 35,A00 WATER REVENUE BONDS, 1960 Ju1y 1, 1980�86 4.25 t0,000 G0,000 10,0,00 I987-88 4.00 15,000 30,000 -0- 1,989 4.00 60,000 60,000 -0- 1990 3.875 65,000 6�,040 -�= TOTALS 215,000 �.0,000 NTA�ERHi0RK5 REVENU� BO'NDS, 1970 - Series A TOTALS BONDEU �NDEBTFDNESS, JUNE 30, 198fl July 1, 1980 6.00 I.981 6 .15 1982 6.30 1983 6.40 19�4 6.50 1985 6.6'0 i9s6 6.�0 1y87 G.80 1988 b.90 1989--90 6.d0 55,000 -0- 55,0.00 60,000 6`0,�00 -Q- 60, 000 F'O, O(!0 -0- 65,OGQ 65,000 -�0- 75,000 75.,OOQ -0- 80,000 80,OQ0 -0- 85, 000 85., 00(? -0- 90,000 90,000 -0� 95,000 95,000 -0- 100,000 204,000 -0- 810,000 55,-Q0,0 $1,357,000 $I00,0�0 See accampanying summary ot accounting pol.icies and notes ta financial statements. ��.z- ,. 3 � , t 4 �. ; � , «� A" vi i�i vi ��`.n�LJDtyL WATER nEPARTMENT SCHEDULE OF OPERATiNG EXPE�ISES WATER PROD'JCTION AND PURIFICATTON Salaries and wages Power Supplies and expense Pu�chased�water Depreciation Totals WATER TRANSDYISS��JN AND DI5TRIBU��iON Salaries and wages � Power r �ommunications ` Maintenance ' Pump station and reservoirs � Meters and services i Transmi�ssion and distributian i Dep,r.eciation � Totals , r � �. GENE�2AL AND ADMINISTRATIVE Salaries ��jid wages Operation an� maintenanc�- mobite equipment Professianal services Of£:ice supplies equipment maintenance Small �ools and supglies Maintenance and suppl'ies, buildings Taxes and insurance Contributions to retirement plans General expense Col�lection fees Deprecza-ticn and amortiz�tion Cost applied to iitility p7.ant in service Totals TOTAL OPEFtATZNG EXP.ENSES Exhibit F�' Year ended June 3d, 1980 1979 $ 39,831 1,828 41,208 713,898 24,909 821,674 $ 38,661 1,234 1, 64 9 645,110 24,909 711,563 142,538 3,455 1,023 7 r-225 18,568 12,113 82, 66'' 267,589 94,864 3,897 16,b30 33,,817 3,487 1,221. 20,,071 44,999 2,3�2 57 33, 7.26 f1o,174> 244,297 $1,333,560 144,009 6,313 584 9,839 29,002 2U,282 8]., 967 291,996 100,617 $,035 8.,183 32,49'7 2, 991. 257 51,776 � 3,, 023 2,200 238 26,867 (10,4Q7) 266, 27.7 $1,269,836 See accompanying summary o� accounting policies and notes to fina:�cial statements. -13- , � . ..� JY S S t �