HomeMy WebLinkAbout; ; 1991 Building Authority Financial Statements; 1991-06-30CITY CLERK
KPMG Peat Marwick
Certified Public Accountants
BUILDING AUTHORITY OF THE
CITY OF CARLSBAD
Combined Financial Statements
June 30, 1991
(With Independent Auditors' Report Thereon)
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Table of Contents
June 30, 1991
Page
Independent Auditors' Report 1
Combined Balance Sheet - All Governmental Fund Types
and Account Group 2
Combined Statement of Revenues, Expenditures and Changes
in Fund Balance - All Governmental Fund Types 3
Notes to Combined Financial Statements 4-8
Supplementary Statements and Schedule:
Combining Balance Sheet - Debt Service Funds 10
Combining Statement of Revenues, Expenditures and Changes
in Fund Balance - Debt Service Funds 11
Schedule of Insurance Coverage 12
Peat Marwick
Certified Public Accountants
North County Office: Telephone 619 931-8700 Telecopier 619 438-4298
2011 Palomar Airport Road
Carlsbad, CA 92008
Independent Auditors' Report
The Board of Directors
Building Authority of the
City of Carlsbad, California:
We have audited the accompanying component unit financial statements of the
Building Authority of the City of Carlsbad (the Authority) as of and for the
year ended June 30, 1991, as listed in the accompanying table of contents.
These component unit financial statements are the responsibility of the
Authority's management. Our responsibility is to express an opinion on these
component unit financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the component unit financial statements referred to above
present fairly, in all material respects, the financial position of the
Building Authority of the City of Carlsbad as of June 30, 1991, and the
results of its operations for the year then ended in conformity with generally
accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the component unit
financial statements taken as a whole. The combining financial statements and
schedule listed in the accompanying table of contents are presented for
purposes of additional analysis and are not a required part of the component
unit financial statements of the Building Authority of the City of Carlsbad.
Such information has been subjected to the auditing procedures applied in the
audit of the component unit financial statements and, in our opinion, is
fairly stated in all material respects in relation to the component unit
financial statements taken as a whole.
September 6, 1991
Member Firm of
Klynveld Peat Marwick Goerdeler
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Combined Balance Sheet
All Governmental Fund Types and Account Group
June 30, 1991
Assets
Cash and investments
Net investment in direct financing lease
Interest receivable
Amount available in debt service fund
Amount to be provided for retirement of
general long-term debt
Total assets
Liabilities and Fund Balance
Liabilities:
Revenue bonds payable
Deferred revenue
Total liabilities
Fund balance:
Reserved for debt service
Unreserved - undesignated
Total fund balance
Total liabilities
and fund balance
Governmental
Notes
2
3
Fund
General
$ 125,784
45,830
247
-
$ 171.861
Types
Debt
Service
19,114
-
56
-
19.170
Account
Group
General
Long-term
Debt
_
-
-
19,170
45.830
65.000
Totals
(Memorandum
Only)
144,898
45,830
303
19,170
45.830
256.031
81.830
81.830
90.031
19,170
65,000
65.000
90.031 19.170
$ 171.861 19.170 65.000
65,000
81.830
146.830
19,170
90.031
109.201
256.031
See accompanying notes to combined financial statements.
2
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Combined Statement of Revenues, Expenditures
and Changes in Fund Balance
All Governmental Fund Types
For the year ended June 30, 1991
Revenues:
Lease payments
Interest on investments
Total revenues
Expenditures:
Principal retirement
Interest
Administrative expenses
Total expenditures
Excess (deficiency) of
revenues over
expenditures
Other financing sources (uses):
Operating transfers in
Operating transfers out
Total other financing
sources (uses)
Excess (deficiency) of
revenues and other
financing sources over
expenditures and other
financing uses
Fund balance at beginning of year
Fund balance at end of year
General
36,000
6.461
42.461
4.522
4.522
6,024
84.007
90.031
Debt
Service
2,124
2.124
30,000
4,800
34.800
37.939 (32.676)
4,522 31,915
(36.437) -
(31.915) 31.915
(761)
19.931
19.170
Totals
(Memorandum
Only)
36,000
8.585
44.585
30,000
4,800
4.522
39.322
5.263
36,437
(36.437)
5,263
103.938
109.201
See accompanying notes to combined financial statements.
3
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Notes to Combined Financial Statements
June 30, 1991
(1) Organization and Summary of Significant Accounting Policies
The Building Authority of the City of Carlsbad (the Authority) was
organized on October 1, 1967 under a joint exercise of powers agreement
between the City of Carlsbad and the County of San Diego for the
purpose of financing and constructing a civic center building for lease
to the City of Carlsbad. Any excess of revenues over expenditures or
net assets of the Authority remaining after providing for all debts and
obligations of the Authority are distributable upon dissolution to the
City of Carlsbad.
The Authority is an integral part of the reporting entity of the City of
Carlsbad (the City). The accounts of the Authority have been included
within the scope of the general purpose financial statements of the
City because the City Council exercises oversight responsibility over
the operations of the Authority. Only the accounts of the Authority
are included herein; therefore, these financial statements do not
purport to represent the financial position or results of operations of
the City of Carlsbad.
The accounting policies of the Authority conform to generally accepted
accounting principles as applicable to governmental units. The
following is a summary of the more significant policies:
(a) Basis of Presentation;
The accounts of the Authority are organized on the basis of funds and
an account group, each of which is considered to be a separate
accounting entity. The operations of each fund and account group
are accounted for by providing a separate set of self-balancing
accounts that comprise its assets, liabilities, fund balance,
revenues, and expenditures. The various funds and account group
are summarized by type in the financial statements. The fund types
and account group used by the Authority are as follows:
GOVERNMENTAL FUND TYPES;
Governmental funds are used to account for the Authority's expendable
financial resources and related liabilities. The measurement focus
is upon determination of changes in financial position. The
following are the Authority's governmental fund types:
General Fund
The general fund is the general operating fund of the Authority.
It is used to account for all financial resources except those
required to be accounted for in another fund.
4 (Continued)
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Notes to Combined Financial Statements, Continued
(1) Organization and Summary of Significant Accounting Policiest Continued
(a) Basis of Presentation, Continued;
GOVERNMENTAL FUND TYPES. Continued!
Debt Service Funds
Debt service funds are used to account for the accumulation of
resources for, and payment of, general long-term debt principal,
interest and related costs.
GENERAL LONG-TERM DEBT ACCOUNT GROUP;
This account group is used to establish accounting control and
accountability for the Authority's general long-term debt. It is
used to account for all long-term obligations of the Authority.
(b) Measurement Focus and Basis for Accounting;
Governmental fund types are accounted for on a "spending" measurement
focus. Accordingly, only current assets and current liabilities
generally are included on their balance sheets, and the reported
fund balance provides an indication of available, spendable
resources. Operating statements for governmental fund types report
increases (revenues) and decreases (expenditures) in available
spendable resources.
Governmental fund types use the modified accrual basis of
accounting. Revenues are recognized when susceptible to accrual
(i.e., both measurable and available). Available means collectible
within the current period or soon enough thereafter to be used to
pay liabilities of the current period. Revenues that are accrued
include interest income.
Governmental fund expenditures are recognized when the liability is
incurred, except for principal and interest on long-term debt,
which is recognized when due.
(c) Budgets;
The Authority does not adopt an annual budget; thus, no budgetary
comparisons are presented.
(d) Investments;
Investments are stated at cost or amortized cost which approximates
market value.
5 (Continued)
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Notes to Combined Financial Statements, Continued
(1) Organization and Summary of Significant Accounting Policies. Continued
(e) Total Columns;
Total columns on the combined statements are captioned "Totals
(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
fund balance in conformity with generally accepted accounting
principles. Neither is such data comparable to a consolidation.
Interfund eliminations have not been made in the aggregation of
this data.
(2) Cash and Investments
Authority for Deposits and Investments;
State statutes require that all deposits be insured or collateralized.
Depositories holding public funds are required to maintain collateral
in the form of a pool of securities with the agent of the depository
having a market value of at least 10 to 50 percent in excess of the
total amount of all public funds on deposit. Investments are further
limited by the Authority's policy to invest only in U.S. government
obligations purchased through its trustee.
Classification of Investments by Credit Risk;
As defined in Governmental Accounting Standards Board Statement No. 3,
the Authority's investments are categorized in the following manner:
Category 1 - Investments that are insured or registered, for which the
securities are held by the Authority or its agent in the
Authority's name.
Category 2 - Uninsured and unregistered investments, for which the
securities are held by the broker's or dealer's trust
department or agent in the Authority's name.
Category 3 - Uninsured and unregistered investments, for which the
securities are held by the broker or dealer, or by its
trust department or agent, but not in the Authority's name.
(Continued)
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Notes to Combined Financial Statements, Continued
•
(2) Cash and Investments. Continued
Cash and investments at June 30, 1991 consisted of the following:
- Cost Market Value
Cash on deposit (All 100% insured) $ 42,643 42,643
U.S. Treasury Bills (Category 2) 102t255 102.255
t Total $ 144.898 144.898
(3) Lease Agreements
The Authority has leased the site for the Civic Center from the City
A under a ground lease dated November 1, 1967 for a total advance rental
payment of $1. The lease expires upon expiration of the Joint Powers
Agreement between the Authority and the City.
On the same date, the Authority entered into an agreement with the City
to lease back to the City the Civic Center site and the facilities to
^ be constructed thereon. The agreement requires annual lease payments
of $36,000 payable in advance on each July 1 until the Authority's
revenue bonds have been paid or provision for payment has been made.
In addition, the City must pay, upon written notice, all taxes,
assessments, insurance and administrative costs of the Authority. The
lease expires on September 30, 2007 or upon final payment of the
- bonds. This lease has been accounted for as a direct financing lease.
(4) Revenue Bonds Payable
The following is a summary of changes in revenue bonds payable for the
year ended June 30, 1991:
Revenue bonds payable as of June 30, 1990 $ 95,000
Bonds retired (30.000)
Revenue bonds payable as of June 30, 1991 $ 65.000
*
The Authority issued the 1967 Carlsbad Building Authority Revenue Bonds
in an original amount of $460,000 with interest payable at 6.0% per
annum. The bonds were issued under a trust indenture with Banker's
Trust Company as Trustee. The remaining bonds mature serially on
- December 15 of each year in amounts of $30,000 and $35,000.
(Continued)
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Notes to Combined Financial Statements, Continued
(4) Revenue Bonds Payablet Continued
Bonds maturing on or after December 15, 1979 are subject to call in whole
or in part at the option of the Authority at prices ranging from
100.75% to 104% of the principal amount of the bonds.
Debt service requirements to maturity are as follows:
Year ending June 30.
1992 $ 33,000
1993 36.050
69,050
Less amounts representing interest 4,050
$ 65.000
In accordance with the terms of the bond indenture, cash balances of the
following funds are restricted to be used for specified purposes as
follows:
General Fund - An amount necessary to pay administrative expenses and
maintain $1,500 in working capital shall be maintained in this fund.
Amounts accumulated after meeting the requirements of the interest,
principal retirement and reserve funds and the working capital
requirements shall be declared surplus and may be used to reimburse the
City for rent previously paid.
Debt Service Funds;
Interest and Principal Retirement Funds - On or before August 1 of
each year, a sum sufficient to pay twelve months interest due on the
next succeeding December 15 and June 15, as well as the amount of
principal maturing on the next succeeding December 15 shall be
transferred to these funds as necessary from the General Fund.
Reserve Fund - An amount at least equal to one half the maximum
annual debt service ($18,025) shall be maintained at all times. Any
excess shall on June 30, and December 30 of each year be transferred
to the General Fund. This fund may be used to pay the principal
and/or interest on the last maturity of the bonds outstanding.
8
SUPPLEMENTARY STATEMENTS AND SCHEDULE
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Combining Balance Sheet - Debt Service Funds
June 30, 1991
Principal
Assets Interest Retirement Reserve Totals
Cash and investments $ - - 19,114 19,114
Interest receivable - - 56 56
Total assets $ - - 19.170 19.170
Fund Balance
Fund balance - reserved for
debt service $ - - 19.170 19.170
10
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Combining Statement of Revenue, Expenditures and Changes
in Fund Balance - Debt Service Funds
For the year ended June 30, 1991
Principal
Interest Retirement Reserve Totals
Revenue - interest on investments $ - 979 1,145 2,124
Expenditures:
Principal retirement - 30,000 - 30,000
Interest 4.800 - - 4.800
Total expenditures 4,800 30,000 - 34.800
Excess (deficiency)
of revenues over
expenditures (4.800) (29.021) 1.145 (32.676)
Other financing sources -
operating transfers in 4,622 27,293 - 31,915
Excess (deficiency)
of revenues and other
financing sources
over expenditures and
other financing uses (178) (1,728) 1,145 (761)
Fund balance at beginning of year 178 1,728 18.025 19.931
Fund balance at end of year $ - - 19.170 19.170
11
BUILDING AUTHORITY OF THE CITY OF CARLSBAD
Schedule of Insurance Coverage
June 30, 1991
Insurance coverage maintained by the City of Carlsbad with the Authority listed
as additional insured at June 30, 1991 includes:
Amount of
Type of Coverage Coverage Term
All risk including valuable papers $ 36,068,500 10/01/90 to 10/01/91
Rental income 450,000 10/01/90 to 10/01/91
Equipment floater 517,400 10/01/90 to 10/01/91
Honesty Blanket Bond 1,500,000 04/16/91 to 04/16/92
Since January 1, 1986, the Authority has not been covered under a liability
insurance policy but is included under the City of Carlsbad's self-insurance
program.
12