By Myrna Trauntvein
Times-News Correspondent
The total net assets of Nephi City increased by
$2,707,513 this past year but the general fund, which is the
primary operating fund of the city, had a decrease in its
fund balance of $2,524.
The audit report, prepared by the firm,Larson &
Peterson, Certified Public Accountants, was presented to
Nephi City Council on Tuesday. Russell Olsen and Clyde
Jones, representing the auditing firm, made the report.
The audit was for the year ended on June 30, 2005.
Randy McKnight, city administrator, and Blair Painter,
city recorder, as management of the city, also prepared a
section of the audit known as the management analysis.
"The governmental net assets increased by $2,474,614
and the business-type net assets increased by $232,899,"
said Painter.
Nephi City's basic financial statements have three
parts. Those include government-wide financial statements,
fund financial statements and notes to the financial
statements.
Government-wide financial statements are designed to
provide a broad overview of the city finances in a manner
which is similar to private-sector business.
The net assets statement gives information on all the
city's assets and liabilities. The difference between the
two is reported as net assets.
The statement of activities gives information showing
how the city's net assets changed during the fiscal
year.
The total net assets of $28,431,736 is made up of
$20,086,790 in capital assets net of related debt and
$8,344,846 in other net assets.
Both government-wide financial statements separate
functions that are supported by taxes and intergovernmental
revenues that are to recover all or a significant amount of
costs through user fees and charges.
The only major governmental fund of the city is the
general fund.
"The general fund is the chief operating fund of the
city," said Jones.
All activities which are not required to be accounted
for in separate funds, either by state or local ordinances
or by a desire to maintain a matching of revenues and
expenses, are accounted for in this fund.
Painter said that taxes continue to be the largest
source of revenue in the general fund and represent 44.4
percent of the total general fund revenues.
"The largest element of taxes is sales tax, as it has
been for the last several years," he said. "It represents
55.5 percent of total tax revenues and represents 24.6
percent of the total general fund revenues.
Major capital asset events during the past fiscal year
included the government building expansion project at
$55,704; the street rehabilitation project at $135,738; the
airport expansion project at $2,623,266; and the new animal
shelter at $91,529.
At the end of the audit period, Nephi had a total
bonded debt outstanding of $2,367,095. Of that amount,
$1,770,000 is considered to be general obligation debt
backed by the full faith and credit of the city. State
statues limit the amount of general obligation debt a
governmental entity may issue to 4 percent of its total
taxable value.
The city falls well within that percentage.
"The city audit is a snapshot in time," said Olsen.
"In a nutshell, the audit indicates that we audited the
city's financial records and found that the city has a clean
audit in all material aspects."
The general fund budget, reflects an increase of 1.1
percent over the final budge for the fiscal year 2004. The
largest part of this increase is because of personnel
costs.
In 2006, some capital improvements which have been
budgeted include street improvements, street rehabilitation,
public works buildings, a downtown project, recreation
improvements, airport expansion, golf course expansion,
equipment purchases, and parks development.
"The audit does tell a story," said Jones. "It tells
us what happened last year."
In addition to the audit report, he said, it was
necessary to do a single audit because of the airport
project. Such an audit becomes necessary when a city spends
more than $500,000 in federal government funds.
The council accepted the audit which then becomes a
public document. The audit report is available at city hall.
Those with questions may also discuss them with Painter.
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