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SUBMISSION AND ACKNOWLEDGING RECEIPT OF REPORTS ENTITLED "COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR FISCAL YEAR ENDED JUNE 30, 2012,"AND "THE CITY OF NORMAN SINGLE AUDIT REPORT FOR THE YEAR ENDED JUNE 30, 2012," AND "NORMAN TAX INCREMENT FINANCE AUTHORITY FINANCIAL STATEMENT FOR THE YEAR ENDED JUNE 30, 2012" AS PREPARED BY THE CITY OF NORMAN FINANCE DEPARTMENT AND AUDITED BY THE FIRM OF COLE AND REED, P. C., FOR THE CITY OF NORMAN, OKLAHOMA, NORMAN UTILITIES AUTHORITY, NORMAN MUNICIPAL AUTHORITY, AND NORMAN TAX INCREMENT FINANCE AUTHORITY.
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BACKGROUND: Oklahoma Statutes, Title 11, Section 17-105 require that an audit of the funds, assets, books, and records of the clerk and treasurer of the City be prepared and reviewed by an independent qualified accountant. The City of Norman has, since fiscal year 1988-89, prepared an audit in conformance with Generally Accepted Accounting Principles (GAAP) promulgated by the Governmental Accounting Standards Board (GASB). For the past sixteen fiscal years, the City has received the Government Finance Officers Association's Award for Achievement for Excellence in Financial Reporting. The Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2012 (FYE 2012) is included here. The CAFR includes financial statements for the City of Norman, the Norman Utilities Authority, and the Norman Municipal Authority, as required by the Trust Indentures of various Trusts of which the City of Norman is the beneficiary.
Many of the federal and state grants that the City receives also require an audit report to be reviewed by independent accountants, as directed by the Federal Single Audit Act of 1984. The "single audit" report is also included.
The University of Oklahoma Foundation, as the lender for TIF Note No. 1, requested a separate audit review of the funds of the Norman Tax Increment Finance Authority (NTIFA) be performed in conjunction with the City's annual audit process, beginning in fiscal year 2008-2009. The annual NTIFA audit is also included here.
On March 25, 2008, the Council accepted the proposal of Cole and Reed, P.C. (RFP 0708-64), to provide independent auditing services for the City of Norman, the Norman Municipal Authority, Norman Utilities Authority, Norman Tax Increment Finance Authority and related entities for a period of three fiscal years with an option to extend the services for an additional two fiscal years.
DISCUSSION: The financial statements of both the City and its Trusts have received an unqualified opinion from Cole and Reed that they fairly represent the financial position of the City as of June 30, 2012 in all material respects.
Under separate cover, the Council Audit/Finance Committee will receive a "management letter" from the City's external auditor. The management letter may discuss findings during the audit review that are not considered material to the overall operations of the City, future audit and accounting standards to be considered, or other items that would impact on the fair representation of the City's financial position.
RECOMMENDATION: It is recommended that the Fiscal Year 2011-2012 Comprehensive Annual Financial Report, NTIFA Audit, and Single Audit Report be accepted.