CLINTON — Clair Buyert, a partner with Clifton Gunderson LLP, offered the Clinton City Council a review of the Fiscal Year 2005-6 Annual City Financial Report and Audit at the recent council meeting.

Buyert first explained that the auditor’s responsibility is to conduct the audit in accordance with generally accepted standards, in order to ascertain whether the financial statements are free from material misstatement, assess the accounting principles used and express an opinion on the overall statement presentation. He said in the opinion of Clifton Gunderson, the city’s financial statements present fairly the financial position and cash flow of the city.

According to the report, the city’s operating revenue budget was $8,334,374 and the operating expenditure budget was $11,699,600. The final budgeted amount for revenues was $35,495,328 and final expenditures was $50,203,322. In a budgetary comparison, the report lists the city’s total revenues as $32,749,675. That amount included $15,093,950 in tax revenue, $192,010 from licenses and permits, $594,836 for use of money and property, $7,683,942 in intergovernmental revenue, $7,173,017 in charges for services, $436,444 for property rental and $1,575,476 in miscellaneous revenues.

In a total expenditures of $45,181,528, the city spent $8,704,919 on public safety and $12,522,925 for capital projects. Expenditures included $2,689,177 for public works, $2,443,820 for culture and recreation, $1,356,850 for community and economic development. Debt service expenditures amounted to $8,379,435, while general government expenditures equaled $1,050,086 and business-type activities amounted to $8,034,316.

The city’s assets amounted to $161,769,480, while liabilities accounted for $41,816,288. Clinton had a total net asset amount of $118,953,192 for the fiscal year ending June 30, 2006, a 4 percent increase over the previous fiscal year. At the close of the fiscal year, the city’s governmental funds reported combined ending fund balances of $6,736,492, a decrease of $1,297,087 from the previous year. The unreserved fund balance for the general fund was $2,753, 398, or 21 percent of the total general fund expenditures at the end of the fiscal year. Reductions in the general fund are forecasted through fiscal year 2007-2008.

Clinton’s total 2006 capital assets including land, buildings, equipment, facilities and infrastructure amounted to $131,325,677. The city’s outstanding debt at the end of the fiscal year was $25,493,000. Of that indebtedness, $5,090,000 is abated from local option sales tax revenues, $2,535,000 from tax increment financing revenues and $175,000 from airport hangar revenues. During the year, the city issued $6,815,000 of new debt that primarily paid for capital projects associated with the Vision Iowa program. The city’s current debt limitation is $53,826,648, “which is significantly in excess of the City’s outstanding general obligation debt.”

Buyert told the council that while no material weaknesses were identified in the city’s financial report, the report showed that the expenditures for the year exceeded the amount budgeted. He said the budget should have been amended before being allowed to exceed the set amount. Clifton Gunderson also found instances where a bid project costing over $1,500 was not done under a competitive bidding process, as is required, and where Department of Homeland Security Employment Eligibility Verification forms were incomplete. In a letter addressed to the council, the company also detailed recommendations for improvement of internal control procedures including suggesting the city review personnel files for completeness, create a policy for capitalization of fixed assets and review staffing needs to make sure all work is completed in a timely manner.