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Accept the following reports for the fiscal year ended June 30, 2025: Solano County Annual Comprehensive Financial Report (ACFR); Solano County Popular Annual Financial Report (PAFR); Report to the Board of Supervisors; Report to Management; and the Report on Applying Agreed-Upon Procedures (AUP, GANN Limit) for the fiscal year ended June 30, 2026
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Published Notice Required? Yes ____ No _X _
Public Hearing Required? Yes ____ No _X _
DEPARTMENTAL RECOMMENDATION:
The Auditor-Controller’s Office (ACO) recommends that the Board of Supervisors accept the following reports for the fiscal year ended June 30, 2025: 1) Solano County Annual Comprehensive Financial Report (ACFR); 2) Solano County Popular Annual Financial Report (PAFR); 3) Report to the Board of Supervisors; 4) Report to Management; and 5) Report on Applying Agreed-Upon Procedures (AUP, GANN Limit) for the fiscal year ended June 30, 2026.
SUMMARY:
In accordance with Government Code §25250 and pursuant to the contract terms approved by the Board of Supervisors on April 22, 2025, Eide Bailly, L.L.P., CPAs, conducted audit services and has issued the following reports: 1) Annual Comprehensive Financial Report (ACFR); 2) Report to the Board of Supervisors; 3) Report to Management; and 4) Report on Applying Agreed-Upon Procedures (AUP, GANN Limit) for the fiscal year ended June 30, 2026. In addition, the ACO also issued the Popular Annual Financial Report (PAFR) for the fiscal year ended June 30, 2025.
For the fiscal year ended June 30, 2025, the County received an unmodified opinion (clean opinion) on the ACFR. The Report to the Board of Supervisors did not note any significant or material audit matters. The Report to Management included three recurring observations from prior year relating to Information Technology (IT) User Access Reviews and security management related to reviews of the Security Organization Controls (SOC) Report and capital asset transactions.
Consistent with the prior years, the Auditor-Controller’s Office believes the current ACFR and PAFR continue to meet the Certificate of Achievement Program’s requirements and has submitted them to the GFOA for consideration for another award.
FINANCIAL IMPACT:
Acceptance of the audit reports has no financial impact.
DISCUSSION:
Annual Comprehensive Financial Report
The ACO prepares the Annual Comprehensive Financial Report (ACFR). The ACFR includes an introductory section, a financial section, and a statistical section.
The introductory section provides general information on the County’s structure, awards received and personnel as well as information useful in assessing the County’s financial condition (pages 1-13).
The financial section (pages 15-170) contains the basic financial statements and required supplementary information as well as the independent auditor’s report. A narrative overview and analysis of the financial activities of the County for the fiscal year ended June 30, 2025 is included in the Management’s Discussion and Analysis (pages 21-34). In addition, the financial section provides information on each individual fund and blended component unit not reported separately within the basic financial statements.
The statistical section (pages 171-197) provides a broad range of trend data covering key financial indicators from the past 10 years. It also contains demographic and miscellaneous data useful in assessing the County’s financial condition.
Basic financial statements are defined as government-wide financial statements (pages 38-41), fund financial statements (pages 42-51), and notes to the financial statements (pages 53-112). Areas of particular interest include the detailed note disclosures on cash and investments (pages 71-79), long-term obligations (pages 89-93), fund balance classifications (pages 94-95), employee retirement plans (pages 96-104), and post-employment health care benefits (pages 104-108).
The focus of the government-wide financial statements is to report the extent to which the government has met its operating objectives, using all resources available for that purpose. The focus of the fund financial statements is to demonstrate the government’s actions in the current period have complied with the public decisions in raising and spending the public funds within the budgetary cycle.
The required supplementary information presents the schedules of changes in net pension liability and related ratios for the defined benefit pension plans (pages 116-123) and schedules of changes in net OPEB liability and related ratios for the OPEB plan (pages 124-127). Also, this section presents the County’s budgetary comparison schedules for the General Fund (pages 128-129) and all major special revenue funds (pages 131-133). The combining statements in connection with non-major governmental and internal service funds are presented immediately following the required supplementary information (pages 135-170).
Popular Annual Financial Report
The ACO prepares the Popular Annual Financial Report (PAFR), also referred to as the “Citizen’s Report.” It is intended to provide Solano County citizens with an easy-to-read explanation of the County’s finances. The PAFR provides an overview of the County’s financial condition and a brief analysis of where the County’s revenues are derived and where those dollars are spent. The information from the PAFR comes from the ACFR.
Report to the Board of Supervisors
The Report to the Board of Supervisors communicates any significant audit matters and other information contained in the audited financial statements. There were no significant material audit matters reported. The report includes corrected misstatements whose effects in the current and prior periods are immaterial to the financial statements taken as a whole.
Report to Management
The Report to Management communicates weaknesses in internal controls and related matters identified in the audit that warrant communication to management but are not material weaknesses in internal controls. The Report to Management included three recurring observations from prior year relating to Information Technology (IT) User Access Reviews and security management related to reviews of the Security Organization Controls (SOC) Report and capital asset transactions.
Report on Applying Agreed-Upon Procedures (GANN Limit)
The Report on Applying Agreed-Upon Procedures (AUP, GANN Limit) communicates the procedures performed on the County's computation of the Gann Appropriations Limit for the fiscal year ending June 30, 2026. The report noted no exceptions.
The preparation of these reports would not have been possible without the dedication of the Auditor-Controller’s staff. The ACO would like to recognize Rosemary Bettencourt, Jennifer Laron, Joy Moss, Vincent Yang, and Kaitlin McDonald for their commitment and hard work. Credit must also be given to the County Administrator and the Board of Supervisors for their support in maintaining the highest standards of professionalism in the management of the County’s finances. In addition, the ACO also thanks the County departments for their cooperation and outstanding support in the preparation of these reports.
ALTERNATIVES:
The Board could elect not to accept the audit reports as presented; however, this alternative is not consistent with sound public policy and is therefore not recommended.
OTHER AGENCY INVOLVEMENT:
The ACO was the liaison between the external auditors, Eide Bailly, L.L.P. and other County departments, including the Workforce Development Board. As the liaison, the ACO coordinated test work and meetings with County departments, facilitated access to financial system (Finance Enterprise) reports and supporting documentation, etc. Prior to the final issuance of the various reports, the ACO invited staff from the County Administrator’s Office, the Grand Jury, and County departments to meet with Eide Bailly, L.L.P., to review and discuss the contents of the various audit reports.
CAO RECOMMENDATION:
APPROVE DEPARTMENTAL RECOMMENDATION