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Audit Report

Curt Boyer, of Boyer and Associates PC, presents the Park Hills City Council with an audit report for the 2017 fiscal year during the council's recent meeting.

During this month's meeting of the Park Hills City Council the group received a presentation from Curt Boyer, of Boyer and Associates PC, regarding the city’s financial audit from the 2017 fiscal year.

Saying that there were no significant findings during the course of the audit, Boyer explained the highlights of the audit to the council.

“I’d like to first point out that we made a couple of changes to the fund balance for this year,” Boyer said. “There were a couple of issues that we ran into that we felt needed adjustment. The first one being that several years ago we created what was called a ‘trust and agency’ fund to set aside the dollars that were received whenever the city pulled out of the Lagers Program.”

Missouri Lagers is a retirement plan that municipalities, cities and political subdivisions pay into and all of the contributions are then invested in the market.

“It’s about a million dollars that was set aside from there in that fund,” Boyer continued. “We felt that the circumstances today,  that what we really needed to say about that money, was that the aldermen had committed those funds as opposed to it being a fiduciary responsibility.

"So we consolidated that trust and agency fund that was outside the financial statements in the past to bring that money into the general fund.”

Boyer said his firm adjusted the $1 million in C.D.s to be shown as committed in the city’s net position, which he described as being a more appropriate interpretation of the financial decision made by the previous city council by ordinance.

“The other thing that we identified that we felt needed to be adjusted was the treatment of the borrowing from the Missouri Transportation Financial Corporation related to the Fairgrounds project,” Boyer said.

“There were two loans involved in the project and there were some expenditures in the prior year that were treated as ‘construction and progress,’ when in fact whenever we got into looking at the impact, we realized that some of those assets that we’d treated as construction and progress, really, were part of what we referred to as the ‘modified approach for infrastructure.’”

Boyer said city expenditures regarding the repair and maintenance of infrastructure are now reflected as such, as opposed to being listed as capital assets.

“Basically, the modified approach took all the infrastructure — the streets and roads and railways — and we repair those to keep them at a certain level of ‘good,’ satisfactory’ and ‘very good,’ so we don’t actually depreciate those infrastructure assets.

“Again, with a little more information, we felt that it was appropriate to expense those things that we’d put under construction and progress the year before and go ahead and treat the debt in the beginning numbers also.”

Boyer said adjustments also had to be made in the audit process in regard to the St. Joe Drive bridge that was constructed during the fiscal year.

“One of the other big things that happened in the year we’re looking at here is we had the bridge rebuilt over the Union Pacific Railway on St. Joe Drive by the St. Francois County Road District #2,” he said. “For governmental financial statements, basically what happens is when another entity or an individual even builds infrastructure, that infrastructure has to be contributed to the city.

“So during this period, we had the Special Road District contribute that bridge to the city and because we deemed that bridge to be new and improved over the bridge that was there, we did capitalize that as part of the infrastructure under the modified approach.

"So there are a couple of places where that may kind of stick out to you.”

Boyer said that on the fund level, the bridge appears as a contribution to the city, constituting an income item of $778,000, equal to the cost of the bridge.

Discussing the city’s cash balances, Boyer pointed out that while the city’s balances are lower than last year’s, the reason is that the city had several projects going in 2017, some of which are still awaiting completion.

“You may remember, we had about $470,000 that went into the Fairgrounds project in this year,” Boyer said. “We spent about $84,000 down at Haney Park that I think was related to the tennis courts. And then we had the paving of East Main Street, which was about $543,000 and, again, since that was infrastructure that was under the modified approach, that ends up being an expense to the city to keep that in a condition greater than 80 percent. So that just about accounts for the decline in cash there.”

Even with the decrease in cash balances, Boyer said the city’s general fund balances appear to be in good order going forward.

“Overall, the general fund balance and net position is still about $370,000 before you consider the trust and agency fund that I moved into the general fund,” he said. “So it’s still in a fairly healthy position as far as its assets and liabilities go.”

Giving the example of a current project going on in a Tax Increment Finance (TIF) district, Boyer said it is wise to always consider the potential revenue garnered by developments within TIF districts.

“Any of these new redevelopment projects that you do consider pretty much have to stand on their own merit at this point,” he said. “That is what the analysis tells us—that when you go out and you want to try to help a developer do something in those TIF districts, you have to look at what the future revenues are.

“For example, the project we’ve got going on right now for the new Dominos building—that piece of property was generating virtually nothing for the TIF. As the new Dominos sit-down restaurant, it should generate quite a bit of sales tax revenues and real estate taxes also.”

Having no questions for Boyer and his team, the council voted to accept the presented audit report.

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Jacob Scott is a reporter with the Daily Journal. He can be reached at 573-518-3616 or at


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