The County maintains a network of flood
control and transportation infrastructure
assets valued at $1.4 billion. Therefore, it
is essential that the County accurately
value and account for these assets.
However, the County’s internal control
policies and procedures did not always
ensure that its infrastructure assets were
properly valued or reported. For fiscal
year 2008, auditors noted the following
material internal control weaknesses over
financial reporting:
• The County incorrectly reported $20
million of flood control construction
projects managed by other
governments and $19 million of
2008
Year Ended June 30, 2008
Maricopa County
Subject
Maricopa County is
responsible for preparing
financial statements,
maintaining strong internal
controls, and demonstrating
accountability for its use of
public monies. As the
auditors, our job is to
determine whether the
County has met its
responsibilities.
Our Conclusion
The information in the
financial statements is fairly
stated in all material respects
and the financial statements
can be relied on. However,
auditors identified 11
deficiencies in internal
control over financial
reporting, including 2 material
weaknesses. In addition, the
County maintained adequate
internal controls for four of
seven federal programs
tested and complied with
federal compliance
requirements for six
programs. However, auditors
found material internal control
weaknesses for three
programs and
noncompliance with program
requirements for one
program.
REPORT
HIGHLIGHTS
FINANCIAL AND SINGLE AUDITS
The County Needs to
Improve Infrastructure
Reporting
transportation infrastructure assets
annexed by other governments.
• The County omitted land donations
received in prior fiscal years valued at
$9 million.
• The County did not maintain an
accurate listing of construction in
progress for its transportation
infrastructure projects. The listing
contained numerous errors, including
one transportation construction project
valued at $17 million that the County
asserted it did not own in prior years.
The County adjusted its financial
statements for all significant errors and
restated the July 1, 2007, balances for
errors affecting prior years.
County’s Condensed
Financial Information
The County’s government-wide financial
statements are designed to provide
readers with a broad overview of the
County’s finances in a manner similar to
private-sector business. These
statements report the financial activities of
the overall government, except for
fiduciary activities.
The tables on the next page present a
summarized version of the County’s
government-wide Statement of Net
Assets and Statement of Activities
reported in the current year
Comprehensive Annual Financial Report.
The Statement of Net Assets presents
information on all county assets and
liabilities, with the difference between the
two reported as net assets. The
Statement of Activities presents
information showing how net assets
changed during the most recent year.
Overall, county expenditures of federal
award monies decreased by $15.3 million
or 12.5 percent, from the $122.8 million
expended during fiscal year 2007. The
decrease was primarily the result of the
following:
• The Help America Vote Act
Requirements Payment Program
The County received an award for the
program in fiscal year 2007 and
expended $7.2 million of federal
monies to purchase voting system
equipment in fiscal year 2007. An
award for this program was not
received in fiscal year 2008.
• The Immunization Grants Program
The value of vaccines is no longer
required to be reported in the Schedule
of Expenditures of Federal Awards. For
fiscal year 2007, $6.6 million of
vaccines were included in the
Schedule.
page2
Statement of Net Assets
June 30, 2008
Total Governmental
Activities
Current and other assets $1,682,971,757
Capital assets 2,737,252,312
Total assets 4,420,224,069
Current and other liabilities 196,057,156
Long-term liabilities 382,973,245
Total liabilities 579,030,401
Net assets
Invested in capital assets, net of
related debt
2,542,165,396
Restricted net assets 526,220,283
Unrestricted net assets 772,807,989
Total net assets $3,841,193,668
Statement of Activities
Year Ended June 30, 2008
Total Governmental
Activities
Program revenues:
Governmental activities $ 605,278,498
General revenues and transfers:
Governmental activities 1,368,920,865
Total revenues and transfers 1,974,199,363
Expenses:
Governmental activities 1,739,841,834
Total expenses 1,739,841,834
Change in net assets 234,357,529
Net assets—beginning, as
restated
3,606,836,139
Net assets—ending $3,841,193,668
The County Experienced an
Overall Decrease in Federal
Award Expenditures
Transportation
$3.2
Other
$7.2 Justice
$8.5
Labor
$9.5
Agriculture
$11.2
Housing and
Urban Development
$23.8
Health and
Human
Services
$44.1
Federal Expenditures by Awarding Agency
Totaling $107.5 Million
Fiscal Year 2008
(In Millions)
Auditors identified and tested seven
federal programs under the guidelines
established by the Single Audit Act. Of
those seven federal programs, the two
federal programs administered by the
Housing Authority of Maricopa County
were audited by other auditors whose
report was furnished to us. Audit tests
included evaluating the County’s
compliance with each program’s federal
regulations generally related to
expending, matching, monitoring, and
reporting federal awards.
page3
Auditors noted internal control
weaknesses for the Workforce Investment
Act Cluster (WIA); the Special
Supplemental Nutrition Program for
Women, Infants, and Children (WIC); and
the Head Start program. Also, instances
of noncompliance with program
requirements were noted for the WIA
program. The table below identifies the
audit findings reported by program and
type of compliance requirement.
The County Did Not Always
Comply with Federal
Program Requirements
Summary of Internal Control Weaknesses and Instances of Noncompliance
Program
Responsible County
Department
Activities1
Costs2
Eligibility3
Match4
Suspension5
WIA Cluster Human Services X X X
WIC Public Health X
Head Start Human Services X X X X
WIA – Workforce Investment Act
WIC – Special Supplemental Nutrition Program for Women, Infants, and Children
1Activities: Federal monies may have been expended for unallowable activities.
2Costs: Support was not retained for cost allocations.
3Eligibility: Benefits may have been awarded to ineligible participants.
4Match: Cash and in-kind matching contributions were not adequately supported and policies and procedures were not followed.
5Suspension: Suspension and debarment verifications were not documented.
Single Audit Fact Sheet
Eleven weaknesses in financial reporting internal
controls, including two material weaknesses. Of
these 11 weaknesses, 9 relate to Maricopa
County and 2 relate to the Sports Commission.
Five material internal control weaknesses in
federal compliance. Two instances in
noncompliance with federal compliance
requirements.
Program costs totaling $368 were questioned as
a result of our audit.
Maricopa County
REPORT
HIGHLIGHTS
FINANCIAL AND SINGLE AUDITS
Year Ended June 30, 2008
A copy of the full report
can be obtained by calling
(602) 553-0333
or by visiting
our Web site at:
www.azauditor.gov
Contact person for
this report:
Jay Zsorey
TO OBTAIN
MORE INFORMATION
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