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649,897 Total Fund Balance 1,572,838 1,148,092 649,897 Total Liabilities and Fund Balance 1,587,046$ 1,154,443$ 660,284$ See Accompanying Notes to Financial Statements. 4 CITY OF DIAMOND BAR SAFE, CLEAN WATER PROGRAM Statement of Revenues, Expenditures, and Changes in Fund Balance For the Year Ended June 30, 2023 2022 2021 Revenues: Intergovernmental 837,850$ 836,902$ 829,702$ Use of money and property 17,436 (11,165) 2,533 Total Revenues 855,286 825,737 832,235 Expenditures: Current: Public works 200,085 270,251 182,338 Total Expenditures 200,085 270,251 182,338 Excess of Revenues over Expenditures 655,201 555,486 649,897 Other Financing Sources (Uses): Transfers out (230,455) (57,291) - Net Change in Fund Balance 424,746 498,195 649,897 Fund Balance, Beginning of the Year 1,148,092 649,897 - Fund Balance, End of the Year 1,572,838$ 1,148,092$ 649,897$ See Accompanying Notes to Financial Statements. 5 &,7<2)',$021'%$5 6$)(&/($1:$7(5352*5$0),1$1&,$/67$7(0(176 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-XO\E\&RXQFLODFWLRQ2ULJLQDODSSURSULDWLRQVPD\EHPRGLILHGE\VXSSOHPHQWDU\EXGJHWUHYLVLRQVDQGWUDQVIHUV DPRQJEXGJHWFDWHJRULHV7KH&LW\&RXQFLODSSURYHVDOOEXGJHWFKDQJHVDWWKHGHSDUWPHQWOHYHO7KH&LW\0DQDJHULV DXWKRUL]HGWRPDNHEXGJHWWUDQVIHUVZLWKLQGHSDUWPHQWV 127( &$6+$1',19(670(176 7KH)XQGSDUWLFLSDWHVLQWKH&LW\¶VSRROHGFDVKDQGLQYHVWPHQWVWKHSRRO,QIRUPDWLRQUHODWLQJWRWKH&LW\¶VFDVKDQG LQYHVWPHQWVFDQEHIRXQGLQWKH&LW\¶VILQDQFLDOVWDWHPHQWV 127( 68%6(48(17(9(176 7KH&LW\HYDOXDWHGVXEVHTXHQWHYHQWVIRUUHFRJQLWLRQDQGGLVFORVXUHWKURXJK0DUFKWKHGDWHRQZKLFK WKHVHILQDQFLDOVWDWHPHQWVZHUHDYDLODEOHWREHLVVXHG0DQDJHPHQWFRQFOXGHGWKDWQRPDWHULDOVXEVHTXHQWHYHQWV KDYH RFFXUUHG VLQFH -XQH WKDW UHTXLUHG UHFRJQLWLRQ RU GLVFORVXUH LQ WKHVH ILQDQFLDO VWDWHPHQW 7 CITY OF DIAMOND BAR SAFE, CLEAN WATER PROGRAM Budgetary Comparision Schedule For the Year Ended June 30, 2023 Variance with Original Final Actual Final Budget Revenues: Intergovernmental 850,000$ 850,000$ 837,850$ (12,150)$ Use of money and property - - 17,436 17,436 Total Revenues 850,000 850,000 855,286 5,286 Expenditures: Current: Public works 435,878 435,878 200,085 235,793 Total Expenditures 435,878 435,878 200,085 235,793 Excess (Deficiency) of Revenues Over (Under) Expenditures 414,122 414,122 655,201 241,079 Other Financing Sources (Uses): Transfers out (775,000)$ (964,210)$ (230,455) 733,755 Net Change in Fund Balance (360,878) (550,088) 424,746 974,834 Fund Balance, Beginning of the Year 1,148,092 1,148,092 1,148,092 - Fund Balance, End of the Year 787,214$ 598,004$ 1,572,838$ 974,834$ Budgeted Amounts 8 CITY OF DIAMOND BAR SAFE, CLEAN WATER PROGRAM Budgetary Comparision Schedule For the Year Ended June 30, 2022 Variance with Original Final Actual Final Budget Revenues: Intergovernmental 800,000$ 800,000$ 836,902$ 36,902$ Use of money and property - - (11,165) (11,165) Total Revenues 800,000 800,000 825,737 25,737 Expenditures: Current: Public works 297,616 297,616 270,251 27,365 Total Expenditures 297,616 297,616 270,251 27,365 Excess (Deficiency) of Revenues Over (Under) Expenditures 502,384 502,384 555,486 53,102 Other Financing Sources (Uses): Transfers out (690,000) (690,000) (57,291) 632,709 Net Change in Fund Balance (187,616) (187,616) 498,195 685,811 Fund Balance, Beginning of the Year 649,897 649,897 649,897 - Fund Balance, End of the Year 462,281$ 462,281$ 1,148,092$ 685,811$ Budgeted Amounts 9 CITY OF DIAMOND BAR SAFE, CLEAN WATER PROGRAM Budgetary Comparision Schedule For the Year Ended June 30, 2021 Variance with Original Final Actual Final Budget Revenues: Intergovernmental 800,000$ 829,702$ 829,702$ -$ Use of money and property - - 2,533 2,533 Total Revenues 800,000 829,702 832,235 2,533 Expenditures: Current: Public works - 228,080 182,338 45,742 Total Expenditures - 228,080 182,338 45,742 Excess (Deficiency) of Revenues Over (Under) Expenditures 800,000 601,622 649,897 48,275 Net Change in Fund Balance 800,000 601,622 649,897 48,275 Fund Balance, Beginning of the Year - - - - Fund Balance, End of the Year 800,000$ 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%UHD&DOLIRUQLD 0DUFK 12 1611 E. Fourth Street, Suite 200 Santa Ana, CA 92701 (714) 569-1000 203 N. Brea Blvd, Suite 203 Brea, CA 92821 (714) 672-0022 21 Waterway Avenue, Suite 30089 The Woodlands, TX 77380 (936) 828-4587 2151 River Plaza Dr., Suite 150 Sacramento, CA 95833 (916) 503-9691 24422 Avenida de la Carlota, Suite 275 Laguna Hills, CA 92653 (949) 829-8299 www.lslcpas.com INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Honorable Mayor and Members of the City Council City of Diamond Bar, California We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the Measure W Return Fund (the “Fund”), a special revenue fund which reports the Safe, Clean Water Program (“SCW Program”) of the City of Diamond Bar, California, (the City), as of and for the three-year period ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the SCW Program’s basic financial statements, and have issued our report thereon dated March 29, 2024. Report on Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the City’s internal control over the Fund’s financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompanying schedule of findings and questioned costs as items 2023-001 to be a significant deficiency. City of Diamond Bar’s Response to Findings Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to the findings identified in our audit and described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response. To the Honorable Mayor and Members of the City Council City of Diamond Bar, California Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the SCW Program’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements, including Los Angeles County Flood Control District Code Chapter Sections 16.05 and 18.05 through 18.07. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of This Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Brea, California March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