01 27 26 2025 Annual Comprehensive Financial Report - Baker Tilly

Baker Tilly US, LLP, trading as Baker Tilly, is a member of the global network of Baker Tilly International Ltd., the members of which are separate 
and independent legal entities. © 2023 Baker Tilly US, LLP.
Reporting and insights from 
2025 audit:
City of Tolleson, Arizona
June 30, 2025

2
Executive summary
We have completed our audit of the financial statements of the City of Tolleson for the year ended 
June 30, 2025 and have issued our report thereon dated December 17, 2025.
• Financial Statement Audit Report
•
Unmodified opinion
• Government Auditing Standards Compliance Report 
•
No instances of noncompliance or other matters
•
No identified material weaknesses
• Federal Grants Single Audit Report
•
Major Program – Coronavirus State and Local Fiscal Recovery Funds
•
No Findings
This presentation supplements our letter to governance dated December 17, 2025 as required by our professional 
standards.

3
Our responsibilities
As your independent auditor, our responsibilities include:
• Planning and performing the audit to obtain reasonable assurance about whether the basic financial statements are free 
from material misstatement. Reasonable assurance is a high level of assurance, but not an absolute level of assurance.
• Assessing the risks of material misstatement of the basic financial statements whether due to fraud or error. Included in 
that assessment is a consideration of the City’s internal control over financial reporting
• Performing appropriate procedures based upon our risk assessment
• Evaluating the appropriateness of the accounting policies used and the reasonableness of significant accounting 
estimates made by management
• Forming and expressing an opinion based on our audit about whether the basic financial statements prepared by 
management, with the oversight of those charged with governance:
• Are free from material misstatement
• Present fairly in all material respects and in accordance with accounting principles generally accepted in the 
United States of America
• Performing tests related to compliance with certain provisions of laws, regulations, contracts and grants, as 
required by Government Auditing Standards
• Our audit of the basic financial statements does not relieve management or those charged with governance of their 
responsibilities.

4
Our responsibilities
We are also required to communicate significant matters related to our 
audit that are relevant to the responsibilities of those charged with 
governance including:
•
Internal control matters – Various controls have been tested with no reportable findings.
•
Qualitative aspects of the City’s accounting practice including policies, accounting estimates and financial statement 
disclosures – This can be found on Note 1 of the financial statements
•
Significant unusual transactions – All significant and unusual transactions have been audited with no reportable issues.
•
Significant difficulties encountered – No difficulties to report
•
Disagreements with management – No disagreements to report
•
Circumstances that affect the form and content of the auditors' report and key audit matters – None noted
•
Audit consultations outside the engagement team – None noted
•
Corrected and uncorrected misstatements – No misstatements identified
•
Other audit findings or issues – No audit findings or issues identified

5
Required communications
Management’s consultations with other accountants
• In some cases, management may decide to consult with other accountants about auditing and accounting matters.
• Management informed us that and to our knowledge, there were no consultations with other accountants regarding 
auditing or accounting matters.
Compliance with laws and regulations
We did not identify any non-compliance with laws and regulations during our audit. 
Fraud
We did not identify any instances of known or suspected fraud during our audit. 
Going concern
Pursuant to professional standards, we are required to communicate to you, when applicable, certain matters relating to our 
evaluation of the City’s ability to continue as a going concern for a reasonable period of time but no less than 12 months 
from the date of the basic financial statements including the effects on the basic financial statements and the adequacy of 
the related disclosures and the effects on the auditor's report. No such matters or conditions have come to our attention 
during our engagement. 
Related parties
We did not have any significant findings or issues arise during the audit in connection with the City’s related parties.

6
Nonattest services
The following nonattest services were provided by Baker Tilly:
• Financial statement preparation
• Adjusting journal entries
• Assistance with preparation of the Data Collection Form
• Assist in preparing the GASB 68/74 Pension journal entries using actuary and plan provided support for (ASRS, 
PSPRS, EORP).
In addition, we prepared GASB No. 34 conversion entries which are summarized in the, “Reconciliation of the Balance 
Sheet of Governmental Funds to the Statement of Net Position” and the, “Reconciliation of the Statement of Revenues, 
Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities” in the financial 
statements.
None of these nonattest services constitute an audit under generally accepted auditing standards, including Government 
Auditing Standards.

7
Communications with City Council and Management
• Expenditure Limitation Report
• City was $112.01 million dollars under the Home Rule Expenditure Limitation
• Issued to the Arizona State Auditor General timely
Voter-Approved Expenditure Limitation
$198,064,114
City Expenditures Subject to Limitation
80,753,780
Amount under the expenditure Limitation
$117,310,334

8
Communications with City Council and Management
• Fund balance increased by $25.6 million during the current fiscal year, with the increase 
primarily due to an increase in tax revenues and investment earnings.
• Actual revenues were $13.5 million more than budget
• Actual expenditures were $13.4 less than budget
 -
 10,000,000
 20,000,000
 30,000,000
 40,000,000
 50,000,000
 60,000,000
 70,000,000
Revenue
Expense
General Fund Budget to Actuals
Budget
Actuals

9
Communications with City Council and Management
Enterprise Funds
• Water fund – Operating expenses exceeded charges for services by $625K, leading to a 
decrease in net position of $587.9K.
• Wastewater and Sewer - Charges for services exceeded operating expenses by $1.8M, leading 
to an increase in net position of $2.9M.
• Sanitation – Charges for services exceeded operating expenses by $2.2K, leading to an increase 
in net position of $18.5K.
 97,000,000
 98,000,000
 99,000,000
 100,000,000
 101,000,000
 102,000,000
 103,000,000
Total Net Position
Business-Type Activities - Net Position
2024
2025

10
Questions?
Cailee Lewis
Senior Manager
E: Cailee.Lewis@bakertilly.com
Baker Tilly US, LLP, trading as Baker Tilly, is a member of the global network of Baker Tilly International Ltd., the members of which are separate and independent legal entities. © 2022 Baker Tilly US, LLP