2021 New Hope Spec Purp
CITY OF NEW HOPE
HENNEPIN COUNTY, MINNESOTA
Special Purpose Audit Reports
Year Ended
December 31, 2021
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Page
Schedule of Expenditures of Federal Awards 1
Independent Auditor’s 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 2–3
Independent Auditor’s Report on Compliance for Each Major Federal
Program; Report on Internal Control Over Compliance; and Report on the
Schedule of Expenditures of Federal Awards Required by the Uniform Guidance 4–6
Independent Auditor’s Report on Minnesota Legal Compliance 7
Schedule of Findings and Questioned Costs 8–9
CITY OF NEW HOPE
Table of Contents
Special Purpose Audit Reports
Year Ended December 31, 2021
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Assistance
Listing
Number
Bulletproof Vest Partnership Program 16.607 1,275$
U.S. Department of Transportation
Passed through City of Minneapolis
Minimum Penalties for Repeat Offenders
for Driving While Intoxicated 20.608 14,160
U.S. Department of the Treasury
COVID-19 – Coronavirus State and Local Fiscal
Recovery Funds 21.027 2,284,764
Total federal awards 2,300,199$
Note 2:
Note 3:
Direct
Unless noted in the table above,the pass-through entities use the same assistance listing numbers as the federal
grantors to identify these grants, and have not assigned any additional identifying numbers.
The City did not elect to use the 10 percent de minimis indirect cost rate.
Direct
The Schedule of Expenditures of Federal Awards is prepared on the accrual basis of accounting.The information in
this schedule is presented in accordance with the U.S.Office of Management and Budget’s Uniform Administrative
Requirements,Cost Principles,and Audit Requirements for Federal Awards.Therefore,some amounts presented
in this schedule may differ from the amounts presented in,or used in the preparation of,the City’s basic financial
statements.
Note 1:
U.S. Department of Justice
CITY OF NEW HOPE
Schedule of Expenditures of Federal Awards
Year Ended December 31, 2021
Federal Grantor/Pass-Through Grantor/Program Title Federal Expenditures
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INDEPENDENT AUDITOR’S 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 City Council and Management
City of New Hope, Minnesota
We have audited, in accordance with 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 governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of
the City of New Hope, Minnesota (the City) as of and for the year ended December 31, 2021, and the
related notes to the financial statements, which collectively comprise the City’s basic financial statements,
and have issued our report thereon dated May 31, 2022.
INTERNAL CONTROL OVER FINANCIAL REPORTING
In planning and performing our audit of the financial statements, we considered the City’s internal control
over 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.
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 City’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.
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.
(continued)
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
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REPORT ON COMPLIANCE AND OTHER MATTERS
As part of obtaining reasonable assurance about whether the City’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. However, providing an opinion on compliance with those provisions was not an
objective of our audit and, accordingly, we do not express such an opinion. 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 or on compliance. 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 report is not suitable for any other purpose.
Minneapolis, Minnesota
May 31, 2022
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INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR
EACH MAJOR FEDERAL PROGRAM; REPORT ON INTERNAL CONTROL
OVER COMPLIANCE; AND REPORT ON THE SCHEDULE OF EXPENDITURES
OF FEDERAL AWARDS REQUIRED BY THE UNIFORM GUIDANCE
To the City Council and Management
City of New Hope, Minnesota
REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM
We have audited the City of New Hope, Minnesota’s (the City) compliance with the types of compliance
requirements identified as subject to audit in the U.S. Office of Management and Budget Compliance
Supplement that could have a direct and material effect on each of the City’s major federal programs for
the year ended December 31, 2021. The City’s major federal programs are identified in the Summary of
Audit Results section of the accompanying Schedule of Findings and Questioned Costs.
OPINION ON EACH MAJOR FEDERAL PROGRAM
In our opinion, the City complied, in all material respects, with the compliance requirements referred to
above, that could have a direct and material effect on each of its major programs for the year ended
December 31, 2021.
BASIS FOR OPINION ON EACH MAJOR FEDERAL PROGRAM
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America (GAAS); the standards applicable to financial audits contained in Government
Auditing Standards issued by the Comptroller General of the United States (Government Auditing
Standards); and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200,
Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards
(Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further
described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.
We are required to be independent of the City and to meet our other ethical responsibilities, in accordance
with relevant ethical requirements relating to our audit. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major
federal program. Our audit does not provide a legal determination of the City’s compliance requirements
referred to above.
(continued)
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
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RESPONSIBILITIES OF MANAGEMENT FOR COMPLIANCE
Management is responsible for compliance with the requirements referred to on the previous page and for
the design, implementation, and maintenance of effective internal control over compliance with the
requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements
applicable to the City’s federal programs.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF COMPLIANCE
Our objectives are to obtain reasonable assurance about whether material noncompliance with the
compliance objectives referred to above occurred, whether due to fraud or error, and express an opinion
on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance , but is not
absolute assurance and, is therefore, not a guarantee that an audit conducted in accordance with GAAS,
Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance
when it exists. The risk of not detecting material noncompliance from fraud is higher than for that
resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal control. Noncompliance with the compliance requirements referred to above , is
considered material if there is a substantial likelihood that, individually or in the aggregate, it would
influence the judgment made by a reasonable user of the report on compliance about the City’s
compliance with the requirements of each major federal program as a whole.
In performing an audit in accordance with GAAS, Government Auditing Standards, and the Uniform
Guidance, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material noncompliance, whether due to fraud or error, and design
and perform audit procedures responsive to those risks. Such procedures include examining, on a
test basis, evidence regarding the City’s compliance with the compliance requirements referred to
above and performing such other procedures as we consider necessary in the circumstances.
• Obtain an understanding of the City’s internal control over compliance relevant to the audit in
order to design audit procedures that are appropriate in the circumstances and to test and report on
internal control over compliance in accordance with the Uniform Guidance, but not for the
purpose of expressing an opinion on the effectiveness of the City’s internal control over
compliance. Accordingly, no such opinion is expressed.
We are required to communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal
control over compliance that we identified during the audit.
(continued)
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REPORT ON INTERNAL CONTROL OVER COMPLIANCE
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a
federal program on a timely basis. A material weakness in internal control over compliance is a
deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a
reasonable possibility that material noncompliance with a type of compliance requirement of a federal
program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in
internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over
compliance with a type of compliance requirement of a federal program that is less severe than a material
weakness in internal control over compliance, yet important enough to merit attention by those charged
with governance.
Our consideration of internal control over compliance was for the limited purpose described in the
Auditor’s Responsibilities for the Audit of Compliance section on the previous page and was not designed
to identify all deficiencies in internal control over compliance that might be material weaknesses or
significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in
internal control over compliance that we consider to be material weaknesses, as defined above. However,
material weaknesses or significant deficiencies in internal control over compliance may exist that were
not been identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal
control over compliance. Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control over compliance and the results of that testing based on the requirements of the
Uniform Guidance. Accordingly, this report is not suitable for any other purpose.
REPORT ON SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS REQUIRED BY THE UNIFORM
GUIDANCE
We have audited the financial statements of the City as of and for the year ended December 31, 2021, and
have issued our report thereon dated May 31, 2022, which contained unmodified opinions on those
financial statements. Our audit was conducted for the purpose of forming opinions on the financial
statements as a whole. The accompanying Schedule of Expenditures of Federal Awards is presented for
purposes of additional analysis as required by the Uniform Guidance and is not a required part of the
financial statements. Such information is the responsibility of management and was derived from and
relates directly to the underlying accounting and other records used to prepare the basic financial
statements. The information has been subjected to the auditing procedures applied in the audit of the
financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the financial
statements or to the financial statements themselves, and other additional procedures in accordance with
auditing standards generally accepted in the United States of America. In our opinion, the Schedule of
Expenditures of Federal Awards is fairly stated, in all material respects, in relation to the basic financial
statements as a whole.
Minneapolis, Minnesota
May 31, 2022
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INDEPENDENT AUDITOR’S REPORT
ON MINNESOTA LEGAL COMPLIANCE
To the City Council and Management
City of New Hope, Minnesota
We have audited, in accordance with 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, t he financial statements of the governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of
the City of New Hope, Minnesota (the City) as of and for the year ended December 31, 2021, and the
related notes to the financial statements, which collectively comprise the City’s basic financial statements,
and have issued our report thereon dated May 31, 2022.
MINNESOTA LEGAL COMPLIANCE
In connection with our audit, nothing came to our attention that caused us to believe that the City failed to
comply with the provisions of the contracting – bid laws, depositories of public funds and public
investments, conflicts of interest, public indebtedness, claims and disbursements, miscellaneous
provisions, and tax increment financing sections of the Minnesota Legal Compliance Audit Guide for
Cities, promulgated by the State Auditor pursuant to Minnesota Statutes § 6.65, insofar as they relate to
accounting matters. However, our audit was not directed primarily toward obtaining knowledge of such
noncompliance. Accordingly, had we performed additional procedures, other matters may have come to
our attention regarding the City’s noncompliance with the above referenced provisions, insofar as they
relate to accounting matters.
PURPOSE OF THIS REPORT
The purpose of this report is solely to describe the scope of our testing of compliance and the results of
that testing, and not to provide an opinion on compliance. Accordingly, this report is not suitable for any
other purpose.
Minneapolis, Minnesota
May 31, 2022
C E R T I F I E D
A C C O U N T A N T S
P UBLIC
PRINCIPALS
Thomas A. Karnowski, CPA
Paul A. Radosevich, CPA
William J. Lauer, CPA
James H. Eichten, CPA
Aaron J. Nielsen, CPA
Victoria L. Holinka, CPA/CMA
Jaclyn M. Huegel, CPA
Kalen T. Karnowski, CPA
Malloy, Montague, Karnowski, Radosevich & Co., P.A.
5353 Wayzata Boulevard • Suite 410 • Minneapolis, MN 55416 • Phone: 952-545-0424 • Fax: 952-545-0569 • www.mmkr.com
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CITY OF NEW HOPE
Schedule of Findings and Questioned Costs
Year Ended December 31, 2021
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A. SUMMARY OF AUDIT RESULTS
This summary is formatted to provide federal granting agencies and pass -through agencies answers to
specific questions regarding the audit of federal awards.
Financial Statements
What type of auditor’s report is issued? X
Internal control over financial reporting:
Material weakness(es) identified?Yes X No
Significant deficiency(ies) identified?Yes X
Noncompliance material to the financial statements noted?Yes X No
Federal Awards
Internal controls over major federal award programs:
Material weakness(es) identified?Yes X No
Significant deficiency(ies) identified?Yes X
Type of auditor’s report issued on compliance for major programs?
U.S. Department of Treasury – COVID-19 – Coronavirus State and Local
Fiscal Recovery Funds Unmodified
Any audit findings disclosed that are required to be reported in
accordance with 2 CFR 200.516(a)?Yes X No
Programs tested as major programs:
Program or Cluster(s)
U.S. Department of the Treasury – COVID-19 – Coronavirus State and Local
Fiscal Recovery Funds 21.027
Threshold for distinguishing between type A and B programs. 750,000$
Does the auditee qualify as a low-risk auditee?Yes X No
Assistance
Listing
Number
Unmodified
Qualified
Adverse
Disclaimer
None reported
None reported
CITY OF NEW HOPE
Schedule of Findings and Questioned Costs (continued)
Year Ended December 31, 2021
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B. FINANCIAL STATEMENT FINDINGS
None.
C. FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
None.
D. MINNESOTA LEGAL COMPLIANCE FINDINGS
None.