For purposes of the recording and introductions, we'll go around the room and around the school and introduce ourselves, and that also helps identify everybody's voice for purposes of the reporting.

So I'm Dina Enfield.

I am a citizen member and chair of the committee.

Amanda Strange, Director of Internal Audit.

Chris Belvinot.

For us Mazars.

Katie Flores for Miss Mazars.

I'm David Coleman with Forbes Mazars.

Neil Martin Audit Committee Audit Committee member of the Fortune Board of Directors.

Christina gets out as board of directors.

Thanks everybody for being here.

We have gone through and as a committee have talked through the procedures.

So that we specified the procedures to be performed.

Those were performed by Fortis Mazars.

They're still working on the draft of the report.

I believe there's a few pending items, and David will be talking about those.

And so as part of this process, we wanted to make sure that we as a committee had input into whether we felt like the procedures hit the items we were wanting it to.

If we need to come back and revise anything.

But the intent is that David and his team are here and they can go through the items and basically talk through each and every one so that it's very clear and we have specific input into those items.

So you have a draft of the report, you have the agenda, and the other thing I ask Amanda to get, she provided is a is the packet that for April, April correct, the April packet that Arm provides as part of the water park.

So as part of the discussions, I wanted to be sure if there are any things we want to recommend or that recommendations come and things we might want added to that for discussion purposes and tracking purposes going forward that we knew what was in that report now and what's being provided.

So Amanda, anything else you want to add?

Not right now, I think that was a good summation.

Okay.

So happy if anybody else has anything right now, and if not, I'll turn it over to David Coleman with Forbes Mazars to get going on the draft.

Alright, well, thank you.

Thank you very much for that introduction.

So uh I think you asked me, asked me to tell you a little bit about our firm.

So we are Formus Mazars, we used to be BKD.

Some of you might know BKD, but we we we merged with another firm a couple years ago with Nixon News Goodman, so now we're forwards Mazars.

Um we are one of the top 10 uh firms in the world.

Uh used to say country, but the the addition of Mazars made us uh a worldwide firm.

So um we do we do focus on industries, so uh myself, Katie and Katie and Fritz most of the time.

We focus on public sector and all things related to public sector, which includes franchise fees, audits like this.

So we've had a lot of experience working with entities like you all, um, and so that uh that that's a little bit about our firm.

So I had a few few remarks.

I was gonna just kind of tell you all, not meaning to repeat what you just said, but um we have been, you know.

If you all remember, I don't remember the exact date that we we talked with you all and determined that you all determined that this would be the best course of action uh for getting accomplished what you all wanted to accomplish as an agreed upon procedure rather than an audit.

Um we are this is not an audit.

We are doing an agreed-upon procedure.

We are auditors, um, but it isn't is a is a basically what we have done is Amanda worked um to come up with procedures with with your all with your input and then sent them to us, and we said we can and cannot do that under the attestation under the standards of agreed upon procedures.

So we didn't modify them materially, we added words here and there to make sure that we could accomplish what you all wanted us to accomplish.

So we are not rendering an opinion on the financial statements of this entity.

So we are essentially we were told to do these procedures, we're doing it and we're reporting the results.

So we have been working with ARM since we were engaged to do this work.

We started uh two or three months ago working with them, um, they have been cooperative with providing this information.

Um the procedures that we did perform were pretty thorough.

Um, when I say thorough, they were thorough in relation to the financial statements and the financial activities of the entity.

We there's certain things that as auditors we can't do, but we did uh do all the procedures.

We were able to fulfill all those, and I'll go through the the uh procedures here in a minute and go through the results.

So last week um I we we felt it was important to just show them kind of the results of what our draft report was going to look like because I didn't want I didn't want them disagreeing with with us and what we put on paper, what we've told y'all.

So we did meet with them last Friday.

Um Amanda has been on every call that we have had with ARM going back.

So we went over a few of these, and you're gonna see in here there's a few variances in here, and I think Amanda thought it would be wise, and I thought it would be wise to add a few procedures to our initial procedures to kind of add some commentary uh from ARM on that.

So an MDA, if you will, on some of the variances that we're gonna talk about because we didn't want the or they didn't want the report being out there and let's just show it a variance and then not having the opportunity to explain that.

So when we say we're pending things, that's what we're pending right now.

So we we in all fairness, we did show them this last Friday.

I think one of the main uh employees or one of the ladies responsible uh for the financials is on vacation this week.

So they they have promised me that I'm gonna get explanations next week.

Okay, so hopefully we can put together a better draft.

I mean, it's a good draft right now, in my opinion.

I mean, this you guys can be the judge here in a minute, but just that added commentary.

So I wanted to explain to you.

Typically how I like to do this, you know, agreed upon procedures, they can be somewhat fluid and like audits.

You know, audits, we kind of have certain standards and things that we have to look at.

Uh, but again, we always bring the draft in front of you all to discuss and get your input on them, word changes, stuff like that.

So, really that that was my what when I told Amanda a few weeks ago, or then you know, I don't recall who which one.

I think we're ready to start talking about it.

That's kind of what the goal from my perspective was coming to have a work, a working session with you all to get your input on what we've done and the results so far.

Okay, so I think that's all of my opening remarks.

So I've I I have sent you all have a draft of our initial draft report.

Um, I've got it up on the screen as well.

So we did the purple, pink-purple highlights are I don't know if buch is the right word.

Um, those were procedures that we added last Friday.

Okay, so they're all basically say there's this variance, tell us why there's this variance.

Okay, so we have highlighted in pink future there, the new procedures.

The yellow highlights are still pending, but those have been pending for a little bit.

Okay, so they're not new procedures, they're not new information.

Okay, so I thought it was important for us to kind of color code it so you could see kind of where we're at.

So, everybody can see my screen here.

I'm just gonna kind of run through here and tell you what we did on each of the procedures, and kind of here's the results of it.

So we will end up issuing a final kind of we have our a letter to go, it's not an audit opinion, but it is an accountant's opinion on the adoption of our agreed upon procedures.

You know, we perform these procedures, and here's our results.

So when we do issue our final report, this will not have draft marked on it, of course.

Um, yes, you make that bigger on the screen.

Okay, read us.

Is there is there a way to make your draft figure over there?

Okay.

Is that better?

Okay, that too.

So our our engagement procedures, so the the procedure one was basically send them a list of things we were going to need.

So uh 1A, we we requested a executed management agreement between ARM and the City of Fort Smith.

Uh B, we wanted all monthly bank statements for 2025 calendar year in for the operating account and any sub-accounts.

Uh, I think there's two sub-accounts.

There's a payroll account and maybe a credit card account.

Um so we requested all bank statements, we wanted all bank reconciliations and supporting schedules for every one of those bank accounts, and then we we selected for we asked for that for 25 and 2024.

Um, then we requested all monthly financial statements for 2025 and 2024.

So later on we'll we'll see the results of that, but F an electronic file of the general ledger.

So what that means is we requested basically every financial transaction that makes up those monthly financial statements that we got every detail.

We requested that detail of that.

We did get it in Excel format.

G, a listing of accounts payable at year in, December 31, 25, and 24.

So that means anything that the water park would have owed anybody at year end, we requested a detail of that.

We requested a detail of the accounts receivable details.

So the accounts payable and the accounts receivable detail.

I so the water park, they they have daily, like I it's almost like a scorecard.

So they have a daily sheet where they have all attendance records, like so whoever wanted the gate, it has uh sales by each by different categories, uh, by park admittance, annual pass, special events.

So we got those daily sheets for every day that the park was open for those two years.

Some of the months they weren't open, so they didn't have much activity on them, but you know, the summer time it's got all activity on a list of revenue per day, uh total for each month.

We also requested that a list of concession items sold during 2025, and the core corresponding sales price and average cost.

We requested their accounting policies covering cash receipts, cash disbursements, capitalization of fixed assets, calculating management fees, and compiling and reporting financial statements for the water park.

Um we also asked for a complete listing of all insurance policies covering uh the 2025 calendar year.

So this is how this report's gonna work.

Here's our procedures.

Here's our findings.

So if we don't have any findings, that means we performed the procedure and there's nothing to report to you all.

Okay, so for our findings, we we got everything on this list except there was two accounts receivable details.

One for a credit card and one for a guest ledger account.

So put that into perspective.

So that is going to be our first findings, we didn't get details for the credit card or the guest ledger.

So in 2024, the guest ledger didn't have anything in there, so that's zero.

In 2025, it had 10 dollars in it.

2024, the credit card had 79,000 in it.

Uh we didn't get a detail for that in 2025, there was 153 dollars in it for those particular accounts receivable details.

Okay, so the next procedure, we were asked to confirm directly with the bank uh their 2025 and 2024 bank account balances for the operating account and the other accounts.

So what that means is we we uh had the check signers on those accounts uh give us permission to go directly to the bank and get a confirmation on those bank balances.

We don't have any findings for that.

A third, um, we took those confirmed bank balances that we got from the bank and then we compared it to the bank reconciliations that that ARM prepared for us, and we didn't have any issues on that either.

Uh we also compared the reconciled cash balance, so every month they have a bank reconciliation, and one of our procedures was to take that bank reconciliation and tie it back to the financial statements that they gave us, okay, and then to report to you all if there was any variances over $100.

So, in that particular case, all their bank reconciliations that they provided to us agreed to their financial statements.

So no findings on number three.

So this is uh number four is where it kind of gets challenging a little bit.

I've read this thing probably 20 times, but it gets challenging to follow.

So these were kind of designed in a cash receipt, so the money that that ARM is getting in every day, Amanda design procedures around the cash receipts.

Before we move on, so we know they have the check for $8,000 that was missing.

So how were how were things reconciled when that?

I mean, there should be a month where that that was off, correct?

Were we not there yet?

Probably not there yet.

Um, as far as is and I would say just I talked briefly with with Drew on this, and it was a check where there was something written on that check and they couldn't deposit it, so they reached out later, and a check was reissued from that company to make that payment.

So that's my understanding of what happened there.

So my understanding was it was a PPA from a school, and they wrote the check in May, it still had not been deposited in September when the PTA president was turning it over to the new one for the new school year, and they had to call Carrot Island multiple times, couldn't get a hold of them, and they reached out to me.

So I reached out to Jeff Fingman, and I think Jessica as well, and they didn't know the check was missing.

And I'm not certain of the timing.

I don't have those details, but what I from what I understand from Drew is that the check eventually was reissued and that was deposited correctly.

So when you're going and you're looking at a you know month to month on things, is it is retroactive?

Like they eventually got the money, so everything reconciled, or is it each month?

What we did, what we were asked to do is get the bank reconciliation agree it to the to the to the bank confirmation in the bank statement and make sure that it ties the financial statements, so there's not a difference between the bank reconciliation and the financial statements.

There could have been reconciling items in there, but our procedures didn't ask us or require us to go and audit every one of those reconciling items.

So shouldn't shouldn't the financial statements reconcile with the attendance or you know the this was a private event.

Yes, but we're back to the well, my comment was if the $8,000 was taken into revenue, and well it on the ledger, the bank account would show up.

Effectively, all this time it was on it was unclear it as a deposit transit.

Right.

So it would effectively be in the ledger, just not in the bank balance, but it would show up on reconciliation.

I don't know if we ever counted that or not, but it seemed to be the best we would mean.

Was it rejected by the bank because it had something written on it, or was it just a I don't I don't know the details of that?

Okay, um, so so on the cash receipts.

So we were asked to to report honors policy obtaining for depositing receipts and agree-upon procedure report.

So essentially what we did is we requested their policy and we copied and pasted it and put it in here.

So after I read these procedures, we'll we'll talk about the results of this.

So, alright, so B, what we did here is we those those daily, those daily reports that we obtained that's supposed to be all of the revenue per day.

Um Fritz, our associated worked on that, worked on summing all of those up per month.

So May, we have 31 days in May, so he took those 31 days, added them all up, and then tried to reconcile that with the financial statements.

Okay, so that was that was B.

C mathematically sum all cash receipts included in the general ledger for each month, the year.

So remember I told you that there was a detail that we got the general ledger detail, so we we added all the cash receipts, basically all the debits to the cash account, added all those up, and then we sum all of the cash deposits included on each bank statement for 2025.

So then after we did those those things, we traced and agreed the cash receipts for the general ledger, activated in this step for C to the cash receipts for the bank statement by month and reported any differences greater than 500.

So I think here is where we took basically their details of revenue for each month, and then that they were shut that they gave us from the park what happened at the park, and then tied it back to the tried to tie it back to the financial statements, and then we were asked to report any any differences greater than $500.

Um I think lastly, on this, we selected five of the largest cash receipts from the general ledger during the year, and then a random 25 from the remaining cash receipts.

Okay, so not everyone we did.

We we just did the five largest and then another 25 on the cash receipts, and then trace and agree cash receipts transactions amount to the deposit on the bank statement.

So essentially, we we pick another source for all the cash deposits and then tie it back to the bank statement to ensure that the general ledger agreed with the bank statement.

Okay, and then for any of those transactions, any discrepancies greater than one dollar, uh, this this pink is what we added to the procedures to get their reasoning why because we had a few variances on this on this.

So finding 4A, here is their policy regarding cash deposits since we just quoted them from the documentation that we got and put it in here in our report.

So table 4B here, this is the table where we took the revenue or their detail, um, and then tried to tie it back to the to the revenue on the financial statements and then report to you any variances over $500.

As you can see here, we do have variances over $500, so it wasn't a part of our procedure to really understand exactly what happened here or why, or but but so that's why we wanted to add those explanations in.

But I can tell you from working on this, let's say that there's a group on a group on purchase or a um, you know, a season pass purchase in January or February.

Well, they may have recorded that revenue and deposit that cash in that particular month and not recognize the revenue in the month where people use the pass.

Okay.

So they utilize group fund?

Do what they use group on.

Um here I'll let you read here's their explanation as to why there's variances there.

We want to take a second read that.

Is it big enough?

Oh, right here I read it, but this is the first I've heard of Groupon.

Well, it says ticket sales through third parties like group bond, they don't always get recorded in centerage timely.

Group on some kind of a discount price.

Yeah, I mean, I know what group on is, I've just I've never heard of this being utilized ever with them before.

Is anyone else aware of that?

I wasn't.

I mean, I understand that's the explanation they gave you, but I this is news to me.

Okay.

All right.

So okay, I have a question.

Do you know if they actually attempt to reconcile this revenue by listing to the revenue and financial service monthly?

In other words, I would think the revenue and their daily listing has got to be a component of what gets to the general debate, right?

And there would be, you know, it would either show up as a specific individual amount and the other numbers would be clear, or someone would do a reconciliation to I don't know that.

Okay.

I mean, there's variances.

Yeah, there are.

And you know, the one the one that really uh stands out is the one in December, which is not a month where I mean, maybe those are for next year, but yeah, I I think, you know, like if you think about it in December, potentially they were buying Chris people were buying Christmas gifts or something like that.

I I don't have, I don't know if they're on the line.

Or they want to tell us.

I don't know if they aren't.

Okay.

Um I I mean, you you all can think about this, and then if it's something that you would like us to explore further, I'm sure Amanda can come up with I had a we're waiting on that.

I had a couple of things to comment while we're just on this specific item.

Okay.

Um I think we should maybe consider because I had actually thought about that $8,000 because you brought it up earlier, that maybe we should have a specific procedure for them to explain what happened on that because that is something that's come up.

Okay.

So that caused that because I would be curious on that as well.

And then uh it's not really part of the report, but when thinking about like recommendations and things we might want to change, maybe in our monthly reporting where they report the water park revenue, we actually have a comparison of the revenue reported versus the deposits, and we that way they could then provide an explanation of why those are different.

Um, and again, I know that's not really something that it's part of this report, but something I think from our perspective on the recommendations we would make from this that they start providing that because I I would think too, you know, in December, probably that is Christmas sales and things where they're selling passes for the next year, but that would be nice to know how we're comparing revenue versus cash collections.

Um I'm not seeing them on group on.

They're not listed.

Um, you know, back back to what the explanation they gave Jamanda on the check.

I mean, I would imagine if if it were my business and somebody wrote me an $8,000 check and I went to the bank and I couldn't do anything with it, I would be reaching out to them immediately.

And they went, you know, from May all the way to September when the PTA president brought it up, and said that um you know, these are two things now.

We're on page four, and these are two things that are of concern to me.

Well, and I'll just add to this comment, the question I had in December.

Um that is in fact sales for the next year effectively uh early sales, it would be proper to defer that revenue into the year in which is earned, and it looks like that's what they do, right?

Can't tell for sure, but yeah, we didn't we didn't do a revenue recognition procedure.

Right.

I mean, like if you I think, you know, it I think I think you nail it.

And to me, Amanda, we should we should ask for uh at least two or three of these reconciliations, these monthlies, where they reconcile a listing to the financial statement, or they provide the details so we know someone is looking at the list.

The numbers don't change by themselves.

Someone is someone is recording this from the listing and some other things are happening, and they may do credit cards, or it may be uh other kinds of uh perfectly reasonable items, but you don't know until you know.

So yeah, and I mean, you know, like you you mentioned they weren't on Croupon, I mean that that might be something where they want to go back and modify that, you know.

I mean, because on those explanations, we didn't do anything with them.

We just asked for them, and so we we that's why we put them in quotes is because they're not our language, they're they're their language.

Yeah, I understand that.

I I just want to be on the record that that's that area of concern for me.

And Lavon, your your uh comment there, was that a recommendation to change our procedure here, or is that monthly reporting going forward?

No, I'd say it would be worth since we had this report, be worth getting your hands on those on those reconciliations to say yes, they did actually reconcile this, or they didn't, or whichever it is, and that the numbers actually agree.

So, excuse me, I would agree, but I also do think it would be possibly to change our monthly reporting or that we start getting those reconciliations.

So both, yes.

Well, and and they mention in their explanation the sponsoring of partners, I mean, I really think the revenue the city would be interested in knowing how much revenue they're getting from sponsors just in general for people that use that as an advertising.

Yeah, and and sometimes it would be more than you think, and and I I think this is great while we're having this.

If you want a mandate to modify that procedure, we can it's not too late for us to do it now.

If we didn't have draft on here, it would be too late.

Right.

Well, actually, if we're I'll refer to the full committee on on that, but okay.

If you want to like get through it and kind of see what all and we can we can talk about what we need to do, what we can't do, like if we need to go back and and do some more work.

I agree, and I think getting through that if you have something like that as we get to go through the report, see that one, so manage and trying to keep her records and not lose five of anything, that would be great too.

Okay, so on this one on this procedure here, this is the one where we took their general ledger detail, and we said, okay, well, here's a cash receipt per year detail, and then we try to tie it back to the bank statement.

Okay, so I think on that one we we picked a total of 30, uh, five of the largest ones, and then a random 25.

We found two on here that there was a cash receipt on their general ledger, but we cannot find it on their bank statement on the bank statement.

So essentially there was uh a debit to cash and it wasn't on the bank statement.

Um so we're we are still pending an explanation on this.

Um I think it had something to do with a payroll or something, but I you know I'm not gonna officially tell you what it had to do with, but there was a couple on there where the ledger didn't tie to the bank to the to the bank statement itself.

And the bank statement itself is what you have, right?

So you've got to make sure.

So we're still yellow.

That means that that is a pending from them, and that is not a new question that we asked last Friday.

The yellow represents question that we've had for a couple weeks.

So I think once they get the explanation in there, you all will be satisfied with the explanation, I think.

So but but I'll let you be the judge of that once we get it.

Okay, so that was kind of the cash receipts.

Now we're going to talk about cash disbursements and how they they pay their bills and and send cash out the door.

So A, we were required to get authorized check signers and their approval thresholds within R.

And list them in the report.

Secondly, we we were required to get their policy for payment of invoices, like what is their accounting policy on how they disperse cash.

So we've got those two things, and we'll talk about those in just a minute.

C mathematically, some all cash disbursements included in the general ledger from each of the years, so each each of the cash that went out, we did that mathematically sum all cash payments included in the bank statements.

So you see a thing, we're trying to make sure by these procedures, the general ledger agrees to the bank statements and then on to the financial statements.

And then trace and agree total cash disbursements for the general ledger calculated in step five C to the cash payments for the bank statement, and then report any variances greater than $500.

Then we were asked to select the five largest cash disbursements for the year and to do a random sample of 25 for the remaining cash payments.

Trace and agreed cash payments amounts to the general ledger and report any discrepancies greater than a dollar.

Trace and agree the cash and payment supporting documents, including approved invoices and check copies.

So on those cash payments that we sampled, we did request support for those.

So invoices to support the cash outflow or the cash payment.

So we were asked to report any cash payments exceeding check signer's threshold on any of the check, any unauthorized individual signer, and then any variances greater than one dollar, cash payments exceeding check signer's threshold, and any check reported as being signed by an authorized individual.

So our findings, I'm sorry, I skipped this one.

The last one on cash disbursements report cash payments inspected up there and essentially report in our report any outstanding invoices exceeding 45 days that they were due.

So if they had a thousand dollar payment, we requested the invoice, looked at the due date on those invoices, and then we put it in our report.

And so now we'll look at that.

I will look at the findings for this.

So step 5A, here is their authorized signers, and they don't have any approval threshold for those people.

So there's no uh limit to what they can sign off on for there.

5B, here is their procedure that we were supplied for payment of invoices.

You know, us doing our our work on the general ledger and the bank statement, and then um, so we weren't able to obtain uh invoices and check copies for three disbursements, these three disbursements here.

So there's a disbursement on the bank statement for these three amounts, and we did not get any uh supporting documentation for those three items that we had sampled.

Uh we are still pending an explanation from them on that, so that is why it's highlighted in yellow.

Question?

Yeah.

Wouldn't the bank be able to produce a copy of the uh a clear check?

It's on the bank statement.

They can get it from the bank if they just do it right.

Yeah.

Okay.

I would say Levon, my understanding was that it was a fee that was charged along with another charge.

And so it wasn't, it wasn't a separate invoice.

So it's not exactly just a charge on the on the bank said it was not actually checking.

Yeah, that's correct.

The bank charges, this is Gerald Sure.

Mackie, I'm uh director of management operations in our bank charges fees every month, and uh there's no check for that, it's just a fee that comes out the bank statement.

Okay, accounts payable.

So next, uh Amanda designed procedures around accounts payable.

So essentially these procedures were designed how would how you would do an audit of accounts payable.

So we apply the same same logic here on doing an audit, but we Amanda put these in agreed upon procedures format.

So we requested a cash disbursement schedule from our 90 days after year in.

So January, February, March after year in the checks that you paid during those three months.

We randomly selected 30 subsequent disbursements from that listing for each year for 24 and 25.

We requested invoices for for those 30 from each year.

So we requested a total of 60 items to support this, and then the procedures basically required us to to get that accounts payable detail.

So in if you go back to one, we requested detail of all accounts payable, a detail of that, and then on this sample, we we requested the invoice so we could determine if it should have been an accounts payable at year end or not.

So in the audit world, if we if we find a million dollar check in January and it's dated in November and it's not an accounts payable, then we're gonna have an audit adjustment.

So that that's so essentially we did a search for unreported liabilities based upon these parameters.

Um we also requested, we looked at the due date of the invoice.

So if the invoice was due in September, when was it actually paid?

Was it paid in October, 45 days or whatever?

So we were we we have it, we were asked to do that and then reported in our report here.

So here is for 2024, and and again, these these are random samples, so we didn't we didn't we didn't go and and say get us this one, get us this one, get us this one.

Um but you can see here like like this one.

There were several in here that were improperly excluded from accounts payable at year end.

Um that just from us looking at the support that we got, we could not find it in the accounts payable detail.

Um, so on this one, you can see the disbursement listing and then the due date of the invoice, and then we've got a formula here on how many days that it was paid over or under the due date per the invoice, and then whether or not it should have been an accounts payable or been excluded in accounts payable.

As you can see here, there's about six or seven in here that were improperly excluded from when we looked at, and then we did pick up in our sample a couple of batches, so this 48,000 here and the eighteen hundred.

That is not one check, that's a number of checks, and then so we put that total in the report here, so you can see this was in March of 2025.

So here is the listing of all the disbursements that make up the 40,000, 48,000.

You can see they were all paid on the same day on March, and you can see the due date of the invoice in this call.

So these represent the number of days on that disbursement between when the bill was paid and when it was due for us looking at the invoice.

Okay.

And then we've also added if it was properly included or properly excluded.

So essentially, like if you look at this one, the $1,600 disbursement here, it was due on October 15, 2024, was paid on March 20th, 2025.

Was there any reason given for that why they were paying their bills so late?

Um let me see that we have that procedure.

I think that's one where that's highlighted in purple where we suggested changing to get their explanation.

So we don't we don't have an explanation.

We don't have it right now.

Okay.

Okay, thank you.

So that's that was 2024, I think.

And in 2025, you also see kind of the same thing.

It looks like 10 years, I think.

I think that'll page 70.

That's correct.

You can see a couple of these were paid in batches, A and B, and the due dates were in February, um, and we have details down here.

You can see where there's a number of days uh per the due date in the invoice and when they were paid.

So several several of our in our sample were improperly excluded in accounts payable, and then several on here, mostly the ones in batches were were late when comparing the due date to the invoice.

Is there uh just one person responsible for making these payments, or are there multiple people?

I don't know, I don't know that either.

Can we find that out?

Yes, are you are you talking about with them like a accounts payable clerk or we need to add a procedure to just get an understanding of the accounts payable process?

I think to you know what their process is really.

Yeah, and this one we're still pending an explanation of this, so that's okay.

So that might address some of the.

I think Amanda, if you want to if you want to add to this, we could do that.

Right.

Similar to where we've obtained the policies for those other sections, we can get that as well for this particularly.

Yeah, so is the accounting for ARM centralized somewhere bills, or do they have their own accounting operation here?

Well, I think it's centralized.

Okay, so they ship all the things.

I mean, they have to do certain things here, right?

I mean, you've got to do certain things here, but um, but they ship all the invoices off someplace else and they pay the bills, and you guys had a request.

You want me to I can comment on that?

Um, um, it is centralized, but at the end of the day, we rely on staff at the property site where most of the invoices arrive, and they have to put the invoice into the system.

We operate a cloud-based system, and people at the site input invoices, and then they're processed, they're paid um from the central location.

Um, but to kick off the whole process, the first thing that has to happen is somebody has to enter the invoice.

Um, and particularly in the off-season, a lot of times, there's not somebody at the site every day, and I think invoices get backed up a little bit.

Um, I'm not gonna comment any farther than that at this point without getting into more details, but um, if you have any other questions, you know, I can I can address those.

Thank you.

So from a consideration on a procedure if we don't already have it, is just getting a more formalized explanation of what that process is.

This is the original one, but I mean, I don't think we're yeah, we've requested one.

All right, and then I have a um this is more of a recommendation for possibly going forward in the packet when we have the accounts payable.

But I would like to request suggest that we get an aged payable detail, just not even have to be summarized to show the age of the payable each month when we're getting the packet to see what's aging, 30 days, 90 days, what the aging is.

Because I think that would be information for the directors to have so David real quick, they um where you got I'm on 11.

Yeah, you're on page 11.

Okay, so it says they did um put an explanation there, but is that not complete?

Or is it I don't think it's I don't think it's complete.

I would think it's I mean we're not making a judgment whether or not it's complete, but I don't think it's complete for your lawyer.

I just know it wasn't highlighted, so I see it.

Because and you know it's not highlighted because we requested that four of us obtain that explanation, that was the explanation that ARM gave.

So I think we've come back and said, can we get a little more detail?

Yeah, yeah, that to me that doesn't look sufficient.

Okay, um, so on number seven, essentially what we were asked to do is to look at all the transfers that were made from one bank account to the other, um, and then select a sample of the transfers.

So typically how organizations work, they will have a payroll account or a credit card account, and they will have to move cash from the operating account to the payroll account to have a payroll, and then from the credit card account to the operating account to get your money back into the operating account.

Okay, so we like those to balance and to be to balance, and you know, if you've got ten thousand dollars coming out of the payroll, you want ten thousand dollars going into the operating, and so we did look at that and they all zeroed out.

Um, we were asked to to take it a step further and understand um why certain transfers were made um on five of the largest ones, and then 10% of five or five from the remaining cash transfers.

So uh the results of that, um, here's the transfer schedule and and where we had our differences.

So this one um all of most of these are involving operating, and there's a couple payroll, uh, from operating to payroll.

Um, there is one down here from credit card to payroll.

As you can see, um they balanced they balance from one account to the other, but we requested okay.

Well, why did you make this 12,500 transfer?

What was a payroll?

And then we requested an explanation on why there was differences in the support that we got versus the actual transfer, and so the the explanation for that was well, we do our payroll a week ahead.

You know, we need about 15,000, so we're gonna move around amount over rather than doing an exact amount.

So that was the explanation on why um some of the transfer support we got did not agree back to the actual transfer.

Is that standard practice?

Um I think so.

You know, as especially if you're if you're like managing your daily cash flow, like so I see it a lot like if if a client would have, let's say they have an interest bearing account or money market account or something, and they they want to keep their money in that money market account as long as they can and not move it to the payroll account, and they might go to their payroll clerk and say, hey, you know what I what are my cash needs for payroll this this month?

And I think what they did instead of getting that exact number, they just did an estimate.

Okay.

For me, the really crucial piece of that is that transfer amount column where you see the 12,500 going out, 12,500 coming into the other account.

So all of those uh zeroed out because we're always concerned was something transferred out of this bank account and transferred to an account that's not the water parks account.

And so that's what we were looking for here is to see these were proper transfers within each uh account, and that they're not double counting cash anywhere to make you know the cash account greater than it actually is.

So that's probably the most important piece to me in this.

Um, and I agree with David of the let's look and see what our cash needs are versus what's in that account.

So maybe you know, for this last one, it was off, you know, the difference here in the far right hand column is 24,000.

Well, you know, maybe you already had the 24,000 in the bank, and to get to that $25,000 number, you only needed to transfer $1,000.

So that explanation seems rational to me.

Just for clarification purpose, the credit card account is that where money is being paid on the credit card on a credit card count in and then it's there or I can I can speak to credit card.

We we've had some uh you know credit cards are are kind of a nightmare if you don't have good controls around them, and you don't want that credit card because sometimes you get daily credit card deposits, and so you don't want just random deposits going into your operating account, and then because it can get away from you, and then you can have problems reconciling it.

So essentially, I think what they have is they have their own credit card accounts, so all those deposits that they get from your swipe your credit card goes into this account, and then they can reconcile it on a monthly basis and not be all jumbled up in your operating account.

That's pretty typical.

And then just going back to the transfer amount, those were amounts, those amounts were different meaning with transferring here and and uh doesn't match what's going out.

That would be obviously cost for concern, right?

So you're we're moving money around, and then we're taking out less here or not enough's coming in, it shouldn't be coming in, okay.

So that kind of maybe gets into is there any manipulation of of money, correct?

Okay, thank you.

Alright, um, number eight, um, for this procedure, we were asked to to in the management agreement that we got from the city or arm, I don't exactly know who gave it to us, but we got the executed management agreement, and then we were asked to just scour that for any reporting requirements where they have to send the city financial statements, quarterly reports.

So we have built a table here that shows and we we did this for for 2025, and I know it's really really small, but I couldn't fit it on the page without getting it kind of squeezed in here.

So there is the management agreement section that is in your management agreement, the section heading, the reporting requirements.

So the first one is the annual financial report, um, the second the annual fiscal physical condition report, PL statements and operating statements.

I'm not sure the operating statements I think are essentially the same thing as the PL, they're just reported on a quarterly basis.

So you can see here the period that they were required to send the city these documents.

Here's the due date per the managed management agreement, and here is when they provided it.

And then we've got a yes or no over here if it met the reporting requirements.

So there is a few in here that were a few days off, like you know, like January.

They were they were I guess six days off here, they provided in 24, and it was due on 218.

Um that is off, that is the reporting requirements that they are required to give you.

Um how we got this, um, we requested all emails sent sent from them that have this information on them, including the attachments where they said here's the BL statement, here's this statement, here's this statement.

So we actually have a document, 200-page PDF in our files that has all that information in there on when they send it.

It's got copies of the emails in there.

Okay.

So for the most part, as you can see, most of these are yes, they didn't meet the requirement.

There was now we we didn't look at if they were accurate or not or anything, we just said we were just required to look if they sent the actual document that they were required in the management letter.

Question um on the annual financial report, you have the one for the 24 year.

I believe I'm reading that correctly that it's due 60 days after your end.

Um we have the one for 25 at this point.

Well, the way the procedure was written, we were just required to look at the 25, which you got in 25.

That's the way we interpreted it.

We can we could add to that.

You know, that's something that it's not too late to add if we want if we want to expand this through.

Yeah, I would add that.

So we should have it by now.

We'll we'll add that.

Alright, so on the financial analytics, so here Amanda was trying to figure out ways for us to recalculate revenue, revenue per month compared to revenue per person per year.

Um, and so we're just gonna dive into it.

I'm not gonna regurgitate these procedures, but they're there for you if you want to read them.

Again, the purple ones we're still kind of waiting on some variance explanations and some commentary on our result of these procedures.

So let me explain this table to you here.

So this this table here, um, we use the total the annual revenue per the financial statements, and then we recalculated the total number of attendees per those sheets that we that I described to you earlier, those those daily sheets.

We said, okay, what is the what is the monthly revenue per attendee, what is the annual revenue per attendee, and is there a variance there?

Real quick, the these daily sheets.

It's in an Excel format of some sort.

I think it's a paper.

It's a PDF.

So it's the scanning paper in or something.

That's how they gave them to us.

Okay.

Oh, all right.

So as you can see here, like in May, or is that May?

Yeah, May, May, $52 revenue per attendee.

So how we arrived at that number is we calculated per their sheet how many people attended the park in May, and then compared it to the total annual revenue for the total year.

So here there was $45 annual revenue per attendee and $52 in May.

So you can see June $44 is closer to the average.

July's off a couple dollars, and then August went down to $37, and then it went up in September.

Um this is the one where we requested explanations for every month.

Of course, all but five of them are pretty easy, right?

There were they weren't open during those periods, but um we did request.

Okay, in May, why is your average revenue per attendee $52 compared to the $45 average?

We're still waiting on that explanation question.

Uh this is a question for the city, really.

Does the city get monthly reports on the number of the attendance at the park?

Is that part of the package?

I I don't know the answer to that, but that is why we have worth asking.

We're the heading, it's a good indicator, and maybe the comparison of the prior year.

This is yeah, this what year is this?

Is this 25?

Yes.

Okay.

So this is not including the cost of attendance, this is just what they spent once they're in the park.

Um this is the revenue per person.

So a thousand people, a hundred thousand dollars in revenue, we would take a hundred thousand dollars divided by a thousand.

That's how we calculate it.

Would rain days impact this?

I mean, it would go into the average, go into the average.

Right.

So it would probably pull down the average a little bit, but it would show it would show up here.

So that's one potential explanation for that decrease in August, which but we don't we don't have that explanation yet, but it it could be an explanation.

It's just interesting, it goes down and it pops up before the end of the year.

I was just looking at what you had highlighted.

It says um uh for the proper percentage of concessions and merchandise, it didn't say anything about.

Oh, we're that's that's further on.

We're right now this is just the attendance here.

Okay, so we're so they're separate.

So okay.

Well that that's good clarification.

So is that just it doesn't include if someone buys a coke or does this do?

This schedule here excludes we did our best to exclude season pass.

So we tried to get to the actual day to day day to day what people spent in the park.

So it doesn't make pay makes a difference too.

So we're paying by credit card, then you're paying processing fees, yeah, and then the timing that we we you know earlier and the earlier procedure there was variances in there, all that's gonna impact this.

So if you don't, you know, if if you don't have a proper cutoff, like you don't get revenue in the appropriate period or payables in the appropriate period, I mean it it's the thing that concerns me when I see that there's invoices that are going four or five months without being paid, it makes me wonder was there money in that account to pay them, and if not, is that why they got put off?

Any reason why I'm sorry, no, I'm done.

Any reason why um you and you maybe you said this earlier, why we would exclude season passes even though they might not be paying then.

Um I think the reason that we are they the reason that they were excluded is because what Mr.

Martin was was I I think the revenue recognition of that is being it's gonna make it wonky.

Okay, make it wonky, and especially if it's not done 100% perfect, it's gonna skew the numbers on the season pass.

I mean, do you think you could if if that is that becoming so because how they're recognizing the those season passes?

Well, it let's say that you had 200,000 dollars worth of revenue for season passes in a particular month, and you didn't spread that out appropriately, then it would skew that month.

Okay, right, it would skew all the months, but it seems like to me, I would want to know that I would want to know better.

Just run the running business.

That was how we originally had it.

This one I struggled with how to write it to get to what we wanted, which was let's look at revenue and see if it makes sense from a daily attendance records of because you would think more people in the park that day, uh the more revenues that would be generated, but those season passes just kind of threw a wrench in it, and so this was our attempt to get.

If I understand right, I mean there's a lot of season passes that are sold.

And that just kind of I guess I guess I it's probably north of these numbers.

If you if you if you look at it, you you put season pass books in there, these numbers probably go up.

Because there would, yeah, because they would be standing up.

If you if you recogni it, you know, if if I buy a season pass and it's distributed when I attend, that yeah, it's gonna affect the numbers.

So if I if you go twice, you have to you have to distribute out that whatever that cost is, and then okay, but it also doesn't reflect if I go by hot dog and all these other things in there, or unless that does it it's in here.

We these numbers were what we tried to do here in in working with them after Amanda's guidance, is we tried to get it to where we were comparing apples to apples, and we tried to exclude the season passes because after learning about it, we knew that it was not, you know, it might not be appropriate to to include those because they might not be in the appropriate period.

Okay, which we could modify these and go back and show maybe both versions of it.

Um I don't know if there will be any additional clarity if we do that.

Okay, excuse me.

And so I see a bunch of uh yellow beer, we're waiting on them to respond.

Yeah, I mean, I I I uh you know, this is a different way of looking at it probably than what everybody's used to.

Um so yeah, okay.

One thing to, you know, I think some of this is more for the comparison, like you've got a baseline now, so what how does that look going forward to say are we up or we down?

If we are why um I was looking at the monthly report, and there isn't item for total park admissions for the month, and then here today, that's obviously zero for April because it was closed, but that might be something to add to the reporting going forward to try to capture some of this to give us a little more information on this.

So you can understand.

Yeah, so if we if we go through, we get a financial statement in June, reporting this May, and we look at that and it's 55 or 45.

We would we could we'd say, Well, compared to last year, 2025, it didn't, it didn't uh yeah, that that's lower as upper or lower.

What you just described, Mr.

Martin is is what we were trying to do here.

Okay, we're trying to understand if this was consistent per person.

I think that's what you were trying to do, Amanda.

When you I'm not speaking for you, but that is correct.

That's what she was trying to do when she designed this procedure.

Okay, um the next one, we took the expenses year over year and compared them from 25 to 24.

Okay, so we got these straight off the financial statements, so and then we asked for any variances over a certain dollar amount, and we asked for their comments.

And so, as you can see, 25 versus 24, the monthly expenses.

Here's the comments that we got from them.

If y'all want to read them and I'll be cutting off what you could see but you have it in front of you.

Question on that do you know if any part of that electoral surge cost was going to insurance and I don't know.

I didn't I did not we didn't we didn't go further than just getting a comment depends on the policy sometimes it is sometimes not be worth the question though asked to ask them whether or not it was or wasn't it because that's relevant.

So it looks like the year over year change is is pretty much flat however the differences in say April versus April of 24 versus September August of 25 that the wide swing is there any anything related to that um I mean well I mean in terms of we had a large spend in a month in in well it wasn't like if you look at April what they say happened there expense in 2024 include a payment to clarity of 246 thousand for a river leak repair that must be the lazy river I guess.

Okay.

So for the um October the power surge was that out of pocket for us there was an insurance that covered that I I do not know.

I do not know either.

You know that's something that we can add to ask them yeah I mean I would imagine that's something that insurance will cover if you don't want to add that I could yeah I'm in your tracking all this I've got written down here.

Yeah.

You know in May it says power surge payment of 84,235 dollars then in October power surge payment for 25000 I mean that's now over a hundred thousand dollars I'd be curious to know what our insurance covers or if it was reimbursed at any point.

So sometimes insurance covers it sometimes it doesn't I should say that it depends on situation but it should it would be useful to know if if they file a client we got the money back.

You know I would also say on this it's worth worth noting that these expenses for the river leak repair which really are large I I would if unless the board receives some written explanation of how that repair could cost 4600 I think that would be worth requesting from from them as to have repair of that I mean I assume it's the lazy river that they're talking about there when they say river leak yeah you know I would think there's a lot more to it than a week I would think if you know you could almost say I need to replace a big section of that but it there needs to be a written and this is outside your scope obviously David but a written explanation from them on what that repair actually consisted of and it's worth noting that because it was reclassified if I'm reading this correctly reclassified out of regular expenses into construction expenses construction and progress like capital then it doesn't really show up in 24 even though you described it here because it was occurred in the early months and reclassified so you're really comparing apples to apples pretty much you only have this giant repair in 24 is not there 25 because the initial look at this would say, well, how could 25 expenses be as much as 24?

If there's a uh 460,000 dollar expense in 24 that will curve but since it was moved at Carl's instruction that that's true.

That's a great point, and and I'm not telling you that this follows gap or anything.

This is just the explanation right that we got.

Um, and if we need to go further, well, I'm just saying, the question needs to be asked from them by the by you guys explain this because I was on the board in 24.

There was never a word, yeah.

Was this for the cast iron fittings or was that the following year?

I know.

I was in the impression gas iron fittings was over the entire park.

Yeah, not just not just that.

I would I would like to maybe suggest.

I mean, we could add that as a procedure, just a specific explanation for the river leak or a summary of the river leak repair, an explanation for that, how that worked, but I would also to Juan's point, you know, maybe to make this comparable, we should if I don't know if we should have a separate table or just have an asterisk by the 24.

If we exlude that reduction of expenses from 24, what does that look like on the comparison?

Yeah, and and I don't know, skewing it.

I don't know what you're interested in.

If you're interested in getting a cash, you know, here, you know, here's what we paid, or if you want more of a gap type, uh it'd be cash, yeah.

Um, because that I think that's what they pay you, or you know, that's what yeah.

I just I think I agree.

I think it would be cash.

I just think yeah, when you're looking at the expenses being comparable, really, other than 17,000 year a year, it's really skewed by the fact that August is so much less because that was moved out.

So I think having something that was allowed more apples to have.

Yeah, so I guess that would better that it's not really cash, right?

I mean, if it was moved out, yeah.

But I mean, the thing is zero, but you would reduce March by 142, then you'd reduce eight, you know, the other April by 246.

So you'd have something that's yeah, and it's it's it's hard to it's hard to kind of look at it now because you're right, in those months leading up to that, they it was it was included in those numbers, right?

Okay, okay, um the next one.

So, in the original procedure here, we're not helped me here on this one.

So initially, I think what we were asked to do is to calculate the cost of certain concession items.

So and the thought was to get the revenue in the the average cost and compare those, like the the sales price that they're charging for each concession item.

When we dug into that to get into a deeper layer, uh that information was not readily available.

Technical term, it was really hard to get, they don't track it that way at their inventory level, so it would be going through each individual invoice to add those up, and it would be a time-intensive process.

Now, could we get them to go ahead and do that?

We could, but it would have ended up in a delay in this information, this conversation we're having now.

So we modified this procedure to look at how management tracks their revenues and costs.

So that's what led to this change here.

Um, we could get more detail about that.

Um, but it would cause a delay in in this report.

So basically they expense all the purchases and then we keep an inventory, but this is all short live stuff.

So what what I was told the way that I understood it is, you know, they sell a pizza, and they don't just buy a frozen pizza, a pizza has 15 ingredients, so they would have to do some cost accounting and determine the cost of the pizza based upon these 15 different items, and they communicated that that would be a lot of work for them to do that is not standard practice.

That's bullshit.

I mean, something I do know something about is the concession business, and you know exactly how much each item costs to make.

If they I mean that's really concerning to me that they don't know what their food cost is on each item.

I mean, I uh, you know, I mean, I can haven't done concessions in 10 years, and I can tell you, you know, what a hot dog was 14 cents with the wrapper, you know, if you factor in a ketchup packet and a napkin, you know, we had accounting for that.

If you've got nachos, it's uh 50 cents or whatever it may be now.

They should know.

I mean, their menu's not that big.

They should know every item on their menu what their food cost is.

I mean, that that's that's where you start.

Which I you know, I I can't comment to that of the system that they're using and if they're able to track it at that level.

Uh we could go back and request that from them, but I think it it will take a significant amount of time to do that.

I think maybe I think maybe you know, the decision or the recommendation would be we would like to see something different, or we would like more information now versus just going back into the history of it to create something that's just not there and it's very wieldly to get, but at least knowing what we know now, what can we request and what we can get that's different that would give us better information on that because you know, they're only open you know four months, they're only serving food three or four months, the food cost isn't that variable from May to August.

I mean, maybe from year to year it is, but um, you know, from the opening of the season to the closing of the season, it's it's not that variable.

And my understanding is that that is discussed as part of uh operations with between ARM and the city and the county to help set those prices.

So it's a conversation that I don't know how you can establish your prices if you don't know what your cost was.

It's right, I thought they're good.

So what we did um is we took the total sales and the cost of sales per the financial statements, and then we recalculated what their gross profit would be on a monthly basis for food sales, beverage sales, and merchandise sales.

Um this is the what we asked, Amanda asked for she thought it would be wise to put a little commentary on the gross profit percentage here, and this is this is what we have.

So I I've heard this, then maybe Jeff sent us an email on this, but prices are intended to be low, so it's affordable for people, so there's not really a profit, right?

But they're charging eight dollars and twenty-five cents a hamburger without cheese, without fries, that there's no one's food cost is that high.

I mean, unless they're selling bagu, it's not it's well, they are showing just not the sales cost of the showing.

Wait, Richard, you can't margin.

Next time you email call, um, um that's for the money.

You know, we if Amanda wants to design some procedures, we're happy to do them.

Um, I don't know.

I mean, if we if we want to push this a little, I mean, whatever you all want me to do.

And I would be looking to for recommendations from the committee.

I think we definitely need to design some procedures.

I think it's disingenuous to say that the prices they're charging are break-even.

Um I think it's you know, definitely procedures, they need to know what their cost is, and they need to be able to, you know, work from there as it's just basic.

So from a you know, these procedures, I don't mean to to get us off track, but the procedures have to be written very clearly for forvice to follow those.

So I'm just looking for some exactly.

Well, to me, what I don't understand is if you're just if you're just in the business to break even just as a service you're providing, why not let people bring their own food?

Why not let people bring their own drinks?

I mean, the the intention is to turn a profit or you would let them do that, I would imagine.

So is your is your is your thought process really kind of does it go back to the cost, like better understanding cost of foods production of food that gets sold?

Yes, okay.

I think that's the baseline where we need to start.

And we're talking about chips, we're talking about canned cheese, we're talking about uh things like that.

I mean, we're not talking about highly perishable items.

I mean, this isn't a Michelin star restaurant.

This is uh, you know, Sam's Club or Cisco or whatever.

I mean, it's you can say I'm buying a case of cheese, it's this much, I get approximately this many servings.

I mean, their menu's not that big.

They should be able to know their approximate food costs on every item they sell it and then to price the the concession prices would be set from there.

So David were you saying earlier that you mentioned the the pizza.

Are they that was just an example that they gave me?

Well, to and to that point, are they saying I don't know how much the pepperoni is, and I don't know how much the cheese speak for them, but um I mean, I think what you're saying is we should know how much feeds cost.

Just in jail, not like 12 pieces of peppermint.

I mean, you're not you're not counting each chip out, but I mean you've got a you know you've got a container and you say a one-pound container, a two-pound container, and you're filling it relatively full, and you know that like when we did it, we knew we got approximately 15 to 16 servings of chips out of one bag.

And then out of a can of cheese, you know, you get maybe 30 or 45, I don't remember what it was, but so you could you could get a you know a pretty good idea from there, and so for the cheese, then you're using you're using a ladle and the ladle holds you know so much, you can buy different size labels.

So I mean it gives you an idea of how much you're getting from each thing.

Can I just read the original procedure?

Okay, so this was the original procedure that we tried to do.

So it says using the list of concession items, calculate report the profitability of each item for the purpose of this calculation, uh profitability should be class calculated by some subtracting the average cost from the sales price and dividing the difference by the sales price.

Obtain document report management's explanation um for the two items with the lowest profit of it.

So that we we had to scrap that.

Because they don't know the cost.

Was it that each item thing that was uh I don't think I was talking pepperonis, I'm talking pizza.

Well, well, I think I think LeBron hit it on the nail in the head when he's when he was talking about like doing a proper inventory and just expensive things.

Yeah.

They're not doing they're not doing inventory, I mean an operation that's this small.

One thing to kind of sit back, think about is food is 20% of revenue, not it's 80% is people in the bar.

20% is food.

So how much you know, just think about how much ever you want to spend on the 20%.

So I would argue that the revenue would be higher than 20%.

If they were doing it properly.

I mean, this should be a cash cow, that's why people do concessions.

And I think you know, for purposes, these procedures, do we want to invest the time of trying to go back historically and calculate that knowing they don't have it, or is that something we're going forward, going toward uh uh of these, I think you know, now that the park is just open.

What can we do, or what's you could we discussions could be had to make sure we're tracking that the way we want to tracked?

Yes, and I I agree they don't if they don't have the data they don't have it, but um, you know, going forward they definitely need to sit.

So there's the procedure we replace with what I just read.

So I know it's kind of hard to read because it's purple, but um but we're happy to happy to to do whatever you all want us to do on that.

But I mean, really, if you wanted to calculate the cost of a hot dog, you don't need to calculate every package of buns they bought.

You can take one package of funds, one buy, you know, I mean, calculate it from there, you don't have to have all the data from all the months.

That would that should give us a rough idea.

I think Christina though, and Neil, I think what Deanna was trying to say in the line is is that we you have the ability to tell AMR exactly what you want, and so you have the ability to call whoever is on the phone and say, I want this breakdown.

It's not part of audit that we did, but we tried to do we didn't get that piece.

And every time we add, I think if we add you know more things we want to do, the meters run.

So we were trying to do this inside a budgeted window.

And so every time we're adding something to the list, we're we're adding another number to the other thing.

So, but if you want something going forward, such as information, you want you want to know what the cost of a hot dog was and what their sales price or hot dog was, then just tell AMR and tell them that's what you expect to see in the monthly report.

To go back and reconstruct it, I don't think helps us trying to get attain what we're trying to get done with the auditors.

That's what I said.

I understand that.

I think I think I'm just still in shock that anybody would run a business that way, but I agree.

Going forward, you know, we'll get that set up, and I may be calling over there.

Uh I think I've asked Jeff for some uh some invoices uh in the past as well.

Thank you.

Are we good on this?

We've got one more.

We're almost done.

Uh, so so number 10, we were asked to recalculate compensation uh of manager payments during the year and report any discrepancies for differences greater than five hundred dollars, and then recalculate all incentive compensation and manager payments during 25.

Um, there were no incentive compensation payments during 25.

Um, there were differences on the calculated compensation versus what they were paid, um, for each month.

Uh, but again, you can see in the difference column here and it zeros and that's itself out.

So, I think this if you're analyzing this, it goes back to the common theme of proper revenue and expense recognition in each month.

It might be you know, you might have expenses this month that should have been the next month, but over the course of the year it works itself out.

So we calculated 94,288 in compensation, um, and that's what they were paid.

Okay, so that was our agreed upon procedures.

That's what we were asked to do.

That's that's what we've done.

Um, I guess I from our perspective, the balls in your court, um, you know, I have reviewed every work paper in here, we've got support for everything in here that we were asked to do.

Um, you know, if we need to go back and add some procedures, then we can work with Amanda on that and add those procedures and then go back to R and request additional information on top of what they already owe us.

So they still owe us everything in here that's highlighted in yellow and in purple before we can issue a final report.

And I was told we were going to get that next week, okay.

My expectation, I know there's somebody listening.

Um my expectation is when I'm auditing about providing the detailed information.

Yeah, so the purple, the purple was was new procedures that we we did we that Amanda suggested that we add based upon some of these variances that we've discussed tonight.

She thought it would make more sense to obtain their explanation, so we can have a complete report.

Right.

So I just want to make sure that we're we've got good solid information in terms of that would be my expectation.

One of the main contacts that we were working with on understanding some of this stuff is out this week.

Well, so I you know, I will say from our perspective, they've been pretty good for us to work with as far as giving us what we needed, taking calls.

Again, we've had weekly, almost weekly calls with them, and Amanda's been on every one of them pretty much, I think.

Um so they've wanted to cooperate with us.

Um a couple of them, you know, this would be impossible for us to do.

They didn't use those exact words, but you know, it would be really difficult for us to do this, and so that's when Amanda said, you know, we'll we'll change it to this and talk to you all about it and see if you all are okay with it.

Uh, but again, that's the beauty of having a draft agreed upon procedures report, we could add to it, we could add to things.

Um, so that's kind of where we're at.

So David, when you get done, would we get some form of we'll get the report, then will we get some form of uh an executive summary that says that you know, I'm as I read the report and I try to think back to the meeting we had.

We're gonna get this report, and then what do we do with it?

I mean, what's what what comes out of this?

I think that that's probably not gonna be me because I I'm I'm I'm not making any management decisions.

Um I have to remain completely independent from this process.

So, um I think you know, like I mean I I really can't tell you how to go forward.

I can just tell you here's here's kind of what we found as a result of these procedures.

I mean, we are your external auditor, right?

So I have to be careful to kind of follow follow the rules and not so that question should go to Amanda or Jeff.

I think it I mean, kind of in my thinking, part of it would come to us.

Like what recommendations do we have for management that they then go to ARM and say we want these items changed or we want more clarity going forward, and then we'll be up to management to be able to make those uh changes.

Would thank you.

That's what that's the answer I was going to say.

Well, what's the next step?

Well, and and also would this need to go to the board for acceptance?

I think once once it's finalized, once it's finalized and the procedures were done and she would work for acceptance.

Um I would like to, you know, you've kind of been taking notes on some of the to Press's point from earlier.

I mean, we've added some things we'd like to have information on, a lot of it is just additional or clarifying expectations.

You know, we don't want to skyrocket the cost of this on things that really don't change anything.

Do you kind of have a list of the things we said that we would like to maybe add as a potential uh procedure or clarity or clarifying item on these?

Can you so we can do that wrongly?

I don't have a summary, we can flip through them real fast.

Um, it's been written down to the parent.

So I think that if we we go back through these um in the cash receipts portion, modify that step to um for those variances on the revenues between the daily statements and um or the monthly.

I could say that wrong, the revenue listing and the revenue in financial statements, those variances that we would ask ARM to provide a reconciliation with some details of what those reconciling items are.

Um and also that would be something they already have, to be honest with you, really.

We can request that the extra one, if they can't, I mean, I think then that becomes the procedure that that wasn't available and they didn't have it.

You know, that would be the finding on that if that's the case.

We can absolutely do that.

Okay, great.

All right, and I think that's again that would be a recommendation I'd have is that we add that to the packet monthly going forward too.

So thank you.

And then um also in the cash receipts, the question of the eight thousand dollar check of what to get it obtained ARM's explanation of what happened with that check.

Do you have the date?

I don't have the date for that.

Um I can get it.

I know it was in May, it was for Cook School, it was their end of the year um PTA situation, so the end of May in 25, and then it went uncashed until September of 25.

And I believe there was a new check that had to be reissued.

But I mean, if it was it was the school calling them saying, hey, you know, we're still showing this money, we don't know what to do.

Because it would be an outstanding check on their part.

Just to clarify, I mean, as I was kind of listing, um, so if if there was a check that they receive and they just put it in the desk, and and like what you just described, and it's not reflected on financials, it wouldn't be reflected in this report.

Because we we went off of the bank statement, and the general ledger, so I think what you just described, I don't know that like it would not be reflected in the bank statement till six months later, so it's gonna be hard to I mean it it's you know what I'm saying?

Were you not looking at attendance and things like that to them?

Because this was a situation where they shut the park down for an entire day, so I mean that's an entire day that needs to be accounted for.

I think our intention would be that it would show up in that revenue daily attendance fluctuations, so anything significant would come up.

I'm just saying, like if if they got money and it's not reflected in the bank statement, I mean, there's no way for us to really, I mean, other than those daily revenues, but the way that we calculate on the monthly basis, I don't know that it would so it wouldn't be showing in their system, right?

Well, I think maybe as part of the explanation was that in revenue in May when the park was shut down and it just didn't get deposited, so it would be in that reconciliation, you know, it should be in that reconciliation.

It may not be, but maybe just making sure in the explanation that the that includes that.

I guess what a point is like if there is activity that's not recorded in the general ledger, there's no way for these procedures to pick that up, it's gonna be very difficult.

Which makes me think then we need new procedures around that, because if not they could be running the park out on weekends and we never know about it.

But if if you think about how you could write a procedure to obtain that, would there be any evidence to see that?

I I I would struggle to know what exactly to instruct Forvis to do in that circumstance to it is difficult to find something that was never recorded where we don't have a evidence that it happened.

Well, I think then we need a procedure around creating evidence on the park is running out.

So like a suggested and and they they may have that.

I I do not know.

I mean, you know, I'm not I'm not an auditor, so I would leave that up to your expertise, but I would imagine if somebody's running out an entire park for a day, we should be able to verify that somewhere else.

Let me think on that of how to write that and uh we'll consider including that in this.

Yeah, I mean that that should be provided to us every month.

Or yeah, it may be a recommendation.

Well, I mean, there's there's a lot of people that rent the entire park out.

I mean, that's not uncommon.

I mean, up now I'm wondering, is that included in any of the information we received.

I mean, I know there's uh businesses that run it out for their employees, I think churches run it out, I think schools run it out.

Well, so if if you clear everything that happens is part is recorded in revenue, there's nothing that's not the park.

So it would show up in the monthly statements on this.

See, he just said that, but I guess what I'm telling you and what Amanda's telling you that is very difficult to do action and audit procedure.

Right.

Because if you think about it, let's say that I have a hundred invoices that I didn't pay.

Okay, and I put them in my desk drawer and I don't pay for a year.

I mean, an auditor's gonna come in and see the bank statement, it's not gonna be recorded on the general ledger or the bank statement, so it's very hard to detect unrecorded activity, unless you're out there like every day checking, you know, like have an internal auditor almost that's checking the gate every day for the people that come in, right?

Yeah, but I guess that's one of the reasons I wouldn't like that eight dollars.

Just because it is very hard to detect something that's not recorded.

We know that came up because it was brought to the attention through a different means.

So what happened with that?

Is that something that then we need to watch for or ask about in the future, or is that just an anomaly that you know there was an issue that we're not aware of, and it just took a while to get right to get rectified.

Um so going down the list here, uh accounts payable.

Uh we are going to add a procedure to obtain the policy from ARM for that account payable process so that we understand how those uh checks are written and paid for invoices.

Um we had a suggestion for going forward in the monthly packets from ARM that they provide an AP uh aging report so that we can see how many days outstanding the invoices are in that um report.

Was that for this?

That was a recommendation, not for these procedures.

Okay, sorry.

No, it was a recommendation put that in in there going forward.

I didn't mean to scare you case.

Sorry.

Um, so flipping forward to cash.

Well, let me say let me back that up.

That's right before cash for transfers.

This is still in in accounts uh the the cash disbursements.

There's a uh comment here from ARM that we're gonna get more clarity on, get some more detail for that.

Uh in the cash transfer section, um, no, let me look forward there.

The timing of the reporting from ARM in that section, we are going to add a procedure to obtain to do this test uh that we did to check to see the timely reporting.

We're gonna extend that to the 2025 annual report that was received in 2026, so we'll add that procedure, and then in the engagement procedures for the financial analytics, we had talked about going back to look at this table that's on page 15 where it's the revenue per attendee.

We we had some consideration of whether we should add the season passes back in there.

Um I don't know that that's gonna muddy the waters more or give more clarity.

Uh, this is one where we're still pending explanations from ARM.

I think we're sorry, we have to go together, can't they go together, but you could just show that that would be helpful, maybe but we could have a procedure where we all those revenues that were excluded, we could have those included in the report in a similar table so that we could see them side by side.

Sure.

And then there was a recommendation going forward to have some of the daily attendance um commentary on the monthly financial statements.

So total, but just the total attendance, for example.

I mean, you know, I think it'd be useful to know what the events was for the month of May versus last year.

Are we running a positive trend or not?

As we go through the year, and you know, giant expenses are to be reported on a timely basis, not two years later.

So I just said if you're gonna spend 300,000 on something, the board deserves to know about it, and the county are four board as well.

So McLaughlin, did you want if you want the attendance and the ARM report every month?

Then is that what yeah?

They could do a supplemental sheet with their financial show, you know, park attendance, or May was this whatever month they're reporting on April's probably zero, but um May, June, July, August through the months of the September, but once they operate.

So you again know, and the the truth is the revenue and the attendance are the track generally.

Attendance is reported at the very top of the report every month.

It is it is reporting.

Yeah, yeah, yeah.

Is the total is that a total for the month or like a daily attendance?

Is it just the total for the month and then your day?

We don't have any daily attendance reports that we should.

Yeah, that's correct.

Thank you.

But I think what the model is asking is is that could you do it versus uh year over year?

So in other words, if you post that comparison is already on the report, is it we're at the top of the page, last year?

Okay.

So we should have alright, I stand corrected.

So Amanda, what I would like to see is on our monthly report a list of private events that are home there, each one thoroughly.

So in addition to the daily attendance also have a section for the private events, yes.

Is private event data included in the daily attendance?

That would be the line for group events, yes.

So, like if we're looking at May's total attendance, that would include that would include group events or or or private events, but then you'd also you also are breaking out that private events later, somewhere in this this financial report.

I understand that's great.

The revenue the revenue is all classified by source on the report under the water.

Are group events, are there different categories of group events versus somebody just bringing in a group and getting a special rate versus running the whole park out?

I can't speak to the details of that right now.

You don't have the information or you don't care to tell you.

I'm not close enough.

I'm the director of American Reserve Management's global operations, and I'm not close enough to this particular operation to be able to speak in detail about it.

So it it sounds like then I mean that's not necessarily a change in the procedures, but just going forward that we get some and we are looking at an April report, so we don't have revenue numbers because the park wasn't open in there, or attendance numbers.

Um, but maybe going forward that some additional information on attendance or group events or just making sure that's included in your number one-day information they want to see, yes, because what I see it says admissions day pass group, which I think is different than running the whole park out.

Okay.

And I know people do rent that park out.

I know there's a lot of churches that do it, I know there's businesses that do it, and I would like to see.

I mean, you know, if you're running the park out at $8,000 a day, you're doing five of those a month, I want to see where that's accounting for.

And it it could be that that is already included in some of the commentary, but it's it's hard for me to tell from this April report because there was no attendance.

But we'll we'll we can include that as a recommendation to have some commentary from ARM regarding the different kinds of revenues.

And add the sponsor revenue in there is I I as a separate line item because I don't see uh I mean I didn't have time to look all the way through the April financials, but I don't see a revenue separate line for sponsored revenue.

And there's a sponsor line report and to be fair if if we want to talk about classifying revenue by different buckets.

I'm I'm very open to that, and I'm open to if you want to have a part by outline, um, that would be fairly easy to do, and you know we can do all this stuff, um, like understanding what you have to want.

So we can work towards adding some of that into the information going forward.

Yes, um, just so for clarity, um, and I appreciate you asking for clarity for clarity.

I want a part by I want is there a standard rate for that?

Uh I don't know the answer to that.

I don't know either.

Okay, so maybe we can determine uh if it's for so many people for so many hours, or if it's just one standard um fee.

Okay.

Um skipping forward to the section on expenses.

Um there were uh some comments here to understand what these insurance if if there was insurance proceeds for uh some of these items that that were repairs, and then additionally there was some there was some talk about should we have this chart and pull out the major capital repairs and then redo this procedure?

Is that where we think we are is the recommendation to update this procedure so it'll be more apples to apples comparison?

So you get the motion comparisons will make more sense right now.

They don't make any sense at all.

There's one where they reverse the number that basically throws that to the round that we're correct, so and maybe just for clarity, we keep the table as it is, and then we do another um we do another table that has those items broken out differently so that we're a little more comparable.

Since we've already really done this procedure, um, that's okay, okay.

Um and then the recommendation going forward about making sure that large repairs are communicated in the monthly financial statements when they've happened, not necessarily when they are paid.

Well, they should be reported to to the uh administration and the board on a very timely basis.

Whether it maybe next month, maybe when it happens and you realize it's gonna be a big expense.

Hopefully it never occurs again.

But I mean you have money spent like we spent on that week.

I mean, that is a significant impact on the entire year's budget, right?

Unexpected, unbudgeted.

But I was there two other things the city should do.

Okay.

One is ask for support for the insurance expense number.

You need to know coverage, limits, deductibles.

And what that 120,000 is made up of.

Okay.

And a second very broad thing you need to ask is of the expenses that show in April financial statements.

How much are direct expenses incurred by the operation here or how and how much are home office allocated expenses?

And I'm not saying there's any correct or incorrect about that, it's kind of a normal thing.

But the city needs to know how much of the total expenses incurred or allocated from the home office.

And it's all location expenses, there's nothing allocated from home office.

But no, and I understand that all locations are.

What I'm saying is the city need deserves to understand okay, what portion and I also recognize that when you do buying on a large scale basis, then it you get a better price if you have a bigger population that you're buying for uh it's just useful information for the city to know how much is correct, how much is applicable.

I'm not saying there's anything wrong, it's just information.

Correct.

One other thing, just so I don't forget it on the expense side when we're looking at recommendations, not changes to procedures, but recommendations.

But is that giving you what you all need to evaluate these?

Like, is there a if this something is over or under budget by X percent or X dollar amount, and we want to request a more specific explanation for that?

I don't think we need to get into every dollar any minor amounts, but there's some threshold that hey, if it's exceeding or under budget or by this percentage or this dollar amount, maybe we want a specific explanation for that, and maybe that's inherent, didn't see it on this April, you know, just let's look at April, but I think that's something to consider as a recommendation to get the information on the expense side.

All right, and then the last one that I have written down is um regarding the uh concession sales to going forward, get a better idea of how much the inventory cost revenues are to identify um profitability on those items and really understand those costs, uh that's all that I have.

You have any just get a better idea of it to identify food costs, and that is all that I had written down.

Does that sound right, Katie?

I concur, thank you very much.

That was a long uh detailed explanation, and we definitely associate.

Okay, that's great.

Um does anybody else have any.

Well, let me say, so the process from here would be that go back to add these, modify these few procedures that we talked about, get the explanations from our and and the pending items cleared, and then the report would be finalized, that point from our perspective, yes.

Okay, and then I think then it would go to the board for so probably this this uh the audit committee, my assumption is correct about the audit committee would make a recommendation to push it forward to the board for approval, yes, and then we uh and I guess our discussion would be as part of that we have some recommendations we would make that go along with that.

Like, here's some things we would recommend, and I mean that kind of we've kind of got that started, we can come up with that.

Um, that would go to the board from there, yeah.

Okay.

Yeah, and from our perspective, even reports essentially done, and what you've asked us to do so far.

We just have to go finalize everything, okay.

Um, I appreciate just the discussion.

Go ahead and do that.

So, so we probably once that's done, probably need to regroup as a committee, and then make that recommendation.

We have a meeting, I know we'll have a meeting in June to discuss the external audit.

I don't know the timing yet, but we could do it since we have that meeting coming up, we can either have a separate meeting to do that specific item, or we can include it with that meeting and take you know the first X number of minutes of that meeting.

When is that meeting?

We don't have it on the calendar yet, I don't think we've talked about it.

I think well, David, if you get that information, David, if you get that information times manager to clean this up, would you be able to have that ready for a June meeting?

I guess I guess my only concern is that that going over the act for actor um is pretty important.

Yeah, it like needs to be kind of off the I don't want to dilute it with something or spend another hour going through this, um, after that.

So, you know, if we can if it can go quick, yeah, we can do it, but we might need to look at something separate.

Okay.

I guess I would say once we have that, because I know you said it would be next week probably when the person's back on the case.

You know, but uh I mean we we've got to design these procedures, and you know, we we've got to design them just so that we're we're being really specific as you're as your external auditors and we're doing exactly what you want us to do.

Because we can't, yeah, you know, can't make management decisions, we can't like oh well.

Yeah, okay.

I guess if you can let Amanda know that that's done.

She's gonna she's gonna let me know when she's got I'll have to write the procedures and then communicate them.

Okay, yeah.

So I I mean I I don't know as far as timing.

I mean, our are we wanting to get this this is this final issue really?

I mean, I think I don't think we want it to drag out for forever, but I mean, I mean, is it something that can be done in the next few weeks?

Do we think?

Yeah, I mean we're we're we're we're we we've got a big audit we're working on too.

So we're we we got a little work to do on that still too.

Um, you know, it's it's it's kind of I mean we'll we'll make it happen.

So whatever you guys need us to do, we'll make it happen.

Um, some of it's kind of out of our control.

You know, we can't we can't make Amanda go home tonight and write the procedures and have it in my inbox in the morning.

My favorite thing to do is try procedures.

You know, I can't I can't make uh Gerald and seem what we want it timely enough that if we're gonna make it doesn't do us any value to be in August or September and then tell them we want these new procedures in place and then we're setting this report without the information basically for another year.

So that's right.

It's kind of time is of the essence.

So if somebody's not cooperating with time, then you need to tell Amanda so that we can go to the board and try to get so we have to get that.

Amanda's on every call that I'm on with them, so she she's we can't and that that is part of why we wanted to have the meeting now, which is ahead of that you know June delivery date that we were aiming for when we started this process.

So we are as well I think it's been really helpful to have this discussion because I think it clarifies some things that we can time which we can still get meet that June deadline.

And we knew that we had this possibility.

If we went through the route of doing agreed upon procedures that we could have this meeting where we talk about, well, this is what we found.

Is there anything else we want to do?

And so I think that we've we've played that out.

And you know, from my perspective, when I when I'm involved with these types of engagements, I always like to let's have a draft and hash it out first because there's inevitably always things that you all want us to add, you know, or clarifying things, and if you have a final report, it's a lot harder to change.

You know, if you still have a work process, so well let me ask this.

Are y'all do you think you'll have a call next Friday?

I mean, I know you've been having was it Friday or Tuesday, you're having calls.

We've been having them on Tuesdays, but uh but I'm sure Joe can have a call with us next Friday.

Is he still is he still on there?

Okay, so maybe if that can happen, if you can maybe see because you've been doing a great job of sending kind of the update and mails of black, you know what the discussions and where we're at just where we're at what we're still pending does it look like we could have these items resolved the week after next and if so then I think we could have a meeting to get back together and look at the final draft make sure there's nothing else and push this forward and also Amanda not to put work on you but the recommendations that like just a draft of our questions that we've talked about I think that would be a good start is it that ever acceptable to everybody.

Okay.

Do we do we need the draft in that to make the recommendations that we talked about that will help us in the analysis do they have to coincide with each other could we go ahead and then you can make the recommendations to the board I guess she would have to make the recommendations to y'all to to move that forward then but we can do that ahead of time we don't have to wait for the draft for the audit report but if we want to see those pieces we and you know again I go back to I you're gonna be in July before we start to see it on the first report or even August you only have two months so we really need to push again you don't have to wait on us.

Right that's what you're saying right yeah that's what I'm saying.

And I think if if that time of we're gonna be pending something and that's not going to happen soon then maybe we do need to go forward with at least getting our recommendations together and if and getting those to the board based on the draft report and then if something comes up in the final we can always amend or add to our recommendations at that point in time.

Would you be able to come speak to the board on that when time comes yes as long as it's not the third the week of the 15th or 16th out that we could so yes.

We'll work on that I'm just gonna say that given the fact that we're already into the 2026 season any reporting changes that will occur will most likely not occur until the 2027 season anyway because I don't think you want to make mid season changes in your reporting.

Okay and I think that's a question if there's something really critical that we want to and I think those are just discussion items if there's something critical that the board really needs to see then maybe it's just an amendment maybe it's not a change in the report but additional information and so I think those are questions that we can have discussion items once we get past this.

Well we'll work on that and we'll I will um communicate to the audit committee and the board.

Okay.

Anything else I appreciate everybody's time we're a two hours and four minutes this is like I was planning we still got three more items to go on a normal Tuesday so we're we're earlier.

Okay.

All right any other items no I got outside when there was light out this Tuesday which is the first in a long time so this is we're good.

Thank you.

Thank you for we are adjourned.

Thank you oh motion to adjourn I guess I didn't know that's a thank you all right