VILLAGES OF WESTPORT COMMUNITY DEVELOPMENT DISTRICT DUVAL COUNTY, FLORIDA
FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2015

VILLAGES OF WESTPORT COMMUNITY DEVELOPMENT DISTRICT DUVAL COUNTY, FLORIDA

TABLE OF CONTENTS

    Page	
INDEPENDENT AUDITOR’S REPORT	1-2
MANAGEMENT’S DISCUSSION AND ANALYSIS	3-6
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements:
Statement of Net Position	7
Statement of Activities	8
Fund Financial Statements:
Balance Sheet – Governmental Funds	9
Reconciliation of Balance Sheet – Governmental Funds to the
Statement of Net Position	10
Statement of Revenues, Expenditures and Changes in Fund Balances –
Governmental Funds	11
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities	12
Notes to the Financial Statements	13-21
REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Revenues, Expenditures and Changes in Fund Balance –
Budget and Actual – General Fund	22
Notes to Required Supplementary Information	23
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS	24-25
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE WITH THE REQUIREMENTS OF SECTION 218.415, FLORIDA STATUTES, REQUIRED BY RULE 10.556(10)
OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA	26
MANAGEMENT LETTER REQUIRED BY CHAPTER 10.550 OF THE RULES
OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA	27-28

INDEPENDENT AUDITOR’S REPORT

To the Board of Supervisors
Villages of Westport Community Development District Duval County, Florida

2700 North Military Trail ▪ Suite 350 Boca Raton, Florida 33431
(561) 994-9299 ▪ (800) 299-4728
Fax (561) 994-5823
www.graucpa.com

Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and each major fund of Villages of Westport Community Development District, Duval County, Florida (“District”) as of and for the fiscal year ended September 30, 2015, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the District as of September 30, 2015, and the respective changes in financial position thereof for the fiscal year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matters

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and budgetary comparison information be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated June 24, 2016, on our consideration of the District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control over financial reporting and compliance.

Report on Other Legal and Regulatory Requirements

We have also issued our report dated June 24, 2016, on our consideration of the District’s compliance with the requirements of Section 218.415, Florida Statutes, as required by Rule 10.556(10) of the Auditor General of the State of Florida. The purpose of that report is to provide an opinion based on our examination conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants.
June 24, 2016

MANAGEMENT’S DISCUSSION AND ANALYSIS

Our discussion and analysis of Villages of Westport Community Development District, Duval County, Florida (“District”) provides a narrative overview of the District’s financial activities for the fiscal year ended September 30, 2015. Please read it in conjunction with the District’s Independent Auditor’s Report, basic financial statements, accompanying notes and supplementary information to the basic financial statements.

FINANCIAL HIGHLIGHTS

The liabilities of the District exceeded its assets at the close of the most recent fiscal year resulting in a net position deficit balance of ($2,474,534).

The District’s total net position increased by $2,656,058 in comparison with the prior fiscal year. The key components of the District’s net position and change in net position are reflected in the table in the government-wide financial analysis section.

At September 30, 2015, the District’s governmental funds reported combined ending fund balances of
$1,575,111, an increase of $2,179,520 in comparison with the prior fiscal year. A portion of fund balance is restricted for debt service and capital projects, non-spendable for prepaid items, the remaining balance is assigned for subsequent year’s expenditures.

OVERVIEW OF FINANCIAL STATEMENTS

This discussion and analysis are intended to serve as the introduction to the District’s basic financial statements. The District’s basic financial statements are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves.

Government-Wide Financial Statements

The government-wide financial statements are designed to provide readers with a broad overview of the District’s finances, in a manner similar to a private-sector business.

The statement of net position presents information on all the District’s assets and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the District is improving or deteriorating.

The statement of activities presents information showing how the government’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods.

The government-wide financial statements include all governmental activities that are principally supported by special assessment revenues. The District does not have any business-type activities. The governmental activities of the District include the general government (management) and maintenance functions.

Fund Financial Statements

A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The District, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. The District has one fund category: governmental funds.

OVERVIEW OF FINANCIAL STATEMENTS (Continued)

Governmental Funds

Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a District’s near-term financing requirements.

Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the District’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The District maintains three individual governmental funds. Information is presented separately in the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances for the general fund, debt service fund and capital projects fund. All three funds are considered major funds.

The District adopts an annual appropriated budget for its general fund. A budgetary comparison schedule has been provided for the general fund to demonstrate compliance with the budget.

Notes to the Financial Statements

The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.

GOVERNMENT-WIDE FINANCIAL ANALYSIS

As noted earlier, net position may serve over time as a useful indicator of an entity’s financial position. In the case of the District, liabilities of the District exceeded its assets at the close of the most recent fiscal year.

Key components of the District’s net position are reflected in the following table:

NET POSITION SEPTEMBER 30,		
	2015	2014	
Assets, excluding capital assets	$	4,771,443	$	1,944,997	
Capital assets	8,755,023	8,615,533	
Total assets	13,526,466	10,560,530	
Liabilities, excluding long-term liabilities	3,491,000	2,851,122	
Long-term liabilities	12,510,000	12,840,000	
Total liabilities	16,001,000	15,691,122	
Net position			
Net investment in capital assets	(3,572,527)	(4,118,093)	
Restricted for debt service	1,012,150	-	
Unrestricted	85,843	(1,012,499)	
Total net position	$ (2,474,534)	$ (5,130,592)	

GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)

A portion of the District’s net position reflects its investment in capital assets (e.g. land, land improvements, and infrastructure); less any related debt used to acquire those assets that is still outstanding. These assets are used to provide services to residents; consequently, these assets are not available for future spending. Although the District’s investment in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

The District’s net position increased during the most recent fiscal year. The majority of the increase is due to the collection of assessments from the Developer in connection with the forbearance agreement.

Key elements of the change in net position are reflected in the following table:

CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED SEPTEMBER 30,

	2015	2014	
Revenues: Program revenues
Charges for services	

$	3,632,669	

$	487,094	
Operating grants and contributions	3,727	106	
Capital grants and contributions	23,083	331	
General revenues			
Unrestricted investment earnings	189	7	
Total revenues	3,659,668	487,538	
Expenses:			
General government	72,034	102,965	
Maintenance and operations	214,506	2,599,151	
Interest	717,070	727,128	
Total expenses	1,003,610	3,429,244	
Change in net position	2,656,058	(2,941,706)	
Net position - beginning	(5,130,592)	(2,188,886)	
Net position - ending	$ (2,474,534)	$ (5,130,592)	
As noted above and in the statement of activities, the cost of all governmental activities during the fiscal year ended September 30, 2015 was $1,003,610. The costs of the District’s activities were funded by program revenues. Program revenues are comprised primarily of assessments in the current fiscal year. The remainder of the current fiscal year revenue is interest revenue. The increase in charges for services is due to the collection of assessments from the Developer in connection with the forbearance agreement. The decrease in current fiscal year expenses is primarily the result of the conveyance of completed infrastructure to another entity for maintenance and ownership responsibilities during the prior fiscal year.

GENERAL BUDGETING HIGHLIGHTS

An operating budget was adopted and maintained by the governing board for the District pursuant to the requirements of Florida Statutes. The budget is adopted using the same basis of accounting that is used in preparation of the fund financial statements. The legal level of budgetary control, the level at which expenditures may not exceed budget, is in the aggregate. Any budget amendments that increase the aggregate budgeted appropriations must be approved by the Board of Supervisors. Actual general fund expenditures did not exceed appropriations for the fiscal year ended September 30, 2015. Actual general fund expenditures for the fiscal year ended September 30, 2015 were less than appropriations due primarily to anticipated costs which were not incurred in the current fiscal year.

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets

At September 30, 2015, the District had $9,370,659 invested in land, infrastructure in progress, and infrastructure improvements, for its governmental activities. In the government-wide financial statements depreciation of $615,636 has been taken, which resulted in a net book value of $8,755,023. More detailed information about the District’s capital assets is presented in the notes of the financial statements.

Capital Debt

At September 30, 2015, the District had $13,455,000 in Bonds outstanding. More detailed information about the District’s capital debt is presented in the notes of the financial statements.

ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND OTHER EVENTS

The District collected past due amounts from the Developer and was able to make all past due interest and principal payments subsequent to year end.

CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT

This financial report is designed to provide our citizens, land owners, customers, investors and creditors with a general overview of the District’s finances and to demonstrate the District’s accountability for the financial resources it manages and the stewardship of the facilities it maintains. If you have questions about this report or need additional financial information, contact the Villages of Westport Community Development District’s Finance Department at 12051 Corporate Boulevard, Orlando, Florida 32817.

VILLAGES OF WESTPORT COMMUNITY DEVELOPMENT DISTRICT DUVAL COUNTY, FLORIDA
STATEMENT OF NET POSITION SEPTEMBER 30, 2015

	Governmental
Activities	
ASSETS
Cash	
$	94,955	
Investments	4,684	
Assessments receivable	3,145,231	
Interest receivable	143	
Accounts receivable	2,321	
Prepaid items
Restricted assets:	15,200	
Investments	1,508,909	
Capital assets:
Nondepreciable	
7,888,167	
Depreciable, net	866,856	
Total assets	13,526,466	

LIABILITIES
Accounts payable	

31,317	
Accrued interest payable
Due to Bondholders:	294,668	
Principal	945,000	
Interest	2,220,015	
Non-current liabilities:		
Due within one year*	350,000	
Due in more than one year	12,160,000	
Total liabilities	16,001,000	

NET POSITION
Net investment in capital assets	

(3,572,527)	
Restricted for debt service	1,012,150	
Unrestricted	85,843	
Total net position	$	(2,474,534)	
* The missed debt service payments due for the Series 2005A Bonds is reflected in the due to Bondholders account balance.

See notes to the financial statements

VILLAGES OF WESTPORT COMMUNITY DEVELOPMENT DISTRICT DUVAL COUNTY, FLORIDA
STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED TO SEPTEMBER 30, 2015

	Net (Expense) Revenue and Changes in Net
Program Revenues	Position	

Functions/Programs	

Expenses	Charges	Operating	Capital
for		Grants and	Grants and	Governmental Services	Contributions Contributions		Activities	
Primary government: Governmental activities:
General government	

$	72,034	

$	72,034	$	-	$	-	$	-	
Maintenance and operations	214,506	153,942	-	23,083	(37,481)	
Interest on long-term debt	717,070	3,406,693	3,727	-	2,693,350	
Total governmental activities	1,003,610	3,632,669	3,727	23,083	2,655,869	

General revenues:	
Unrestricted investment earnings	189	
Total general revenues	189	
Change in net position	2,656,058	
Net position - beginning	(5,130,592)	
Net position - ending	$	(2,474,534)	

See notes to the financial statements

8

BALANCE SHEET GOVERNMENTAL FUNDS SEPTEMBER 30, 2015

Major Funds
Debt	Capital
General	Service	Projects

Total Governmental Funds

ASSETS		
Cash	$	94,955	$	-	$	-	$	94,955	
Investments	4,684	1,326,488	182,421	1,513,593	
Assessments receivable	-	3,145,231	-	3,145,231	
Accounts receivable	2,321	-	-	2,321	
Interest receivable	-	114	29	143	
Prepaid items	15,200	-	-	15,200	
Total assets	$	117,160	$  4,471,833	$	182,450	$	4,771,443	

LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Due to Bondholders:	$	31,317	$	-	$	-	$	31,317	
Principal	-	945,000	-	945,000	
Interest	-	2,220,015	-	2,220,015	
Total liabilities	31,317	3,165,015	-	3,196,332	

Fund balances:
Nonspendable:
Prepaid items
Restricted for:	15,200	-	-	15,200	
Debt service	-	1,306,818	-	1,306,818	
Capital projects	-	-	182,450	182,450	
Assigned to:		
Subsequent year's expenditures	70,643			70,643	
Total fund balances	85,843	1,306,818	182,450	1,575,111	

Total liabilities and fund balances	
$	117,160	
$ 4,471,833	
$	182,450	
$	4,771,443	

See notes to the financial statements

RECONCILIATION OF BALANCE SHEET – GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION
GOVERNMENTAL FUNDS SEPTEMBER 30, 2015

Fund balance - governmental funds	$ 1,575,111

Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and, therefore, are not reported as assets in the governmental funds. The statement of net position includes those capital assets, net of any accumulated depreciation, in the net position of the government as a whole.
Cost of capital assets	9,370,659
Accumulated depreciation	(615,636)	8,755,023
Liabilities not due and payable from current available resources are not reported as liabilities in the governmental fund statements. All liabilities, both current and long-term, are reported in the government-wide financial statements.
Accrued interest payable	(294,668)		
Bonds payable*	(12,510,000)	(12,804,668)	
Net positions of governmental activities		$ (2,474,534)	

* The missed debt service payments due for the Series 2005A Bonds is reflected in the due to Bondholders account balance.

See notes to the financial statements

STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED TO SEPTEMBER 30, 2015

		Major Funds		Total		
	
General	Debt
Service	Capital
Projects	Governmental
Funds		
REVENUES
Assessments	
$	225,976	
$ 3,406,693	
$	-	
$ 3,632,669		
Interest	189	3,727	23,083	26,999		
Total revenues	226,165	3,410,420	23,083	3,659,668		

EXPENDITURES
Current:
General government	56,308	15,726	-	72,034	
Maintenance and operations Debt service:
Principal	146,102	-	-	146,102

-	330,000	-	330,000	
Interest	-	724,118	-	724,118	
Capital outlay	-	-	207,894	207,894	
Total expenditures	202,410	1,069,844	207,894	1,480,148	

Excess (deficiency) of revenues
over (under) expenditures	23,755	

2,340,576	

(184,811)	

2,179,520	
OTHER FINANCING SOURCES (USES)
Transfers in		
-	260,887	
260,887	
Transfers (out)	(260,887)	-	-	(260,887)	
Total other financing sources (uses)	(260,887)	-	260,887	-	

Net change in fund balances	
(237,132)	
2,340,576	76,076	
2,179,520	
Fund balances - beginning	322,975	(1,033,758)	106,374	(604,409)	

Fund balances - ending	
$	85,843	
$ 1,306,818	$	182,450	
$ 1,575,111	

See notes to the financial statements

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED TO SEPTEMBER 30, 2015

Net change in fund balances - total governmental funds
Amounts reported for governmental activities in the statement of

$	2,179,520

activities are different because:
Governmental  funds   report   capital  outlays   as expenditures;
however, the cost of capital assets is eliminated in the statement  of activities  and  capitalized in the statement  of net		
position.	207,894	
Repayment of long-term liabilities are reported as  expenditures in the governmental fund financial  statements, but such repayments reduce liabilities  in  the  statement  of net position and are eliminated in the statement of activities.	

330,000	
Depreciation of capital assets is not recognized in the governmental fund financial statements, but is reported as an expense in the statement of activities.	

(68,404)	
The change in accrued interest on long-term liabilities between the current and prior fiscal years is recorded in the		
statement of activities, but not in the governmental fund
financial statements.	7,048
$	2,656,058

See notes to the financial statements

NOTES TO FINANCIAL STATEMENTS NOTE 1 – NATURE OF ORGANIZATION AND REPORTING ENTITY
Villages of Westport Community Development District ("District") was created on June 14, 2004 by Rule 42QQ-1, Florida Administrative Code, adopted by the Florida Land & Water Adjudicatory Commission, pursuant to the Uniform Community Development District Act of 1980, and otherwise known as Chapter 190, Florida Statutes. The Act provides among other things, the power to manage basic services for community development, power to borrow money and issue bonds, and to levy and assess non-ad valorem assessments for the financing and delivery of capital infrastructure.

The District was established for the purposes of financing and managing the acquisition, construction, maintenance and operation of a portion of the infrastructure necessary for community development within the District.

The District is governed by the Board of Supervisors ("Board"), which is composed of five members. The Supervisors are elected on an at large basis by the owners of the property within the District. The Board exercises all powers granted to the District pursuant to Chapter 190, Florida Statutes. At September 30, 2015, all Board members are affiliated with ICI Homes (“Developer”).

The Board has the final responsibility for:
Assessing and levying assessments.
Approving budgets.
Exercising control over facilities and properties.
Controlling the use of funds generated by the District.
Approving the hiring and firing of key personnel.
Financing improvements.

The financial statements were prepared in accordance with Governmental Accounting Standards Board (“GASB”) Statements. Under the provisions of those standards, the financial reporting entity consists of the primary government, organizations for which the District is considered to be financially accountable and other organizations for which the nature and significance of their relationship with the District are such that, if excluded, the financial statements of the District would be considered incomplete or misleading. There are no entities considered to be component units of the District; therefore, the financial statements include only the operations of the District.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Government-Wide and Fund Financial Statements
The basic financial statements include both government-wide and fund financial statements.

The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the non-fiduciary activities of the primary government. For the most part, the effect of interfund activity has been removed from these statements.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment (operating-type special assessments for maintenance and debt service are treated as charges for services) and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Other items not included among program revenues are reported instead as general revenues.

Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Assessments are recognized as revenues in the year for which they are levied. Grants and similar items are to be recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures are recorded only when payment is due.

Assessments
Assessments are non-ad valorem assessments on benefitted property within the District. Operating and Maintenance Assessments are based upon adopted budget and levied annually. Debt Service Assessments are levied when Bonds are issued and collected on an annual basis. The District may collect assessments directly or utilize the uniform method of collection (Chapter 197.3632, Florida Statutes). Direct collected assessments are due as determined by annual assessment resolution adopted by the Board of Supervisors. Assessments collected under the uniform method are mailed by County Tax Collector on November 1 and due on or before March 31 of each year. Property owners may prepay a portion or all of the Debt Service Assessments on their property subject to various provisions in the Bond documents.

Assessments and interest associated with the current fiscal period are considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. The portion of assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period.

The District reports the following major governmental funds:

General Fund
The general fund is the general operating fund of the District. It is used to account for all financial resources except those required to be accounted for in another fund.

Debt Service Fund
The debt service fund is used to account for the accumulation of resources for the annual payment of principal and interest on long-term debt.

Capital Projects Fund
This fund accounts for the financial resources to be used for the acquisition or construction of major infrastructure within the District.

As a general rule, the effect of inter-fund activity has been eliminated from the government-wide financial statements.

When both restricted and unrestricted resources are available for use, it is the government’s policy to use restricted resources first for qualifying expenditures, then unrestricted resources as they are needed.

Assets, Liabilities and Net Position or Equity

Restricted Assets
These assets represent cash and investments set aside pursuant to Bond covenants or other contractual restrictions.

Deposits and Investments
The District’s cash and cash equivalents are considered to be cash on hand and demand deposits.

The District has elected to proceed under the Alternative Investment Guidelines as set forth in Section 218.415
Florida Statutes. The District may invest any surplus public funds in the following:

The Local Government Surplus Trust Funds, or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act;
Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency;
Interest bearing time deposits or savings accounts in qualified public depositories;
Direct obligations of the U.S. Treasury.

The State Board of Administration’s Local Government Surplus Funds Trust Fund (Florida PRIME) is a“2a-7 like” pool. A “2a-7 like” pool is an external investment pool that is not registered with the Securities and Exchange Commission (“SEC”) as an investment company, but nevertheless has a policy that it will, and does, operate in a manner consistent with the SEC’s Rule 2a-7 of the Investment Company Act of 1940, which comprises the rules governing money market funds. Thus, the pool operates essentially as a money market fund. Rule 2a-7 is the rule that allows money market funds to use amortized cost to maintain a constant NAV of $1.00 per share, provided that such funds meet certain conditions. The District has reported its investment in Florida PRIME at the same value as the pooled shares allocated to the District.

Securities listed in paragraph c and d shall be invested to provide sufficient liquidity to pay obligations as they come due. In addition, surplus funds may be deposited into certificates of deposit which are insured and any unspent Bond proceeds are required to be held in investments as specified in the Bond Indenture.

The District records all interest revenue related to investment activities in the respective funds and reports investments at fair value.

Inventories and Prepaid Items
Inventories of governmental funds are recorded as expenditures when consumed rather than when purchased.

Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements.

Capital Assets
Capital assets which include property, plant and equipment, and infrastructure assets (e.g., roads, sidewalks and similar items) are reported in the government activities columns in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 (amount not rounded) and an estimated useful life in excess of two years. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed.

Capital Assets (Continued)
Property, plant and equipment of the District are depreciated using the straight-line method over the following estimated useful lives:
Assets	Years
Roadways and other	20
Storm water system	25

In the governmental fund financial statements, amounts incurred for the acquisition of capital assets are reported as fund expenditures. Depreciation expense is not reported in the governmental fund financial statements.

Unearned Revenue
Governmental funds report unearned revenue in connection with resources that have been received, but not yet earned.

Long-Term Obligations
In the government-wide financial statements long-term debt and other long-term obligations are reported as liabilities in the statement of net position. Bond premiums and discounts, as well as issuance costs, are deferred and amortized ratably over the life of the Bonds. Bonds payable are reported net of applicable premiums or discounts. Bond issuance costs are expensed when incurred.

In the fund financial statements, governmental fund types recognize premiums and discounts, as well as issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.

Deferred Outflows/Inflows of Resources
Deferred outflows of resources represent a consumption of net position that applies to future reporting period(s). For example, the District would record deferred outflows of resources on the statement of net position related to debit amounts resulting from current and advance refundings resulting in the defeasance of debt (i.e. when there are differences between the reacquisition price and the net carrying amount of the old debt).

Deferred inflows of resources represent an acquisition of net position that applies to future reporting period(s). For example, when an asset is recorded in the governmental fund financial statements, but the revenue is unavailable, the District reports a deferred inflow of resources on the balance sheet until such times as the revenue becomes available.

Fund Equity/Net Position
In the fund financial statements, governmental funds report non spendable and restricted fund balance for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Assignments of fund balance represent tentative management plans that are subject to change.

The District can establish limitations on the use of fund balance as follows:

Committed fund balance – Amounts that can be used only for the specific purposes determined by a formal action (resolution) of the Board of Supervisors. Commitments may be changed or lifted only by the Board of Supervisors taking the same formal action (resolution) that imposed the constraint originally. Resources accumulated pursuant to stabilization arrangements sometimes are reported in this category.

Fund Equity/Net Position (Continued)

Assigned fund balance – Includes spendable fund balance amounts that are intended to be used for specific purposes that are neither considered restricted nor committed. The Board may also assign fund balance as it does when appropriating fund balance to cover differences in estimated revenue and appropriations in the subsequent year’s appropriated budget. Assignments are generally temporary and normally the same formal action need not be taken to remove the assignment.

The District first uses committed fund balance, followed by assigned fund balance and then unassigned fund balance when expenditures are incurred for purposes for which amounts in any of the unrestricted fund balance classifications could be used.

Net position is the difference between assets and deferred outflows of resources less liabilities and deferred inflows of resources. Net position in the government-wide financial statements are categorized as net investment in capital assets, restricted or unrestricted. Net investment in capital assets represents net position related to infrastructure and property, plant and equipment. Restricted net position represents the assets restricted by the District’s Bond covenants or other contractual restrictions. Unrestricted net position consists of the net position not meeting the definition of either of the other two components.

Other Disclosures

Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those estimates.

NOTE 3 – BUDGETARY INFORMATION

The District is required to establish a budgetary system and an approved Annual Budget. Annual Budgets are adopted on a basis consistent with generally accepted accounting principles for the general fund. All annual appropriations lapse at fiscal year end.

The District follows these procedures in establishing the budgetary data reflected in the financial statements:

Each year, the District Manager submits to the District Board a proposed operating budget for the fiscal year commencing the following October 1.
A public hearing is conducted to obtain public comments.
Prior to October 1, the budget is legally adopted by the District Board.
All budget changes must be approved by the District Board.
The budgets are adopted on a basis consistent with generally accepted accounting principles.
Unused appropriation for annually budgeted funds lapse at the end of the year.

The District’s cash balances were entirely covered by federal depository insurance or by a collateral pool pledged to the State Treasurer. Florida Statutes Chapter 280, "Florida Security for Public Deposits Act", requires all qualified depositories to deposit with the Treasurer or another banking institution eligible collateral equal to various percentages of the average daily balance for each month of all public deposits in excess of any applicable deposit insurance held. The percentage of eligible collateral (generally, U.S. Governmental and agency securities, state or local government debt, or corporate bonds) to public deposits is dependent upon the depository's financial history and its compliance with Chapter 280. In the event of a failure of a qualified public depository, the remaining public depositories would be responsible for covering any resulting losses.

Investments
The District’s investments were held as follows at September 30, 2015:
Fair Value	Credit Risk	Maturities	
Money Market Mutual Funds - Fidelity Institutional
Prime Class I	
$	1,424,912	
S&P AAAm	Weighted average of the
fund portfolio: 34 days	

Florida PRIME	
88,681	
S&P AAAm	Weighted average of the
fund portfolio: 29 days	
	$	1,513,593			
Credit risk – For investments, credit risk is generally the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Investment ratings by investment type are included in the preceding summary of investments.

Concentration risk – The District places no limit on the amount the District may invest in any one issuer.

Interest rate risk – The District does not have a formal policy that limits investment maturities as a means of managing exposure to fair value losses arising from increasing interest rates.

However, the Bond Indenture limits the type of investments held using unspent proceeds.

NOTE 5 – INTERFUND TRANSFERS

Interfund transfers for the fiscal year ended September 30, 2015 were as follows:
Fund	Transf er in	Transfer out	
General	$	-	$	(260,887)	
Capital projects	260,887	-	
Total	$	260,887	$	(260,887)	
During the fiscal year ended September 30, 2014, there was an excess of funds in the general fund. Therefore, the board decided to not assess operations and maintenance to on-roll homeowners in fiscal year 2015. The landowners billed off-roll agreed to be assessed operation and maintenance and have their credit apply towards the completion of the phase 2/3 project to the extent that the District did not have sufficient funds.

Capital asset activity for the fiscal year ended September 30, 2015 was as follows:

	Beginning
Balance	
Additions	Ending
Reductions	Balance	
Governmental activities
Capital assets, not being depreciated Land and land improvements	

$ 2,020,928	

$	-	

$	-	$ 2,020,928	
Infrastructure in progress	5,659,345	207,894	5,867,239	
Total capital assets, not being depreciated	7,680,273	207,894	-	7,888,167	

Capital assets, being depreciated
Infrastructure - roadw ays and other	

910,456	

-	

-	910,456	
Infrastructure - stormw ater system	572,036	-	-	572,036	
Total capital assets, being depreciated	1,482,492	-	-	1,482,492	

Less accumulated depreciation for:
Infrastructure - roadw ays and other	

364,183	

45,523	

-	409,706	
Infrastructure - stormw ater system	183,049	22,881	-	205,930	
Total accumulated depreciation	547,232	68,404	-	615,636	

Total capital assets, being depreciated, net	
935,260	
(68,404)	
-	866,856	

Governmental activities capital assets, net	
$ 8,615,533	
$	139,490	
$	-	$ 8,755,023	

The total expected cost of the District’s infrastructure improvements was estimated at approximately
$47,000,000. A portion of the Series 2005A Bonds discussed in Note 7 were for the acquisition and construction of certain infrastructure improvements. The balance of the District’s improvements was to be funded either by the Developer or by the issuance of additional Bonds.

Depreciation expense was charged to the maintenance and operations function.

In connection with the 2005 project, if the amount by which the cost of the 2005 project or portion thereof to be conveyed by the Developer to the District pursuant to the Acquisition Agreement exceeds the amount actually paid by the District for the 2005 project or portion thereof from proceeds of the Series 2005 Bonds, it may be determined that deferred obligations exist. Upon completion of the project, certain funds available from the Bonds may be used to pay deferred obligations, as outlined in the Bond Indenture. At September 30, 2015, there is a balance of $77,371 in the deferred cost account. The District has not yet determined if a liability exists for deferred costs.

NOTE 7 – LONG TERM LIABILITIES

The District Board authorized the issuance of Bonds not to exceed $57,000,000. At September 30, 2015, the District has the following Bond issues outstanding.

On February 1, 2005 the District issued $24,345,000 of Capital Improvement Revenue Bonds, Series 2005A.
$4,265,000 of the Bonds is due May 1, 2015 with a fixed interest rate of 5.125%; $3,130,000 of the Bonds is due May 1, 2020 with a fixed interest rate of 5.4%; $16,950,000 of the Bonds is due May 1, 2035 with a fixed interest rate of 5.7%. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the District. Interest is to be paid semiannually on each May 1 and November 1, and the principal is to be paid annually on each May 1, commencing May 1, 2006.

The Series 2005A Bonds are subject to redemption at the option of the District prior to their maturity. In addition, the Bonds are subject to extraordinary mandatory redemption prior to their selected maturity as outlined in the Bond Indenture.

The Bond Indenture established a debt service reserve requirement as well as other restrictions and requirements relating principally to the use of proceeds to pay for the infrastructure improvements and the procedures to be followed by the District on assessments to property owners. The District agrees to levy special assessments in annual amounts adequate to provide payment of debt service and to meet the reserve requirements.

In a prior fiscal year, debt assessments levied against certain real property within the District were not paid to the District as and when required. As discussed in Note 8, on October 10, 2013 the District agreed to delay foreclosure and collection proceedings for two years. As a result, the scheduled debt service payments due during the prior fiscal year were made, in part, by draws on the Debt Service Reserve Account. As a result of these draws there is a deficit of approximately $485,000 in the Series 2005A Debt Service Reserve Account at September 30, 2015. Furthermore, in the current fiscal year the District did not have sufficient funds to make certain scheduled debt service payments and as a result, the payments were not made. The amount has been accrued on the fund financial statements as due to Bondholders and reflects $945,000 due for principal and $2,220,015 due for interest which paid by the District subsequent to fiscal year end as discussed in note 12.

Changes in long-term liability activity for the fiscal year ended September 30, 2015 were as follows:

Governmental activities Bonds payable:

Beginning
Balance	Additions	Reductions

Ending Balance

Due Within One Year

Series 2005A	$ 13,455,000	$	-	$	-	$ 13,455,000	$ 1,295,000	
Total	$ 13,455,000	$	-	$	-	$ 13,455,000	$ 1,295,000	
* Includes the missed debt service payments due for the Series 2005A Bonds w hich w ere not paid.

At September 30, 2015, the scheduled debt service requirements on the long-term debt were as follows:

Governmental Activities
Year ending
September 30:	Principal	Interest	Total
2016	$ 1,295,000	* $ 2,927,220	* $ 4,222,220	
2017	370,000	688,305	1,058,305	
2018	390,000	668,325	1,058,325	
2019	410,000	647,265	1,057,265	
2020	435,000	625,125	1,060,125	
2021-2025	2,580,000	2,733,435	5,313,435	
2026-2030	3,430,000	1,909,785	5,339,785	
2031-2035	4,545,000	810,540	5,355,540	
Total	$ 13,455,000	$ 11,010,000	$ 24,465,000	
* Includes the missed debt service payments due for the Series 2005A Bonds w hich w ere not paid.
NOTE 8 – DEVELOPER TRANSACTIONS

Assessments
The Developer owns a significant portion of land within the District; therefore, assessment revenues in the general and debt service funds include the assessments levied on those lots owned by the Developer.

Forbearance Agreement
On October 10, 2013, the District, the Developer, and the Trustee entered into a forbearance agreement. The agreement generally states that in exchange for the District delaying foreclosure and collection proceedings for a period of two years after October 10, 2013 the Developer will cure all past due County taxes and operating and maintenance assessments on the property within the District that it owns and to keep these items current going forward. During the current year the Developer made all required payments under the forbearance agreement. As a result of these payments by the Developer the District paid the amounts accrued on the fund financial statements as due to Bondholders at September 30, 2015 of $945,000 due for principal and
$2,220,015 due for interest subsequent to fiscal year end, as discussed in Note 12.

NOTE 9 – CONCENTRATION

The District’s activity is dependent upon the continued involvement of the Developer, the loss of which could have a material adverse effect on the District’s operations.

NOTE 10 – MANAGEMENT COMPANY

The District has contracted with a management company to perform management advisory services, which include financial and accounting services. Certain employees of the management company also serve as officers of the District. Under the agreement, the District compensates the management company for management, accounting, financial reporting, computer and other administrative costs.

NOTE 11 – RISK MANAGEMENT

The District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; and natural disasters. The District has obtained commercial insurance from independent third parties to mitigate the costs of these risks; coverage may not extend to all situations. There have been no settled claims from these risks during the past three years.

NOTE 12 – SUBSEQUENT EVENTS

Debt Service Payments
Subsequent to fiscal year end, all missed debt service payments, approximately $2.6 million in interest and
$945,000 in principal payments, were made and the District is now current with respect to the amount owed on the Bonds. In addition, the debt service reserve account was replenished with approximately $420,000 and is in compliance with its bond covenant.

SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL – GENERAL FUND FOR THE FISCAL YEAR ENDED
TO SEPTEMBER 30, 2015

	
Budgeted Amounts	

Actual	Variance with Final Budget -
Positive	
	Original & Final	Amounts	(Negative)	
REVENUES
Assessments	
$	225,976	
$	225,976	
$	-	
Interest	-	189	189	
Total revenues	225,976	226,165	189	

EXPENDITURES
Current:				
General government	87,850	56,308	31,542	
Maintenance and operations	172,000	146,102	25,898	
Total expenditures	259,850	202,410	57,440	

Excess (deficiency) of revenues over (under) expenditures	

(33,874)	

23,755	

57,629	
OTHER FINANCING SOURCES (USES)
Transfers (out)		
(260,887)	
(260,887)	
Total other financiing sources (uses)	-	(260,887)	(260,887)	

Net change in fund balances	
$	(33,874)	
(237,132)	
$	(203,258)	

Fund balance - beginning		
322,975		

Fund balance - ending		
$	85,843		

See notes to required supplementary information

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION

The District is required to establish a budgetary system and an approved Annual Budget for the general fund. The District’s budgeting process is based on estimates of cash receipts and cash expenditures which are approved by the Board. The budget approximates a basis consistent with accounting principles generally accepted in the United States of America (generally accepted accounting principles).

The legal level of budgetary control, the level at which expenditures may not exceed budget, is in the aggregate. Any budget amendments that increase the aggregate budgeted appropriations must be approved by the Board of Supervisors. Actual general fund expenditures did not exceed appropriations for the fiscal year ended September 30, 2015. Actual general fund expenditures for the fiscal year ended September 30, 2015 were less than appropriations due primarily to anticipated costs which were not incurred in the current fiscal year.

2700 North Military Trail ▪ Suite 350 Boca Raton, Florida 33431
(561) 994-9299 ▪ (800) 299-4728
Fax (561) 994-5823
www.graucpa.com

INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
To the Board of Supervisors
Villages of Westport Community Development District Duval County, Florida
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities and each major fund of Villages of Westport Community Development District, Duval County, Florida (“District”) as of and for the fiscal year ended September 30, 2015, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements, and have issued our opinion thereon dated June 24, 2016

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the District’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the District’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
June 24, 2016

INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE WITH THE REQUIREMENTS OF SECTION 218.415, FLORIDA STATUTES, REQUIRED BY RULE 10.556(10) OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA

To the Board of Supervisors
Villages of Westport Community Development District Duval County, Florida

We have examined Villages of Westport Community Development District, Duval County, Florida’s (“District”) compliance with the requirements of Section 218.415, Florida Statutes, in accordance with Rule 10.556(10) of the Auditor General of the State of Florida during the fiscal year ended September 30, 2015. Management is responsible for District’s compliance with those requirements. Our responsibility is to express an opinion on District’s compliance based on our examination.

Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about District’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on District’s compliance with specified requirements.

In our opinion, the District complied, in all material respects, with the aforementioned requirements for the fiscal year ended September 30, 2015.

This report is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, management, and the Board of Supervisors of Villages of Westport Community Development District, Duval County, Florida and is not intended to be and should not be used by anyone other than these specified parties.
June 24, 2016

MANAGEMENT LETTER PURSUANT TO THE RULES OF THE AUDITOR GENERAL FOR THE STATE OF FLORIDA

To the Board of Supervisors
Villages of Westport Community Development District Duval County, Florida

Report on the Financial Statements

We have audited the accompanying basic financial statements of Villages of Westport Community Development District, Duval County, Florida ("District") as of and for the fiscal year ended September 30, 2015, and have issued our report thereon dated June 24, 2016.

Auditor’s Responsibility

We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Florida Auditor General.

Other Reports and Schedule

We have issued our Independent Auditor’s Report on Internal Control over Financial Reporting and Compliance and Other Matters based on an audit of the financial statements performed in accordance with Government Auditing Standards; and Independent Auditor’s Report on an examination conducted in accordance with AICPA Professional Standards, Section 601, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated June 24, 2016, should be considered in conjunction with this management letter.

Purpose of this Letter

The purpose of this letter is to comment on those matters required by Chapter 10.550 of the Rules of the Auditor General for the State of Florida. Accordingly, in connection with our audit of the financial statements of the District, as described in the first paragraph, we report the following:

Current year findings and recommendations.
Status of prior year findings and recommendations.
Compliance with the Provisions of the Auditor General of the State of Florida.

Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, as applicable, management, and the Board of Supervisors of Villages of Westport Community Development District, Duval County, Florida and is not intended to be and should not be used by anyone other than these specified parties.

We wish to thank Villages of Westport Community Development District, Duval County, Florida and the personnel associated with it, for the opportunity to be of service to them in this endeavor as well as future engagements, and the courtesies extended to us.
June 24, 2016

REPORT TO MANAGEMENT

CURRENT YEAR FINDINGS AND RECOMMENDATIONS

None

PRIOR YEAR FINDINGS AND RECOMMENDATIONS

2012-02 Financial Condition Assessment: 2013-01 Financial Condition Assessment: 2014-01 Financial Condition Assessment:

Current Status: Finding has been resolved..

COMPLIANCE WITH THE PROVISIONS OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA

Unless otherwise required to be reported in the auditor’s report on compliance and internal controls, the management letter shall include, but not be limited to the following:

A statement as to whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report.

There were no significant findings and recommendations made in the preceding annual financial audit report for the fiscal year ended September 30, 2014, except as noted above.

Any recommendations to improve the local governmental entity's financial management.

There were no such matters discovered by, or that came to the attention of, the auditor, to be reported for the fiscal year ended September 30, 2015.

Noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance.

There were no such matters discovered by, or that came to the attention of, the auditor, to be reported, for the fiscal year ended September 30, 2015.

The name or official title and legal authority of the District are disclosed in the notes to the financial statements.

The financial report filed with the Florida Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes agrees with the September 30, 2015 financial audit report.

In connection with our audit, we determined that the District has met one or more of the financial emergency conditions described in Section 218.503(1), Florida Statutes. The District failed to make certain scheduled debt service payments due on the Series 2005A Bonds, as a result of a lack of funds. However, subsequent to year end all outstanding amounts owed on the Bonds were paid by the District. We applied financial condition assessment procedures pursuant to Rule 10.556(7) and determined that no deteriorating financial conditions were noted. It is management’s responsibility to monitor financial condition, and our financial condition assessment was based in part on representations made by management and the review of financial information provided by same.