Marysville, CA COP Rating Placed On CreditWatch Developing On Audit Discrepancies, Auditor#s #Going Concern# Opinion

Stocks and Financial Services Press Releases Wednesday October 11, 2017 08:48
SAN FRANCISCO--11 Oct--S&P Global Ratings

SAN FRANCISCO (S&P Global Ratings) Oct. 10, 2017--S&P Global Ratings placed its 'BBB+' long-term rating on the City of Marysville, Calif.'s previously rated certificates of participation (COPs) on CreditWatch with developing implications.

"While conducting surveillance on the rating, we observed what appear to be inconsistencies in the information reported in the city's 2016 audited financial statements," said S&P Global Ratings credit analyst Benjamin Geare. "We also note that the auditor included a 'going concern' opinion related to the city's pension liability. We will be discussing both the discrepancies and the 'going concern' with the city's management and auditor."

Prior to this action, in September 2016, we assigned a positive outlook to Marysville's COP rating as a result of our view of an improved economic base as well as the city's new ongoing source of revenue that would help the city to maintain structural balance. For more information, please see our report published Sept. 30, 2016, on RatingsDirect. In our opinion, if we can resolve our questions regarding the discrepancies and "going concern" opinion in the city's audit and confirm that Marysville has been able to maintain balanced operating results and rebuild its fund balance, we may consider a higher rating.

However, after evaluating the audit discrepancies and other relevant information, if we determine that we are unable to obtain timely information of satisfactory quality to maintain our rating on the securities in accordance with our applicable criteria and policies, we may lower our rating, or withdraw our rating, or both. This would occur during the 90 days of the CreditWatch horizon, although it is possible that the CreditWatch status could be resolved sooner.

Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed to them in our criteria, and should therefore be read in conjunction with such criteria. Please see Ratings Criteria at www.standardandpoors.com for further information. Complete ratings information is available to subscribers of RatingsDirect at www.globalcreditportal.com and at www.spcapitaliq.com. All ratings affected by this rating action can be found on the S&P Global Ratings' public website at www.standardandpoors.com. Use the Ratings search box located in the left column.


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