Financial Statements September 30, 2022 The Crossings at Fleming Island Community Development District The Crossings at Fleming Island Community Development District Table of Contents September 30, 2022 Page I. Financial Section: Independent Auditor's Report 1 Management's Discussion and Analysis 3 Financial Statements: Government-Wide Financial Statements: Statement of Net Position 8 Statement of Activities 9 Fund Financial Statements: Balance Sheet -Governmental Funds 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 Statement of Revenues, Expenditures and Changes in Fund Balance Budget and Actual -General Fund 13 Statement of Net Position -Proprietary Funds 14 Statement of Revenues, Expenses and Changes in Net Position - Proprietary Funds 15 Statement of Cash Flows -Proprietary Funds 16 Notes to Financial Statements 17 II. Compliance Section: 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 30 Management Letter 32 Independent Auditor's Report on Compliance with the Requirements of Section 218.415, Florida Statutes 36 934 North Magnolia Avenue, Suite 100 Orlando, Florida 32803 407-843-5406 www.mcdirmitdavis.com INDEPENDENT AUDITOR'S REPORT To the Board of Supervisors The Crossings at Fleming Island Community Development District Report on the Audit of the Financial Statements Opinions We have audited the accompanying financial statements of the governmental activities, the business-type activities, and each major fund of The Crossings at Fleming Island Community Development District (the “District”), as of and for the year ended September 30, 2022, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents. In our opinion, the accompanying financial statements present fairly, the respective financial position of the governmental activities, the business-type activities, and each major fund of the District as of September 30, 2022, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the District and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements related to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Responsibilities of Management for the Financial Statements The District's management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America; and for 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. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. Auditor’s Responsibility for the Audit of Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgement made by a reasonable user based on the financial statements. In performing an audit in accordance with GAAS, we: . Exercise professional judgment and maintain professional skepticism throughout the audit. . Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. . Obtain an understanding of internal control relevant to the audit 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 District’s internal control. Accordingly, no such opinion is expressed. the trusted partner . Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. . Conclude whether, in our judgement, there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis starting on page 3, be presented to supplement the basic financial statements. Such information is the responsibility of management and, 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 a report dated June 29, 2023, on our consideration of the District’s internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters. The purpose of that report is solely 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 the effectiveness of 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. Orlando, Florida June 29, 2023 Page | 2 The Crossings at Fleming Island Community Development District Management’s Discussion and Analysis Our discussion and analysis of The Crossings at Fleming Island Community Development District (the “District”) financial accomplishments provide an overview of the District’s financial activities for the year ended September 30, 2022. Please read it in conjunction with the District’s Independent Auditor’s Report, financial statements and accompanying notes. This information is being presented to provide additional information regarding the activities of the District and to meet the disclosure requirements of Government Accounting Standards Board Statement (GASB) No. 34, Basic Financial Statements -and Management’s Discussion and Analysis -for State and Local Governments issued June 1999. Financial Highlights . The liabilities of the District exceeded its assets and deferred outflows at September 30, 2022 by $9,669,021, an increase in net position of $2,893,426 in comparison with the prior year. . At September 30, 2022, the District’s governmental funds reported a combined fund balance of $7,267,723, an increase of $212,541 in comparison with the prior year. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to The Crossings at Fleming Island Community Development District’s financial statements. The District’s financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements and 3) notes to financial statements. 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 of the District’s assets, deferred outflows of resources, and liabilities, with the difference 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. Both of the government-wide financial statements distinguish functions of the District that are principally supported by assessments (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the District include general (administration, finance, and community services), physical environment (maintenance and operations) and culture and recreation. The business-type activities of the District include the Utility (water and sewer) and Golf Course operation. 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 two fund categories: Governmental and Proprietary Funds. 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. Page | 3 The Crossings at Fleming Island Community Development District Management’s Discussion and Analysis 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 government’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 two 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, and debt service fund which are considered to be 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. Proprietary Funds The District maintains one type of proprietary fund: enterprise. The District maintains two enterprise funds. An enterprise fund is used to report the same functions presented as business-type activities in the government-wide financial statements. The District uses an enterprise fund to account for the operations of the water and sewer utility services and golf services within the District. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide information for the utility and golf funds, which are considered major funds. Notes to 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 Statement of Net Position The District’s net position was $(9,669,021) at September 30, 2022. The following analysis focuses on the net position of the District’s governmental activities. Assets Current and other assets Capital assets, net $ 2022 2021 7,784,130 7,500,460 $ 10,465,359 10,356,501 Governmental Activities 2022 2021 6,135,835 5,770,555 $ 13,177,560 13,155,979 Business-Type Activities $ 2022 2021 13,919,965 $ 13,271,015 23,642,919 23,512,480 Total Primary Government Total assets 18,249,489 17,856,961 19,313,395 18,926,534 37,562,884 36,783,495 Deferred Outflows 814,557 852,177 1,210,916 1,295,892 2,025,473 2,148,069 Liabilities Current liabilities Long-term liabilities 946,891 19,595,277 936,044 21,502,196 7,373,935 21,341,275 6,710,397 22,345,374 8,320,826 40,936,552 7,646,441 43,847,570 Total liabilities 20,542,168 22,438,240 28,715,210 29,055,771 49,257,378 51,494,011 Net Position Net investment in capital assets Restricted Unrestricted (8,315,361) 2,081,443 4,755,796 (10,293,518) 2,164,980 4,399,436 (10,152,799) 1,658,555 303,345 (10,703,503) 1,483,298 386,860 (18,468,160) 3,739,998 5,059,141 (20,997,021) 3,648,278 4,786,296 Total net position $ (1,478,122) $ (3,729,102) $ (8,190,899) $ (8,833,345) $ (9,669,021) $ (12,562,447) Page | 4 The Crossings at Fleming Island Community Development District Management’s Discussion and Analysis 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 following is a summary of the District’s governmental activities for the fiscal years ended September 30, 2022 and 2021. Revenues Program revenues: Charges for services Operating grants and Contributions General revenues: Investment earnings Other 2022 2021 7,232,221 $ 8,215,917 $ 10,786 856 61,656 6,072 -5,360 Governmental Activities 2022 2021 $ 10,245,213 9,490,111 $ -- 27,014 3,335 -- Business-Type Activities $ 2022 2021 17,477,434 17,706,028 $ 10,786 856 88,670 9,407 -5,360 Total Primary Government Total revenues 7,304,663 8,228,205 10,272,227 9,493,446 17,576,890 17,721,651 Expenses Governmental activities: General government Physical environment Recreation Interest Business -type activities: Water and sewer Golf and restaurant 299,963 1,733,728 1,879,684 1,071,910 - - 249,851 1,791,690 1,679,559 1,227,617 - - - - - - 5,691,859 3,954,778 - - - - 5,474,916 3,510,048 299,963 1,733,728 1,879,684 1,071,910 5,691,859 3,954,778 249,851 1,791,690 1,679,559 1,227,617 5,474,916 3,510,048 Total expenses 4,985,285 4,948,717 9,646,637 8,984,964 14,631,922 13,933,681 Increase (Decrease) in Net Position Before Transfers 2,319,378 3,279,488 625,590 508,482 2,944,968 3,787,970 Transfers Increase (Decrease) in Net Position (68,398) 2,250,980 - 3,279,488 68,398 693,988 - 508,482 - 2,944,968 - 3,787,970 Net position, beginning Restatement (3,729,102) - (7,008,590) - (8,833,345) (51,542) (9,341,827) - (12,562,447) (51,542) (16,350,417) - Net position, end $ (1,478,122) $ (3,729,102) $ (8,190,899) $ (8,833,345) $ (9,669,021) $ (12,562,447) Governmental Activities As noted above and in the statement of activities, the cost of all governmental activities during the year ended September 30, 2022 was $4,985,285. The majority of these costs are comprised of physical environment and recreation expenditures. Business-Type Activities The cost of the business-type activities was $9,646,637, a 7.4% increase from the prior year. The costs of those activities were paid for by charges for services, which accounted for 99% of total business-type revenues. Charges for services increased $755,102 or 8% from the prior year. Page | 5 The Crossings at Fleming Island Community Development District Management’s Discussion and Analysis Financial Analysis of the Government’s Funds Governmental Funds The District uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. The focus of the District’s governmental funds is to provide information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing the District’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. At September 30, 2022, the District’s governmental funds reported combined ending fund balances of $7,267,723. Of this total, $211,787 is nonspendable, $2,511,927 is restricted, $26,835 is assigned and $4,517,174 is unassigned. The fund balance of the general fund increased $356,360, primarily due to assessments and charges for services in excess of expenditures. The debt service fund balance decreased $143,819 due to a decrease in debt service assessment revenue. Proprietary Funds The District’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. The Water and Sewer Fund reported operating income of $1,697,932, which is an increase of $65,713 from the previous year. Of the total net position in the amount of $(5,797,780), $1,658,555 is restricted for renewal, replacement, and debt service. The Golf Course Fund reported an operating loss of $24,294, which is a decrease of $71,860 from the previous year operating loss. General Fund Budgetary 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. There were no amendments to the September 30, 2022 general fund budget. The legal level of budgetary control is at the fund level. Capital Asset and Debt Administration Capital Assets At September 30, 2022, the District had $23,401,800 invested in capital assets. More detailed information about the District’s capital assets is presented in the notes to the financial statements. Governmental Activities Business-Type Activities Total Primary Government 2022 2021 2022 2021 2022 2021 Land $ 2,298,612 $ 2,298,612 $ 3,599,131 $ 3,599,131 $ 5,897,743 $ 5,897,743 Improvements and equipment 12,398,374 11,918,887 107,569 347,601 12,505,943 12,266,488 Water and sewer facilities --20,424,770 20,096,198 20,424,770 20,096,198 Golf course and improvements --3,230,427 3,206,918 3,230,427 3,206,918 Leased asset --347,601 -347,601 - Accumulated depreciation (4,231,627) (3,860,998) (14,531,938) (13,853,837) (18,763,565) (17,714,835) Total $10,465,359 $10,356,501 $ 13,177,560 $13,396,011 $ 23,642,919 $ 23,752,512 Capital Debt At September 30, 2022, the District had $44,325,000 in bonds outstanding, including matured bonds payable of $3,200,000. The District also had leases payable of $283,193. More detailed information about the District’s capital debt is presented in the notes to the financial statements. Page | 6 The Crossings at Fleming Island Community Development District Management’s Discussion and Analysis Economic Factors and Next Year’s Budget It is difficult to predict what significant effect the current economic condition and the matured bonds payable will have on the financial position or results of operations of the District in fiscal year 2023. Requests for Information If you have questions about this report or need additional financial information, contact The Crossings at Fleming Island Community Development District’s Finance Department at 5385 N. Nob Hill Road, Sunrise, Florida 33351. Page | 7 FINANCIAL STATEMENTS The Crossings at Fleming Island Community Development District Statement of Net Position September 30, 2022 Assets Governmental Activities Business-type Activities Total Cash Investments Internal balances Accounts receivable Inventories Prepaid costs Deposits Restricted Assets: $ 1,002,649 3,994,741 102,148 46,678 45,023 41,921 39,043 660,317 $ 2,885,303 (102,148) 333,473 119,438 74,079 7,146 $ 1,662,966 6,880,044 - 380,151 164,461 116,000 46,189 Temporarily restricted investments Capital Assets: Capital assets not being depreciated Capital assets being depreciated, net 2,511,927 2,298,612 8,166,747 2,158,227 3,599,131 9,578,429 4,670,154 5,897,743 17,745,176 Total assets 18,249,489 19,313,395 37,562,884 Deferred Outflows of Resources: Deferred amount on refunding 814,557 1,210,916 2,025,473 Total Assets and Deferred Outflows of Resources 19,064,046 20,524,311 39,588,357 Liabilities Accounts payable and accrued expenses Accrued interest payable Matured bonds payable Matured interest payable Unearned revenue Customer deposits Noncurrent liabilities: 266,303 430,484 - - 235,981 14,123 823,946 449,821 3,200,000 2,570,668 48,425 281,075 1,090,249 880,305 3,200,000 2,570,668 284,406 295,198 Due within one year Due in more than one year 1,665,000 17,930,277 1,495,211 19,846,064 3,160,211 37,776,341 Total liabilities 20,542,168 28,715,210 49,257,378 Net Position Net investment in capital assets Restricted for debt service Restricted for renewal and replacement Unrestricted (8,315,361) 2,081,443 - 4,755,796 (10,152,799) 1,370,130 288,425 303,345 (18,468,160) 3,451,573 288,425 5,059,141 Total net position $ (1,478,122) $ (8,190,899) $ (9,669,021) The accompanying Notes to Financial Statements are an integral part of this statement Page | 8 The Crossings at Fleming Island Community Development District Statement of Activities Year Ended September 30, 2022 Functions/Programs Governmental Activities: General government Physical environment Recreation Interest on long-term debt Program Revenue Charges Operating Grants for and Expenses Services Contributions 299,963 $ 290,236 $ -$ 1,733,728 1,641,769 - 1,879,684 2,415,710 - 1,071,910 2,884,506 10,786 Governmental Business-type Activities Activities Total (9,727) $ -$ (9,727) $ (91,959) -(91,959) 536,026 -536,026 1,823,382 -1,823,382 Net (Expense) Revenue and Changes in Net Position Primary Government Total governmental activities 4,985,285 7,232,221 10,786 2,257,722 -2,257,722 Business-type Activities: Water and sewer Golf and restaurant 5,691,859 3,954,778 6,485,903 3,759,310 - - - - 794,044 (195,468) 794,044 (195,468) Total business-type activities 9,646,637 10,245,213 --598,576 598,576 Total primary government 14,631,922 $ 17,477,434 $ 10,786 $ 2,257,722 598,576 2,856,298 General Revenues: Investment and other income Transfers 61,656 (68,398) 27,014 68,398 88,670 - Total general revenues and transfers (6,742) 95,412 88,670 Change in net position Net position, beginning Restatement, implementation of GASB 87 2,250,980 (3,729,102) - 693,988 (8,833,345) (51,542) 2,944,968 (12,562,447) (51,542) Net position, ending $ (1,478,122) $ (8,190,899) $ (9,669,021) The accompanying Notes to Financial Statements are an integral part of this statement Page | 9 The Crossings at Fleming Island Community Development District Balance Sheet -Governmental Funds September 30, 2022 Total Governmental General Debt Service Funds Assets Cash $ 1,002,649 -$ 1,002,649 $ Investments 3,994,741 2,511,927 6,506,668 Accounts receivable 46,678 -46,678 Inventory 45,023 -45,023 Prepaid costs 41,921 -41,921 Due from other funds 16,348 -16,348 Advance to other fund 85,800 -85,800 Deposits 39,043 -39,043 Total assets $ 5,272,203 $ 2,511,927 $ 7,784,130 Liabilities and Fund Balances Liabilities: Accounts payable and accrued expenses $ 266,303 $ -$ 266,303 Unearned revenue 235,981 -235,981 Deposits 14,123 -14,123 Total liabilities 516,407 -516,407 Fund Balances: Nonspendable 211,787 -211,787 Restricted for debt service -2,511,927 2,511,927 Assigned for subsequent years' expenditures 26,835 -26,835 Unassigned 4,517,174 -4,517,174 Total fund balances 4,755,796 2,511,927 7,267,723 Total liabilities and fund balances $ 5,272,203 $ 2,511,927 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 in the funds. 10,465,359 Deferred amounts on refunding are not financial resources and therefore are not reported in the funds. 814,557 Liabilities notdue and payable fromcurrentavailableresources arenotreportedin governmentalfund statements. Allliabilities,bothcurrentand long-term,arereportedinthegovernment-widestatements. Accrued interest payable (430,484) Bonds payable (19,595,277) (20,025,761) Net position of governmental activities $ (1,478,122) The accompanying Notes to Financial Statements are an integral part of this statement Page | 10 The Crossings at Fleming Island Community Development District Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds Year Ended September 30, 2022 Revenues Special assessments Charges for services Investment and other income $ General 3,705,806 641,909 61,656 $ Debt Service 2,884,506 - 10,786 $ Total Governmental Funds 6,590,312 641,909 72,442 Total revenues 4,409,371 2,895,292 7,304,663 Expenditures Current: General government Physical environment Recreation Debt Service: Interest Principal Capital outlay 262,343 1,354,200 1,879,684 - - 488,386 - - - 1,119,111 1,920,000 - 262,343 1,354,200 1,879,684 1,119,111 1,920,000 488,386 Total expenditures 3,984,613 3,039,111 7,023,724 Excess (Deficit) of Revenues Over Expenditures 424,758 (143,819) 280,939 Other Financing Sources (Uses): Transfer out (68,398) -(68,398) Total other financing sources (uses) (68,398) -(68,398) Net change in fund balances 356,360 (143,819) 212,541 Fund balances, beginning of year 4,399,436 2,655,746 7,055,182 Fund balances, end of year $ 4,755,796 $ 2,511,927 $ 7,267,723 The accompanying Notes to Financial Statements are an integral part of this statement Page | 11 The Crossings at Fleming Island Community Development District Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities. Year Ended September 30, 2022 Amounts reported for Governmental Activities in the Statement of Activities are different because: Net change in fund balances -total governmental funds $ 212,541 Governmental funds report outlays for capital assets as expenditures because such outlays use current financial resources; however, in the statement of net position the cost of those assets is recorded as capital assets. Repayments of long-term liabilities are reported as expenditures in governmental funds, while repayments reduce long-term liabilities in the statement of net position. Depreciation on capital assets is not recognized in the governmental fund statement; however, it is reported as an expense in the statement of activities. 479,487 (370,629) 1,920,000 Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. Change in accrued interest Amortization of bond discount Amortization of deferred amount on refunding 60,282 (13,081) (37,620) 9,581 Change in net position of governmental activities $ 2,250,980 The accompanying Notes to Financial Statements are an integral part of this statement Page | 12 The Crossings at Fleming Island Community Development District Statement of Revenues, Expenditures and Changes in Fund Balance Budget and Actual -General Fund Year Ended September 30, 2022 Revenues Special assessments Charges for services Investment and other income $ Budgeted Amounts Original Final 3,695,680 3,695,680 $ 474,200 474,200 6,000 6,000 $ Actual Amounts 3,705,806 641,909 61,656 Variance with Final Budget Positive (Negative) 10,126 $ 167,709 55,656 Total revenues 4,175,880 4,175,880 4,409,371 233,491 Expenditures Current: General government Physical environment Recreation Capital outlay 272,200 1,405,892 1,710,250 763,974 272,200 1,405,892 1,710,250 763,974 262,343 1,354,200 1,879,684 488,386 9,857 51,692 (169,434) 275,588 Total expenditures 4,152,316 4,152,316 3,984,613 167,703 Excess (Deficit) of Revenues Over Expenditures 23,564 23,564 424,758 401,194 Other Financing Sources (Uses): Transfers out (75,000) (75,000) (68,398) 6,602 Total other financing sources (uses) (75,000) (75,000) (68,398) 6,602 Net change in fund balance (51,436) (51,436) 356,360 407,796 Fund balance, beginning 4,399,436 4,399,436 4,399,436 - Fund balance, ending $ 4,348,000 4,348,000 $ $ 4,755,796 407,796 $ The accompanying Notes to Financial Statements are an integral part of this statement Page | 13 The Crossings at Fleming Island Community Development District Statement of Net Position -Proprietary Funds September 30, 2022 Enterprise Funds Assets Current Assets: Cash and cash equivalents Investments Accounts receivable, net Inventories Prepaid expenses and deposits Water and Sewer 445,139 $ $ 4,949,223 309,098 - - Golf Course 215,178 94,307 24,375 119,438 81,225 $ Total 660,317 5,043,530 333,473 119,438 81,225 Total current assets 5,703,460 534,523 6,237,983 Noncurrent Assets: Capital Assets: Land and improvements Equipment and furniture Less accumulated depreciation 20,136,098 288,972 (12,356,442) 3,598,831 3,685,597 (2,175,496) 23,734,929 3,974,569 (14,531,938) Total noncurrent assets 8,068,628 5,108,932 13,177,560 Total assets 13,772,088 5,643,455 19,415,543 Deferred Outflows of Resources Deferred amount on refunding 1,210,916 -1,210,916 Total Assets and Deferred Outflow of Resources 14,983,004 5,643,455 20,626,459 Liabilities Current Liabilities: Accounts payable and accrued expenses Accrued interest payable Due to other funds Customer deposits Unearned revenue Matured interest payable Matured bonds payable Bonds, notes and loans payable 373,276 405,601 2,750 281,075 - - - 930,000 450,670 44,220 13,598 - 48,425 2,570,668 3,200,000 565,211 823,946 449,821 16,348 281,075 48,425 2,570,668 3,200,000 1,495,211 Total current liabilities 1,992,702 6,892,792 8,885,494 Noncurrent Liabilities: Advance from other funds Bonds, notes and loans payable - 18,788,082 85,800 1,057,982 85,800 19,846,064 Total noncurrent liabilities 18,788,082 1,143,782 19,931,864 Total liabilities 20,780,784 8,036,574 28,817,358 Net Position Net investment in capital assets Restricted for debt service Restricted for other purposes Unrestricted (10,438,538) 1,370,130 288,425 2,982,203 285,739 - - (2,678,858) (10,152,799) 1,370,130 288,425 303,345 Total net position $ (5,797,780) $ (2,393,119) $ (8,190,899) The accompanying Notes to Financial Statements are an integral part of this statement Page | 14 The Crossings at Fleming Island Community Development District Statement of Revenues, Expenses and Changes in Net Position -Proprietary Funds Year Ended September 30, 2022 Enterprise Funds Operating Revenues Charges for services Water and Sewer 6,485,903 $ $ Golf Course 3,759,310 $ Total 10,245,213 Total operating revenues 6,485,903 3,759,310 10,245,213 Operating Expenses Water and sewer Golf and restaurant Depreciation 4,292,790 - 495,181 - 3,600,684 182,920 4,292,790 3,600,684 678,101 Total Operating Expenses 4,787,971 3,783,604 8,571,575 Operating income (loss) 1,697,932 (24,294) 1,673,638 Nonoperating Revenues (Expenses) Interest and investment revenue Interest expense 26,771 (903,888) 243 (171,174) 27,014 (1,075,062) Total nonoperating revenue (expenses) (877,117) (170,931) (1,048,048) Income (loss) before transfers 820,815 (195,225) 625,590 Transfers in 44,889 23,509 68,398 Change in net position 865,704 (171,716) 693,988 Total net position, beginning Restatement, implementation of GASB 87 (6,663,484) - (2,169,861) (51,542) (8,833,345) (51,542) Total net position, ending $ (5,797,780) $ (2,393,119) $ (8,190,899) The accompanying Notes to Financial Statements are an integral part of this statement Page | 15 The Crossings at Fleming Island Community Development District Statement of Cash Flows -Proprietary Funds Year Ended September 30, 2022 Cash Flows from Operating Activities Receipts from customers and users Payments to suppliers of goods and services $ Water and Sewer 6,455,016 (4,215,952) Golf Course 3,751,422 $ (3,513,437) Total $ 10,206,438 (7,729,389) Net cash provided (used) by operating activities 2,239,064 237,985 2,477,049 Cash Flows from Non-Capital Financing Activities Transfers (to)/from other funds Increase (decrease) in due to other funds 44,889 2,750 23,509 - 68,398 2,750 Net cash provided (used) by non-capital financing activities 47,639 23,509 71,148 Cash Flows from Capital and Related Financing Activities Principal paid on debt Purchase of capital assets Interest paid on debt (905,000) (328,572) (823,322) (115,950) (23,509) (83,559) (1,020,950) (352,081) (906,881) Net cash used by capital and related financing activities (2,056,894) (223,018) (2,279,912) Cash Flows from Investing Activities Interest earnings Sale (purchase) of investments 26,771 (68,358) 243 (293) 27,014 (68,651) Net cash provided (used) by investing activities (41,587) (50) (41,637) Net increase (decrease) in cash and cash equivalents 188,222 38,426 226,648 Cash and cash equivalents, beginning 256,917 176,752 433,669 Cash and cash equivalents, ending $ 445,139 215,178 $ 660,317 $ Reconciliation of Operating Income (Loss) to Net Cash Provided (Used) By Operating Activities Operating income (loss) $ 1,697,932 (24,294) $ 1,673,638 $ Adjustments Not Affecting Cash Depreciation and amortization 495,181 182,920 678,101 Change in Assets and Liabilities (Increase) decrease in accounts receivable (Increase) decrease in prepaids / inventory Increase (decrease) in accounts payable Increase (decrease) in customer deposits Increase (decrease) in unearned revenue (34,477) 44,690 32,148 3,590 - (8,224) (74,720) 161,967 - 336 (42,701) (30,030) 194,115 3,590 336 Total adjustments 541,132 262,279 803,411 Net cash provided (used) by operating activities $ 2,239,064 237,985 $ 2,477,049 $ The accompanying Notes to Financial Statements are an integral part of this statement Page | 16 NOTES TO FINANCIAL STATEMENTS The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity The Crossings at Fleming Island Community Development District, (the “District”) was established in November 1989 by the Florida Land and Water Adjudicatory Commission Chapter 42H-1 pursuant to the Uniform Community Development District Act of 1980, otherwise known as Chapter 190, Florida Statutes. The Act provides, among other things, the power to manage basic services for community development, the power to borrow money and issue bonds, and the power to levy and collect non-ad valorem assessments for the financing and delivery of capital infrastructure. The District was established for the purpose 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 (the “Board”), which is composed of five members. At present, the Supervisors are elected on an at large basis by qualified electors of the District. The Board of Supervisors of the District exercises all powers granted to the District pursuant to Chapter 190, Florida Statutes. The Board has the final responsibility for, among other things: 1. Allocating and levying assessments. 2. Approving budgets. 3. Exercising control over facilities and properties. 4. Controlling the use of funds generated by the District. 5. Approving the hiring and firing of key personnel. 6. Financing improvements. The financial statements were prepared in accordance with Governmental Accounting Standards Board (“GASB”) Statements 14, 39, and 61. Under the provisions of those standards, the financial reporting entity consists of the primary government, organizations for which the District Board of Supervisors 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. Government-Wide and Fund Financial Statements The 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 and 2) grants, contributions and investment income that are restricted to meeting the operational or capital requirements of a particular function or segment and 3) operating-type special assessments that are treated as charges for services (including assessments for maintenance and debt service). Other items not included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds and proprietary funds. The major governmental and major individual enterprise funds are reported as separate columns in the fund financial statements. Page | 17 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 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 recognized as revenues as soon as all eligibility requirements imposed by the provider have been met. Unbilled service revenue is accrued in the enterprise funds. 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 District 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, including debt service assessments and operation and maintenance assessments, are non-ad valorem assessments imposed on all lands located within the District and benefited by the District’s activities. Operation and maintenance assessments are levied by the District prior to the start of the fiscal year which begins October 1st and ends on September 30th. These assessments are imposed upon all benefited lands located in the District. Debt service special assessments are imposed upon certain lots and lands as described in each resolution imposing the special assessment for each series of bonds issued by the District. Certain debt service assessments are collected upon the closing of those lots subject to short term debt and are used to prepay a portion of the bonds outstanding. Assessments and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the District. The District reports the following major governmental funds: General Fund -is the District’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. Debt Service Fund -accounts for the accumulation of resources for the annual payment of principal and interest on long-term debt. The District reports the following major proprietary funds: Water and Sewer Fund -This enterprise fund is used to account for the operations of the water and sewer utility services within the District. The costs of providing services to the residents are recovered primarily through user charges. Golf Course Fund -This enterprise fund is used to account for the operations of the golf course, pro shop and restaurant within the District. The costs of providing services to the residents and public are recovered primarily through user charges. As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. When both restricted and unrestricted resources are available for use, it is the District’s policy to use restricted resources first, then unrestricted resources as they are needed. Page | 18 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position/Fund Balance Restricted Assets These assets represent cash and investments set aside pursuant to bond covenants. Deposits and Investments The District’s cash and cash equivalents are considered to be cash on hand and demand deposits. Investments of the District are reported at fair value and are categorized within the fair value hierarchy established in accordance with GASB Statement No. 72, Fair Value Measurement and Application. The District’s investments consist of investments authorized in accordance with Section 218.415, Florida Statutes. Inventories Inventories are valued at cost which approximates market value using the first-in, first-out (FIFO) method. Prepaid Items 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. Receivables and Payables During the course of operations, transactions occur between individual funds. Any residual balances outstanding between governmental activities and business-type activities for internal borrowing are reported in the government-wide statements as “internal balances”. Accounts receivable and assessments receivable are shown net of an allowance for uncollectible amounts. These receivables will be recognized as revenue as they are collected. Capital Assets Capital assets, which include property, golf course, recreation facilities, water and sewer improvements, equipment and infrastructure assets (e.g., utilities system, stormwater system, landscaping and similar items), are reported in the applicable governmental activities column 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 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 acquisition 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. Property, plant, and equipment of the District are depreciated using the straight-line method over the following estimated useful lives: Assets Years Land improvements 10-20 Buildings 30 Stormwater system 30 Improvements other than buildings 40 Roadways and other 30 Equipment 5-10 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. Page | 19 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Long Term Obligations In the government-wide and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities or proprietary fund type statement of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of premiums or discounts. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond 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 expenditures. Deferred Outflows/Inflows of Resources In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The District has one item that qualifies for reporting in this category. It is the deferred charge on refunding reported in the government-wide statement of net position. A deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The District does not have any item that qualifies for reporting in this category for the year ended September 30, 2022. Net Position Flow Assumption Sometimes the District will fund outlays for a particular purpose from both restricted and unrestricted resources. In order to calculate the amounts to report as restricted net position and unrestricted net position in the government-wide financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the District’s policy to consider restricted net position to have been depleted before unrestricted net position is applied. Fund Balance Flow Assumptions Sometimes the District will fund outlays for a particular purpose from both restricted and unrestricted resources (total of committed, assigned, and unassigned fund balance). In order to calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance in the governmental fund financial statements a flow assumption must be made about the order in which the resources are considered to be applied. It is the District’s policy to consider restricted fund balance to have been depleted before using any of the components of unrestricted fund balance. Further, when the components of unrestricted fund balance can be used for the same purpose, committed fund balance is depleted first, followed by assigned fund balance. Unassigned fund balance is applied last. Fund Balance Policies Fund balance of governmental funds is reported in various categories based on the nature of any limitations requiring the use of resources for specific purposes. The District itself can establish limitations on the use of resources through either commitment (committed fund balance) or an assignment (assigned fund balance). The committed fund balance classification includes fund balance amounts that can be used only for the specific purposes determined by a formal action of the government’s highest level of decision-making authority. The Board of Supervisors is the highest level of decision-making authority for the government that can, by adoption of an ordinance or resolution prior to the end of the fiscal year, commit fund balance. Once adopted, the limitation imposed by the ordinance or resolution remains in place until a similar action is taken to remove or revise the limitation. Page | 20 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Amounts in the assigned fund balance classification are intended to be used by the government for specific purposes but do not meet the criteria to be classified as committed. The Board of Supervisors has authorized the District Manager to assign amounts for specific purposes. The Board of Supervisors may also assign fund balance as it does when appropriating fund balance to cover a gap between estimated revenue and appropriations in the subsequent year’s appropriated budget. Unlike commitments, assignments generally only exist temporarily. In other words, an additional action does not normally have to be taken for the removal of an assignment. Conversely, as discussed above an additional action is essential to either remove or revise a commitment. 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. New Accounting Standards In fiscal year 2022, the District implemented Government Accounting Standards Board (GASB) Statement No. 87, Leases. This statement increases the usefulness of governments’ financial statements by requiring recognition of certain lease assets, liabilities and inflows of resources or outflows of resources based on the payment provisions of the contract. It also establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use underlying asset. As a result of implementation, beginning capital assets of the golf fund were increased $347,601, lease liabilities were increased $399,143 and net position was decreased $51,542. NOTE 2 STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY Budgetary Information The District is required to establish a budgetary system and an approved annual budget for the General Fund. Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. All annual appropriations lapse at the fiscal year end. The legal level of budgetary control is at the fund level. Any budget amendments that increase the aggregate budgeted appropriations, at the fund level, must be approved by the Board of Supervisors. The District follows these procedures in establishing the budgetary data reflected in the financial statements. 1. Each year the District Manager submits to the District Board proposed budgets for the fiscal year commencing the following October 1. 2. A public hearing is conducted to obtain public comments. 3. Prior to October 1, the budget is legally adopted by the District Board. 4. Subject to certain limited exceptions set forth in the District’s appropriation resolutions adopted each year, all budget changes must be approved by the District Board. 5. The budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. 6. Unused appropriation for annually budgeted funds lapse at the end of the year. NOTE 3 DEPOSITS AND INVESTMENTS Deposits 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. Page | 21 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 3 DEPOSITS AND INVESTMENTS (CONTINUED) Restricted cash Included in cash and investments for the water and sewer fund is restricted cash of $569,500 for customer deposits and renewal and replacement reserves. Investments The District categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The fair value is the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Under GASB 72, assets or liabilities are classified into one of three levels. Level 1 is the most reliable and is based on quoted prices for identical assets, or liabilities, in an active market. Level 2 uses significant other observable inputs when obtaining quoted prices for identical or similar assets, or liabilities, in markets that are not active. Level 3 is the least reliable, and uses significant unobservable inputs that uses the best information available under the circumstances, which includes the District’s own data in measuring unobservable inputs. The District has the following recurring fair value measurements as of September 30, 2022: . Money market mutual funds of $5,325,825 are valued using Level 2 inputs. The District’s investment policy is governed by State Statutes and the District Trust Indenture. This policy allows investments in any financial institution that is a qualified public depository of the State of Florida as identified by the State Treasurer, in accordance with Chapter 280 of the Florida Statutes. Authorized investments are: 1. The State Board of Administration Local Government Investment Pool (SBA); 2. Securities and Exchange Commission Registered Money Market Funds with the highest credit quality rating from a nationally recognized rating agency; 3. Interest-bearing savings accounts and certificates of deposit in state-certified qualified public depositories; 4. Direct obligations of the U.S. Treasury. The SBA is not a registrant with the Securities and Exchange Commission (SEC); however, the State of Florida does provide oversight. The Board has adopted operating procedures consistent with the requirements for a 2a-7-like fund for the Florida Prime Fund; therefore, the pool net asset value per share can be used as fair value for financial reporting. Investments made by the District at September 30, 2022 are summarized below. In accordance with GASB 31, investments are reported at fair value. Weighted Credit Average Investment Type Fair Value Rating Maturity First American Government Obligation Fund-Class Y $ 3,409,191 AAAm 18 days First American Government Obligation Fund-Class Z 1,916,634 AAAm 18 days US Bank Money Market 94,071 n/a n/a Local GovernmentInvestmentPool: Florida Prime 6,130,302 AAAm 21 days $ 11,550,198 Page | 22 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 3 DEPOSITS AND INVESTMENTS (CONTINUED) Credit Risk The District’s investment policy limits credit risk by restricting authorized investments to those described. Investments in U.S. Government securities and agencies must be backed by the full faith and credit of the United States Government. Short term bond funds shall be rated by a nationally recognized ratings agency and shall maintain the highest credit quality rating. Custodial Credit Risk In the case of deposits, this is the risk that, in the event of a bank failure, the District’s deposits may not be returned to it. The District’s investment policy requires that bank deposits be secured as provided by Chapter 280, Florida Statutes. This law requires local governments to deposit funds only in financial institutions designated as qualified public depositories by the Chief Financial Officer of the State of Florida, and creates the Public Deposits Trust Fund, a multiple financial institution pool with the ability to assess its member financial institutions for collateral shortfalls if a default or insolvency has occurred. At September 30, 2022, all of the District’s bank deposits were in qualified public depositories. For an investment, this is the risk that, in the event of the failure of the counterparty, the government will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. At September 30, 2022, none of the investments listed are exposed to custodial credit risk because their existence is not evidenced by securities that exist in physical or book entry form. Concentration of Credit Risk The District’s investment policy does not specify limits on the amount the District may invest in any one issuer. Interest Rate Risk The District’s investment policy does not specifically address interest rate risk; however, the general investment policy is to apply the prudent-person rule: Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserve capital, and in general, avoid speculative investments. The District manages its exposure to declines in fair values by investing primarily in pooled investments that have a weighted average maturity of less than three months. NOTE 4 INTERFUND, RECEIVABLES, PAYABLES AND TRANSFERS Interfund receivables and payables at September 30, 2022 were as follows: Receivable Fund Payable Fund Amount General Golf Course $ 13,598 General Water and Sewer $ 2,750 Advances: General Golf Course $ 85,800 The outstanding balances between funds result primarily from the time lag between the dates that transactions are recorded in the accounting system and payments between funds are made. Balances between funds are for services paid by the General Fund to be reimbursed. In August 2009, the General Fund loaned the Golf Fund $85,800 to cover the Golf Fund debt service payment. The advance is to be repaid in 30 annual installments of $2,860. During the fiscal year ended September 30, 2022, no payments were made to the General Fund. During the year ended September 30, 2022, the general fund transferred $44,889 to the water and sewer fund and $23,509 to the golf course fund for capital purchases. Page | 23 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 5 CAPITAL ASSETS Capital asset activity for the year ended September 30, 2022 was as follows: Governmental Activities Capital assets, not being depreciated: Land Beginning Balance $ 2,298,612 $ Additions - Disposals -$ Ending Balance $ 2,298,612 Total capital assets, not being depreciated 2,298,612 --2,298,612 Capital Assets Being Depreciated: Improvements and equipment Total capital assets, being depreciated 11,918,887 11,918,887 479,487 479,487 - - 12,398,374 12,398,374 Less Accumulated Depreciation for: Improvements and equipment Total accumulated depreciation (3,860,998) (3,860,998) (370,629) (370,629) - - (4,231,627) (4,231,627) Total capital assets being depreciated, net Governmental activities capital assets, net 8,057,889 $ 10,356,501 $ 108,858 108,858 $ - - 8,166,747 $ 10,465,359 Depreciation expense is charged to physical environment. Page | 24 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 5 CAPITAL ASSETS (CONTINUED) Beginning Balance, as Ending restated Additions Disposals Balance Business-Type Activities Capital assets, not being depreciated: Land 3,599,131 --3,599,131 Total capital assets, not being depreciated 3,599,131 --3,599,131 Capital Assets Being Depreciated: Water and sewer facilities 20,096,198 328,572 -20,424,770 Golfcourse and improvements 3,206,918 23,509 -3,230,427 Improvements and equipment 107,569 --107,569 Leased asset 347,601 --347,601 Total capital assets, being depreciated 23,758,286 352,081 -24,110,367 Less accumulated depreciation for: Water and sewer facilities (11,861,261) (495,181) -(12,356,442) Golfcourse and improvements (1,885,007) (76,438) -(1,961,445) Improvements and equipment (107,569) --(107,569) Leased asset -(106,482) -(106,482) Total accumulated depreciation (13,853,837) (678,101) -(14,531,938) Total capital assets being depreciated, net 9,904,449 (326,020) -9,578,429 Business-type activities capital assets, net $13,503,580 $ (326,020) $ -$13,177,560 Depreciation of $495,181 is charged to the water and sewer fund and $182,920 is charged to the golf fund. Page | 25 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 6 LONG-TERM LIABILITIES Special Assessment Revenue Refunding Bonds, Series 2014 -Public Offering In August 2014, the District issued $37,005,000 of Special Assessment Revenue Refunding Bonds, Series 2014 due on November 1, 2044 with a variable interest rate. The Bonds were issued to refund the Special Assessment Refunding Bonds, Series 2000 and to finance the acquisition and construction of certain improvements for the benefit of the property within the District. Interest is paid semiannually on each May 1 and November 1. Principal is payable annually commencing May 1, 2014 through May 1, 2044. The Series 2014 Bonds are subject to redemption at the option of the District, in whole or in part at a redemption price set forth in the Bond Indenture. The Series 2014 Bonds are subject to optional and extraordinary mandatory redemption prior to maturity in the manner determined by the Bond Indenture. The Bond Indenture requires that the District maintain adequate funds in a reserve account to meet the debt service reserve requirement as defined in the Indenture. This requirement was met at September 30, 2022. The Bond Indenture has certain 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 agreed to levy special assessments in annual amounts adequate to provide payment of debt service and to meet the reserve requirements. Payment of principal and interest on the 2014 Bonds is secured by a pledge of and a first lien upon the pledged special assessment revenue. The District is in compliance with the requirements of the Bond Indenture. Total principal and interest remaining on the Series 2014 Bonds at September 30, 2022 is $26,461,549. For the year ended September 30, 2022, principal and interest of $2,961,961 was paid. Special assessment revenue of $2,817,171 was pledged for the year ended September 30, 2022. Special Assessment Revenue Bonds, Series 2017 -Public Offering In May 2017, the District issued $870,000 of Special Assessment Revenue Bonds, Series 2017 due on May 1, 2044 with a fixed interest rate of 5.75%. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the property within the District and pay issuance costs. Interest is paid semiannually on each May 1 and November 1. Principal is payable annually commencing May 1, 2019 through May 1, 2044. The Series 2017 Bonds are subject to redemption at the option of the District, in whole or in part at a redemption price set forth in the Bond Indenture. The Series 2017 Bonds are subject to optional and extraordinary mandatory redemption prior to maturity in the manner determined by the Bond Indenture. In the event of default, all principal and interest of the Bond will become immediately due and payable. The Bond Indenture requires that the District maintain adequate funds in a reserve account to meet the debt service reserve requirement as defined in the Indenture. This requirement was met at September 30, 2022. The Bond Indenture has certain 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 agreed to levy special assessments in annual amounts adequate to provide payment of debt service and to meet the reserve requirements. Payment of principal and interest on the 2017 Bonds is secured by a pledge of and a first lien upon the pledged special assessment revenue. The District is in compliance with the requirements of the Bond Indenture. Total principal and interest remaining on the Series 2017 Bonds at September 30, 2022 is $1,421,466. For the year ended September 30, 2022, principal and interest of $77,150 was paid. Special assessment revenue of $67,335 was pledged for the year ended September 30, 2022. Page | 26 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 6 LONG-TERM LIABILITIES (CONTINUED) Utility Refunding Revenue Bonds, Series 2016 -Public Offering In December 2016, the District issued $24,045,000 of Utility Refunding Revenue Bonds, Series 2016 due October 1, 2037 with an interest rate ranging from 4.5% to 4.875%. The Bonds were issued to refund the outstanding Utility Revenue Refunding Bonds, Series 2007. Interest is paid semiannually on each April 1 and October 1. Principal is payable annually commencing October 1, 2017 through October 1, 2037. The Bond Indenture has certain 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 agreed to establish rates in amount adequate to provide payment of debt service and to meet certain trust indenture provisions. The District was in compliance with these provisions in the current fiscal year. In the event of default, all principal and interest of the Bond will become immediately due and payable. Total principal and interest remaining on the Series 2016 Bonds at September 30, 2022 is $27,052,212. For the year ended September 30, 2022, principal and interest of $1,728,320 was paid. Revenue of $2,193,113 was pledged for the year ended September 30, 2022. Golf Course Revenue Bonds, Series 1999 -Public Offering In March 1999, the District issued $7,835,000 of Golf Course Revenue Bonds, Series 1999 due October 1, 2024 with an interest rate of 6.6%. The Bonds were issued to finance the acquisition and construction of certain public infrastructure with the District. The bonds are secured by a pledge of certain revenues derived as a result of operations on the golf course. Interest is paid semiannually on each April 1 and October 1. Principal is payable annually commencing October 1, 2000 through October 1, 2024. The Bonds are secured by a pledge of certain revenues derived as a result of operations of the golf course. The District has not made a debt service payment on the Golf Course Revenue Bonds, Series 1999 since April 1, 2011 and is not in compliance with the Trust Indenture. In the event of default, all principal and interest of the Bond will become immediately due and payable. Total principal and interest remaining on the Series 1999 Bonds at September 30, 2022 is $7,202,738, which includes matured bonds payable of $3,200,000 and matured interest payable of $2,570,668. For the year ended September 30, 2022, no principal and interest was paid ($390,000 of principal was added to matured bonds payable and $101,310 of interest was added to matured interest payable). Revenue of $3,759,310 was pledged for the year ended September 30, 2022. At September 30, 2022, the scheduled debt service requirements on the bonds payable were as follows: Governmental Activities Business-Type Activities 2023 2028 -2032 2033 -2037 2038 -2042 2043 -2046 2025 2026 2027 Year Ending September 30, 2024 $ Principal 1,665,000 1,740,000 1,825,000 1,910,000 2,015,000 7,065,000 1,195,000 1,645,000 820,000 $ Interest 1,033,163 957,538 878,188 787,588 692,688 1,958,263 1,025,938 590,399 79,250 $ Principal 1,350,000 1,405,000 1,460,000 1,020,000 1,060,000 4,655,000 7,030,000 3,265,000 - $ Interest 844,378 784,445 719,655 683,475 644,750 2,114,370 1,373,953 74,256 - $ 19,880,000 $ 8,003,015 $ 21,245,000 $ 7,239,282 Page | 27 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 6 LONG-TERM LIABILITIES (CONTINUED) Leases The District has entered into agreements to lease certain equipment. The lease agreements qualify as other than short-term leases under GASB 87 and, therefore, have been recorded at the present value of the future minimum lease payments as of the date of their inception. Individual lease terms range from 48 to 60 months. These leases require monthly payments ranging from $442 to $7,349. The lease liability is measured at a discount rate of 2%, which is the District’s incremental borrowing rate. As a result of the leases, the District has recorded a right to uses asset with a net book value of $241,119 at September 30, 2022. Future minimum lease payments as of September 30, 2022, were as follows: Business-Type Activities Year Ending September 30, Principal Interest 2023 $ 145,211 $ 47,409 2024 125,026 13,296 2025 12,956 46 $ 283,193 $ 60,751 Long-term debt activity for the year ended September 30, 2022 was as follows: Beginning Balance, as Ending Due Within restated Increases Decreases Balance One Year Governmental activities Bonds Payable: Series 2014 $ 20,975,000 $ -$ (1,890,000) $ 19,085,000 $ 1,645,000 Discount (297,804) -13,081 (284,723) - Series 2017 825,000 -(30,000) 795,000 20,000 Governmental activity long- term liabilities $ 21,502,196 $ -$ (1,906,919) $ 19,595,277 $ 1,665,000 Business-Type Activities Bonds Payable: Water and sewer, series 2016 $ 20,810,000 $ -$ (905,000) $ 19,905,000 930,000 Discount (194,626) -7,708 (186,918) - Golf course, series 1999 1,730,000 -(390,000) 1,340,000 420,000 Lease liability 399,143 -(115,950) 283,193 145,211 Business-type long-term liabilities $ 22,744,517 $ -$ (1,403,242) $ 21,341,275 $ 1,495,211 The $390,000 reduction above for the Golf Course, Series 1999 Bonds was not paid, but was accrued to matured bonds payable. The beginning balance is reduced by $2,810,000 which was also not paid, but accrued to matured bonds payable in prior years. At year end, total matured bonds payable is $3,200,000. Page | 28 The Crossings at Fleming Island Community Development District Notes to Financial Statements September 30, 2022 NOTE 7 MANAGEMENT COMPANY District Operations The District has contracted with a management company (“GMS”) to perform management services, which include financial and accounting services. Certain employees of GMS also serve as officers (Board appointed non-voting positions) of the District. Under the agreement, the District compensates the management company for management, accounting, financial reporting and other administrative costs. Recreation Operations The District employees manage and staff the recreation operations of the District. Such operations include management, marketing, operations and maintenance of the District’s recreational assets. Golf Operations The District entered into a management agreement in June 2008, with Hampton Golf, Inc. to supervise, direct and control the management, development, marketing and operation of the Eagle Harbor Golf Club. The agreement has no ending date and provides that either party may terminate the agreement with 90-day notice. The monthly management fee is $7,000 per month. During fiscal year 2022, the District paid $84,000 to Hampton Golf, Inc. as management fees under these agreements. NOTE 8 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. These risks are covered by commercial insurance from independent third parties. The District has not filed any claims under this commercial coverage during the last three years. NOTE 9 SUBSEQUENT EVENTS The District was not able to make the October 2022 and May 2023 debt service payments on the Golf Course Revenue Bonds, Series 1999. Page | 29 COMPLIANCE SECTION 934 North Magnolia Avenue, Suite 100 Orlando, Florida 32803 Tel. 407-843-5406 www.mcdirmitdavis.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 The Crossings at Fleming Island Community Development District We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, business-type activities and each major fund of The Crossings at Fleming Island Community Development District (the “District”) as of and for the year ended September 30, 2022, which collectively comprise the District’s financial statements and have issued our report thereon dated June 29, 2023. Report on 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) as a basis for designing procedures that are appropriate in the circumstances for the purpose of expressing 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. Report on 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 grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. See Appendix A. We noted certain other matters that we reported to management of the District, in a separate letter dated June 29, 2023. The District’s response to our findings identified in our audit are included in this report. We did not audit the District’s response, and accordingly, we express no opinion on it. the trusted partner Page | 30 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 District’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 District’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Orlando, Florida June 29, 2023 the trusted partner Page | 31 934 North Magnolia Avenue, Suite 100 Orlando, Florida 32803 Tel. 407-843-5406 www.mcdirmitdavis.com MANAGEMENT LETTER To the Board of Supervisors The Crossings at Fleming Island Community Development District Report on the Financial Statements We have audited the financial statements of The Crossings at Fleming Island Community Development District (the “District”), as of and for the fiscal year ended September 30, 2022, and have issued our report thereon dated June 29, 2023. 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 Auditor General. Other Reporting Requirements We have issued our 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 and Independent Auditor’s Report on an examination conducted in accordance with AICPA Professional Standards, AT-C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in these reports, which are dated June 29, 2023, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i.)1., Rules of the Auditor General, require that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. Corrective actions have been taken to address findings and recommendations made in the preceding annual financial report, except as noted below. Tabulation of Uncorrected Audit Findings Current Year Finding # 2020-21 FY Finding # 2019-20 FY Finding # 15-01 15-01 15-01 15-02 15-02 15-02 Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information has been disclosed in the notes to the financial statements. Financial Condition and Management Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require us to apply appropriate procedures and communicate the results of our determination as to whether or not the District has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and to identify of the specific condition(s) met. In connection with our audit, we determined that the District met one of the conditions described in Section 218.503(1), Florida Statutes, as listed in Appendix B. Pursuant to Sections 10.554(1)(i)5.b. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures for the District. It is management’s responsibility to monitor the District’s 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. Deteriorating financial conditions were noted as indicated in Appendix B. Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. the trusted partner Page | 32 Specific Information (Unaudited) As required by Section 218.39(3)(c), Florida Statutes, and Section 10.554(1)(i)6, Rules of the Auditor General, the District reported: a. The total number of district employees compensated in the last pay period of the district’s fiscal year as 73. b. The total number of independent contractors to whom nonemployee compensation was paid in the last month of the district’s fiscal year as 4. c. All compensation earned by or awarded to employees, whether paid or accrued, regardless of contingency as $860,686. d. All compensation earned by or awarded to nonemployee independent contractors, whether paid or accrued, regardless of contingency as $135,684. e. Each construction project with a total cost of at least $65,000 approved by the district that is scheduled to begin on or after October 1 of the fiscal year being reported, together with the total expenditures for such project as: Docks-$132,000 Swim Park-$117,343 Waterfront Park-$93,654 f. A budget variance based on the budget adopted under Section 189.016(4), Florida Statutes, before the beginning of the fiscal year being reported if the district amends a final budget under Section 189.016(6), Florida Statutes, as included in the general fund budget statement. As required by Section 218.39(3)(c), Florida Statutes, and Section 10.554(1)(i)7, Rules of the Auditor General, the district reported: a. The rate or rates of non-ad valorem special assessments imposed by the district as $675.73-$127,369.18. b. The total amount of special assessments collected by or on behalf of the district as $6,590,312. c. The total amount of outstanding bonds issued by the district and the terms of such bonds as disclosed in the notes. Additional Matters Section 10.554(1)(i)3., Rules of the Auditor General, requires us to communicate 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. In connection with our audit, we did not note any such findings. Purpose of this Letter 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, the Board of Supervisors and applicable management, and is not intended to be and should not be used by anyone other than these specified parties. Orlando, Florida June 29, 2023 Page | 33 The Crossings at Fleming Island Community Development District Appendix A -Compliance, Violations of Laws, Regulations and Contractual Provisions September 30, 2022 15-01 -Failure to Make Debt Service Payments When Due Criteria The Golf Course Revenue Bonds Series 1999 require semiannual interest payments and annual principal payments as per the Bond Indenture. Condition In the current and prior years, the District did not pay the entire principal and interest due on the Series 1999 Bonds. Cause Operating revenues are insufficient. Effect At September 30, 2022, the District was in default per Article VIII Section 8.02a of the Trust Indenture. Recommendation We recommend the District utilize all remedies available to bring debt service payments current. Management Response The District’s Golf Course Bonds are Revenue Bonds secured solely by the Pledged Revenues generated by the Golf Course which have been insufficient to pay the operating costs and debt service payments on the Golf Course Bonds for the past ten years. The District has made capital improvements, hired an independent golf course consultant to evaluate the golf course facilities and operations, hired a professional golf course management company along with various other actions to improve the financial condition of the Golf Course Enterprise Fund. However, golf as an industry continues to struggle financially and it will be extremely difficult for the District to meet its financial obligations based upon the diminishing interest in the sport for the foreseeable future. 15-02 -Failure to Meet Debt Service Reserve Account Requirement Criteria The Trust Indenture requires the District to maintain a minimum balance in the Debt Service Reserve Account. Condition At September 30, 2022, the Debt Service Reserve Account was deficient. Cause The balance in the Debt Service Reserve Account was used to pay debt service expenditures. Effect At September 30, 2021, the District was in default per Article VIII Section 8.02e of the Trust Indenture. Recommendation We recommend the District utilize all remedies available to replenish the Debt Service Reserve Account. Management Response The District’s Golf Course Bonds are Revenue Bonds secured solely by the Pledged Revenues generated by the Golf Course which have been insufficient to pay the operating costs and debt service payments on the Golf Course Bonds for the past ten years. The District has made capital improvements, hired an independent golf course consultant to evaluate the golf course facilities and operations, hired a professional golf course management company along with various other actions to improve the financial condition of the Golf Course Enterprise Fund. However, golf as an industry continues to struggle financially and it will be extremely difficult for the District to meet its financial obligations based upon the diminishing interest in the sport for the foreseeable future. Page | 34 The Crossings at Fleming Island Community Development District Appendix B -Conditions of Financial Emergency September 30, 2022 15-01 -Failure to Make Debt Service Payments When Due In the current and prior years, the District did not pay all of the principal and interest due on the Series 1999 Bonds due to lack of funds; therefore the District meets Section 218.503(1)(a) as a financial emergency condition. Page | 35 934 North Magnolia Avenue, Suite 100 Orlando, Florida 32803 Tel. 407-843-5406 www.mcdirmitdavis.com INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE WITH THE REQUIREMENTS OF SECTION 218.415, FLORIDA STATUTES To the Board of Supervisors The Crossings at Fleming Island Community Development District We have examined The Crossings at Fleming Island Community Development District’s (the “District”) compliance with the requirements of Section 218.415, Florida Statutes, during the year ended September 30, 2022. Management is responsible for the 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 the standards applicable to attestation engagements contained in Government Auditing Standards issued by the Comptroller General of the United States, and, accordingly, included examining, on a test basis, evidence about the 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 the District’s compliance with specified requirements. In our opinion, the District complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2022. Orlando, Florida June 29, 2023 the trusted partner Page | 36