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MAGIC RESERVE COMMUNITY DEVELOPMENT DISTRICT
OSCEOLA COUNTY, FLORIDA FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018

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Grau & Associates
CERTIFIED  PUBLIC  ACCOUNTANTS

951 Yamato Road• Suite 280 Boca Raton, Florida 33431 (561) 994-9299 • {800) 299-4728
Fax (561) 994-5823
www.graucpa.com

INDEPENDENT AUDITOR'S REPORT
D	To the Board of Supervisors
Magic Reserve Community Development District Osceola County, Florida
Report on the Financial Statements

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We have audited the accompanying financial statements of the governmental activities and each major fund of Magic Reserve Community Development District, Osceola County, Florida ("District") as of and for the fiscal year ended September 30, 2018, and the related notes to the financialstatements, which collectively comprise the District's basic financial statements as listed in the table of contents.

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Management's Responsibility for the Financial Statements

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

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Auditor's Responsibility

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

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

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

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund, of the District as of September 30, 2018, and the respective changes in financial position thereof for the fiscal year then ended in accordance with accounting principles generally accepted in the United States of America.

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D	MANAGEMENT'S DISCUSSION AND ANALYSIS

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The management of the Magic Reserve Community Development District, Osceola County, Florida ("District") would like to offer the readers of the District's financial statements this discussion and analysis of the District's financial activities for the fiscal year ended September 30, 2018. Please read it in conjunction with the District's Independent Auditor's Report, basic financial statements, accompanying notes and supplementary information to the basic financial statements.

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FINANCIAL HIGHLIGHTS
The liabilities of the District exceeded its assets at the close of the most recent fiscal year resulting in a net position deficit balance of ($7,863).
The change in the District's total net position in comparison with the prior fiscal year was $534,853, an increase. The key components of the District's net position and change in net position arereflected in the table in the govemment-wide financial analysis section.
At September 30, 2018, the District's governmental funds reported combined endingfundbalances of

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$675,447 an increase of$523,033 in comparison with the prior fiscal year. The total fund balance is restricted for debt service and capital projects, non-spendable for prepaid items and the remainder is unassigned fund balance which is available for spending at the District's discretion.

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OVERVIEW OF FINANCIAL STATEMENTS

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

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Government-Wide Financial Statements

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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.

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The statement of net position presents information on all the District's assets, deferred outflows of resources, liabilities, and deferred inflows of resources with the residual amount being 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.

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The statement of activities presents information showing how the government's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods.
The government-wide financial statements include all governmental activities that are principally supportedby Developer contributions and assessments. The District does not have any business-type activities, The governmental activities of the District include the general government (management) function.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The District, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. The District has one fund category, the governmental funds.

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GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)
The District's net position increased during the most recent fiscal year. Themajority of the increase was due to a Developer contribution and assessments during the current fiscal year.

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Key elements of the change in net position are reflected in the following table:
CHANGES IN NET POSITION

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FOR THE FISCAL YEAR ENDED SEPTEMBER 30,
2018	2017
Revenues:

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Program revenues
Charges for services	$    523,540	$
Operating grants and contributions	1,089	43,757
Capital grants and contributions	332,136 General revenues
Miscellaneous	219
Total revenues	856,984	43,757 Expenses:
General government	60,597	40,089
Interest	261,534	251,585

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Bond issuance costs	 		293,650 Total expenses		322,131	585,324
Change in net position			534,853	!541,567l Net position - beginning	 	(542,11si		(1,149l

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Net position - ending	s	(7,863l   $	!542,11si

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As noted above and in the statement of activities, the cost of all governmental activities during the fiscal year ended September 30, 2018 was $322,131. The costs of the District's activities were partially funded by program revenues. They are comprised primarily of assessments and increased during the fiscal year as a result of collecting the debt service assessments. Also, the Developer contributed funds to the District by paying the retainage payable. Expenses decreased as a result of bond issue costs incurred in the prior fiscal year that did not reoccur.
GENERAL BUDGETING HIGHLIGHTS

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An operating budget was adopted and maintained by the governing board for the District pursuant to the requirements of Florida Statutes. The budget is adopted using the same basis of accounting that is used in preparation of the fund financial statements. The legal level of budgetary control, the level at which expenditures may not exceed budget, is in the aggregate. Any budget amendments that increase the aggregate budgeted appropriations must be approved by the Board of Supervisors. Actual general fund expenditures did not exceed appropriations for the fiscal year ended September 30, 2018.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
At September 30, 2018, the District had $4,588,335 invested in capital assets for its governmental activities. More detailed information about the District's capital assets is presented in the notes of the financial statements.
Capital Debt
At September 30, 2018, the District had $5,160,000 of Bonds outstanding for its governmental activities. More detailed information about the District's capital debt is presented in the notes of the financial statements.

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MAGIC RESERVE COMMUNITY DEVELOPMENT DISTRICT OSCEOLA COUNTY, FLORIDA

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STATEMENT OF NET POSITION SEPTEMBER 30, 2018

Governmental
 	Activities	

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ASSETS
Cash	$	79,864
Assessments receivable	3,337

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Prepaids and deposits	10,920
Restricted assets:
Investments	584,369

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Interest receivable	144
Capital assets:	 	

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N-:>ndepreciable	4,588,335
Total assets	 	5,266,969 

LIABILlllES
Accounts payable	3,187

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Accrued interest payable	111,645
N-:>n-current liabilities:	 	

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Due INithin one year	80,000
Due in more than one year		5,080,000 Total liabilities	 	5,274,832 

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NET POSlllON
Net investment in capital assets	(566,569)

90,934

Restricted for debt service		467,772 Unrestricted	 		

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Total net position	$	(7,863)

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See notes to the financial statements

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MAGIC RESERVE COMMUNITY DEVELOPMENT DISTRICT OSCEOLA COUNTY, FLORIDA
BALANCE SHEET

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GOVERNMENTAL FUNDS SEPTEMBER 30, 2018

 	IVajQr Funds	
Debt	Capital

Total
Go-.ernmental

ASSETS

 	General	Ser\Jice	Project           s	Funds	

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Cash	$	$	$	$	79,864

l nwstments	579,274	5,095
Assessments receivable	3,337
Interest receivable	143	1

584,369
3,337
144

Prepaids and deposits	 	10,920	10,920 
Total assets	$	94,121	$	579,417	$	5,096	$	678,634
LIABILITIES AND FUND BALANCES

Accounts payable	$	3,187	$	$

$	3,187

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0	Liabilities:	 	
Total liabilities	 	3,187	3,187 

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Fund balances: Nonspendable:

Prepaid items	10,920
Restricted for:
Debt service	579,417
D	Capital projects	5,096

10,920

579,417

Unassigned	 	80,014	80,014 
□	Total fund balances	 	90,93          4	579,417	5,09         6	675,447 

Total liabilities and fund balances	$	94,121	$	579,417	$	5,096

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See notes to the financial statements

$	678,634

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MAGIC RESERVE COMMUNITY DEVELOPMENT DISTRICT OSCEOLA COUNTY, FLORIDA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018

 	Major Funds		Total

Debt

Capital

Governmental

 	General	Service	Project         s	Funds	
REVENUES

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Assessments	158,730	364,810	523,540	
Interest income	1,089	1,102	
Miscellaneous	 	219	219	
Total revenues	 	158,949	365,899	332,136	856,984 	

Developer contributions

$	$	$

332,123	$	332,123

EXPENDITURES
Current
General government Debt service:
0	Interest

60,597

262,306

60,597

262,306

Capital outlay
Total expenditures

E>eess (deficiency) of revenues

 	11,048	11,048
 	60,597	262,30               6	11,048	333,951

over (under) expenditures

98,352

103,593

321,088

523,033

lnterfund transfers

(10,190)

10,190

0	On-tER FINANCING SOURCES (USES)	 	
Total other financing sources (uses)	 	(10,190)	10,190	

Net change in fund balances

88,162

103,593

331,278

523,033

Fund balances - beginning

 	2,772	475,824	(326,182)	152,414

Fund balances - ending

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$	90,934	$	579,417	$

See notes to the financial statements

5,096	$	675,447

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MAGIC RESERVE COMMUNITY DEVELOPMENT DISTRICT OSCEOLA COUNTY, FLORIDA
NOTES TO FINANCIAL STATEMENTS

NOTE 1 - NATURE OF ORGANIZATION AND REPORTING ENTITY

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Magic Reserve Community Development District ("District") wascreated on March 23, 2016 by Ordinance No. 2016-28 of Osceola County and established 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, power to borrowmoney andissuebonds, and to levy and assess non-ad valorem assessments for the financing and delivery of capital infrastructure.
The District was established for the purposes of financing and managing the acquisition, construction, maintenance and operation of a portion of the infrastructure necessary for community developmentwithinthe District.

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The District is governed by the Board of Supervisors ("Board"), which is composed of five members. The Supervisors are presently elected on an at large basis by the owners of the property within the District. Ownership of land within the District entitles the owner to one vote per acre. The Board exercises all powers granted to the District pursuant to Chapter 190, Florida Statutes. At September 30, 2018 all of the Board members are affiliated with Magic Village 2, LLC. ("Developer").
The Board has the final responsibility for, among other things:
Assessing and levying assessments.
Approving budgets.

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Exercising control over facilities and properties.
Controlling the use of funds generated by the District.
Approving the hiring and firing of key personnel.
Financing improvements.

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The financial statements were prepared in accordance with Governmental Accounting Standards Board ("GASB") Statements. Under the provisions of those standards, the financial reporting entity consists of the primary government, organizations for which the District is considered to be financially accountable and other organizations for which the nature and significance of their relationship with the District are such that, if excluded, the financial statements of the District would be considered incomplete or misleading. There are no entities considered to be component units of the District; therefore, the financial statements include only the operations of the District.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Government-Wide and Fund Financial Statements

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The basic financial statements include both government-wide and fund financial statements.

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

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D	NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

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□	Assets, Liabilities and Net Position or Equity
Restricted Assets
These assets represent cash and investments set aside pursuant to Bond covenants or other contractual restrictions.
Deposits and Investments
The District's cash on hand and demand deposits are considered to be cash and cash equivalents.
The District has elected to proceed under the Alternative Investment Guidelines as set forth in Section
218.415 (17) Florida Statutes. The District may invest any surplus public funds in the following:

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The Local Government Surplus Trust Funds, or any intergovernmental investment pool authorized
pursuant to the Florida lnterlocal Cooperation Act;
Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency;

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Interest bearing time deposits or savings accounts in qualified public depositories;
Direct obligations of the U.S. Treasury.

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

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The District records all interest revenue related to investment activities in the respective funds. Investments are measured at amortized cost or reported at fair value as required by generally accepted accounting principles.

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

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Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements.
Capital Assets
Capital assets which include property, plant and equipment, and infrastructure assets (e.g., roads, sidewalks and similar items) are reported in the government activities columns in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 (amount not rounded) and an estimated useful life in excess of two years. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed.
No depreciation has been taken in the current fiscal year as the District's infrastructure and other capital assets are under construction.
Unearned Revenue
Governmental funds report unearned revenue in connection with resources that have been received, but not yet earned.

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D	NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Other Disclosures
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those estimates.
NOTE 3 - BUDGETARY INFORMATION

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

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Each year the District Manager submits to the District Board a proposed operating budget for the fiscal year commencing the following October 1.
Public hearings are conducted to obtain public comments.
Prior to October 1, the budget is legally adopted by the District Board.
Subject to certain limited exceptions set forth in the District's annual appropriations resolution, all budget changes must be approved by the District Board.
The budgets are adopted on a basis consistent with generally accepted accounting principles.

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Unused appropriation for annually budgeted funds lapse at the end of the year.
NOTE 4 - DEPOSITS AND INVESTMENTS

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Deposits

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The District's cash balances were entirely covered by federal depository insurance or by a collateral pool pledged to the State Treasurer. Florida Statutes Chapter 280, "Florida Security for Public Deposits Act", requires all qualified depositories to deposit with the Treasurer or another banking institution eligible collateral equal to various percentages of the average daily balance for each month of all public deposits in excess of any applicable deposit insurance held. The percentage of eligible collateral (generally, U.S. Governmental and agency securities, state or local government debt, or corporate bonds) to public deposits is dependent upon the depository's financial history and its compliance with Chapter 280. In the event of a failure of a qualified public depository, the remaining public depositories would be responsible for covering any resulting losses.
Investments
The District's investments were held as follows at September 30. 2018:

Amortized Cosl
US Bank Money Market     ...s 	__...584 ......,.36,__9__ Total rm.estments	-$ 		584-136,_9_

Credit Risk NIA

Maturities
NIA

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Credit risk- For investments, credit risk is generally the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Investment ratings by investment type are included in the preceding summary of investments.

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Concentration risk- The District places no limit on the amount the District may invest in any one issuer.
Interest rate risk- The District does not have a formal policy that limits investment maturities as a means of managing exposure to fair value losses arising from increasing interest rates.
However, the Bond Indenture limits the type of investments held using unspent proceeds.

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0		NOTE 7 - LONG-TERM LIABILITIES Series 2016

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On October 5, 2016, the District issued $5,160,000 of Special Assessment Revenue Bonds, Series 2016 consisting of $865,000 Term Bonds Series 2016 due on November 1, 2026 with a fixed interest rate of 4.500%, $1,685,000 Term Bonds Series 2016 due on November 1, 2037 with a fixed interest rate of 5.125%, and $2,610,000 Term Bonds Series 2016 due on November 1, 2047 with a fixed interest rate of 5.250%. The Bonds were issued to finance the acquisition and construction of certain improvements for the benefit of the District. Interest is to be paid semiannually on each May 1 and November 1. Principal on the Bonds is to be paid serially commencing November 1, 2018 through November 1, 2047.

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The Series 2016 Bonds are subject to redemption at the option of the District prior to their maturity. The Bonds are subject to extraordinary mandatory redemption prior to their selected maturity in the manner determined by the Bond Registrar if certain events occurred as outlined in the Bond Indenture.

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The Bond Indenture established a debt service reserve requirement as well as other restrictions and requirements relating principally to the use of proceeds to pay for the infrastructure improvements and the procedures to be followed by the District on assessments to property owners. The District agrees to levy special assessments in annual amounts adequate to provide payment of debt service and to meet the reserve requirements. The District was in compliance with the requirements at September 30, 2018.
Long-term Debt Activity
Changes in long-term liability activity for the fiscal year ended September 30, 2018 were as follows:

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Beginning	Ending	Due Within
Balance	Additions	Reductions	Balance	One Year

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Gamminta1 i!!:.li�i�!l
Series 2016 Bonds	s   5,160,000   s	$	s   5,160,000    s	80,000
Total	s   5,160,000   s	$	s   5,160,000    s	80,000

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At September 30, 2018, the scheduled debt service requirements on the long-term debt were as follows:

Year ending

September 30:
2019
2020

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2021
2022
2023
2024-2028
2029-2033
2034-2038
2039-2043

Gowmmental Acti-.tt1es

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Principal	Interest
s	80,000     $	260,506 s
85,000	256,794
85,000	252,969
90,000	249,031
95,000	244,869
550,000	1,1 53,656
685,000	1,001 ,722
880,000	802,488
1,135,000	542, 194

Total
340,506
341,794
337,969
339,031
339,869
1,703,656
1,686,722
1,682,488
1,6TT,194

2044-2048	 	1 ,475,000	201,469	1,676,469 
s  5,160,000   $    4,965,698    $ 10,125,698
NOTE 8 - DEVELOPER TRANSACTIONS AND CONCENTRATION

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The Developer owns a portion of land within the District; therefore, assessment revenues in the general and debt service funds include the assessments levied on those lots owned by the Developer. In addition, during the current fiscal year the Developer provided contributions to the capital projects fund of $332, 123 at September 30, 2018.
The District's activities are dependent on the continued involvement of the Developer, the loss of which could have a material adverse effect on the District's operations.
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MAGIC RESERVE COMMUNITY DEVELOPMENT DISTRICT OSCEOLA COUNTY, FLORIDA
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL - GENERAL FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018

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Budgeted		Variance wth Final
Budget -	
	Arrounts	Actual	Positi-..e	
	Original & Final	Arrounts	(Negati-..e}	

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REVENUES
Assessments	$	$	158,730	$	158,730

Miscellaneous		219	219	
Total re-..enues	145,650	158,949	13,299	

De-..eloper contribution	145,650	(145,650)

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EXPEl'OITURES

General go-..ernment	79, 075	60,597	18.478	
Main1enance and operations	66,575		66,575	

Current

D	Total e�nditures	 	145,65               0	60,597	85,053 

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E>cess (deficiency) of re-..enues	 	
o-..er (under) e,<penditures	98,352	98,352

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On-E R FINANCING SOURCES
Transfer in (out)	(10,190}	(10,190}

Net change in fund balances	$	88,162	$	88,162

0

Fund balance - beginning	 	2,772 

Fund balance - ending	$

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See notes to required supplementary information

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D	Grau & Associates
CERTIFIED  PUBLIC  ACCOUNTANTS

951 Yamato Road • Suite 280 Boca Raton, Florida 33431 (561) 994-9299 • (800) 299-4728
Fax (561) 994-5823
www.graucpa.com

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INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENTAUDITING STANDARDS
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To the Board of SupeivtSors
Magic Reserve Community Development District Osceola County, Florida

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We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in GovernmentAuditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities and each major fund of Magic Reserve Community Development District, Osceola County, Florida ("District") as of and for the fiscal year ended September 30, 2018, and the related notes to the financial statements, which collectively comprise the District's basic financial statements, and have issued our opinion thereon dated June 18, 2019.
Internal Control Over Financial Reporting

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

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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.

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Compliance and Other Matters

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

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D	Grau& Associates
CERTIFIED   PUBLIC ACCOUNTANTS

951 Yamato Road • Suite 280 Boca Raton, Florida 33431 (561) 994-9299 • (800) 299-4728
Fax (561) 994-5823
www.graucpa.com

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

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To the Board of Supervisors
Magic Reserve Community Development District Osceola County, Florida

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We have examined Magic Reserve Community Development District, Osceola County, Florida's ("District") compliance with the requirements of Section 218.415, Florida Statutes, in accordance with Rule 10.556(10) of the Auditor General of the State of Florida during the fiscal year ended September 30, 2018. Management is responsible for District's compliance with those requirements. Our responsibility is to express an opinion on District's compliance based on our examination.

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Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we plan and perform the examination to obtain reasonable assurance about whether the District complied, in all material respects, with the specified requirements referenced in Section 218.415, Florida Statutes. An examination involves performing procedures to obtain evidence about whether the District complied with the specified requirements. The nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material noncompliance, whether due to fraud or error. We believe that the evidence we obtained is sufficient and appropriate to provide 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 fiscal year ended September 30, 2018.

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This report is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senateand the Florida House of Representatives, the Florida Auditor General, management, and the Board of Supervisors of Magic Reserve Community Development District, Osceola County, Florida and is not intended to be and should not be used by anyone other than these specified parties.
a	June 18, 2019
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REPORT TO MANAGEMENT

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D

CURRENT YEAR FINDINGS AND RECOMMENDATIONS None.
PRIOR YEAR FINDINGS AND RECOMMENDATIONS None
Ill. COMPLIANCEWITH THE PROVISIONS OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA

0

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

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

There were no significant findings and recommendations made in the preceding annual financial audit report for the period ended September 30, 2017.
Any recommendations to improve the local governmental entity's financial management.

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There were no such matters discovered by, or that came to the attention of, the auditor, to be reported for the fiscal year ended September 30, 2018.

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

There were no such matters discovered by, or that came to the attention of, the auditor, to be reported, for the fiscal year ended September 30, 2018.

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The name or official title and legal authority of the District are disclosed in the notes to the financial statements.
The District has not met one or more of the financial emergency conditions described in Section 218.503(1), Florida Statutes.

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We applied financial condition assessment procedures and no deteriorating financial conditions were noted as of September 30, 2018. It is management's responsibility to monitor financial condition, and our financial condition assessment was based in part on representations made by management and the review of financial information provided by same.
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