south central planning and development commission · tommy eschete charlotte randolph mark...
TRANSCRIPT
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Financial Report
South Central Planning &
Development Commission^ Inc.
Houma, Louisiana
For the year ended June 30,2014
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TABLE OF CONTENTS
South Central Planning & Development Commission, Inc.
June 30, 2014
Page Exhibit Number
Introductory Section
Title Page
Table of Contents
Principal Officials
Financial Section
Independent Auditor's Report
Management's Discussion and Analysis
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position
Statement of Activities
Fund Financial Statements:
Governmental Funds:
Balance Sheet
Reconciliation of the Balance Sheet - Governmental Funds to the Statement of Net Position
Statement of Revenues, Expenditures and Changes in Fund Balances
A
B
D
11 - IV
V-VI
1-3
4-11
12
13
14
15
16
11
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TABLE OF CONTENTS
(Continued)
Exhibit
Financial Section (continued)
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds to the Statement of Activities
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund
Statement of Revenues, Expenditures and Changes in Fund Balance- Budget and Actual- Loan Fund
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Grant Fund
Proprietary Fund:
F
G
H
Schedule
Supplementary Information Section
Combining Balance Sheet - Loan Programs
Combining Statement of Revenues, Expenditures and Changes in Fund Balance - Loan Programs
Combining Statement of Revenues, Expenditures and Changes in Fund Balance - Grant Programs
1
2
3
Page Number
17
18
19
20
Statement of Net Position J 21
Statement of Revenues, Expenses and Changes in Net Position K 22
Statement of Cash Flows L 23
Notes to Financial Statements M 24-44
45
46
47-48
111
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TABLE OF CONTENTS
(Continued)
Special Reports of Certified Public Accountants
Page Number
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 49 - 50
Independent Auditor's Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by 0MB Circular A-133 51 - 53
Schedule of Expenditures of Federal Awards 54-55
Notes to Schedule of Expenditures of Federal Awards 56 - 57
Schedule of Findings and Questioned Costs 58-59
Reports By Management
Schedule of Prior Year Findings and Questioned Costs 60
Management's Corrective Action Plan 61
IV
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PRINCIPAL OFFICIALS
South Central Planning & Development Commission, Inc.
as of June 30, 2014
V. St. Pierre, Jr. Chairman
Arlanda Williams Vice Chairman
Timmy Roussel Secretary
Ellis Alexander Treasurer
Officers
St. Charles Parish
Terrebonne Parish
St. James Parish
St. Charles Parish Commissioners
Martin Triche JeffNaquin Willie Reed Tommy Eschete Charlotte Randolph Mark Atzenhoffer A1 Archer Wendy Bendetto Ken Brass Michael R. Guillot, Jr. Natalie Robottom Dr. Henry Hardy Randy Noel Leroy Mitchell Michel Claudet A1 Badeaux, Jr. Marvin Marmande, Jr. Leroy Charles John Rogers Joey Bouziga Terry Borne Paul Champagne Rowdy Scott Ron Animashaun
Chief Executive Officer Kevin P. Belanger
Assumption Parish Assumption Parish Assumption Parish City of Thibodaux Lafourche Parish Lafourche Parish Lafourche Parish St. Charles Parish St. James Parish St. James Parish St. John the Baptist Parish St. John the Baptist Parish St. John the Baptist Parish St. John the Baptist Parish Terrebonne Parish Terrebonne Parish Terrebonne Parish Terrebonne Parish Terrebonne Parish Town of Golden Meadow Town of Gramercy Town of Lockport Town of Lutcher Village of Napoleonville
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PRINCIPAL OFFICIALS
South Central Planning & Development Commission, Inc.
As of December 31, 2013
Officers
VJ St. Pierre Chairman
Arlanda Williams Vice Chairman
Ellis Alexander Secretary
A1 Badeaux, Jr. Treasurer
Martin Triche Calvin James Willie Reed Tommy Eschete Charlotte Randolph Wendy Bendetto Timmy Roussel Ken Brass Michael R. Guillot, Jr. Natalie Robottom Leroy Mitchell Randy Noel Dr. Henry Hardy Michel Claudet Marvin Marmande, Jr. Leroy Charles Gordon Crowe John Rogers Joey Bouziga Terry Borne Paul Champagne Rowdy Scott Ron Animashaun
Commissioners
Chief Executive Officer Kevin P. Belanger
St. Charles Parish
Terrebonne Parish
St. Charles Parish
Terrebonne Parish
Assumption Parish Assumption Parish Assumption Parish City of Thibodaux Lafourche Parish St. Charles Parish St. James Parish St. James Parish St. James Parish St. John the Baptist Parish St. John the Baptist Parish St. John the Baptist Parish St. John the Baptist Parish Terrebonne Parish Terrebonne Parish Terreboime Parish Terrebonne Parish Terrebonne Parish Town of Golden Meadow Town of Gramercy Town of Lockport Town of Lutcher Village of Napoleonville
VI
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FINANCIAL SECTION
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Bourgeois Bennett C^CERTIFIED PUBLIC ACCOUNTANTS | CONSULTANTS
- A LIMITED LIABILITY COMPANY
INDEPENDENT AUDITOR'S REPORT
To the Board of Commissioners, South Central Planning & Development Commission, Inc.,
Houma, Louisiana.
We have audited the accompanying financial statements of the governmental activities, the business-type activities and each major fund of the South Central Planning & Development Commission, Inc. (the Commission) as of and for the year ended June 30, 2014, and the related notes to the financial statements, which collectively comprise the Commission's basic financial statements as listed in the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting
1 P.O. BOX 2168 • HOUMA, LA 70361-2168 | 985.868.0139
507 ST. PHILIP STREET, SUITE D • THIBODAUX, LA 70301 I 985.447.5243 I BOURGEOISBENNETT.COM
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policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the fmaneial statements referred to above present fairly, in all material respects, the respective fmaneial position of the governmental activities, the business-type activities and each major fiind of the South Central Planning & Development Commission, Inc., as of June 30, 2014, and the respeetive changes in financial position and cash flows, where applicable, thereof and the respective budgetary comparison for the General Fund, Loan Fund and Grant Fund for the year then ended in accordance with accounting principles generally aceepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis on pages 4 through 11 be presented to supplement the basie financial statements. Sueh information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, eeonomic, or historical context. We have applied certain limited procedures to the required supplementary information in accordanee with auditing standards generally aeeepted in the United States of America, which consisted of inquires of management about the methods of preparing the information and comparing the information for eonsistency with management's responses to our inquires, the basic financial statements, and other knowledge we obtained during our audit of the basie fmaneial 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 assuranee.
Other Information
Our audit was condueted for the purpose of forming opinions on the financial statements that colleetively eomprise the Commission's fmaneial statements as a whole. The listing of Principal Officials and Combining Balance Sheet and Combining Statements of Revenues, Expenditures and Changes in Fund Balance - Loan Programs and Grant Programs are presented for purposes of additional analysis and are not a required part of the financial statements. The accompanying Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by U.S. Office of Management and Budget Cireular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is also not a required part of the basic financial statements.
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The Combining Balance Sheet and Combining Statements of Revenues, Expenditures and Changes in Fund Balance - Loan Programs, Grant Programs, and the Schedule of Expenditures of Federal Awards are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Such information has been subjected to the auditing procedures applied in the audit of basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.
The listing of Principal Officials has not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on it.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 22, 2014 on our consideration of South Central Planning & Development Commission, Inc.'s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the 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 South Central Planning & Development Commission's internal control over financial reporting and compliance.
Certified Public Accountants.
Houma, Louisiana, December 22, 2014.
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MANAGEMENT'S DISCUSSION AND ANALYSIS
South Central Planning and Development Commission, Inc.
The Chief Executive Officer and Chief Administrative Officer are responsible for the overview and analysis of the financial activities of South Central Planning & Development Commission, Inc. (the Commission) for the year ended June 30, 2014. The narrative provided is designed to introduce the financial highlights and offer an overview of our financial statements.
Management's Discussion and Analysis (MD&A) is designed to focus on the current year's activities, resulting changes and facts known to date. This narrative includes a government-wide financial analysis of revenues, expenses and changes in the net position. Further detail offers our readers a financial analysis of the Commission's funds consisting of the governmental fund types and proprietary funds.
FINANCIAL HIGHLIGHTS
Assets of the Commission exceeded its liabilities at June 30, 2014 by $14,518,553 (net position). Of this amount, $1,488,458 (unrestricted net position) may be used to meet the Commission's ongoing obligations.
The Commission's total net position increased by $1,071,065 for the year ended June 30, 2014. The business-type net position increased by $102,157 for the year ended June 30, 2014.
The Commission's governmental funds reported that total assets increased by $824,747 or 7.05%. Total governmental fund assets exceeded liabilities at June 30, 2014 by $2,887,002 (fund balance) a decrease of $50,786 or 1.73%. Of this $2,887,002 fund balance, $41,908 is held in nonspendables, $1,842,252 is restricted for use in loan and grant programs, $250,000 is restricted for capital projects, $70,000 is assigned for building construction, and $682,842 is unassigned in the General Fund.
Operating grants and contributions in governmental activities decreased by $312,973 or 12.39% mostly due to a decrease in loan fund revenue. Charges for services revenue increased by $811,271 or 74.99% mostly due to an increase in contracts with Louisiana Department of Transportation and Development and My Government Online contracts with governmental jurisdictions. Capital grants and contributions increased by $152,362 or 34.97% due to an increase in revenue from the Environmental Protection Agency.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to South Central Planning & Development Commission's basic financial statements. South Central Planning & Development Commission'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
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report also contains other supplementary information in addition to the basic financial statements themselves.
Government-Wide Financial Statements
The government-wide financial statements, reported in Exhibits A and B, are designed to be similar to private-sector business in that all governmental and business-type activities are consolidated into columns which add to a total for the primary government. These statements combine governmental funds' current financial resources with capital assets and long-term obligations. Also presented in the government-wide financial statements is a column for the business-type activities of the primary government.
The Statement of Net Position, reported in Exhibit A, presents information on all the Commission's assets and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the Commission is improving or deteriorating.
The Statement of Activities, reported in Exhibit B, presents information showing how the government's net position changed during the most recent fiscal year. All changes in the assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the 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. For example, earned but unused vacation leave result in cash flows for future periods. The focus of the Statement of Activities is on both the gross and net cost of various activities, which are provided by the government's general dues assessment and other revenues. This is intended to summarize information and simplify the user's analysis of cost of various governmental services and the business-type activity.
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. Traditional users of governmental financial statements will find the fund financial statements presentation more familiar. The focus is now on major funds, rather than generic fund types. All funds of the Commission can be divided into two categories: governmental funds and proprietary funds.
Governmental Funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. The governmental major fund presentation in Exhibits C through I is presented on a sources and uses of liquid resources basis. This is the manner in which the financial budget is typically developed. Unlike the government-wide financial statements, governmental fund financial statements focus on near-term 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 government's current financing requirements. The Commission has presented the following major funds: General Fund, Loan Fund, Capital Projects Fund and the Grant Fund.
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There are no non-major governmental funds.
Proprietary Funds include an enterprise fund on the fund financial statements illustrated in Exhibits J through L. Enterprise funds are used to account for operations financed and operated in a manner similar to private business enterprises. The Enterprise Fund is presented as a major fund - the Regional Building Code Fund. The intent is that costs of goods or services to the general public on a continuing basis be financed primarily through user charges.
While the business-type fund financial statements for the enterprise fund (See Exhibits J through L) is the same as the business-type column, the government-wide financial statement and the governmental funds total column requires a reconciliation because of the different measurement focus which is reflected on the page following each governmental fund statement (see Exhibits D and F). The flow of current financial resources will reflect loan collections as revenues and interfund transfers as other financial sources as well as capital outlay and loan disbursements as expenditures. The reconciliation will eliminate these transactions and incorporate the capital assets and long-term obligations into the governmental activities column in the government-wide statements.
Capital Assets
General capital assets include construction in progress, buildings and furniture, fixtures and equipment and intangible assets that are used in operations and exceed the Commission's capitalization threshold, as explained in Note Ih), Exhibit M. Accumulated depreciation and amortization is recorded for the life span of the asset.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements are a required part of the financial statements and can be found in Exhibit M of this report.
Other Information
Other supplementary financial information can be found in Schedules 1 through 3 of this report and presents the Combining Balance Sheet of Loan Programs and Combining Statements of Revenues, Expenditures and Changes in Fund Balance for the various loan and grant programs.
Also included in the report are special auditor reports on internal control over financial reporting, compliance and other matters, findings and schedules as required by government auditing standards. The Office of Management and Budget through its Circular A-133 requires a Schedule of Expenditures of Federal Awards. This schedule presents required information about the Commission's federally funded programs in a manner that can facilitate financial and compliance analysis by agencies that have granted Federal money to the Commission.
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Government-Wide Financial Analysis
The table below reflects the condensed Statement of Net Position at June 30, 2014 with comparative figures from June 30, 2013:
TABLE A-1 Condensed Statement of Net Position
Governmental Activities Business-type Activities Totals
2014 2013 2014 2013 2014 2013 Current and other assets $ Capital assets
12,516,937 1,830,226
$ 11,658,584 1,473,695
$ 861,254 219,408
$ 740,890 232,150
$ 13,378,191 2,049,634
$ 12,399,474 1,705,845
Total assets $ 14,347,163 $ 13,132,279 $ 1,080.662 $ 973,040 $ 15,427.825 $ 14,105,319
Long -term liabilities $ Other liabilities
330,792 169.109
$ 61,324 426,893
$ 38,349 48,405
$ 37,734 43.555
$ 369,141 217,514
$ 99,058 470,448
Total liabilities 499,901 488.217 86,754 81,289 586.655 569,506
Deferred inflows of resources 322,617 88,325 322,617 88,325
Net assets: Net investment in capital assets Restricted for Loan Fund Unrestricted
1,830,226 10,980,461
713,958
1,473,695 10,288,208
793,834
219,408
774,500
232,150
659.601
2,049,634 10,980,461
1,488,458
1,705,845 10,288,208 1,453,435
Total net position 13,524,645 12,555.737 993,908 891,751 14,518,553 13,447,488
Total liabilities and net position $ 14,347,163 $ 13,132,279 $ 1,080,662 $ 973,040 $ 15,427,825 $ 14,105,319
For more detailed information see Exhibit A, the Statement of Net Position.
Approximately 14.12% of the Commission's net position as of June 30, 2014, reflect the Commission's investment in capital assets (construction in progress, buildings, furniture, fixtures, equipment and intangible assets), 75.63% is restricted for future Loan Program loans, and the remaining 10.25% of net position, referred to as unrestricted, may be used to meet the ongoing obligations of the Commission.
The table on the following page provides a summary of the changes in net position for the year ended June 30, 2014, with comparative figures from June 30, 2013:
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Table A-2 Condensed Statement of Changes in Net Position
Governmental Activities Business-type
Activities Total For the year ended June 30, For the vear ended June 30, For the year ended June 30, 2014 2013 2014 2013 2014 2013
Revenues Program revenues;
Charge for services $ 1,893,179 $ 1,081,908 $ 1,684,323 $ 1,513,605 $ 3,577,502 $ 2,595,513 Operating grants and contrtoutions 2,212,366 2,525,339 - 2,212,366 2,525,339 Capital grants and contributions 587,994 435,632 - 587,994 435,632
General revenues: Dues assessment 133,418 133,478 - 133,418 133,478 Grants and contributions not restricted
to specific programs 68,089 48,636 - 68,089 48.636 Unrestricted investment earnings 127 221 293 226 420 447 Miscellaneous 26,612 21,554 7,769 26,612 29,323 Transfers . 214,458 (214,458) - -
Total revenues 4,921,785 4,461,226 1,684,616 1,307,142 6,606,401 5,768,368
Expenses Economic Development and Assistance 3,952,877 3,107,828 1,582,459 1,457,932 5,535,336 4,565,760
Change in net assets 968,908 1,353,398 102,157 (150,790) 1,071,065 1,202,608
Net Position Beginning net position 12,555,737 11,202,339 891,751 1,042,541 13,447,488 12,244,880 Ending net position $ 13.524,645 $ 12,555,737 $ 993,908 $ 891,751 $ 14,518,553 $ 13,447,488
The Commission's net position increased by $1,071,065 during the current fiscal year.
Governmental Activities net position increased $968,908, primarily due to an increase in charges for services.
Business-Type Activities net position increased by $102,157, due to an increase in charges for services resulting from permits being issued by the member parishes.
Financial Analysis of the Commission's Funds
The Commission uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
Governmental Funds:
The focus of the Commission's governmental funds is to provide information on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing the Commission's financing requirement. In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. The combined fund balance of the Commission's governmental funds at June 30, 2014 was $2,887,002 as compared to $2,937,788 at June 30, 2013, a decrease of $50,786. Revenues for the Commission's governmental funds for the year ended June 30, 2014 were approximately $6.7 million. There are four funding categories: intergovernmental (36.18%), charges for services (28.17%), interest earned (3.90%), and miscellaneous (31.75%).
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The Commission's governmental expenditures were approximately $7.0 million for the year ended June 30, 2014. There are six categories of expenditures: personal services (28.00%), supplies and materials (1.68%), other services and charges (15.78%), loan dishursements (47.03%), repairs and maintenance (.58%), and capital expenditures (6.93%).
An increase in other services and charges of $154,992 was mostly due to professional services for Environmental Protection Agency grants. The personal services category increased $164,562 due to a cost of living and merit increases for employees. The loan disbursements decreased $170,906 due to fewer loan closings. A $49,196 increase in the supplies and materials category was due to additional supply purchases for all funds. There was an increase of $4,694 in the repairs and maintenance category and an increase of $280,114 capital expenditures due to capitalized intangibles for My Government Online software and architectural fees for the building addition.
The Commission's financial position declined by $50,786 over the past year due to an excess of expenditures over revenues, mostly due to more loan closings than principal payments received over the past year. Because, the Commission constantly faces the possibility of funding cuts from state and federal ftinding sources there is a continued effort to aggressively seek additional revenue sources for future ftinding.
Fund Analysis
General Fund:
The General Fund is the chief operating fund of the Commission. At the end of the current fiscal year, the total fund balance of the General Fund was $794,750. Of this amount, $41,908 was nonspendable, $70,000 was assigned for building construction and the remainder of fund balance, $682,842 is unassigned. During the current fiscal year, the fund balance of the Commission's General Fund, decreased by $60,408 (Exhibit E). The key factor of this decrease was due to inereases in capital expenditures.
Loan Fund:
The Commission maintains seven loan programs. The loan programs are federally funded. The expenditures consist primarily of loan disbursements.
Capital Projects Fund:
The Commission maintains the proceeds from the certificate of indebtedness issue in 2014 and all related expenditures for the addition to the existing building.
Grant Fund:
The Commission maintains seventeen individual grant programs. These programs are generally reimbursed by federal/state grants. Expenditures in excess of the grants are covered by transfers from the General Fund.
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Proprietary Funds:
The Commission's proprietary fund provides the same type of information found in the government-wide financial statements, but in more detail.
Unrestricted net position of the Regional Building Code Fund at June 30, 2014 amounted to $774,500 (Exhibit J). This fund is used to account for revenues and expenses associated with its operation and is self-supporting. This fund encompasses all assets associated with its operation. Net investment in capital assets, construction in progress, equipment and intangibles, at the end of the current fiscal year totaled $219,408 (Exhibit J). During the year ended June 30, 2014, the proprietary fund recognized operating income of $101,864 due to an upturn of the economy of the Commission's area of service.
Budgetary Highlights
Budgets are presented to the Board of Commissioners and adopted as required by Louisiana Revised Statutes. As needed budget adjustments are made to account for any significant deviation from beginning year projections. The major difference between the original General Fund budget and the final amended budget was for a decrease in intergovernmental revenues and an increase in charges for services revenues while budgeted expenditures were decreased in personal services and other services and charges and increased in capital expenditures.
Budgets are also presented for the Commission's special revenue funds: the Loan Fund and Grant Fund. Differences in the original and final Loan Fund budget were decreases in intergovernmental revenues and loan distributions as a result of fewer loan closings than anticipated. Differences in the original and final Grant Fund budgets are decreases in revenues and expenditures due to receipt of fewer grants.
Capital Asset And Long-Term Debt Administration
The Commission's investment in capital assets for its governmental and business-type activities as of June 30, 2014, amounts to $2,049,634 (net of accumulated depreciation). This investment in capital assets includes construction in progress, buildings, furniture, fixtures, equipment and intangible assets as shown in Table A-3. This amount represents a net increase of $343,789 over last year.
Table A-3 Capital Assets
(Net of depreciation)
Governmental Business-type Activities Activities Total June 30. June 30, June 30,
2014 2013 2014 2013 2014 2013 Buildings $ 1,134,706 $ 1,168,631 $ $ - $ 1,134,706 $ 1,168,631 Furniture, equipment
and fixtures 145,029 59,797 31,623 47,044 176,652 106,841 Intangibles 429,588 231,601 150,886 185,106 580,474 416,707 Construction in progress 120,903 13,666 36,899 - 157,802 13,666
Totals $ 1,830,226 $ 1,473,695 $ 219,408 $ 232,150 $ 2,049,634 $ 1,705,845
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Significant capital asset activity was the development costs, $249,404, of software, professional fees incurred for design of the building addition, $107,237, and purehases of equipment amounting to $130,472.
Additional information on the Commission's eapital assets can be found in Note 5, Exhibit M of this report.
On May 14, 2014, the Commission issued $250,000 of certificates of indebtedness, series 2014A for the purpose of making eapital improvements. The certifieates mature on May 1, 2021 and with an interest rate of 4.50%. Interest payments are due quarterly beginning on August 1, 2014. Principal is due annually beginning May 1, 2015. Additional information on the Commission's long-term debt ean be found in Note 7, Exhibit M of this report.
Economic Factors and Next Year's Budget and Rates
The Board of Commissioners and management considered many factors when setting the fiscal year 2015 budget. These factors include any unusual conditions, one time expenditures and increases in rates or fees that oceurred during the 2014 fiscal year or that have already been announced for the 2015 fiscal year.
Governmental revenues for fiscal year 2015 are projeeted to be $8,395,680, a increase of $1,674,708 over the 2014 fiscal year revenues. Budgeted expenditures are expected to increase to $8,731,718, a increase of $1,709,960 over the 2014 fiscal year expenditures. The most significant increases are due to the anticipated revenues and expenditures on Louisiana Department of Transportation grants and additional My Government Online contracts. The Commission's governmental fund balanee is budgeted for a deerease of $336,038, General Fund an inerease of $145,120 and Loan Fund decrease of $481,158. However, as additional eontracts are obtained, amendments will be executed during the year.
Requests for Information
This financial report is designed to provide a general overview of the Commission's fmanees for all those with an interest in the Commission's finances. If you have any questions about this report or need additional financial information, contact South Central Planning and Development Commission, 5058 West Main Street, Houma, Louisiana 70360 or P.O. Box 1870, Gray, Louisiana 70359. General information relating to the Commission ean be found at the Commission's website, scpdc.org.
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STATEMENT OF NET POSITION
South Central Planning & Development Commission, Inc.
June 30, 2014
Exhibit A
Governmental Activities
Business-type Activities Total
ASSETS Cash and cash equivalents Receivables:
Economic loans Miscellaneous
Due from other governmental units Internal balances Prepaid insurance Prepaid maintenance Prepaid other Deposits Capital assets -
Depreciable, net of accumulated depreciation and amortization
Total assets
LIABILITIES AND DEFERRED INFLOWS OF RESOURCES Accounts payable and accrued expenses Non-current liabilities -
Due within one year Due after one year
Total liabilities
Deferred inflows of resources
NET POSITION Net Investment in eapital assets Restricted for loan programs Unrestricted
Total net position
$ 2,438,219 $ 521,859 $ 2,960,078
9,138,209 9,138,209 5,549 1,833 7,382
882,940 325,883 1,208,823 8,256 (8,256) -
28,884 19,032 47,916 - 903 903
13,024 - 13,024 1,856 - 1,856
1,830,226 219,408 2,049,634
14,347,163 1,080,662 15,427,825
169,109 48,405 217,514
40,834 2,285 43,119 289,958 36,064 326,022
499,901 86,754 586,655
322,617 322,617
1,830,226 219,408 2,049,634 10,980,461 - 10,980,461
713,958 774,500 1,488,458
$ 13,524,645 $ 993,908 $ 14,518,553
See notes to financial statements.
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Exhibit B
STATEMENT OF ACTIVITIES
South Central Planning & Development Commission, Inc.
For the year ended June 30, 2014
Ooveminental activities: Economic development
and assistance
Business-type activities: Economic development
and assistance
Totds
Program Revenue
Expenses Charges for
Services
$ 3,952,877 $ 1,893,179
Operating Grants and
Contributions
2,212,366
Capital Grants and
Contributions
587,994
1,582,459 1,684,323
1.577,502 587.994
General revenues; Dues assessment Grants and contributions not restricted to specific programs Unrestricted investment earnings Miscellaneous
Total general revenues
Change in net position
Net assets: Beginning
Ending
Net (Expense) Revenue and Change in Net Position
Governmental Activities
740,662
740.662
133,418 68,089
127 26.612
228,246
Business-type Activities
968,908
12,555.737
$ 13,524,645
101,864
101,864
293
293
102,157
891.751
993,908 $
Total
740.662
101,864
842,526
133,418 68.089
420 26,612
228.539
1,071,065
13.447.488
14.518.553
See notes to financial statements.
-
Exhibit C
South Central Planning & Development Commission, Inc.
June 30.2014
Assets
General Fund
Loan Fund
Capital Projects
Fund Grant Fund
Total Governmental
Cash S 287,826 $ 1,900,393 $ 250,000 $ 2,438,219 Receivables:
Economic loans * 9,138,209 9,138,209 Miscellaneous 5,549 5,549
Due from other governmental units 872,717 10,223 882,940 Due from other funds 18,380 - 18,380 Prepaid insurance 28,884 - 28,884 Prepaid other 13,024 - 13,024 Deposits 1.856 - 1,856
Total assets and other debits $ 1,228,236 S 11.048.825 S 250.000 s $ 12.527,061
Liabilities Accounts payable and accrued expenditures $ 110,869 s 58,240 $ 169,109 Due to other funds 10,124 10,124 Unavailable revenue 322.617 9.138,209 9.460,826
Total liabilities 433.486 9.206.573 9.640,059
Fund Balances Nonspendables 41,908 - 41,908 Restricted;
Loans 1,842,252 1,842,252 Capital projects - - $ 250,000 250,000
Assigned: Building construction 70,000 - 70,000
Unassigned 682,842 - . 682.842
Total fund balances 794,750 1.842,252 250,000 2.887,002
Total liabilities and fund balances $ 1.228,236 s 11.048,825 $ 250,000 $ S 12,527.061
See notes to financial statements,
-
Exhibit D
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET POSITION
South Central Planning & Development Commission, Inc.
June 30,2014
Fund Balances - Governmental Funds $ 2,887,002
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 governmental funds.
Governmental capital assets $ 2,701,911 Less accumulated depreciation (871,685) 1,830,226
Long-term liabilities are not due and payable in the current period and therefore are not reported in the governmental fund.
Certificates of indebtedness payable (250,000)
Unavailable revenues, that represent future collections of loans receivable, which are accounted for as increases in net position in the government-wide financial statements. 9,138,209
Non-current liabilities are not due and payable in the current period and therefore are not reported in the governmental funds.
Compensated absences payable (80,792)
Net Position of Governmental Activities $ 13,524,645
See notes to financial statements.
15
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STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES -GOVERNMENTAL FUNDS
South Central Planning & Development Commission, Inc.
For the year ended June 30,2014
Exhibit E
Revenues Intergovernmental Charges for services Interest earned Miscellaneous
Total revenues
Expenditures Current;
Economic development and assistance: Personal services Supplies and materials Other services and charges Loan disbursements Repairs and maintenance
Capital expenditures
Total expenditures
Excess (deficiency) of revenues over expenditures
Other Financing Sources (Uses) Proceeds from the issuance of certificates of indebtedness Operating transfers in Operating transfers out
Total other financing sources (uses)
Net Change in Fund Balances
Fund Balances Beginning of year
End of year
See notes to financial statements.
General Fund
Loan Fund
Capital Projects Fund
Grant Fund
Total Governmental
Funds
$ 493,534 $ 1,235,551
127 17.683
1,199,988
261,958 2,110,265
$ 737,807 657,620
6,439
$ 2,431,329 1,893,171
262,085 2,134,387
1,746,895 3,572,211 1,401,866 6,720.972
1,028,724 64,398
588,717
39,553 362,701
103,500 16,953
168,892 3,302,096
$ 107,237
833,972 36,559
350,193
1,088 17,175
1,966,196 117,910
1,107,802 3,302,096
40,641 487,113
2,084,093 3,591,441 107,237 1,238,987 7,021,758
(337.198) (19,230) (107,237) 162.879 (300,786)
465,334 (188,544)
7,277 (228,425)
250,000 144,136 (36,899)
74,031 (236,910)
250,000 690,778
(690,778)
276,790 (221,148) 357,237 (162,879) 250,000
(60,408) (240,378) 250,000 - (50,786)
855,158 2,082,630 2,937,788
$ 794,750 $ 1,842,252 $ 250,000 $ $ 2,887,002
16
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Exhibit F
RECONCILIATION OF THE STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
South Central Planning & Development Commission, Inc.
For the year ended June 30, 2014
Net Change in Fund Balances - Total Governmental Funds $ (50,786)
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense.
Capital outlay $ 487,113 Depreciation expense (130,582) 356,531
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position.
Proceeds from issuance of certificates of indebtedness (250,000)
Loan transactions are reported as revenue and expenditures in the governmental funds. In the government-wide financial statements, these transactions are accounted for as increases/decreases in assets and liabilities.
Revenue from loan collections (2,049,187) Expenditures for loan disbursements 3,302,096 Net loss on uncollectible loans (320,278) 932,631
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 the governmental funds.
Increase in compensated absences (19,468)
Change in Net Position of Governmental Activities $ 968,908
See notes to financial statements.
17
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Exhibit G
STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
GENERAL FUND
South Central Planning & Development Commission, Inc.
For the year ended June 30, 2014
Revenues Intergovernmental Charges for services Interest earned Miscellaneous
Budgeted Amounts Original
633,421 1,076,388
200 5,000
Final
511,321 1,209,627
125 14,000
Actual
493.534 1,235,551
127 17,683
Variance with Final Budget
Positive (Negative)
$ (17,787) 25,924
2 3.683
Total revenues 1,715,009 1,735,073 1,746,895
Expenditures Current:
Economic development and assistance: Personal services Supplies and materials Other services and charges Repairs and maintenance
Capital expenditures
1,101,050 35,750
875,395 33,840 10,000
1,033,895 54,410
831,271 39,480
113,340
1,028,724 64,398
588,717 39,553
362,701
Total expenditures 2,056,035 2,072,396 2,084,093
Deficiency of revenues over expenditures (341,026) (337,323) (337,198)
Other Financing Sources (Uses) Operating transfers in Operating transfers out
399,700 (35,584)
522,322 (174,497)
465,334 (188,544)
Total other financing sources 364,116 347,825 276,790
Net Change in Fund Balance 23,090 10,502 (60,408)
Fund Balance Beginning of year 1,018,762 855.158 855,158
End of year $ 1,041,852 $ 865,660 $ 794,750
See notes to financial statements,
11,822
5,171 (9,988)
242,554 (73)
(249,361)
(11,697)
125
(56,988) (14,047)
(71.035)
(70,910)
$ (70,910)
18
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Exhibit H
STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL - LOAN FUND
South Central Planning & Development Commission, Inc.
For the year ended June 30, 2014
Budgeted Amounts Original Final Actual
Variance with Final Budget
Positive (Negative)
Revenues Intergovernmental Interest Earned Miscellaneous
$ 2,224,803 258,300
1,893,073
$ 1,215,387 $ 261,006
1.875,498
1,199,988 261,958
2,110,265
$ (15,399) 952
234,767
Total revenues 4,376,176 3,351.891 3,572,211 220,320
Expenditures Current;
Economic development and assistance: Personal services Supplies and materials Other services and charges Loan disbursements
96,700 4,500
10,800 4,125,000
106,350 19,175
169,710 3,243,046
103,500 16,953
168,892 3,302,096
2,850 2,222
818 (59,050)
Total expenditures 4,237,000 3,538,281 3,591,441 (53,160)
Excess (deficiency) of revenues over expenditures 139,176 (186,390) (19,230) 167.160
Other Financing Sources (uses) Operating transfers in Operating transfers out
3,584 (249,650)
16,300 (261,622)
7,277 (228,425)
(9,023) 33,197
Total other financing uses (246,066) (245,322) (221,148) 24,174
Net Change in Fund Balance (106,890) (431,712) (240,378) 191,334
Fund Balance Beginning of year 2,248,290 2.082.630 2,082,630
End of year $ 2,141,400 $ 1,650,918 $ 1,842,252 $ 191,334
See notes to financial statements.
19
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Exhibit I
STATEMENT OF REVENUES. EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL -
GRANT FUND
South Central Planning & Development Commission, Inc.
For the year ended June 30, 2014
Budgeted Amounts
Variance with Final Budget
Positive Original Final Actual (Negative)
Revenues Intergovernmental Charges for services Miscellaneous
$ 2,401,972 144,500 20,000
$ 739,963 676,520
6,431
$ 737,807 657,620
6,439
$ (2,156) (18,900)
8
Total revenues 2,566,472 1,422,914 1,401,866 (21,048)
Expenditures Current:
Economic development and assistance: Personal services Supplies and materials Other services and charges Repairs and maintenance
Capital expenditures
805,880 25,225
1,598,317 6,000
10,000
818,334 45,953
340,530 1,100
16,588
833,972 36,559
350,193 1,088
17.175
(15,638) 9,394
(9,663) 12
(587)
Total expenditures 2,445,422 1,222,505 1.238.987 (16,482)
Excess of revenues over expenditures 121,050 200,409 162.879 (37,530)
Other Financing Uses Operating transfers in Operating transfers out
32,000 (153,050)
52,491 (252,900)
74,031 (236,910)
21,540 15.990
Total other financing uses (121,050) (200,409) (162,879) 37.530
Net Change in Fund Balance $ $ $ $
See notes to financial statements.
20
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Exhibit J
STATEMENT OF NET POSITION PROPRIETARY FUND
South Central Planning & Development Commission, Inc.
June 30, 2014
ASSETS Current
Cash and cash equivalents Due from other governmental units Miscellaneous receivable Prepaid insurance Prepaid maintenance
Total current assets
Construction in progress
Equipment Less accumulated depreciation
Net equipment
Intangible assets Less accumulated amortization
Net intangible assets
Total assets
LIABILITIES Current
Accounts payable and accrued expenses Compensated absences payable Due to other funds
Total payable from current assets
Noncurrent Compensated absences payable
Total liabilities
NET POSITION Net investment in capital assets Unrestricted
Total net position
Business-type Activities -Enterprise
Fund
521,859 325,883
1,833 19,032
903
869,510
36,899
511,801 (480,178)
31,623
342,197 (191,311)
150,886
1,088,918
48,405 36,064 8,256
92,725
2,285
95,010
182,509 811,399
993,908
See notes to financial statements. 21
-
Exhibit K
STATEMENT OF REVENUES. EXPENSES AND CHANGES IN FUND NET POSITION
PROPRIETARY FUND
South Central Planning & Development Commission, Inc.
For the year ended June 30,2014
Operating Revenues Charges for services
Operating Expenses Personal services Supplies and materials Other services and charges Repairs and maintenance Depreciation and ammortization expense
Total operating expenses
Operating income
Nonoperating Revenues Investment income
Change in Net Position
Net Position Beginning of year
End of year
See notes to financial statements.
Business-type Activities -Enterprise
Fund
1,684,323
1,293,086 60,841 160,046 13,266 55,220
1,582,459
101,864
293
102,157
891,751
993,908
22
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Exhibit L
STATEMENT OF CASH FLOWS PROPRIETARY FUND
South Central Planning & Development Commission, Inc.
For the year ended June 30, 2014
Business-type Activities -Enterprise
Fund
Cash Flow from Operating Activities Cash received from customers and users Cash payments to suppliers Cash payments to employees for services and benefits
Net cash provided by operating activities
Cash Flow used in Capital Activities Acquisition and construction of capital assets
Cash Flow from Investing Activities Investment income
Net increase in Cash and Cash Equivalents
Cash and Cash Equivalents Beginning of year
End of year
Reconciliation of operating loss to net cash used for operating activities;
Operating income
Adjustments to reconcile operating loss to net cash used by operating activities:
Depreciation (Increase) Decrease in assets:
Accounts receivable Due from other governmental units Due from other funds Prepaid expenses
Increase (decrease) in liabilities: Accounts payable and accrued expenses Compensated absences Due to other funds
Total adjustments
Net cash used for operating activities
See notes to financial statements.
$ 1,704,456 (227,788)
(1,288,029)
188,639
(42,478)
293
146,454
375,405
521,859
101,864
55,220
(90) 20,223
162 (2,461)
4,850 615
8,256
86,775
188,639
23
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Exhibit M
NOTES TO FINANCIAL STATEMENTS
South Central Planning & Development Commission, Inc.
June 30,2014
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the South Central Planning & Development Commission, Inc. (the Commission) conform to accounting principles generally accepted in the United States of America (GAAP) as applied to special districts as prescribed by the Governmental Accounting Standards Board (GASB), the accepted standard setting body for establishing governmental accounting and financial reporting principles. The accounting and reporting framework and the more significant accounting policies are discussed in subsequent subsections of this note.
a) Reporting Entity
The Commission was created under enabling legislation of the State of Louisiana and incorporated under the provisions of Louisiana Revised Statutes 12:201 et. seq., as amended in 1968; provided, however, that its activities shall be consistent with the powers, duties, rights and liabilities as may be deemed necessary or proper to accomplish the purposes of a regional planning or an economic development district and are for charitable, educational and scientific research purposes.
The Commission although governed by a Board of Commissioners who are directly appointed by the governing bodies of the municipalities and parishes, of which it serves, is considered a separate governmental entity because it is substantially autonomous.
GASB No. 14, The Financial Reporting Entity, GASB No. 39, Determining Whether Certain Organizations Are Component Units- an amendment of GASB Statement No. 14, and GASB No. 61, The Financial Reporting Entity: Omnibus and amendment of GASB Statements No. 14 and No. 34 established the criterion for determining which component units should be considered part of the Commission for financial reporting purposes. The basic criteria are as follows:
1. Legal status of the potential component unit including the right to incur its own debt, levy its own taxes and charges, expropriate property in its own name, sue and be sued, and the right to buy, sell and lease property in its own name.
2. Whether the governing authority appoints a majority of the board members of the potential component unit.
24
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
a) Reporting Entity (continued)
3. Fiscal interdependency between the Commission and the potential component unit.
4. Imposition of will hy the Commission on the potential component unit.
5. Financial henefit/hurden relationship between the Commission and the potential component unit.
The Commission has reviewed all of its activity and determined that there are no potential component units and the hasie financial statements include all the fund types of the entity.
b) Basis of Presentation
The Commission's basic financial statements consist of the government-wide statements on all of the non-fiduciary activities of the Commission and the governmental and proprietary fund financial statements.
Government-Wide Financial Statements
The government-wide financial statements include the Statement of Net Position and the Statement of Activities for all activities of the Commission. As a general rule, the effect of interfund activity has been removed from these statements. The government-wide presentation focuses primarily on the sustainability of the Commission as an entity and the change in aggregate financial position resulting from the activities of the fiscal period.
Governmental Activities represent programs, which normally are financed through intergovernmental revenues and other nonexchange revenues.
Business-Type Activities are financed in whole or in part by fees charged to external parties for goods and services.
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.
25
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
b) Basis of Presentation (continued)
Indirect costs are not allocated by function for financial reporting in this statement; however, certain indirect costs have been directly allocated as administrative fees to grants and special programs. Program revenues include: (1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Dues and other items not properly included among program revenues are reported instead as general revenues.
Fund Financial Statements
The fund financial statements are very similar to the traditional governmental fund statements as presented by governments prior to the issuanee of GASB Statement No. 34. Emphasis is now on the major funds in either the governmental or business-type categories.
The daily accounts and operations of the Commission continue to be organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The operations of each fiind are aecounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, equity, revenues, expenditures or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. The various funds of the Commission are grouped, into generic fund types and two broad fund categories as follows:
Governmental activities presented as governmental funds in the fund financial statements:
General Fund - The General Fund is the general operating fund of the Commission. It is used to account for and reported all financial resources except those that are required to be accounted for and reported in another fund. The General Fund is always a major fund.
Capital Projects Fund- account for and reports the financial resources that are restricted, committed or assigned to expenditures for capital outlays, including the acquisition or construction of major capital facilities and other capital assets (other than those financed by the Proprietary Funds). The Capital Projects Fund is reported as a major fund.
26
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Basis of Presentation (continued)
Special Revenue Funds - Special revenue funds are used to account for and report the proceeds of specific revenue sources (other than major capital projects) that are restricted or committed to expenditures for specified purposes. Special revenue funds reported as major funds in the fund financial statements are as follows:
Loan Fund - To account for and report receipts and uses of grant funds received from various federal agencies which are restricted to uses specified as economic development loans and grants as specified in grant documents.
Grant Fund - accounts for and reports the receipts and disbursements of Federal and State grant program services performed.
Business activities presented as proprietary funds in the fund financial statements:
Enterprise Fund - is used to account for operations: (a) that are financed and operated similarly to private business enterprises, where the intent of the goveming body is that the costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges; or (b) where the goveming body has decided periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability or other purposes. Enterprise funds are presented in the business-type activities column in government-wide financial statements and the major funds section of the basic financial statements, the enterprise fund reported as a major fund in the fund financial statements is as follows:
Regional Building Code Fund - accounts for and reports the providing of construction plan approval and inspection services to the residents of the participating municipalities and parishes in which the Commission serves. All activities necessary to provide such services are accounted for in this fund, including, but not limited to, administration, operations, maintenance, financing, billing and collection.
Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. Operating expenses for the enterprise fund include the cost of services, administrative expenses and depreciation of capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.
27
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
c) Basis of Accounting and Measurement Focus
Measurement focus is a term used to describe "which" transactions are recorded within the various financial statements. Basis of accounting refers to "when" transactions are recorded regardless of the measurement focus applied.
Government-Wide Financial Statements
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.
Fund Financial Statements
All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (revenues and other financing sources) and decreases (expenditures and other uses) in net current assets. Governmental funds are maintained on the modified accrual basis of accounting.
Governmental fund revenues resulting from exchange transactions are recognized in the fiscal year in which the exehange takes place and meets the government's availability criteria (susceptible to aeerual). Available means that the resources will be collected within the current fiseal year or are expected to be colleeted soon enough thereafter to be used to pay liabilities of the current fiscal year. For this purpose, the Commission considers revenues to be available if they are collected within 60 days of the end of the current fiscal year. Member assessments are recognized as revenues in the period for which they are assessed. Grant and contract revenues are recognized when earned since they are measurable and available. Interest earned and other miscellaneous revenues are reeorded as revenues when received in cash by the Commission because they are generally not measurable until actually received.
Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. An exception to this general rule is vaeation and siek leave which are recognized when paid. Alloeations of cost such as depreciation are not recognized in the governmental funds.
28
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
c) Basis of Accounting and Measurement Focus (continued)
All proprietary funds are accounted for on a flow of economic resources measurement focus. Proprietaiy funds are maintained on the accrual basis of accounting wherein revenues are recognized in the accounting period in which they are earned and become measurable, and expenses are recognized in the period incurred, if measurable. Revenues resulting from transactions, in which each party gives and receives essentially equal value is recorded on the accrual basis when the exchange takes place.
d) Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions. Those estimates affect the reported amounts of assets and liabilities and disclosures of assets and liabilities at the date of the financial statements. They may also affect the reported amounts of revenues and expenses of proprietary funds and the government-wide financial statements during the reporting period. Actual results could differ from those estimates.
e) Budgets and Budgetary Accounting
The Commission under the terms of its charter, adopts and annual budget. This budget is for the General Fund and special revenue funds. Special revenue funds, which at June 30, 2014 consisted of various government and government agency projects, are budgeted on a project by project basis as funding becomes available. The General Fund and special revenue funds budgets were amended during the year to reflect changes in budgeted revenues, expenditures and operating transfers as dictated by the circumstances.
Budgets for carryover grants and projects, which are to be performed over more than one accounting period, are reflected only to the extent they affect the current period being reported on. Budgeted amounts which are not expended, or obligated through contracts, lapse at year end.
Major funds are included in the budget presentations in the basic financial statements. The budgets are adopted on a basis materially consistent with accounting principles generally accepted in the United States of America (GAAP).
f) Cash, Cash Equivalents and Investments
Cash includes amounts in regular and money market accounts.
For purposes of the statement of cash flows, cash and cash equivalents include certificates of deposit with maturities of three months or less when purchased.
29
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
g) Accounts Receivable
The financial statements of the Commission contain no allowance for uncollectible accounts. Uncollectible amounts due for member assessments, contract revenues and other receivables are recognized as bad debts at the time information becomes available which would indicate the uncollectibility of the particular receivable. Miscellaneous accounts receivable and amounts due from other governments in excess of 60 days comprise the accounts receivable allowance for uncollectibles. These amounts are not considered to be material in relation to the financial position or operations of the fimds of the Commission.
Economic loans are shown net of an allowance for loan losses. Additions to the allowance for loan losses are recognized as expenses in the government activities financial statements at the time information becomes available which would indicate the loan is less than fiilly collectible. As of June 30, 2014, the loan loss reserve amounted to $530,349. Loan loss reserves are deducted from deferred revenue in the fund financial statements. For the year ended June 30, 2014, the Commission recognized no additional expenses for estimated loan losses in governmental aetivities. For purposes of the fund financial statements the change in allowance for loan loss is offset by an equal change in deferred revenues.
h) Capital Assets
Capital assets, which include construction in progress, buildings, furniture, fixtures and equipment are reported in the applicable governmental or business-type activities column in the government-wide financial statements. Capital assets are defined by the Commission as assets purchased or acquired with an original cost of $1,000 or more. Such assets are recorded at historical costs or estimated historical cost if actual is unavailable.
Donated capital assets are recorded at their estimated fair value at the date of donation. Additions, improvements and other capital outlays that significantly extend the useful life of an asset are capitalized. Other costs incurred for repairs and maintenance are expensed as incurred.
Capital assets also include the historical cost of intangible assets. At June 30, 2014 the Commission's intangible assets consist of computer software costs purchased and internally generated. For purposes of identifying capitalizable computer software eosts, the Commission has elassified activities into (1) preliminary stage, (2) application development stage, and (3) post-implementation/operation stage. Costs incurred during the application development stage are capitalized, while costs incurred during preliminary and post-implantation/operational the stages are expensed as incurred.
30
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
h) Capital Assets (continued)
Depreciation and amortization are provided over the assets' estimated useful lives using the straight-line method. The range of estimated useful lives by type of asset is as follows:
Buildings 50 years Furniture, fixtures and equipment 4-25 years Intangibles - computer software 10 years
i) Non-Current Liabilities
The accounting treatment of non-current liabilities depends on whether they are reported in governmental fund operations or proprietary fund operations and whether they are reported in the government-wide or fund financial statements.
Government-wide Financial Statements:
All non-current liabilities to be repaid from governmental resources are reported as liabilities in the government-wide statements. The non-current liabilities consist of certificates of indebtedness and accumulated annual leave.
Fund Financial Statements:
Non-current liabilities for governmental funds are not reported as liabilities in the governmental fund financial statements. In the proprietary fund financial statements non-current liabilities are reported as liabilities.
j) Compensated Absences
The Commission's policies regarding vacation and sick leave permit employees to accumulate earned but unused vacation. The liability for these compensated absences is recorded as a non-current liability in the government-wide statements and the proprietary fund type fund statements. In the fund financial statements, governmental funds report only the compensated absence liability payable from expendable available financial resources.
All full-time, permanent employees of the Commission receive two weeks of vacation which accrues at a rate of 3.08 hours per pay period beginning with the first day of full-time, permanent employment. After five years of service employees will receive three weeks of vacation at a rate of 4.62 hours per pay period, and will receive an additional day of vacation per year of service after ten years of continuous employment. Vacation cannot be used for the first three months of full-time,
31
-
Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
j) Compensated Absences (continued)
permanent employment. Employees may carry over a maximum of one hundred hours of vaeation from one fiscal year to another. Any time in excess of one hundred hours must be approved by the Chief Executive Officer before the end of the fiseal year or will be lost without compensation. Vacation is paid when an employee terminates service with the Commission.
All full-time, permanent employees of the Commission earn sick leave at the rate of one day per month or 3.69 hours per pay period. No limits on this aecrual privilege have been established. Siek leave can be aecumulated but does not vest and, therefore, a provision has not been made for sick leave.
k) Unavailable Revenue/Deferred Inflows of Resources
In the governmental funds, the Commission accounts for its loan programs (Environmental Protection Agency Brownfield Loan Program, Economic Development Administration Revolving Loan Program, Louisiana Economic Development Small Business Recovery Loan and Grant Phase I and Phase II Programs, Louisiana Economie Development Revolving Capital Program, Louisiana Economic Innovation Loan Program and Louisiana Economic Innovation Revolving Capital Program) in the operating accounts of a special revenue fund, the Loan Fund. In the Loan Fund the receipt of loan collections are recognized as miscellaneous revenue and loan disbursements to beneficiaries of the programs are accounted for as expenditures. The asset "economic loans receivable" is offset on the Governmental Fund Balance Sheet by "unavailable revenue." In addition, grant proceeds, to be used to provide loans, is accounted for as intergovernmental revenue in the Loan Fund. In the government-wide financial statements, loan disbursements to beneficiaries and subsequent loan collections are accounted for as increases/deereases in the asset, "economic loans receivable", while the reeeipt of grant proceeds, to be used to provide loans, is aceounted for as operating grant revenue. Grant contributions are considered revenues of the period in which grant requirements are met.
I) Fund Equity
Government-wide Statements:
Equity is classified as net position and displayed in three components;
a. Net investment in capital assets - Consists of eapital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balanees of any bonds, mortgages, notes or other borrowings that are attributable to the aequisition, eonstruction or improvement of those assets, if any. At June 30, 2014 the Commission had no outstanding borrowings.
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Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
1) Fund Equity (continued)
b. Restricted net position - Consists of assets and deferred outflows of resourees less liabilities and deferred inflows of resources (net position) with eonstraints plaeed on the use either by (1) external groups sueh as ereditors, grantors, contributions or laws or regulations of other governments; or (2) law through eonstitutional provisions or enabling legislation.
e. Unrestricted net position - All other net position that do not meet the definition of "restricted" or "invested in capital assets."
When both restricted and unrestricted resourees are available for use, it is the Commission's policy to use restricted resources first, then unrestricted resourees as they are needed.
Fund Finaneial Statements:
Governmental fund equity is classified as fund balance. Fund balance is further classified as follows:
a. Non-spendable - amounts that eannot be spent either because they are in non-spendable form or beeause they are legally or eontractually required to maintain intact.
b. Restricted - amounts that can be spent only for speeifie purposes beeause of eonstitutional provisions, charter requirements or enabling legislation or because of eonstraints that are externally imposed by ereditors, grantors, contributors, or the laws or regulations of other governments.
c. Committed - amounts that ean be used only for speeifie purposes determined by a formal aetion of the Commission's Board of Direetors. Commitments may be established, modified, or reseinded only through resolutions approved by the Commission's Board of Direetors.
d. Assigned - amounts that do not meet the eriteria to be classified as either restricted or eommitted but that are intended to be used for speeifie purposes. Assigned amounts may be established, modified or rescinded by majority vote of the Board of Directors or by the Chief Executive Offieer.
e. Unassigned - all other spendable amounts.
For the classifieation of governmental fund balances, the Commission eonsiders an expenditure to be made from the most restrictive first when more than one elassifieation is available. The Commission's fund balanee was classified as nonspendable, restrictive, assigned and unassigned as of June 30, 2014.
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Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
m) Interfund Transactions
In the financial statements, interfund activity is reported as either loans or transfers. Loans between funds are reported as interfund receivables (due from) and payables (due to) as appropriate. Transfers represent a permanent reallocation of resources between funds. In other words, they are not expected to be paid. For reporting purposes, all interfund transactions between individual governmental funds have been eliminated in the government-wide financial statements. Any residual balances outstanding between the governmental activities and the business-type activities are reported in the government-wide financial statements as "internal balances".
n) Indirect Cost Plan
The Commission maintains an indirect cost plan for the allocation of costs that are incurred for a common or joint purpose benefiting more than one cost objective and not readily assignable to the cost objectives specifically benefited through June 30, 2014. These indirect costs are allocated based on direct salaries incurred by each fund benefiting from the indirect costs.
o) New GASB Statements
During the year ending June 30, 2014, the Commission implemented the following GASB Statements:
Statement No. 66, "Technical Corrections - 2012." The statement enhances the usefulness of financial reports by resolving conflicting accounting and financial reporting guidance that could diminish the consistency of financial reporting. This statement did not affect the Commission's financial statements.
Statement No. 67, "Financial Reporting for Pension Plans. " The statement improves the usefulness of pension information included in the general purpose external financial reports of state and local governmental pension plans for making decisions and assessing accountability. This statement did not affect the Commission's financial statements.
Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial Guarantees." The objective of this Statement is to improve the recognition, measurement, and disclosure guidance for state and local governments that have extended or received financial guarantees that are nonexchange transactions. This statement did not affect the Commission's financial statements.
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Exhibit M (Continued)
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
o) New GASB Statements (continued)
Statement No. 71, "Pension Transition for Contributions made Subsequent to the Measurement Date. " The objeetive of this Statement is to address an issue regarding application of the transition provisions of Statement No. 68. The statement will be applied simultaneously with Statement No. 68. Management has not yet determined the effeet of this statement on the financial statements.
Note 2 -DEPOSITS
Louisiana state law allows all political subdivisions to invest excess funds in obligations of the United States or other federally insured investments, certificates of deposit of any bank domiciled or having a branch office in the State of Louisiana, guaranteed investments eontracts and investment grade (A-l/P-1) commercial paper of domestic corporations.
Bank Deposits:
State law requires deposits (cash and certificates of deposit) of all political subdivisions to be fully collateralized at all times. Acceptable collateralization includes FDIC insurance and securities purchased and pledged to the political subdivision. Obligations of the United States, the State of Louisiana and certain politieal subdivisions are allowed as security for deposits. Obligations furnished as security must be held by the political subdivision or with an unaffiliated bank or with a trust company for the account of the political subdivision.
The year end balances of deposits are as follows:
Bank Reported Balances Amount
Cash $ 3,501,182 $ 2,959,978
Custodial credit risk is the risk that in the event of a bank failure, the Commission's deposits may not be returned to it. The Commission has a written policy for custodial credit risk. As of June 30, 2014, $3,001,182 of the Commission's bank balance of $3,501,182 was exposed to custodial credit risk. These deposits were uninsured and collateralized with securities held by the pledging financial institution's trust department or agent and are deemed to be in the Commission's name by state law.
35
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Exhibit M (Continued)
Note 2 - DEPOSITS (Continued)
At June 30, 2014, cash was adequately collateralized in accordance with state law by securities held by unaffiliated banks for the account of the Commission. The Governmental Accounting Standards Board (GASB), which promulgates the standards for accounting and financial reporting for state and local governments, considers these securities subject to custodial credit risk. Even though the deposits are considered subject to custodial credit risk under the provisions of GASB, Louisiana Revised Statute 39:1229 imposes a statutory requirement on the custodial bank to advertise and sell the pledged securities within 10 days of being notified by the depositor that the fiscal agent has failed to pay deposited funds upon demand.
A reconciliation of deposits as shown on the Statement of Net Position and Governmental Fund Balance Sheet is as follows:
Cash on hand $ ICQ Carrying amount of deposits 2,959.978
Total cash $2.960.078
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Exhibit M (Continued)
Note 3 - DUE FROM OTHER GOVERNMENTAL UNITS
Amounts due from other governmental units at June 30, 2014 eonsisted of the following:
Amount Governmental Activities: U.S. Environmental Protection Agency U.S. Economic Development Administration Federal Transit Administration Louisiana Association of Planning and Development District Louisiana Department of Homeland Security and Emergency
Preparedness Louisiana Department of Transportation and Development LED Small Firm Loans and Grant Program Louisiana Department of Wildlife and Fisheries Louisiana Highway Safety Commission Lafourche Parish Council Acadian Regional Development District Assumption Parish Police Jury Ascension Parish Jefferson Parish Plaquemines Parish St. Bern2ird Parish Council St. Charles Parish Council St. John the Baptist Parish Council St. James Parish Council St. Mary Parish Council St. Tammany Parish Council Terrebonne Levee and Conservation District Terrebonne Parish Consolidated Government East Baton Rouge Parish/City of Baton Rouge City of Alexandria City of Cedar Park City of Denham Springs City of Georgetown, Texas City of Hutto, Texas City of Lago Vista, Texaas City of Lake Charles City of Pflugerville, Texas City of San Marcos, Texas City of Thibodaux City of West Lake Village of Napoleonville Rapides Parish Planning Commission Town of Golden Meadow Town of Gramercy Town of Lutcher Town of Lockport Bee Cave, Texas Buda, Texas Hays County, Texas Hernando, Mississippi Mont Belvieu, Texas Travis County, Texas
Total governmental activities
$ 17,899 37,500
567 1,175
10,872 166,543 64,002
238,388 28,999 5,867
90,896 24,656 2,250 4,783 1,583 656 364 364
23,328 438
3,333 17,500 8,216
64,200 1,913 2,730 229
7,960 730 535
1,783 1,188 9,265 1,184 229
2,509 1,583 2,880 17,430 3,000 213 730 500 961 448 272
10,289
$ 882,940
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Exhibit M (Continued)
Note 3 - DUE FROM OTHER GOVERNMENTAL UNITS (Continued)
Amount Business-type Activities: Assumption Parish Police Jury $ 5,972 Town of Golden Meadow 200 Town of Gramercy 14,564 Town of Lockport 911 Village of Napoleonville 360 St. Charles Parish Council 122,235 St. James Parish Council 15,054 St. John the Baptist Parish Council 20,785 Terrebonne Parish Consolidated Government 145,802
Total business-type activities ,$_^25^88^
As of June 30, 2014, governmental activities due from other governmental units included $259,922 of unbilled receivables. There were no unbilled receivables from business activities as of June 30, 2014.
Note 4 - INTERFUND RECEIVABLES AND PAYABLES
Interfund receivables and payables consist of the following at June 30, 2014:
Interfund Interfund Individual Funds Receivables Payables
General Fund $ 18,380 Special Revenue Fund:
Loan Fund - $ 10,124 Enterprise Fund ^ 8,256
Total $ 18,380 $ 18,380
The balances above resulted from the time lag between the dates the (1) interfund goods and services are provided or reimbursable expenditures occur, (2) transactions are recorded in the accounting system and (3) payments between funds are made.
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Exhibit M (Continued)
Note 5 - CHANGES IN CAPITAL ASSETS
Capital asset activity for the year ended June 30, 2014 was as follows:
Additions Deletions Balance Balance
June 30,2014
Governmental Activities: Capital assets not being depreciated:
Construction in progress
Capital assets being depreciated: Buildings Intangibles Furniture, fixtures and equipment
Total capital assets being depreciated
Less accumulated depreciation for: Buildings Intangibles Furniture, fixtures and equipment
Total accumulated depreciation
Total governmental activities capital assets, net
Business-type Activities: Capital assets not being depreciated:
Construction in progress
Capital assets being depreciated and amortized: Furniture, fixtures, and equipment
Intangibles
Total capital assets being depreciated
Less accumulated depreciated and amortization
Furniture, fixtures, and equipment
Intangibles
Total ^cumulated depreciation
Total business-type activities capital assets, net
$ 13,666 $ 107.237 $ 120,903
1,408,933 1,408,933 264,768 249,404 514,172 531,394 130,472 $ (3,963) 657,903
2,205,095 379.876 (3,963) 2,581,008
(240,302) (33,925) (274,227) (33,167) (51,417) - (84,584)
(471,597) (45,240) 3,963 (512,874)
(745,066) (130,582) 3,963 (871,685)
$ 1,473.695 $ 356,531 $ $ 1,830.226
Balance Balance
July 1,2013 Additions Deletions June 30,2014
$ $ 36,899 $ $ 36,899
516,552 5,579 (10,330) 511,801
342,197 - - 342,197
858,749 5,579 (10,330) 853,998
i:
(469,508) (21,000) 10,330 (480,178) (157,091) (34,220) - (191,311)
(626,599) (55.220) 10,330 (671,489)
$ 232,150 $ (12,742) $ $ 219,408
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Exhibit M (Continued)
Note 5 - CHANGES IN CAPITAL ASSETS (Continued)
During 2014 the Commission recognized $185,802 of depreciation expense and reported depreciation expense as economic development and assistance as follows;
Government activities $ 130,582 Business activities 55,220
Total $ 185,802
Note 6 - ACCOUNTS PAYABLE
At June 30, 2014, the Commission had accounts payable reported in the Governmental Activities of $169,109 and $48,405 in Business-type Activities. The General Fund pays all Grant Fund expenditures therefore the table below also reports the incurred charges in the Grant Fund.
Personal Services Vendors Total
Governmental activities: General Fund Loan Fund Grant Fund
$ 73,228 $ 25,545 58,240 12,096
$ 98,773 58,240 12,096
Total governmental activities 73,228 95,881 169,109
Business-type activities: Enterprise Fund 45,130 3,275 48,405
Totals $ 118,358 $ 99,156 $ 217,514
Other accounts payable in the Loan Fund is for a loan approved by