Town of Mamou...TOWN OF MAMOU, LOUISIANA Statement of Net Assets December 31,2005 Governmental...

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TOWN OF MAMO U, LOUISIANA

Financial Report

Year Ended December 31,2005

Under provisions of state law, this report is a publicdocument. A copy of the report has been submitted tothe entity and other appropriate public officials. Thereport is available for public inspection at the BatonRouge office of the Legislative Auditor and, whereappropriate, at the office of the parish clerk of court.

Release Date

TABLE OF CONTENTS

Page

Independent Auditors'Report 1-2

BASIC FINANCIAL STATEMENTS

GOVERNMENT-WIDE FINANCIAL STATEMENTS (GWFS)Statement of net assets 5Statement of activities 6

FUND FINANCIAL STATEMENTS (FFS)Balance sheet - governmental funds 9Reconciliation of the governmental funds balance sheet

to the statement of net assets 10Statement of revenues, expenditures, and changes in fund balances-

governmental funds 11Reconciliation of the statement of revenues, expenditures, and

changes in fund balances of governmental funds to the statement of activities 12Statement of net assets - proprietary funds 13Statement of revenues, expenses, and changes in fund net

assets - proprietary funds 14Statement of cash flows - proprietary funds 15-16

Notes to basic financial statements 17-40

REQUIRED SUPPLEMENTARY INFORMATIONBudgetary comparison schedules:

General Fund 42Sales Tax Special Revenue Fund 43

OTHER SUPPLEMENTARY INFORMATION

OTHER FINANCIAL INFORMATIONStatement of net assets-compared to prior year totals 46General and Special Revenue Funds - comparative balance sheet 47General and Special Revenue Funds - Comparative revenues, expenses, and changes

in fund balances 48Major Governmental Funds -

General Fund - budgetary comparison schedule - revenues 49General Fund - budgetary comparison schedule- expenditures 50-52Sales Tax Fund - budgetary comparison schedule 53

Schedule of number of utility customers (unaudited) 54Schedule of insurance in force (unaudited) 55Combined schedule of interest-bearing deposits - all funds 56-57Comparative statement of net assets - proprietary fund 58Comparative statement of revenues, expenses, and changes in fund net assets 59Departmental analysis of revenues and expenses - utility fund 60

COMPLIANCE AND INTERNAL CONTROL

Report on Compliance and on Internal Controlover Financial Reporting Based on an Audit ofFinancial Statements Performed in Accordancewith Government Auditing Standards 62-63

Summary schedule of current and prior year audit findings and corrective action plan 64-66

KOLDER, CHAMPAGNE, SLAVEN & COMPANY, LLCCERTIFIED PUBLIC ACCOUNTANTS

C. Burton Kolder, CPA*Russell F. Champagne, CPA*Victor R. Slaven, CPA"P. Troy Courvilto, CPA'Gerald A. Thibodeaux, Jr., CPA*Robert S. Carter, CPA*Arthur R. Mixon, CPA

OFFICES

Tynes E. Mixon, Jr., CPAAlien J. LaBry, CPAAlbert R. Leger, CPA.PFS.CSA*Harry J. Clostio, CPAPenny Angelle Scruggins, CPAChristine L Cousin, CPAMary T. Thibodeaux, CPAJames R. Roy, CPARobert J. Mete, CPAKelly M. Ooucet, CPACheryl L. Bartley, CPA, CVAMandy B. Self. CPAChris E. Bilski, CPA

INDEPENDENT AUDITORS' REPORT

163 South Beadle Rd. 113 East Bridge SiLafayette, LA 70508 Breaux Bridge, LA 70517Phone (337) 232-4141 Phone (337) 332-4020Fax (337) 232-8660 Fax (337) 332-2867

133 East Waddil 1234 David DR. Ste 203Marksvilte, LA 71351 Morgan City, LA 70380Phone (318) 253-9252 Phone (985) 384-2020Fax (318) 253-8681 Fax (985) 384-3020

408 West Cotton Street 332 West Sixth AvenueVille Platte, LA 70586 Oberiin, LA 70655Phone (337) 363-2792 Phone (337) 639-4737Fax (337) 363-3049 Fax (337) 639-4568

200 South Main StreetAbbeville, LA 70510Phone (337) 893-7944Fax (337) 893-7946

450 East Main StreetNew Iberia, LA 70560

Phone (337) 367-9204Fax (337) 367-9208

Retired:Conrad O. Chapman, CPA* 2006

WEBSFTE;WWW. KCSRCPAS. COM

* A Professional Accounting Coiporation

The Honorable Wilda Chamberlain, Mayorand Members of the Board of Aldermen

Town of Mamou, Louisiana

We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the Town of Mamou,Louisiana, as of and for the year ended December 31, 2005, which collectively comprise the basic financialstatements of the Town's primary government as listed in the table of contents. These financial statementsare the responsibility of the Town's management. Our responsibility is to express an opinion on thesefinancial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United Statesof 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 theaudit to obtain reasonable assurance about whether the financial statements are free of material misstatement.An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basicfinancial statements. An audit also includes assessing the accounting principles used and significant estimatesmade by management, as well as evaluating the overall financial statement presentation. We believe that ouraudit provides a reasonable basis for our opinion.

The financial statements referred to above include only the primary government of the Town ofMamou, Louisiana, which consists of all funds, organizations, institutions, agencies, departments, and officesthat comprise the Town's legal entity. The financial statements do not include financial data for the Town'slegally separate component units, which accounting principles generally accepted in the United States ofAmerica require to be reported with the financial data of the Town's primary government. As a result, theprimary government financial statements do not purport to, and do not, present fairly the financial position ofthe reporting entity of the Town of Mamou, Louisiana as of December 31, 2005, and the changes in itsfinancial position and its cash flows, where applicable, for the year then ended in conformity with accountingprinciples generally accepted in the United States of America.

Member of:AMERICAN INSTITUTE OFCERTIFIED PUBLIC ACCOUNTANTS

Member of:SOCIETY OF LOUISIANA

CERTIFIED PUBLIC ACCOUNTANTS

In our opinion, the financial statements referred to above present fairly, in all material respects, therespective financial position of the governmental activities, the business-type activities, each major fund, andthe aggregate remaining fund information for the primary government of the Town of Mamou, Louisiana, asof December 31, 2005, and the respective changes in financial position and cash flows, where applicable, forthe year then ended in conformity with accounting principles generally accepted in the United States ofAmerica.

In accordance with Government Auditing Standards, we have also issued a report dated June 2, 2006,on our consideration of the Town of Mamou's internal control over financial reporting and our tests of itscompliance with certain provisions of laws, regulations, contracts, and grants. That report is an integral part ofan audit performed in accordance with Government Auditing Standards and should be read in conjunctionwith this report in considering the results of our audit.

The required supplementary information on pages 42 through 43 are not a required part of the basicfinancial statements but are supplementary information required by the Governmental Accounting StandardsBoard. We have applied certain limited procedures, which consisted principally of inquiries of managementregarding the methods of measurement and presentation of the supplementary information. However, we didnot audit the information and express no opinion on it.

The Town of Mamou has not presented management's discussion and analysis that the GovernmentalAccounting Standards Board has determined is necessary to supplement, although not required to be part of,the basic financial statements.

Our audit was conducted for the purpose of forming opinions on the financial statements thatcollectively comprise the Town of Mamou, Louisiana's basic financial statements. The other supplementaryinformation on pages 44 through 66 is presented for purposes of additional analysis and is not a required partof the basic financial statements. Such information, except for that portion marked "unaudited" on which weexpress no opinion, has been subjected to the auditing procedures applied in the audit of the basic financialstatements and, in our opinion, is fairly stated in all material respects in relation to the basic financialstatements taken as a whole.

Kolder, Champagne, Slaven & Company, LLCCertified Public Accountants

Ville Platte, LouisianaJune 2,2006

GOVERNMENT-WIDEFINANCIAL STATEMENTS (GWFS)

TOWN OF MAMOU, LOUISIANA

Statement of Net AssetsDecember 31,2005

Governmental Business-TypeActivities Activities Total

ASSETSCurrent assets:

Cash and interest-bearing depositsReceivables, netDue from other governmental unitsInventoryPrepaid items

Total current assets

Noncurrent assets:Restricted assets:

Cash and interest-bearing depositsCapital assets, net

Total noncurrent assets

Total assets

LIABILITIESCurrent liabilities:

Accounts and other payablesClaims payableInternal balancesCapital lease payableBonds payableAccrued interest

Total current liabilities

Noncurrent liabilities:Customers deposits payableContingent liabilitiesCapital lease payableBonds payable

Total noncurrent liabilities

Total liabilities

NET ASSETSInvested in capital assets, net of related debtRestricted for debt serviceUnrestricted

Total net assets

$1,641,602175,760206,690

-20,385

2,044,437

975,0003,008,991

3,983,991

6,028,428

183,378169,089(39,973)12,01589,0001,335

414,844

350,00047,375

-

397,375

812,219

2,958,36644,364

2,213,479

$5,216,209

$ 40,014399,166

-44,9567,162

491,298

423,2052,680,423

3,103,628

3,594,926

215,259-

39,973-

50,0582,446

307,736

224,034--

91,753

315,787

623,523

2,588,670-

382,733$2,971,403

$ 1,681,616574,926206,69044,95627,547

2,535,735

1,398,2055,689,414

7,087,619

9,623,354

398,637169,089

-12,015139,0583,781

722,580

224,034350,00047,37591,753

713,162

1,435,742

5,547,03644,364

2,596,212

$ 8,187,612

The accompanying notes are an integral part of the basic financial statements.

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The General Fund is used to account for resources traditionally associated with governments which are notrequired to be accounted for in another fund.

Special Revenue Fund

Special revenue funds are used to account for specific revenues that are legally restricted to expenditures forparticular purposes.

Sales Tas FundTo account for the receipt and use of proceeds of the Town's two 1 % sales and use taxes. These taxes arededicated and used for the purpose of inducing and attracting commerce, industry and tourism in the Town,including die acquisition and improvement of land and buildings and for constructing, acquiring, improvingand/or extending any work of capital improvement for the Town; and any lawful corporate purpose of theTown.

Debt Service Funds

Debt service funds are used to accumulate resources to be used to make debt service principal and interestpayments on general obligation long-term debt.

P.I. Sales Tax Refunding Bonds Debt Service FundTo accumulate monies for payment of the $693,000 Public Improvement Sales Tax Refunding Bonds, Series1995. Debt service is financed by the collection of sales taxes.

Enterprise Fund

Utility Fund -To account for the provision of gas, water, and sewerage services to residents of the Town. All activitiesnecessary to provide such services are accounted for in this fund, including, but not limited to,administration, operations, maintenance, financing and related debt service, and billing and collection.


Balance SheetGovernmental Funds

December 31,2005

Sales Tax DebtSpecial Service

General Revenue Fund TotalASSETS

Cash $ 142,532 $ - $ $ 142,532Interest-bearing deposits 915,507 407,107 146,714 1,469,328Receivables:

Taxes 166,636 - - 166,636Accrued interest 6,995 - - 6,995Due from other governmental units 206,690 - - 206,690Other 2,129 - - 2,129

Due from other funds - 58,179 - 58,179Prepaid expenses 20,385 - - 20,385Restricted cash:

Interest-bearing deposits 975,000 - - 975,000

Total assets $2,435,874 $ 465,286 $ 146,714 $3,047,874

LIABILITIES AND FUND BALANCES

Liabilities:Accounts and other payables $ 134,903 $ 18,715 $ - $ 153,618Compensated absences payable 29,742 - - 29,742Due to other funds 90,605 - - 90,605Other 18 - - 18

Total liabilities 255,268 18,715 - 273,983

Fund balances -Reserved for debt service - - 146,714 146,714Unreserved, undesignated 2,180,606 446,571 - 2,627',177

Total fund balances 2,180,606 446,571 146,714 2,773,891

Total liabilities and fund balances $2,435,874 $ 465,286 $ 146,714 $3,047,874


9


Reconciliation of the Governmental Funds Balance Sheetto the Statement of Net Assets

December 31,2005

Total fund balances for governmental funds at December 31,2005 $ 2,773,891

Total net assets reported for governmental activities in the statement of netassets is different because:

Capital assets used in governmental activities are not financial resourcesand, therefore, are not reported in the funds. Those assets consist of:Land and construction in progress $ 198,000Buildings and improvements, net of $418,508 accumulated depreciation 1,726,052Infrastructure, net of $704,867 accumulated depreciation 799,142Equipment, furniture, and fixtures, net of $319,893 accumulated depreciation 210,452Vehicles, net of $181,088 accumulated depreciation 75,345 3,008,991

Long-term liabilities at December 31, 2005:Capital lease payable (59,390)Bonds payable (89,000)Contingent liability (350,000)Accrued interest payable (1,335) (499,725)

Net assets (deficiency) of the group self-insurance internal service fund (66,948)

Total net assets of governmental activities at December 31,2005 $ 5,216,209


10


Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds

For the Year Ended December 31, 2005

Revenues:TaxesLicenses and permitsIntergovernmentalFines and forfeitsMiscellaneous

Total revenues

Expenditures:Current-

General government:Administrative

Public safety:Police

Highways and streetsCulture and recreationJudicialCentral garage

Capital outlayDebt service -

Principal retirementInterest and fiscal charges

Total expenditures

Excess (deficiency) of revenuesover expenditures

Other financing sources (uses):Proceeds from capital leaseTransfers inTransfers out

Transfers in (out) - component unit

Total other financing sources (uses)

Net changes in fund balances

Fund balances, beginning

Fund balances, ending

General

5 343,290123,274275,672324,696

1,184,156

2,251,088

802,937

(267,951)

65,451680,463

(444,262)

301,652

33,701

2,146,905

Sales TaxSpecial

Revenue

DebtServiceFund

$ 612,963 $

4,456

617,419

1,176

1,176

47,345 1,010

511,713 (88,604)

92,247(519,735)

(519,735) 92,247

(8,022) 3,643

454,593 143,071

Total

$ 956,253123,274275,672324,696

1,189,788

2,869,683

851,292

782,681544,668186,18988,4686,95599,717

6,0611,363

2,519,039

782,681544,668186,18988,4686,955

58,361 - 158,078

81,000 87,0617,770 9,133

105,706 89,780 2,714,525

$2,180,606 $ 446,571 $ 146,714

155,158

65,451772,710

(519,735)(444,262)

(125,836)

29,322

2,744,569

$2,773,891


11


Reconciliation of the Statement of Revenues, Expenditures, andChanges in Fund Balances of Governmental Funds

to the Statement of ActivitiesFor the Year Ended December 31, 2005

Total net changes in fund balances at December 31,2005 perStatement of Revenues, Expenditures and Changes in Fund Balances $ 29,322

The change in net assets reported for governmental activities in thestatement of activities is different because:

Governmental funds report capital outlays as expenditures. However,in the statement of activities, the cost of those assets is allocated overtheir estimated useful lives and reported as depreciation expense.Capital outlay which is considered expenditures on the Statementof Revenues, Expenditures and Changes in Fund Balances $ 158,078Depreciation expense for the year ended December 31, 2005 (145,759) 12,319

Governmental funds report bonded debt repayments as expenditures.However, this expenditure does not appear in the statement of activitiessince the payment is applied against the bond payable balance on the state-ment of net assets 87,061

Proceeds from capital lease (65,451)

Net loss of group self-insurance internal service fund (76,780)

Reduction in estimated loss of workers compensation claims 325,000

Difference between interest on long-term debt on modified accrual basisversus interest on long-term debt on accrual basis 1,215

Total changes in net assets at December 31,2005 per Statement of Activities $ 312,686


12


Proprietary FundsStatement of Net Assets

December 31,2005

Business-type Activities - Governmental Activities -Enterprise Fund Internal Service Fund


CashInterest-bearing depositsReceivables:

AccountsUnbilled utility receivablesAccrued interest receivableDue from other fimds

Inventory - natural gasPrepaid items

Total current assetsNoncurrent assets:

Restricted assets -Interest-bearing deposits

Capital assets, net of accumulated depreciationTotal noncurrent assets

Total assets


Accounts and other payablesCompensated absences payableClaims payableDue to other fundsPayable from restricted assets -

Revenue bondsAccrued interest payable


Noncurrent liabilities:Customers' depositsRevenue bonds payable


Total liabilities


Total net assets


$ 1140,003

218,707180,367

92

44,9567,162

491,298

423,2052,680,423

3,103,628

3,594,926

206,9618,298

39,973

50,0582,446

307,736

224,03491,753

315,787

623,523

2,588,670

382,733

$2,971,403

$ 29,742

72,399

102,141

102,141

169,089

169,089

169.089

(66,948)

$ (66,948)

13


Proprietary FundsStatement of Revenues, Expenses, and Changes in Fund Net Assets

Year Ended December 31,2005

Operating revenues:Charges for servicesPermits, reconnections and penaltiesMiscellaneous

Total operating revenues

Operating expenses:Gas department expensesWater department expensesSewerage department expensesDepreciation expenseSelf insurance expenses

Total operating expenses

Operating income

Nonoperating revenues (expenses):Interest incomeInterest expense

Total nonoperating revenues (expenses)

Income before contributions and transfers

Capital contributions

Transfers in (out):Transfers inTransfers out

Total transfers in (out)

Change in net assets

Net assets, beginning

Net assets, ending

Business-type Activities-Enterprise Fund

11,858,06045,313

9,396

1,912,769

1,015,818193,321316,112180,218

1,705,469

207,300

7,236(10,534)

(3,298)

204,002

(252,975)

(252,975)

(48,973)

3,020,376

$2,971,403

Governmental Activities -Internal Service Fund

$ 380,792

380,792

457,572

457,572

(76,780)

(76,780)

(76,780)

9,832

$ (66,948)

The accompanying notes are an integral part of this statement.

14


Statement of Cash FlowsProprietary Funds

For the Year Ended December 31,2005

Cash flows from operating activities:Receipts from customersPayments to suppliersPayments to employeesOther receipts

Net cash provided (used) by operating activities

Cash flows from noncapital financing activities:Transfers to other funds

Cash flows from capital and related financing activities:Principal paid on revenue bonds payablePrincipal paid on certificates of indebtednessInterest and fiscal charges paid on revenue

bonds and certificatesNet increase (decrease) in customer meter depositsAcquisition of property, plant and equipmentDisposition of property, plant and equipment

Net cash used by capital and related

financing activities

Cash flows from investing activities:Net maturities of interest-bearing deposits with

maturity in excess of ninety daysInterest earned

Net cash provided by investing activities

Net increase (decrease) in cashand cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Business-type Activities •Enterprise Fund

$1,777,360(1,134,780)

(270,770)9,396

381,206

(252,975)

(43,400)

(11,283)4,815

(65,852)561

(115,159)

(3,957)7,335

3,378

16,450

247,580

$ 264,030


$ 361,469(335,862)

25,607

25,607

4,135

$ 29,742

(continued)

15


Statement of Cash FlowsProprietary Funds (continued)

For the Year Ended December 31,2005

Reconciliation of operating income to net cash provided(used) by operating activities:

Operating income (loss)Adjustments to reconcile operating income to net cash

provided (used) by operating activities:DepreciationChanges in current assets and liabilities:

Increase in accounts receivable(Increase) decrease in provision for

uncollectible accounts(Increase) decrease in unbilled utility receivables(Increase) decrease in inventory(Increase) decrease in prepaid items(Increase) decrease in due from other fundsIncrease (decrease) in due to other fundsIncrease in accounts payableIncrease (decrease) in compensated

absences payableIncrease (decrease) in claims payable

Net cash provided (used) by operating activities

Reconciliation of cash and cash equivalents perstatement of cash flows to the balance sheet:

Cash and cash equivalents, beginning of period -Cash - unrestrictedInterest-bearing deposits - unrestrictedInterest-bearing deposits - restricted

Less: Interest-bearing deposits with maturity

in excess of 90 days

Total cash and cash equivalents

Cash and cash equivalents, end of period -Cash - unrestrictedInterest-bearing deposits - unrestrictedInterest-bearing deposits - restricted

Less: Interest-bearing deposits with maturityin excess of 90 days

Total cash and cash equivalents

Net increase (decrease)

Business-type Activities •Enterprise Fund

$ 207,300

180,218

(66,728)

(2,739)(56,546)(5,098)(1,670)6,771

39,97374,063

5,662

$ 381,206

1129,780

413,021

(195,232)

247,580

1140,003

423,205

(199,189)

264,030

$ 16.450


$ (76,780)

(19,323)

121,710

$ 25,607

$ 4,135

4,135

29,742

29,742

$ 25,607


16


Notes to Financial Statements

(1) Summary of Significant Accounting Policies

The accompanying financial statements of the Town of Mamou (Town) have been preparedin conformity with generally accepted accounting principles (GAAP) as applied to governmentalunits. GAAP includes all relevant Governmental Accounting Standards Board (GASB)pronouncements. In the government-wide financial statements and the fund financial statements forthe proprietary funds, Financial Accounting Standards Board (FASB) pronouncements andAccounting Principles Board (APB) opinions on or before December 31, 1989, have been appliedunless those pronouncements conflict with or contradict GASB pronouncements, in which case,GASB prevails. The accounting and reporting framework and the more significant accountingpolicies are discussed in subsequent subsections of this note.

A. Financial Reporting Entity

The Town of Mamou was incorporated on January 4, 1911, under theprovisions of the Lawrason Act. The Town operates under the Mayor-Board ofAldermen form of government.

As the municipal governing authority, for reporting purposes, the Town ofMamou is considered a separate financial reporting entity. The financial reportingentity consists of (a) the primary government (municipality), (b) organizations forwhich the primary government is financially accountable, (c) other organizations forwhich the nature and significance of their relationship with the primary governmentare such that exclusion would cause the reporting entity's financial statements to bemisleading or incomplete, and (d) organizations that are closely related to, orfinancially integrated with the primary government.

Governmental Accounting Standards Board (GASB) Statement No. 14 asamended by Statement No. 39 established criteria for determining which componentunits should be considered part of the Town of Mamou for financial reportingpurposes. The basic criterion for including a potential component unit within thereporting entity is financial accountability. The GASB has set forth criteria to beconsidered in determining financial accountability. These criteria include:

1. Appointing a voting majority of an organization's governing body, and

a. The ability of the municipality to impose its will on thatorganization and/or

b. The potential for the organization to provide specific financialbenefits to or impose specific financial burdens on themunicipality.

2. Organizations for which the municipality does not appoint a votingmajority but are fiscally dependent on the municipality.

17


Notes to Financial Statements (Continued)

3. Organizations for which the reporting entity's financial statements wouldbe misleading if data of the organization is not included because of thenature or significance of the relationship if all of the following conditionsexist:

a. The economic resources received or held by the organization areentirely or almost entirely for the direct benefit of the primarygovernment, its component units, or its constituents.

b. The primary government (or its component units) is entitled to,or has the ability to otherwise access, a majority of the economicresources received or held by the separate organization.

c. The economic resources received or held by an individualorganization that the specific primary government (or itscomponent units) is entitled to, or has the ability to otherwiseaccess, are significant to that primary government.

4. Organizations that are closely related to, or financially integrated with theprimary government.

The following component units are not presented in the accompanyingfinancial statements:

Savoy Cancer Center, Inc.

The Savoy Cancer Center, Inc. (a nonprofit organization), consisting of theSavoy Cancer Center Operations Fund and the Town of Mamou Cancer CenterBuilding Fund was determined to be a component unit but is not presented in theaccompanying financial statements. The Town of Mamou owns the cancer treatmenthealth care facilities located in Mamou, Louisiana, which are operated by SavoyCancer Center, Inc. (the Center). The Center is a nonprofit organization incorporatedon June 29, 1998. The Center was formed for the purpose of operating and managinga facility for treating cancer patients and is exempt from income taxes under Section501(c)(3) of the Internal Revenue Code. The direction, administration andmanagement of the Center is governed by a Board of Directors or Trustees of not lessthan six (6) nor more than ten (10) members. The members serve terms of one tothree years.

On September 16, 1999, an agreement was entered into between the Townand the Center for a fifteen-year (15) term. The Town is the owner of the cancertreatment facility and retains the services of the Center to provide experience, skills,supervision and necessary personnel for the operation and management of thefacility. Various reporting and accountability requirements must be performed andsubmitted to the Town by the Center on a periodic basis. The Center will provide allservices specified in the agreement at no fee to the Town.

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The Town shall, on a monthly basis or intermittently, as determined by theCenter, reimburse the Center for all operating expenses related to the operation andmanagement of the facility. The Town is also required to maintain insurancecoverage on behalf of the facility. This agreement may be terminated "for cause" byeither party at any time during the term by giving written notice to the other. TheTown has the right of termination without cause under specified circumstances in theagreement.

Complete financial statements for the component unit may be obtained at theentity's administrative office (Savoy Cancer Center, Inc., 803 Poinciana, Mamou, LA70554).

Savoy Medical Center & Savoy Care Center Nursing Home

The Savoy Medical Center and the Savoy Care Center Nursing Home weredetermined to be component units but are not presented in the accompanyingfinancial statements. The Town of Mamou owns the equipment and physical plantoperated by Savoy Medical Center and Savoy Care Center Nursing Home. TheTown appoints five of the thirteen members of the governing board of Savoy MedicalCenter. The Town leases the premises, which includes the land, buildings, fixtures,improvements and equipment for the hospital facility to Rapides Healthcare System,LLC d/b/a Savoy Medical Center for $765,000 annually. The Town also leases thepremises, which includes the land, buildings, fixtures, improvements and equipmentfor the nursing home facility to MH3F Healthcare Management, LLC d/b/a SavoyCare Center Nursing Home for $222,300. The lessees agree to pay all taxes, charges,costs and expenses including maintenance, repairs and utilities of the facilities.

Complete financial statements for the component unit may be obtained at theentity's administrative office (Savoy Medical Center, 801 Poinciana, Mamou, LA70554).

These primary government financial statements of the Town of Mamou donot include the financial data of the component units described above. Thesecomponent units' financial data is necessary for reporting in conformity withgenerally accepted accounting principles.

B. Basis of Presentation

Government-Wide Financial Statements (GWFS)

The statement of net assets and statement of activities display informationabout the reporting government as a whole. They include all funds of the reportingentity. The statements distinguish between governmental and business-type activities.Governmental activities generally are financed through taxes, intergovernmentalrevenues, and other nonexchange revenues. Business-type activities are financed inwhole or in part by fees charged to external parties for goods or services.

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The statement of activities presents a comparison between direct expensesand program revenues for the business-type activities of the Town and for eachfunction of the Town's governmental activities. Direct expenses are those that arespecifically associated with a program or function and, therefore, are clearlyidentifiable to a particular function. Program revenues include (a) fees, fines, andcharges paid by the recipients of goods or services offered by the programs, and (b)grants and contributions that are restricted to meeting the operational or capitalrequirements of a particular program. Revenues that are not classified as programrevenues, including all taxes, are presented as general revenues.

Fund Financial Statements

The accounts of the Town are organized and operated on the basis of funds.A fund is an independent fiscal and accounting entity with a separate set of self-balancing accounts. Fund accounting segregates funds according to their intendedpurpose and is used to aid management in demonstrating compliance with finance-related legal and contractual provisions. The minimum number of funds ismaintained consistent with legal and managerial requirements.

The various funds of the Town are classified into two categories:governmental and proprietary. The emphasis on fund financial statements is on majorgovernmental and enterprise funds, each displayed in a separate column. A fund isconsidered major if it is the primary operating fund of the Town or meets thefollowing criteria:

a. Total assets, liabilities, revenues, or expenditures/expenses of thatindividual governmental or enterprise fund are at least 10 percent ofthe corresponding total for all funds of that category or type; and

b. Total assets, liabilities, revenues, or expenditures/expenses of theindividual governmental or enterprise fund are at least 5 percent ofthe corresponding total for all governmental and enterprise fundscombined.

The major funds of the Town are described below:

Governmental Funds -

The General Fund is the general operating fund of the Town. It is used toaccount for all financial resources except those required to be accounted for inanother fund.

The Sales Tax Special Revenue Fund is used to account for the proceeds oftwo separate one percent sales and use taxes that are legally restricted to expendituresfor specific purposes.

20



The P.I. Sales Tax Refunding Bonds Debt Service Fund accounts for theaccumulation of monies for payment of the $693,000 Public Improvement Sales TaxRefunding Bonds, Series 1995.

Additionally, the Town reports the following fund types:

Proprietary Funds -

Proprietary funds are used to account for ongoing organizations and activitiesthat are similar to those often found in the private sector. The measurement focus isbased upon the determination of net income, financial position, and cash flows. Thefollowing are the Town's proprietary fund types:

Enterprise funds

Enterprise funds are used to account for operations (a) that are financed andoperated in a manner similar to private business enterprises - where the intent of thegoverning body is that the costs (expenses, including depreciation) of providinggoods or services to the general public on a continuing basis be financed or recoveredprimarily through user charges; or (b) where the governing body has decided thatperiodic determination of revenues earned, expenses incurred, and/or net income isappropriate for capital maintenance, public policy, management control,accountability, or other purposes. The Town applies all applicable FASBpronouncements issued after November 30, 1989 in accounting and reporting for itsenterprise fund. The Town's enterprise fund is the Utility Fund.

Internal service funds

Internal service funds are used to account for the financing of goods orservices provided by one department or agency or other departments or agencies ofthe governmental unit, or to other governmental units, on a cost-reimbursement basis.The Town's internal service is the Group Health Self Insurance Fund.

C. Measurement Focus/Basis of Accounting

Measurement focus is a term used to describe "which" transactions arerecorded within the various financial statements. Basis of accounting refers to"when" transactions are recorded regardless of the measurement focus applied.

Measurement Focus

On the government-wide statement of net assets and the statement ofactivities, both governmental and business-type activities are presented using theeconomic resources measurement focus as defined in item b. below.

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In the fund financial statements, the "current financial resources"measurement focus or the "economic resources" measurement focus is used asappropriate:

a. All governmental funds utilize a "current financial resources"measurement focus. Only current financial assets and liabilities aregenerally included on their balance sheets. Their operatingstatements present sources and uses of available spendable financialresources during a given period. These funds use fund balance astheir measure of available spendable financial resources at the end ofthe period.

b. The proprietary fund utilizes an "economic resources" measurementfocus. The accounting objectives of this measurement focus are thedetermination of operating income, changes in net assets (or costrecovery), financial position, and cash flows. All assets and liabilities(whether current or noncurrent) associated with their activities arereported. Proprietary fund equity is classified as net assets.

Basis of Accounting

In the government-wide statement of net assets and statement of activities,both governmental and business-type activities are presented using the accrual basisof accounting. Under the accrual basis of accounting, revenues are recognized whenearned and expenses are recorded when the liability is incurred or economic assetused. Revenues, expenses, gains, losses, assets, and liabilities resulting fromexchange and exchange-like transactions are recognized when the exchange takesplace.

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

The proprietary funds utilize the accrual basis of accounting. Under theaccrual basis of accounting, revenues are recognized when earned and expenses arerecorded when the liability is incurred or economic asset used.

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D. Assets, Liabilities and Equity

Cash, interest-bearing deposits, and investments

For purposes of the statement of net assets, cash and interest-bearing depositsinclude all demand accounts, savings accounts, and certificates of deposits of theTown.

Under state law, the Town may invest in United States bonds, treasury notes,or certificates. Investments are stated at amortized cost.

For the purpose of the proprietary funds statement of cash flows, "cash andcash equivalents" include all demand and savings accounts, and certificates ofdeposit or short-term investments with an original maturity of three months or less.

Receivables

In the government-wide statements, receivables consist of all revenuesearned at year-end and not yet received. Major receivable balances for thegovernmental activities include ad valorem and sales and use taxes. Business-typeactivities report customer's utility service receivables as their major receivables.Uncollectible ad valorem taxes or utility service receivables are recognized as baddebts at the time information becomes available which would indicate theuncollectibility of the particular receivable. At December 31, 2005 and 2004, anallowance for ad valorem taxes was considered unnecessary due to immateriality.The allowance for customers' utility receivables was $145,745 and $143,006 atDecember 31, 2005 and 2004, respectively. Unbilled utility service receivablesresulting from utility services rendered between the date of meter reading and billingand the end of the month, are recorded at year-end.

Interfund receivables and payables

During the course of operations, numerous transactions occur betweenindividual funds that may result in amounts owed between funds. Those related togoods and services type transactions are classified as "due to and from other funds."Short-term interfund loans are reported as "interfund receivables and payables."

Long-term interfund loans (noncurrent portion) are reported as "advancesfrom and to other funds." Interfund receivables and payables between funds withingovernmental activities are eliminated in the statement of net assets.

Inventory

Inventory of the Utility Fund consists of natural gas being held as storage onbehalf of the Town by the Louisiana Municipal Gas Authority and is valued at a priceper MCF determined by the Louisiana Municipal Gas Authority. Supplies and partson hand are considered immaterial and have been accounted for using the purchasemethod.

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Prepaid Items

Payments made to vendors for services that will benefit periods beyondDecember 31,2005, are recorded as prepaid items.

Restricted Assets

Restricted assets include cash and interest-bearing deposits of the generalfund and proprietary fund that are legally restricted as to their use. The restrictedassets in the utility fund are related to the utility meter deposits and revenue bondaccounts. The restricted assets in the general fund are related to contingent liabilitiesarising out of workman's compensation and malpractice claims in existence at thetime the Town purchased the hospital and fund required to be on hand for repaymentof the Cancer Treatment Center bonds.

Capital Assets

Capital assets, which include property, plant, equipment, and infrastructureassets, are reported in the applicable governmental or business-type activitiescolumns in the government-wide or financial statements. Capital assets arecapitalized at historical cost or estimated cost if historical is not available. Donatedassets are recorded as capital assets at their estimated fair market value at the date ofdonation. The Town maintains a threshold level of $1,000 or more for capitalizingcapital assets.

The costs of normal maintenance and repairs that do not add to the value ofthe asset or materially extend assets lives are not capitalized. Prior to July 1, 2001,governmental funds' infrastructure assets were not capitalized. These assets havebeen valued at estimated historical cost.

Depreciation of all exhaustible capital assets is recorded as an allocatedexpense in the statement of activities, with accumulated depreciation reflected in thestatement of net assets. Depreciation is provided over the assets' estimated usefullives using the straight-line method of depreciation. The range of estimated usefullives by type of asset is as follows:

Buildings 40 yearsEquipment 5 yearsUtility system and improvements 20-40 yearsInfrastructure 20 years

In the fund financial statements, capital assets used in governmental fundoperations are accounted for as capital outlay expenditures of the governmental fundupon acquisition. Capital assets used in proprietary fund operations are accounted forthe same as in the government-wide statements.

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Long-term debt

The accounting treatment of long-term debt depends on whether the assetsare used in governmental fund operations or proprietary fund operations and whetherthey are reported in the government-wide or fund financial statements.

All long-term debt to be repaid from governmental and business-typeresources are reported as liabilities in the government-wide statements. The long-term debt consists primarily of the public improvement and revenue bonds payable,utility meter deposits payable, and contingent liabilities arising out of workman'scompensation and malpractice claims in existence at the time the Town purchased thehospital.

Long-term debt for governmental funds is not reported as liabilities in thefund financial statements. The debt proceeds are reported as other financing sourcesand payment of principal and interest reported as expenditures. The accounting forproprietary fund long-term debt is the same in the fund statements as it is in thegovernment-wide statements

Compensated Absences

Sick leave is earned at the rate of one day for each month worked, with alimit of twelve days per year. An employee may not carry over or accumulate morethan forty-eight days of sick leave from one year to another. Sick leave is notpayable at termination of employment. Vacation leave is earned over an anniversaryyear basis at the rate of one day for each month worked, with a limit of twelve daysper year. An employee may not carry over or accumulate vacation leave from oneemployment anniversary date to another.

For fund financial statements, vested or accumulated leave that is expected tobe liquidated with expendable available financial resources is reported as anexpenditure and a current fund liability of the governmental fund that will pay it. Inthe government-wide statements, amounts of vested or accumulated leave that are notexpected to be liquidated with expendable available financial resources are recordedas long-term debt.

Equity Classifications

In the government-wide statements, equity is classified as net assets anddisplayed in three components:

a. Invested in capital assets, net of related debt - Consists of capitalassets including restricted capital assets, net of accumulateddepreciation and reduced by the outstanding balances of any bonds,mortgages, notes, or other borrowings that are attributable to theacquisition, construction, or improvement of those assets.

25



b. Restricted net assets - Consists of net assets with constraints placedon the use either by (1) external groups such as creditors, grantors,contributors, or laws or regulations of other governments; or (2) lawthrough constitutional provisions or enabling legislation.

c. Unrestricted net assets - All other net assets that do not meet thedefinition of "restricted" or "invested in capital assets, net of relateddebt."

In the fund statements, governmental fund equity is classified as fundbalance. Fund balance is further classified as reserved and unreserved, withunreserved further split between designated and undesignated. Proprietary fundequity is classified the same as in the government-wide statements.

E. Revenues. Expenditures, and Expenses

Operating Revenues and Expenses

Operating revenues and expenses for proprietary funds are those that resultfrom providing services and producing and delivering goods and/or services. It alsoincludes all revenue and expenses not related to capital and related financing,noncapital financing, or investing activities.

Expenditures/Expenses

In the government-wide financial statements, expenses are classified byfunction for both governmental and business-type activities.

In the fund financial statements, expenditures are classified as follows:

Governmental Funds - By CharacterProprietary Fund - By Operating and Nonoperating

In the fund financial statements, governmental funds report expenditures offinancial resources. Proprietary funds report expenses relating to use of economicresources.

Interfund Transfers

Permanent reallocations of resources between funds of the reporting entityare classified as interfund transfers. For the purposes of the statement of activities,all interfund transfers between individual governmental funds have been eliminated.

26



F. Revenue Restrictions

The Town has various restrictions placed over certain revenue sources fromstate or local requirements. The primary restricted revenue sources include:

Revenue Source Legal Restrictions of Use

Sales tax See Note 3Gas, water and sewer revenue Debt service and utility operations

The Town uses unrestricted resources only when restricted resources arefully depleted.

G. Budget and Budgetary Accounting

The Town follows these procedures in establishing the budgetary datareflected in the financial statements:

1. The Town Clerk prepares a proposed operating budget for the fiscal yearand submits it to the Mayor and Board of Aldermen not later than fifteendays prior to the beginning of each fiscal year.

2. A summary of the proposed budget is published and the public notifiedthat the proposed budget is available for public inspection. At the sametime, a public hearing is called.

3. A public hearing is held on the proposed budget at least ten days afterpublication of the call for the hearing.

4. After the holding of the public hearing and completion of all actionnecessary to finalize and implement the budget, the budget is adoptedthrough passage of a resolution prior to the commencement of the fiscalyear for which the budget is being adopted.

5. Budgetary amendments involving the transfer of funds from onedepartment, program or function to another or involving increases inexpenditures resulting from revenues exceeding amounts estimatedrequire the approval of the Board of Aldermen.

6. All budgetary appropriations lapse at the end of each fiscal year.

7. Budgets for all funds are adopted on a basis consistent with generallyaccepted accounting principles (GAAP). Budgeted amounts are asoriginally adopted or as amended by the Board of Aldermen. Suchamendments were not material in relation to the original appropriations.

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H. Capitalization of Interest Expense

It is the policy of the Town of Mamou to capitalize material amounts ofinterest resulting from borrowings in the course of the construction of capital assetsin the Proprietary Fund. At December 31, 2005, there were no borrowings for assetsunder construction and no capitalized interest expense was recorded on the books.

I. Use of Estimates

The preparation of financial statements in conformity with generallyaccepted accounting principles requires management to make estimates andassumptions that affect the reported amounts of assets and liabilities and disclosure ofcontingent assets and liabilities at the date of the financial statements and the reportedamounts of revenues and expenditures during the reporting period. Actual resultscould differ from those estimates.

(2) Ad Valorem Taxes

Ad valorem taxes attach as an enforceable lien on property as of January 1 of each year.Taxes are levied by the Town in September or October and are actually billed to taxpayers inDecember. Billed taxes become delinquent on January 1 of the following year. The Town bills andcollects its own property taxes. Property tax revenues are recognized when levied to the extent thatthey result in current receivables.

For the year ended December 31, 2005, taxes of 19.23 mills were levied on property withassessed valuations totaling $9,020,930 and were dedicated as follows:

General corporate purposes 7.28 millsStreets and recreation maintenance 11.95 mills

Total 19.23 mills

Total taxes levied were $173,472. Taxes receivable at December 31, 2005 were $121,219.

(3) Sales and Use Tax

A. Proceeds of the 1% sales and use tax levied by the Town of Mamou (2005 collections$306,346) are dedicated for any lawful corporate purposes of the Town.

28



B. Proceeds of the 1% sales and use tax levied by the Town of Mamou in 1991 (2005 collections$306,346) are dedicated to the following purposes:

Thirty-five percent (35%) for any lawful corporate purposes of the Town; tenpercent (10%) for inducing and attracting commerce, industry and tourism in theTown, including the acquisition and improvement of land and buildings there for; andfifty-five percent (55%) for constructing, acquiring, improving and /or extending anywork of capital improvement for the Town.

(4) Cash, Interest-Bearing Deposits

Under state law, the Town may deposit funds within a fiscal agent bank organized under thelaws of the State of Louisiana, the laws of any other state in the Union, or the laws of the UnitedStates. The Town may invest in certificates and time deposits of the state banks organized underLouisiana law and national banks having principal offices in Louisiana. At December 31, 2005, theTown had cash and interest-bearing deposits (book balances) totaling $3,079,821 as follows:

Demand deposits $ 174,538Money market accounts 917,203Time deposits 1,988,080

Total $ 3,079,821

These deposits are stated at cost, which approximates market. Under state law, thesedeposits, (or the resulting bank balances) must be secured by federal deposit insurance or the pledgeof securities owned by the fiscal agent bank. The market value of the pledged securities plus thefederal deposit insurance must at all times equal the amount on deposit with the fiscal agent bank.These securities are held in the name of the pledging fiscal agent bank in a holding or custodial bankthat is mutually acceptable to both parties. Deposit balances (bank balances) at December 31, 2005were secured as follows:

Bank balances $ 3,628,962

Federal deposit insurance $ 632,633Pledged securities (Category 3) 2,971,329

Total FDIC insurance and pledged securities $ 3,603,962

Pledged securities in Category 3 include uninsured or unregistered investments, for whichsecurities are held by the broker or dealer, or by its trust department or agent, but not in the Town'sname. Even though the pledged securities are considered uncollateralized (Category 3), LouisianaRevised Statute 39:1229 imposes a statutory requirement on the custodial bank to advertise and sellthe pledged securities within 10 days of being notified by the Town that the fiscal agent has failed topay deposited funds upon demand.

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(5) Receivables

Receivables at December 31,2005 of $574,926 consist of the following:

AccountsUnbilled utilityAllowance for uncollectible accountsAd valoremFranchise tax

Interest

OtherTotals

(6) Due from Other Governmental Units

Amounts due from other governmental units of $206,690 at December 31, 2005 consisted ofthe following:

SalesGeneral Tax

$ - $ ---

121,21945,4176,995

2,000

$175,631 $ -

Utility$364,581

180,367(145,745)

-

92-

$399,295

Total$364,581

180,367(145,745)121,21945,4177,087

2,000

$574,926

General Fund:State of Louisiana - beer tax revenues receivableFEMA - Hurricane Katrina expense reimbursement receivable

Total due from other governmental units

$ 2,059204,631

$206,690

(7) Restricted Assets

A. Restricted assets in the enterprise utility fund consisted of the following at December 31,2005:

B.

Customers' depositsWater sinking fundWater depreciation and contingency

Total enterprise utility fund restricted assets

$323,20241,37558,627

$423,204

Restricted assets in the general fund pertain to prior year hospital revenue claims andconsisted of the following at December 31, 2005:

Worker's compensation claims depositsMalpractice claims depositsCancer treatment center bond restricted cash

Total general fund restricted assets

$ 100,000125,000750,000

$ 975,000

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(8) Capital Assets

Capital asset activity for the year ended December 31,2005 was as follows:

Governmental activities:Capital assets not being depreciated:

LandOther capital assets:

BuildingsInfrastructureEquipment, furniture and fixturesVehicles

Totals

Less accumulated depreciationBuildingsInfrastructureEquipment, furniture and fixtures

VehiclesTotal accumulated depreciation

Governmental activities,capital assets, net

Business-type activities:Capital assets not being depreciated:

Land - sewer systemOther capital assets:

Gas systemWater systemSewer systemMachinery and equipment

Totals

Less accumulated depreciationGas systemWater systemSewer systemMachinery and equipment

Total accumulated depreciation

Business-type activities,capital assets, net

Balance01/01/05

402,9301,256,3251,265,281

830,006

3,754,542

Additions Deletions

$ 198,000 $

$2,996,672 $ 12,319 $

$ 63,910 $

400,7312,371,5722,385,0921,328,587

6,549,892

65,852 1,295

65,852 1,295

14,91181,95283,355

734

180,218

Balance12/31/05

$ 198,000

2,144,5601,504,010395,920236,029

4,478,519

363,189665,948292,560160,150

1,481,847

--

134,42423,654

158,078

55,31938,91927,33324,188

145,759

---3,250

3,250

--3,250

3,250

2,144,5601,504,010530,344256,433

4,633,347

418,508704,867319,893181,088

1,624,356

$3,008,991

$ 63,910

400,7312,371,5722,385,0921,393,144

6,614,449

417,8411,338,2771,348,636

829,272

734 3,934,026

$2,795,350 $ (114,366) $ 561 $2,680,423

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Depreciation expense was charged to governmental activities as follows:

General government $ 17,848Police 19,794Highways and streets 45,244Culture and recreation 61,725Judicial 1,148

Total depreciation expense $ 145,759

Depreciation expense was charged to business-type activities as follows:

Gas $ 14,911Water 81,952Sewer 83,355

Total depreciation expense $180,218

(9) Accounts and Other Pavables

The accounts and other payables consisted of the following at December 31,2005:

Governmental Business-typeActivities Activities Total

Accounts $153,618 $201,986 $355,604Compensated absences 29,742 8,298 38,040Accrued liabilities 18 4,975 4,993

Totals $183,378 $215,259 $398,637

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(10) Changes in Long-Term Debt

A. The following is a summary of long-term debt transactions of the Town for the year endedDecember 31,2005:

GovernmentalActivities Business-type Activities

Public CertificatesImprovement Revenue of Indebtedness Total

Long-term debt, January 1, 2005AdditionsRetirements

Long-term debt, December 31,2005

$170,000 $185,211

(81,000) (43,400)

$ 89,000 $141,811

$ $355,211

(124,400)

$230,811

Long-term debt payable at December 31, 2005 is comprised of the following individualissues:

Long-term debt -

Balance12/31/05

Due WithinOne Year

$693,000 Public Improvement Sales Tax Bonds Series 1995, due inannual installments of $39,000 to $89,000 through April 1, 2006;interest at 6.00 percent; payable from sales tax revenues $ 89,000 $ 89,000

$393,692 Water Revenue Refunding Bonds, Series 1998 due in annualinstallments of $24,485 - $51,557 through April 1, 2008; interest at6.90 percent; secured by water fund revenues. 141 gi i

The bonds are due as follows:

50 058

$230,811 $139,058

Governmental Activities Business-type ActivitiesYear ending

December 2005

200620072008

Total

Principalpayments

$ 89,000

Interestpayments

$ 2,670

Principalpayments

$ 50,05851,55740,195

Interestpayments

$ 8,0584,4521,387

$ 89,000 $ 2,670 $141,810 $13,897

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B. In 1999, the Town issued $5,000,000 of revenue bonds for the construction of the SavoyCancer Center facility. These bonds are reported on the financial statements of SavoyCancer Center, Inc., a component unit of the Town (see Note 1), At December 31, 2005there were $3,520,000 of bonds outstanding.

C. Capital leases -

$65,450 equipment lease dated August 1, 2005, due in monthly installmentsof $1,237, including interest at 5.25% through July 1, 2010, secured byGeneral Fund revenues $ 59,390

Less: current portion of capital lease payable 12.015Noncurrent portion of capital lease payable $ 47,375

(11) Flow of Funds: Restrictions on Use - Water Revenues

Under the terms of the $393,692 Water Revenue Refunding Bonds, Series 1998, all incomeand revenues of every nature derived from the operation of the system are pledged and dedicated tothe retirement of said bonds.

Water Revenue Bond and Interest Sinking Fund

The Town is required to set aside into the Water Revenue Bond and Interest Sinking Fundmonthly in advance on or before the 20th day of each month of each year a sum equal to 176th of theinterest falling due on the next interest payment date and a sum equal to 1712th of the principal fallingdue on the next principal payment date. Funds deposited in this account are available only for theretirement of maturing bonds and interest.

Water Depreciation and Contingency Fund

The Town is required to maintain the Water Depreciation and Contingency Fund to care fordepreciation, extensions, additions, improvements, and replacements necessary to properly operatethe System, by transferring monthly in advance on or before the 20th day of each month a sum at leastequal to 5% of the amount to be paid into the Sinking Fund. Funds deposited into this account mayalso be used to pay the principal of and interest on bonds for the payment of which there is notsufficient money in the Sinking Fund, but if used, such money must be replaced as soon as possibleout of the earnings of the system after making the required monthly payments into the respectivefunds and accounts.

Utility Rates

It is further understood that the Town shall adopt a rate ordinance which shall providerevenue in each year, after paying all reasonable and necessary expenses of operating and maintainingthe water system in such year, at least equal to 130 percent of the largest amount of principal andinterest maturing on the bonds in any future fiscal year. Said rate ordinance shall also provide for a10 percent penalty charge for non-payment bills within fifteen days after the due date anddiscontinuance of service upon non-payment of bills within twenty-five days after the due date.

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(12) Employee Retirement

A. Social Security System

Employees of the Town of Mamou who are not eligible to participate in anyother retirement system are members of the Social Security System. The Town andits employees contribute a percentage of each employee's salary to the System (7.65percent contributed by the Town; 7.65 percent contributed by the employee). TheTown's contributions during the years ending December 31,2005 and 2004 amountedto $99,803 and $89,161, respectively.

B. Municipal Police Employees Retirement System of Louisiana (System)

Plan Description - All full-time police department employees engaged in lawenforcement are eligible to participate in the System. Employees who retire at orafter age 50 with at least 20 years of creditable service or at or after age 55 with atleast 12 years of creditable service are entitled to a retirement benefit, payablemonthly for life, equal to 3 1/3% of their final-average salary for each year ofcreditable service. Final average salary is the employee's average salary over the 36consecutive or joined months that produce the highest average. Employees whoterminate with at least the amount of creditable service stated above, and do notwithdraw their employee contributions, may retire at the ages specified above andreceive the benefit accrued to their date of termination. The System also providesdeath and disability benefits. Benefits are established by state statute.

The System issues an annual publicly available financial report that includesfinancial statements and required supplementary information for the System. Thatreport may be obtained by writing to the Municipal Police Employees RetirementSystem of Louisiana, (225) 929-7411.

Funding Policy - Plan members are required by state statute to contribute7.5% of their annual covered salary and the Town is required to contribute at anactuarially determined rate. The current rate is 23.75% of annual covered payroll.The contribution requirements of plan members and the Town are established andmay be amended by state statute. As provided by R.S. 11:103, the employercontributions are determined by actuarial valuation and are subject to change eachyear based on the results of the valuation for the prior fiscal year. The Town'scontributions to the System for the years ending December 31, 2005 and 2004 were$9,412 and $8,119, respectively, equal to the required contributions for each year.

35



(13) Litigation and Claims

At December 31, 2005, the Town is involved in several lawsuits claiming damages. In theopinion of the Town's legal counsel, the only exposure to the Town would be any costs in defense ofthe lawsuits with no liability to the Town in excess of insurance coverage. The Town also expects tosettle old worker's compensation and malpractice claims within the next two years at an amount lessthan what it currently set aside for such claims. See also Note 15.

(14) Risk Management

A. Commercial Insurance Coverage

The Town is exposed to risks of loss in the areas of health care, general andauto liability, property hazards and workers' compensation. All of these risks arehandled by purchasing commercial insurance coverage. There have been nosignificant reductions in the insurance coverage during the year.

B. Group Self-Insurance

Effective July 1, 1998, the Town established a self-insurance health plan toaccount for and finance its uninsured risk of loss for commercial group healthinsurance. From January 1, 2005 through June 30, 2005, the plan was administeredby Total Benefit Services, Inc. The provider was changed to Southern BenefitServices effective July 1, 2005. Under this plan, the International Insurance AgencyServices, Inc. agreed to reimburse the Town for specific incurred claims related toany one covered employee or dependent which exceeds the retention by the Town,which is $25,000. For the plan year ending June 30, 2005, the InternationalInsurance Agency Services, Inc. will reimburse the Town for aggregate incurredclaims during the period of insurance less any amounts paid with respect to thespecific incurred claims, which exceeds the greater of $336,549 or the total ofmonthly payments by the Town. Monthly payments are calculated based on thenumber of employees with single coverage multiplied by a funding factor of $336and the number of employees with family coverage multiplied by a funding factor of$749. The Town currently funds the plan based upon actual claims incurred insteadof the funding factors discussed above.

36



The General and Utility Funds of the Town participate in the program andmake payments to the Self-Insurance Fund based upon amounts needed to pay priorand current year claims. The claims liability of $169,088 reported in the fund atDecember 31, 2005 is based on the loss that is probable at the date of the financialstatements and the amount of the loss that can be reasonably estimated. The Towncurrently does not discount its claims liabilities.

Reconciliation of Claims Liabilities

Claims payable, January 1,2005 $ 47,379

Insurance claims incurred for year ended December 31,2005 324,664Payments made for the year ended December 31, 2005 (202,955)

Claims payable, December 31,2005 $169,088

Claims payable of $ 169,088 at December 31,2005 was determined asfollows:

A. Claims incurred prior to December 31,2005 and paidin January 1,2006 through March 31,2006 $ 134,088

B. Provision for claims incurred but not reported 35,000

Total claims payable $ 169,088

The provision for claims incurred but not reported of $35,000 wascalculated utilizing historical information adjusted for current trends.

(15) Contingent Liabilities

At December 31, 2005, the Town had contingent liabilities in the amount of $350,000consisting of $225,000 in workers* compensation claims and $125,000 in malpractice claims, both ofwhich are the result of the prior operations of the hospital facility owned by the Town. The Town hascertificates of deposit totaling $225,000 held as security for these claims.

37



(16) Segment Information for the Enterprise Fund

The Town of Mamou maintains one enterprise fund with three departments, which providegas, water, and sewerage services. Segment information for the year ended December 31, 2005, wasas follows:

TotalGas Water Sewer Enterprise

Department Department Department Fund

Operating revenues $1,108,739 $ 420,166 $ 383,864 $1,912,769

Operating expenses:Depreciation 14,911 81,952 83,355 180,218Other 1,015,818 193,321 316,112 1,525,251

Total operating expenses 1,030,729 275,273 399,467 1,705,469

Operating income $ 78,010 $ 144,893 $ (15,603) $ 207,300

(17) Compensation of Town Officials

A detail of compensation paid to the Mayor and Board of Aldermen for the year endedDecember 31, 2005 follows:

Wilda Chamberlain, Mayor 26,344

Aldermen:Ricky Fontenot 9,493J.L. Saucier 9,000Jody Soileau 9,352Essie Holland 9,464Randall Young 9,292

Total $72,945

38



(18) Interfund Receivables/Payables

A. A summary of interfund receivables and payables at December 31,2005 follows:

Interfund InterfundReceivables Payables

Major governmental funds:General Fund $ - $ 90,605Sales Tax Fund 58,179

Proprietary funds:Enterprise Fund - 39,973

Group Health Self-Insurance Internal Service Fund 72,399 -

Total $ 130,578 $ 130,578

The receivable in the Group Health Self-Insurance Fund is for amounts owed from variousother funds for their share of health insurance premiums. The amounts due from the General Fund tovarious other funds are for short-term loans.

B. Transfers consisted of the following at December 31, 2005:

Transfers In Transfers OutMajor governmental funds:

General Fund $ 680,463 $Sales Tax Special Revenue Fund - 519,735P. I. Sales Tax Refunding Bonds Debt Service Fund 92,247 -

Total governmental funds 772,710 519,735

Proprietary funds:Enterprise Fund - 252,975

Total $772,710 $ 772,710

Transfers are used to (a) move revenues from the fund that statute or budget requires tocollect them to the fund that statute or budget requires to expend them and to (b) use unrestrictedrevenues collected in the general fund to finance various programs accounted for in other funds inaccordance with budgetary authorizations.

39



(19) Operating Lease Revenues

The Town has negotiated the lease of Savoy Medical Center and Savoy Care Center NursingHome. Under the Savoy Medical Center lease agreement, the Town will receive $63,750 per monthfor a primary term of five years commencing on February 1, 2005 and ending on January 31, 2010.This lease includes on option by lessee to renew for three additional periods of five years. Under theSavoy Care Center Nursing Home agreement, the Town will receive $18,525 per month on a month-to-month basis commencing on February 1, 2005.

(20) Economic Dependency

The Town of Mamou owns a hospital facility and nursing home within the Town. Thehospital is leased to Rapides Healthcare System, LLC operating as Savoy Medical Center for$765,000 per year. The nursing home is leased to MH3F Healthcare Management, LLC operating asSavoy Care Center Nursing Home for $222,300 per year. These leases provide a significant portionof the Town's total revenues. If the Town were to cease receiving these lease revenues, the Town'sability to continue to provide services at present levels would be threatened.

(21) Enterprise Fund Contracts

The Town of Mamou, under contract dated January 1, 1997, is required to purchase itsnatural gas from the Louisiana Municipal Gas Authority. The contract automatically renews annuallyunless notice is given in writing six months in advance. The Town purchased natural gas during theyear ended December 31, 2005 in the amount of $717,450 of which $165,370 was owed for purchasesfor the month of December 2005.

40

TOWN OF MAMOU, LOUISIANAGeneral Fund

Budgetary Comparison ScheduleFor the Year Ended December 31, 2005


Total revenues

Expenditures:Current:




Capital outlayDebt service

Total expenditures

Deficiency of revenuesover expenditures

Other financing sources (uses):Proceeds from capital leaseTransfers from -

Utility FundSales Tax Fund

Transfer to component unit


Excess (deficiency) of revenues andother sources over expendituresand other uses

Fund balance, beginning

Fund balance, ending

BudgetOriginal

$ 258,500115,000106,000100,000943,200

1,522,700

595,700

(310,500)

300,000

300,000

Final Actual

$ 338,500 $ 343,290

120,000 123,274270,000 275,672333,000 324,696

1,159,850 1,184,156

2,221,350 2,251,088

804,000 802,937

(300,450) (267,951)

65,450

200,000400,000

(445,000)

155,000

65,451

252,975427,488

(444,262)

301,652

(10,500) (145,450) 33,701

2,146,905 2,146,905 2,146,905

Variance withFinal Budget

Positive(Negative)

$ 4,7903,2745,672

(8,304)24,306

29,738

1,063

605,100419,000163,50049,900

---

1,833,200

790,100537,330193,55088,5206,500

101,8007,500

2,521,800

782,681544,668186,18988,4686,95599,7177,424

2,519,039

7,419(7,338)7,361

52(455)2,083

7610,185

32,499

1

52,97527,488

738

81,201

113,700

$2,136,405 $2,001,455 $2,180,606 $ 113,700

42

TOWN OF MAMOU, LOUISIANASales Tax Special Revenue Fund

Budgetary Comparison ScheduleFor the Year Ended December 31,2005

Revenues:TaxesMiscellaneous -

InterestOther

Total revenues

Expenditures:Current:

General governmentCapital outlay

Total expenditures

Excess of revenuesover expenditures

Other financing uses:Transfers out

Excess (deficiency) of revenuesover expenditures and other uses



BudgetOriginal

33,000218,000

251,000

312,000

Final Actual

35,00086,000

121,000

503,000

47,34558,361

105,706

511,713

(595,000) (805,000) (519,735)

(283,000) (302,000)

454,593 454,593


Positive(Negative)

$ 560,000 $ 621,000 $ 612,963 $ (8,037)

3,000

563,000

3,000

624,000

3,679111

617,419

679111

(6,58i;

(12,345)27,639

15,294

8,713

285,265

(8,022) 293,978

454,593

171,593 $ 152,593 $ 446,571 $ 293,978

43

OTHER SUPPLEMENTARY INFORMATION

44

OTHER FINANCIAL INFORMATION

45


Statement of Net AssetsDecember 31,2005

With Comparative Totals for December 31,2004


Cash and interest-bearing depositsReceivables, netDue from other governmental unitsInventoryPrepaid items

Total current assets

Noncurrent assets:Restricted assets:

Cash and interest-bearing depositsCapital assets, net


Total assets


Accounts and other payablesClaims payableInternal balancesCapital lease payableBonds payableAccrued interest


Noncurrent liabilities:Customers deposits payableContingent liabilitiesCapital lease payableBonds payable


Total liabilities


Total net assets

2005Governmental

Activities

$1,641,602175,760206,690

-20,385

2,044,437

975,0003,008,991

3,983,991

6,028,428

183,378169,089(39,973)12,01589,000

1,335414,844

350,00047,375

-

397,375

812,219

2,958,36644,364

2,213,479

$5,216,209

Business-TypeActivities

$ 40,014399,166

-44,9567,162

491,298

423,2052,680,423

3,103,628

3,594,926

215,259-

39,973-

50,0582,446

307,736

224,034--

91,753

315,787

623,523

2,588,670-

382,733

$2,971,403

Total

$ 1,681,616574,926206,69044,95627,547

2,535,735

1,398,2055,689,414

7,087,619

9,623,354

398,637169,089

-12,015

139,0583,781

722,580

224,034350,00047,37591,753

713,162

1,435,742

5,547,03644,364

2,596,212

$ 8,187,612

2004Totals

$1,366,721414,890

2,47639,8586,759

1,830,704

1,838,0215,792,022

7,630,043

9,460,747

234,29447,379

124,4015,745

411,819

219,219675,000

230,810

1,125,029

1,536,848

5,561,21259,521

2,303,166

$7,923,899

46


Balance SheetGovernmental FundsDecember 31,2005

With Comparative Amounts as of December 31, 2004

2005

ASSETS


TaxesAccrued interestDue from other governmental unitsOther

Due from other fundsPrepaid expensesRestricted cash:

Interest-bearing depositsTotal assets

LIABILITIES AND FUND BALANCES

Liabilities:Accounts and other payablesCompensated absences payableDue to other fundsOther

Total liabilities

Fund balances -Reserved for debt serviceUnreserved, undesignated

Total fund balances

Total liabilities and fund balances

General

$ 142,532915,507

166,6366,995

206,6902,129-

20,385

975,000

$2,435,874

$ 134,90329,74290,605

18255,268

2,180,606

2,180,606

$2,435,874

Sales TaxSpecialRevenue

$407,107

----

58,179-

_

$ 465,286

$ 18,715---

18,715

446,571

446,571

$ 465,286

DebtServiceFund Total

$ - $ 142,532146,714 1,469,328

166,6366,995

206,6902,12958,17920,385

975,000

$ 146,714 $3,047,874

$ - $ 153,61829,74290,605

18273,983

146,714 146,7142,627,177

146,714 2,773,891

$146,714 $3,047,874

2004

$ 122,6471,210,148

137,5963,9132,476129

48,0291,267

1,425,000

$2,951,205

$ 81,93615,791107,8761,033

206,636

143,0712,601,498

2,744,569

$2,951,205

47


Statement of Revenues, Expenditures, and Changes in Fund Balances-Governmental Funds

For the Year Ended December 31,2005With Comparative Actual Amounts for the Year Ended December 31,2004

2005


Total revenues

Expenditures:Current -




Capital outlayDebt service -

Principal retirementInterest and fiscal charges

Total expenditures

Excess (deficiency) of revenuesover expenditures

Other financing sources (uses):Proceeds from capital leaseTransfers inTransfers out

Transfers in (out) - component unit


Net changes in fund balances



General

$ 343,290123,274275,672324,696

1,184,156

2,251,088

802,937

782,681544,668186,18988,4686,95599,717

6,0611,363

2,519,039

(267,951)

65,451680,463

-(444,262)

301,652

33,701

2,146,905

$2,180,606

Sales TaxSpecialRevenue

$ 612,963---4,456

617,419

47,345

-

----

58,361

--

105,706

511,713

-(519,735)

-

(519,735)

(8,022)

454,593

$ 446,571

DebtServiceFund

$ ----1,1761,176

1,010

_

-----

81,0007,770

89,780

(88,604)

92,247

-

-92,247

3,643

143,071

$ 146,714

Total

$ 956,253123,274275,672324,696

1,189,788

2,869,683

851,292

782,681544,668186,18988,4686,955

158,078

87,0619,133

2,714,525

155,158

65,451772,710

(519,735)

(444,262)

(125,836)

29,322

2,744,569

$2,773,891

2004

$ 884,099115,85057,824113,123

1,109,860

2,280,756

680,446

627,370431,144175,46165,954

130,005

73,00012,390

2,195,770

84,986

805,806(368,438)

(455,303)

(17,935)

67,051

2,677,518

$2,744,569

48


Budgetary Comparison Schedule - RevenuesFor the Year Ended December 31, 2005

With Comparative Actual Amounts for the Year Ended December 31, 2004

2005

Taxes:Ad valoremFranchise -

ElectricTelephoneCable TV

Total taxes

Licenses and permits:

Occupational licensesPermits

Total licenses and permits

Intergovernmental:

Federal grants •Federal Emergency Mgmt. AssistanceSummer feeding grant

State of Louisiana-

Beer taxesHighway maintenanceRural Development grantDARE grantEvangel ine Parish tourist commission grant

Total intergovernmental

Fines and forfeits:

Fines and court costs

Miscellaneous:InterestHospital lease revenueHospital receivable revenueNursing home lease revenueHospital workers comp recoveriesRentalsRecreation complex

Other sources

Total miscellaneous

Total revenues

BudgetOriginal

$ 130,000

113,00015,500

-

258,500

115,000

-115,000

-

6,000-

--

100,000106,000

100,000

10,000900,000

---5,00023,0005,200

943,200

$1,522,700

Final

$ 165,000

138,00015,50020,000338,500

120,000-

120,000

250,000-

6,0004,000

--

10,000270,000

333,000

43,000775,00010,000200,00076,0005,00023,00027,850

1,159,850

$2,221,350

Actual

$ 167,012

140,63315,93519,710343,290

121,7791,495

123,274

253,283-

7,7844,605--

10,000275,672

324,696

44,801776,25210,248206,72578,1044,55025,03938,437

1,184,156

$2,251,088


Positive(Negative)

$ 2,012

2,633435(290)4,790

1,7791,4953,274

3,283-

1,784605--

-5,672

(8,304)

1,8011,252248

6,7252,104(450)2,03910,587

24,306

$ 29,738

2004Actual

$ 182,710

117,4978,16522,142330,514

114,3121,538

115,850

18,534

8,8824,60522,5003,303

-57,824

113,123

35,840900,00013,714-

107,8184,71824,66516,587

1,103,342

$1,720,653

49


Budgetary Comparison Schedule - ExpendituresFor the Year Ended December 31,2005

With Comparative Actual Amounts for the Year Ended December 31,2004

2005

Current:General government:

Administrative -Mayor and council salariesOther salaries and wagesGroup insuranceInsurancePayroll taxesMaterials and suppliesAdvertisements and recordingsLegal feesAccounting and auditingProfessional feesMiscellaneousUtilities and telephoneRepairs and maintenanceEquipment rentalTrainingLegal settlementHospital workers' comp claimsHurricane expenditures

Total administrative

Public safety:Police -

SalariesPayroll taxesRetirement contributionGroup insuranceUtilities and telephoneInsuranceAutoGas and repairsProfessional feesMiscellaneousSuppliesEquipment rentalTrainingHurricane expenditures

Total police department

BudgetOriginal

$ 60,232199,87698,25032,75019,49223,000-

33,00023,00051,50027,00016,2007,500-3,900-

--

595,700

358,80031,2008,000

43,89023,50033,11026,00025,600

1,50023,50022,000

1,0007,000-

605,100

Final

$ 78,800239,800

63,00021,00025,40029,40010,0009,500

84,0003,000

50,00016,60046,600-3,900

10,000

80,00033,000

804,000

408,42035,0809,200

60,44031,30082,56037,00021,900

6,50046,70044,000

1,3005,700-

790,100

Actual

$ 72,945238,985

67,61622,34225,55629,09210,2047,838

83,2063,249

47,48116,53847,863

4322,813

10,000

83,37733,400

802,937

409,10835,8459,412

58,60531,43576,84337,76120,364

6,18443,82945,561

1,0565,5441,134

782,681


Positive(Negative)

$ 5,855815

(4,616)(1,342)

(156)308

(204)1,662

794(249)

2,51962

(1,263)(432)

1,087-(3,377)

(400)1,063

(688)(765)(212)

1,835(135)

5,717(761)

1,536316

2,871(1,561)

244156

(M34)7,419

69,000202,60455,32528,74722,73935,7687,31830,93366,8182,90846,78215,40617,460420

2,924

45,967

651,119

349,95132,1008,11949,09128,26453,82923,98616,7968,61725,71027,7071,1002,100

627,370

(continued)

50


Budgetary Comparison Schedule - Expenditures (continued)For the Year Ended December 31,2005

With Comparative Actual Amounts for the Year Ended December 31, 2004

2005

Highways and streets:SalariesPayroll taxesMaintenance and suppliesLightingGroup insuranceTelephoneInsuranceInmate laborMiscellaneousAutoEquipment rentalProfessional fees

TrainingHurricane expenditures

Total highways and streets

Culture and recreation -SalariesPayroll taxesRepairs and maintenanceMaterials and suppliesAutoUtilities and telephoneInsuranceEquipment rentalGroup insuranceMiscellaneousProfessional feesConcession purchasesAdvertisingHurricane expenditures

Total culture and recreation

BudgetOriginal

138,00012,00075,00051,00047,0002,500

33,0006,500

21,00030,000-3,000

--

419,000

66,5165,784

13,00025,800

3,00013,00021,105

20012,3951,300-1,200

200-

163,500

Final

211,71017,52061,50051,00058,0003,300

37,00011,00016,00030,300-3,000

-37,000

537,330

55,6604,8408,500

33,0003,700

39,55025,035

20016,4651,300-2,300-3,000

193,550

Actual

211,62818,90862,57554,33458,6053,828

36,7569,965

18,51729,276

8711,742

58637,077

544,668

52,5554,534

10,14133,6622,757

40,05022,319

23413,023

751661

2,323-3,179

186,189


Positive(Negative)

82(1,388)(1,075)(3,334)

(605)(528)244

1,035(2,517)1,024(871)

1,258

(586)(77)

(7,338)

3,105306

(1,641)(662)943

(500)2,716

(34)3,442

549(661)(23)

-(179)

7,361

2004Actual

145,47819,78391,79346,87341,3402,360

35,3776,797

17,06119,6842,723

914961

-

431,144

58,4375,460

15,44622,9432,792

34,89225,650

1047,751

200100

1,492194_

175,461

(continued)

51


Budgetary Comparison Schedule - Expenditures (continued)For the Year Ended December 31,2005


2005

Judicial:SalariesPayroll taxesOffice rentalInsuranceGroup insuranceMaterials and suppliesRepairs and maintenanceTelephoneProfessional feesMiscellaneous

Total judicial

Central Garage:SalariesPayroll taxesInsurance

Total central garage

Capital outlay:General government:

LandTotal general government

BudgetOriginal Final


PositiveActual (Negative)

2004Actual

39,0602,9402,100

1,0001,8001,0001,900

100

49,900

57,0003,9202,100

15,0003,8001,7004,400

600

88,520

6,500

6,500

56,1954,4302,100

16,2793,6951,3423,950

477

88,468

6,435180

340

6,955

805(510)

(1,279)105358450

123

52

65

(180)

(340)

(455)

42,4623,4892,100

10012,919

1,445930

2,169340

65,954

Public Safety:Police -

AutosEquipment

Total police

26,0004,000

30,000

21,0043,830

24,834

4,996170

5,166

Highways and streets:AutosEquipment

Total highways and streets

65,00065,000

2,65065,45168,101

(2,650)(451)

(3,101)

Culture and recreation:Fence for baseball field

Total culture and recreation10,17610,176

JudicialEquipment

Total judicial6,8006.800

6,7826,782

1818

Total capital outlay

Debt service:Retirement of principalInterest and fiscal charges

Total debt service

Total expenditures

101,800

6,1001,4007,500

99,717

6,0611,3637,424

$1,833,200 $2,515,300 $2,519,039

52

2.083

393776

10,640

10,176

$1,961,224

TOWN OF MAMOU, LOUISIANASpecial Revenue Fund

Sales Tax Fund

Budgetary Comparison ScheduleFor the Year Ended December 31, 2005


2005

Revenues:TaxesMiscellaneous:

Interest

Other

Total revenues

Expenditures:Current -

General government -Audit and accountingMiscellaneousIndustry and tourism inducement

Total general government

Capital outlay -General government:

Roof for town hallA/CunitEquipment

Public safety:Police station improvementsVehiclesEquipmentA/Cunit

Highways and streets:Street improvementsVehiclesEquipment

Culture and recreation:A/CunitEquipmentPlaza mural project

Judicial:Equipment

Total capital outlay

Total expenditures

Excess of revenues over expenditures

Other financing uses:

Transfers to -

Debt Service FundUtility FundGeneral Fund

Total other financing uses

Excess (deficiency) of revenues over

expenditures and other uses

Fund balance, beginning

Fund balance, ending

BudgetOriginal

$ 560,000

3,000

563,000

5,000

28,000

33,000

30,000

40,000

42,000

-

106,000

218,000

251,000

312,000

(88,000)(207,000)(300,000)

(595,000)

(283,000)

454,593

$ 171,593

Final

$ 621,000

3,000

624,000

5,000

30,000

35,000

4,00035,000

5,000

42,000

-

-

86,000

121,000

503,000

(88,000)(302,000)(415,000)

(805,000)

(302,000)

454,593

$ 152,593

Actual

$ 612,963

3,679

111617,419

5,0348,868

33,443

47,345

4,12536,491

5,446

-

1,174

1,425

9,700

58,361

105,706

511,713

(92,247)

(427.488)

(519,735)

(8,022)

454,593

$ 446,571


Positive(Negative)

$ (8,037)

679

(6,581)

(34)(8,868)(3,443)

(12,345)

(125)(1,491)

(446)

42,000

(1,174)

(1,425)

(9,700)

27,639

15,294

8,713

(4,247)302,000(12,488)

285,265

293,978

-

$ 293,978

2004Actual

$ 553,585

2,246

555,831

3,495725

24,080

28,300

10,855

6,000

8,55538,800

1,433

38,8613,5004,360

5,032

2,433

119,829

148,129

407,702

(89,087)

(279,351)

(368,438)

39,264

411,781

$ 451,045

53

TOWN OF MAMOU, LOUISIANAEnterprise Fund

Utility Fund

Schedule of Number of Utility Customers(Unaudited)

December 31,2005

Records maintained by the Town indicated the following number of customers were beingserviced during the month of December 2005 and 2004:

Department 2005 2004

Gas(metered) 1,195 1,181Water 1,675 1,650Sewerage 1,258 1,249

54


Schedule of Insurance In Force(Unaudited)

December 31,2005

Description of Coverage

Workmen's compensation -Employer's liability- policy limitBodily injury by accidentBodily injury by disease

Surety bonds -Fidelity bondNotary public bond

Commercial general liability -Premises/operationsProducts/completed operationsBoiler and Machinery - equipmentMedical payments per personMedical payments per accidentFire legal liability

Law enforcement officers' comprehensive liability

Automobile liability

Public officials' errors and omissions liability

Commercial fire and extended coverage -BuildingsContentsBoiler and machinery - equipment

CoverageAmounts

Statutory500,000100,000100,000

30,0005,000

500,000500,000525,000

1,00010,00050,000

500,000

500,000

500,000

3,914,5952,845,0002,025,000

55


Combined Schedule of Interest-Bearing Deposits and Investments - All FundsDecember 31,2005

Major Governmental Funds:General Fund -

Certificate of Deposit - Worker's Comp SecurityCertificate of Deposit - Malpractice ClaimsCertificate of Deposit - Hospital Revenue FundCertificate of Deposit - CTC Bond SecurityCertificate of Deposit - Hospital Revenue CITSavings Account - Hospital RevenueInterest-bearing checking - GeneralInterest-bearing checking - Payroll

Interest-bearing checking-Law Enforcement GrantsInterest-bearing checking - Insurance Contengency

Total General Fund

Special Revenue Funds -Sales Tax Fund

Interest-bearing checking - Sales Tax FundInterest-bearing checking - Construction Account

Total Sales Tax Fund

(C)(B)(C)(C)(C)(G)(G)(G)(S)(S)

InterestRate

3.85%2.91%1.70%3.55%3.55%1.50%1.25%1.25%

1.25%1.25%

MaturityDate

11/21/0605/06/0605/16/0611/08/0605/21/06

N/AN/AN/A

N/AN/A

Total BookValue

$ 100,000125,000516,145750,000300,000

6,25935,94456,317

56786

1,890,507

(S)(S)

1.00%1.25%

N/AN/A

392,95914,148

407,107

Nonmajor Governmental Funds:Debt Service Fund -

Sales Tax Bond Reserve Fund:Interest-bearing checking

Sales Tax Bond Sinking Fund:Interest-bearing checking

Total Debt Service Fund

(S)

(S)

1.25%

1.25%

N/A

N/A

79,399

67,315146,714

Total Governmental Funds $2,444,328

(continued)

56


Combined Schedule of Interest-Bearing Deposits and Investments - All Funds (Continued)December 31,2005

InterestRate

Maturity Total BookDate Value

Proprietary Fund:Utility Fund:

Operating Account -Interest-bearing checking

Water Revenue Fund -Interest-bearing checking

Meter Deposit Fund -Certificate of DepositCertificate of DepositInterest-bearing checking

Water Revenue & Interest Sinking Fund -Interest-bearing checking

Water Depreciation & Contengency FundInterest-bearing checking

Total Proprietary Fund

Total Interest-bearing Deposits andInvestments - All Funds

(C)

(S)

(S)(G)(G)

(S)

(S)

1.00%

1.00%

3.35%3.00%1.25%

1.25%

1.25%

N/A

N/A

07/28/0603/25/06

N/A

N/A

N/A

14,380

25,623

157,59741,592

124,013

41,375

58,628

463,208

$ 2,907,536

Certificates of deposit, savings account andinterest-bearing checking accounts with —

(B) Bank One, Baton Rouge, Louisiana(C) Citizens Bank, Ville Platte, Louisiana(G) Guaranty Bank, Mamou, Louisiana(S) Sabine State Bank, Many, Louisiana

57


Proprietary FundsStatement of Net Assets

December 31,2005 and 2004

Business-type Activities - Governmental Activities -



AccountsUnbilled utility receivablesAccrued interest receivableDue from other funds

Inventory - natural gasPrepaid items

Total current assetsNoncurrent assets:

Restricted assets -Interest-bearing deposits

Capital assets, net of accumulated depreciation


Total assets


Accounts and other payablesCompensated absences payableClaims payableDue to other fundsPayable from restricted assets -

Revenue bondsAccrued interest payable


Noncurrent liabilities:Customers' depositsRevenue bonds payable


Total liabilities


Total net assets

Enterprise Fund2005

$ 1240,003

218,707180,367

92-

44,9567,162

491,298

423,2052,680,423

3,103,628

3,594,926

206,9618,298-

39,973

50,0582,446

307,736

224,03491,753

315,787

623,523

2,588,670

382,733

$ 2,971,403

2004

$ 1129,780

149,240123,821

1916,77139,8585,492

355,164

413,0212,795,350

3,208,371

3,563,535

132,8982,636--

43,4013,195

182,130

219,219141,810

361,029

543,159

2,653,540

366,836

$3,020,376

Internal Service Fund2005

$ 29,742-

---

72,399--

102,141

-

-102,141

-169,089

-

--

169,089

--

169,089

-

(66,948)

$ (66,948)

2004

$ 4,135-

_

--

53,076--

57,211

-

-57,211

-47,379

-

--

47,379

--

47,379

-

9,832

$ 9,832

58


Proprietary FundsStatement of Revenues, Expenses, and Changes in Fund Net Assets

Years Ended December 31,2005 and 2004

Operating revenues:Charges for servicesPermits, reconnections and penaltiesMiscellaneous

Total operating revenues

Operating expenses:Gas department expensesWater department expensesSewerage department expensesDepreciation expenseSelf insurance expenses

Total operating expenses

Operating income

Nonoperating revenues (expenses):Interest incomeInterest expense

Total nonoperating revenues (expenses)

Income before contributions and transfers

Capital contributions

Transfers in (out):Transfers inTransfers out

Total transfers in (out)

Change in net assets

Net assets, beginning

Net assets, ending

Business-type Activities-Enterprise Fund

2005

$1,858,06045,3139,396

1,912,769

1,015,818193,321316,112180,218

1,705,469

207,300

204,002

2004

$1,698,93346,4315,313

1,750,677

818,204210,158234,121178,553

1,441,036

309,641

7,236(10,534)

(3,298)

5,176(14,156)

(8,980)

300,661

(252,975) (437,368)

(252,975) (437,368)

(48,973) (136,707)

3,020,376 3,157,083

$2,971,403 $3,020,376

Govermental Activities-Internal Service Fund2005

457,572457,572

(76,780)

(76,780)

(76,780)

9,832

2004

$380,792 $299,168

380,792 299,168

289,336289,336

9,832

9,832

9,832

$ (66,948) $ 9,832

59

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AND

INTERNAL CONTROL

61


C. Burton Kolder, CPA"Russell F. Champagne, CPA*Victor R Slaven. CPA"P. Troy Courville. CPA*Gerald A. Thibodeaux, Jr., CPA"Robert S. Carter, CPA'Arthur R. Mixon, CPA

OFFICES

Tynes E. Mixon, Jr., CPAAllen J. LaBry, CPAAlbert R. Leger. CPA.PFS.CSA'Harry J. Clostio, CPAPenny Angelle Scruggins, CPAChristine L. Cousin, CPAMary T. Thibodeaux, CPAJames R. Roy, CPARobert J. Mete, CPAKelly M.Doucet, CPACheryl L. Bartley, CPA, CVAMandy B Self, CPAChris E. Bilski, CPA

183 South Beadle Rd. 113 East Bridge StLafayette, LA 70506 Breaux Bridge, LA 70517Phone (337) 232-4141 Phone (337) 332-4020Fax (337) 232-8660 Fax £337) 332-2867

133 East Waddil 1234 David OR. Ste 203Marksville, LA 71351 Morgan City, LA 70380Phone (318) 253-9252 Phone (985) 384-2020Fax (318) 253-8681 Fax (985) 384-3020

408 West Cotton Street 332 West Sixth AvenueVille Platte, LA 70586 Oberiln, LA 70655Phone (337) 363-2792 Phone (337) 639-4737Fax (337) 363-3049 Fax (337) 639-4568

200 South Main StreetAbbeville. LA 70510Phone (337) 893-7944Fax (337) 893-7946

450 East Main StreetNew Iberia, LA 70560

Phone (337) 367-9204Fax (337) 367-9208

Retired:Conrad 0. Chapman, CPA* 2006

*A Professional Accounting Corporation

REPORT ON COMPLIANCE AND ON INTERNAL CONTROLOVER FINANCIAL REPORTING BASED ON AN AUDIT OF

FINANCIAL STATEMENTS PERFORMED IN ACCORDANCEWITH GOVERNMENT AUDITING STANDARDS

WEBSITE;WWW. KCSRCPAS.COM



We have audited the basic financial statements of the Town of Mamou, Louisiana's (the Town)primary government as of and for the year ended December 31, 2005, and have issued our report thereondated June 2, 2006. We conducted our audit in accordance with auditing standards generally accepted in theUnited States of America and the standards applicable to financial audits contained in Government AuditingStandards issued by the Comptroller General of the United States.

Compliance

As part of obtaining reasonable assurance about whether the Town's financial statements are free ofmaterial misstatement, we performed tests of its compliance with certain provisions of laws, regulations,contracts, and grants, noncompliance with which could have a direct and material effect on the determinationof financial statement amounts. However, providing an opinion on compliance with those provisions was notan objective of our audit, and accordingly, we do not express such an opinion. The results of our testsdisclosed four instances of noncompliance that are required to be reported under Government AuditingStandards which are described in the accompanying summary schedule of current and prior year auditfindings as items 05-2 (C), 05-3(C), 05-4(C) and 05-5(C).

Internal Control Over Financial Reporting

In planning and performing our audit, we considered the Town's internal control over financialreporting in order to determine our auditing procedures for the purpose of expressing our opinion on thefinancial statements and not to provide assurance on the internal control over financial reporting. However,we noted a certain matter involving the internal control over financial reporting and its operation that weconsider to be a reportable condition. Reportable conditions involve matters coming to our attention relatingto significant deficiencies in the design or operation of the internal control over financial reporting that, in ourjudgment, could adversely affect the Town's ability to record, process, summarize and report financial dataconsistent with the assertions of management in the financial statements. The reportable condition isdescribed in the accompanying summary schedule of current and prior year audit findings as item 05-1 (1C).




62

A material weakness is a condition in which the design or operation of one or more of the internalcontrol components does not reduce to a relatively low level the risk that misstatements in amounts thatwould be material in relation to the financial statements being audited may occur and not be detected within atimely period by employees in the normal course of performing their assigned functions. Our considerationof the internal control over financial reporting would not necessarily disclose all matters in the internal controlthat might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditionsthat are also considered to be material weaknesses. However, we believe the reportable condition describedabove is a material weakness.

We also noted other matters involving the internal control over financial reporting that we havereported to management of the Town in a separate letter dated June 2,2006.

This report is intended solely for the information of the Town's management and federal awardingagencies and pass-through entities and is not intended to be and should not be used by anyone other than thesespecified parties. Although the intended use of this report maybe limited, under Louisiana Revised Statute24:513, this report is distributed by the Legislative Auditor as a public document.



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C. Burton Kolder, CPA*Russell F. Champagne, CPA*Victor R. Slaven, CPA'P. Troy Courville, CPA*Gerald A, Thtbodeaux. Jr.. CPA*Robert S. Carter, CPA*Arthur R. Mixon, CPA

OFFICES

Tynes E. Mixon, Jr., CPAAllen J. LaBry, CPAAlbert R. Leger, CPA,PFS.CSA*Harry J. Clostio, CPAPenny Angelle Scruggins, CPAChristine L. Cousin, CPAMary T. Thibodeaux, CPAJames R. Roy, CPARobert J. Metz, CPAKetlyM. Doucet, CPAKenneth J. Radial, CPACheryl L. Bartley, CPA, CVAMandy B. Self. CPAChris E. Bilski, CPA

183 South Beadle Rd. 113 East Bridge St.Lafayette, LA 70508 Breaux Bridge. LA 70517Phone (337) 232-4141 Phone (337) 332-4020Fax (337) 232-8660 Fax (337) 332-2867

133 East Waddil 1234 David DR. Ste 105Marksvllle, LA 71351 Morgan City, LA 70380Phone {318) 253-9252 Phone (965) 384-2020Fax (318) 253-8681 Fax (985) 384-3020

408 West Cotton Street 332 West Sixth AvenueVitte Platte, LA 70586 Oberiin, LA 70655Phone (337) 363-2792 Phone (337) 639-4737Fax (337) 363-3049 Fax (337) 639-4568

200 South Main StreetAbbeville, LA 70510Phone (337) 893-7944Fax (337) 893-7946

450 East Main StreetNew Iberia. LA 70560

Phone (337) 367-9204Fax (337) 367-9208

Retired:Conrad 0. Chapman, CPA* 2006

MANAGEMENT LETTERWEBSITE;

WWW.KCSRCPAS.COM

' A Professional Accounting Corporation



We have completed our audit of the basic financial statements of the Town of Mamou, Louisiana for the yearended December 31,2005, and submit the following recommendations for your consideration:

(1) The Town has two credit cards. In the period following the hurricane, the spendinglimit for one of the credit cards was increased to $40,000 to accommodate theincrease in spending necessitated by the emergency situation. The credit card ismade available to employees as needed. The Town also at times pays the creditcard bill without sufficient supporting documentation. Management should notmake the credit card available to employees, but rather use a reimbursement oradvance system. Management should consider reducing the spending limit from$40,000 to $ 15,000. Also, procedures should be implemented to improve controlsover credit card transactions. All credit card disbursements should be documentedby valid invoices.

(2) The Town has an increasing gas loss. This loss has been continuously increasingeach year. The Town should investigate possible reasons for the increasing gas lossand attempt to reduce the loss.

(3) The Town should evaluate the procedures for recording and collecting of policefines. Consideration should be given to modifying these procedures to ensure thatcomplete and accurate records are maintained on tickets issued, fines collected, andfines outstanding.

In conclusion, we express our appreciation to you and your staff, particularly to your office staff, for thecourtesies and assistance rendered to us during the performance of our audit. Should you have any questions or needassistance in implementing our recommendations, please feel free to contact us.






Town of Mamou...TOWN OF MAMOU, LOUISIANA Statement of Net Assets December 31,2005 Governmental...

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