Village of Collinston - Louisiana · procedures to management's financial data and making inquiries...

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VILLAGE OF COLLII'iSTON COLLINSTOI'i, LOUISIANA

FJI'iANCIAL STATEMENTS AND SUPPLEMEI'iTARY INFORMATION

AS OF AND FOR THE YEAR ENDED DECEMBER 31. 2010

VILLAGE OF COLLINSTON COLLINSTON, LOUISIANA

TABLE OF CONTENTS AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2010

INDEPENDENT ACCOUNTANT'S REVIEW REPORT

Page

MANAGEMENT'S DISCUSSION AND ANALYSIS 2·7 BASIC FINANCIAL STATEM ENTS

Government-Wide Financial Statements:

Statement ofNet Assets 8 Statement of Activities 9

Fund Financial Statements: Balance Sheet - Governmental Fund - General Fund 10 Reconciliation of the Governmental Fund Balance Sheet to the Statement of Net Assets II Statement of Revenues, Expenditures, and Changes in Fund Balances 12 Reccnciliation ofthe Governmental Funds' Statement of Revenues, Expenditures, and

Changes in Fund Balances to the Statement of Activities 13 Proprietary Fund Water and Sewer Fund:

Statement of Net Assets 14 Statement of Revenues. Expenses, and Changes in Net Assets IS Statement of Cash Flows 16

Noles to the financial Statements 17-28 REQUIRED SUPPLEMENTAL INFORMATION

Budgelary Comparison Schedule: General Fund

OTHER SUPPLEM ENTAL SCHEDULE Schedule of Compensation to Mayor and Aldermen

OTHER REPORTS

INDEPENDENT ACCOUNTANT'S REPORT ON APPLYING AGREED-UPON PROCEDURES 31.33 Louisiana Attestalion Quesliomudre 34.35

Schedule of Findings with Management'. Response and Planned Corrective Action 36-]8 Summary Schedule of Prior Year Findings 39

29

30

iii Hulsey, Harwood & Sheridan, lLlLC

Certified Public Accountants

Independent Acconntant's Review Report

Mayor and Members of Ibe Board of Aldermen Village of ColliustoD, Loolsfana

We have reviewed the accompanying financial statements of the Village of Collinston, Louisiana (the Village), as ofand for the year ended December 31, 2010, which collectively comprise the Village's basic financial statements as listed in the table of contents, A review includes primarily applying analytical procedures to management's financial data and making inquiries of lhe management of Ibe Village, A review is substantially less in scope thai. an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole. Accordingly, We do not express such an opinion.

The management of the Village is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing, implementing, and maintaining internal control relevant to the preparation and fair presentation ofthe financial statements.

Our responsibility is to conduct the review in accordance with Statements on Standards fOr Accounting and Review Services issued by the American Institute of Certified Public Accountants. Those standards require us to perform procedures to obtain limited assurance that there are no material modifications that should be made to Ibe financial statements. We believe that the results of our procedures provide a reasonable basis for our report.

Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with accounting principles generally accepted in the United States of America.

The management's discussion and analysis on pages 3 through 8 and budgetary comparison infonnation on page 30 are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. Such information has not been subjected 10

the inquiry and analytical procedures applied in the review of the basic financial statements, but was compiled from information that is the representation of management, without audit or review. Accordingly, we do not express an opinion or any other form of assurance on the supplementluy information.

In accordance with the Louisiana Governmental Audit Guide and the provisions of state law, we have issued a report dated July 5, 2011, on the results ofour agreed-upon procedures.

HULSEY, HARWOOD & SHERIDAN, LLC

#14'~'~ July 5, 2011

1900 Roselawn Avenue. Monroe, LA 71201 • Phone (318) 325-6500 • Fax (318)325-1423 (

VILLAGE OF COLLINSTON, LOUISIANA

Management's Discussion and Analysis As of and for the Yel!r Ended December 31, 20 I0

As managemenl of Village of Collinston, Louisiana (the Village), we offer readers of the Village's financial stalements this narrative overview and analysis oflhe financial activities of the Village for the year ended December 31, 20 IO. This discussion and analysis of management is designed 10 provide an objective and easy 10 read analysis of Ihe Village's finandal activities based on currently known facts, decisions, or conditions. It is intended to provide readers with a broad overview of the Village's finances. It is also intended to provide readers with an analysis of Ihe Village's short-term and long-term activities based on information presented in the financial report and fiscal policies that have been adopted by the Village. Specifically, this section is designed to assist the readers in focusing on significant financial issues, provide an overview of the Village's financial activity, identitY changes in the Village's financial position (its ability to address the next and subsequent years' challenges), identify any material deviations from the financial plan (approved budget), and identitY issues or concerns of individual funds.

As with other sections of this financial report, the information contained within this diSCUSSion and analysis of management should be considered only a pan of the greater whole. The readers of this slatement should take time to read and evaluate all sections of this report, including the foomotes and the supplementarY information that are proVided in addition to this discussion'and analysis ofman!'&ement.

Overview of Financial Statements

This discussion and analysis is intended to serve as an introduction to tbe Village's financial statements. The Village's basic financial statements consist of the following components:

I. Government-wide financial statements. 2. Fund financial statements. 3. Notes to financial stalements.

In addilion 10 the basic financial statements and accompanying nOles, Ihe Village also includes in subsequent seclions of this report addilional informalion 10 supplement Ihe basic financial stalements.

,. Government -wide financial statements

Govemmenl-wide financial stalements are designed by Govemmenl Accounling Standards Boan! (GASB) Slatemenl No. 34 10 change the way in which government financial stalements are presenled. II now provides readers for the firsltime wilh aconcise "enlity-wide" statemenl ofnel assets and statemenl of activities, seeking 10 give the users of the financial statements a broad overview of the Village's financial posilion and results of operations in a manner similar to a private-sector business.

The statemenl of nel assets presents informalion on all of the Village's assets and liabilities using the accrual basis of accounting, which is similar 10 the accounling used by mOst privale-sector companies, with Ihe elimination of internal activities. The difference between assets and liabilities is reported as net assets. Over time, increases or decreases in nel assets may serve as a useful indicalor of whether the financial posilion of Ihe Village is improving or weakening. Evaluation

2


Management's Discussion and Analysis As ofand for the Year Ended December 31, 20 I0

of the o.emll economic health of the Village would extend to other nonfinancial factors in addition to the financial information pro.ided in this report.

The statement of acti.ities presents information detailing how the Village's net assets changed during the current fiscal year. All current year re.enues and expenses are included regardless of when cash is recei.ed or paid. An important purpose of this statement is to show the financial reliance of the Village's distinct acti.ities or functions on re.enues pIO.ided by the citizenry of the Village.

The go.emment-wide financial statements report go.eminental acti.ities of the Village that are principally supported by tax re.enues. Go.emmental acti.ities include general go.emmen!, public safety (police), public works (streets), sanitation, and public impro.ement ser.ices.

2. Fund financial statements

A fund is an accountability unit used to maintain control o.er resources segregated for specific acti.ities or objecti.es. The Village uses funds to ensure and demonstrate compliance with finance-related laws and regulations. Within the basic financial statements, fund financial statements focus on the Village as a whole with major funds being separately reported.

The Village has two fund types:

Go.emmental funds are reported in the fund financial statements and encompass essentially the same functions reported as go.emmental acli.ities in the go.enunent·wide financial statements. Howe-er, the focus is .ery different with fund statements pro.iding a distinct i.e .iew of the Village's governmental funds. These statements report short-term fiscal accountability focusing on the use of spendable resources during the year and balances of spendable resources available at the end of the year. They are useful in evaluating annual financing requirements of go.ernmental programs and commitment of spendable resources for the near-term.

The proprietary fund is ,eparle<! in the fund financial statements and generally repons services for which the Village charges customers a fee. The fund essentially encompasses the same functions reported as business-type activities in the govemment-wide statements. Ser.ices are provided to customers external to the Village. Proprietary fund financiahtatements provide both long-term and short-term financial information consistent with the focus provided by the go.ernment-wide financial statements but with more detail.

As the government-wide focus includes the long-term view, comparisons between these two perspecti.es may provide insight into the long-term impact of short-term f!Dancing decisions. A

. reconciliation from both the governmental funds balance sheet and the statement of revenues, expenditures, and changes in fund balances to the govemment-wide statements is provided to assist in understanding the differences between these two perspectives.

J

VILLAGE OF COLLINSfON, LOUISIANA

Management's Discussion and Analysis As ofand for the Vear Ended December 31, 20 I0

3. Notes to financial statements

The accompanying notes to the fmancial statements provide information essential to a full under:standing of the government-wide and fund financial statements. The noles to the financial stalements begin immediately following the financial statements.

Government-Wide Financial Analysis

The following provides a summary of the net assets ofthe Village as of December 3\:

2010 2009

Current and other assets

Capi..1assets, net To..1assets

S I13,55t

1,130,659

1,254,210

$ 100,400

1,069,583

1,169,983

liabilities: Current

Long-term To..lliabilities

53,t86

'86,113

439,309

54,371

408,068

462,439

Net assets:

Invested in capital assets, net ofd

Restricted Unrestricted Total Del ...ets

ebt

S

733,587

69,097

12,217

814,901 S

661,515

55,446

(9,417)

707,544

As noted earlier, net assets may serve over lime as a useful indicator of the Village's financial position. The Village will use the unrestricted net assets to meel the ongoing obligations to users of its services and credilors.

By far, the largesl portion (90%) of the Village's net assels as of OeeembeT 31,2010, reflects the Village's investmenl in capital assets (infrastnlcture, buildings, improvements, machinery, equipment, and land) less any related debt used to acquire these assets that remains outstanding. The Village uses lhese capital assets 10 provide services to cilizens; consequently, these'assets are nol available fOT future spending. Although the Village's inveslmenl in its capital assets is reported net of related debt, il should be noted that the resources needed 10 repay the debt must be provided from otheT sources, as the capital assets themselves cannol be used to liquidate the debt.

An additional portion of the Village's net assets represents resources that are subject to eKternal restrictions as 10 how they may be used. The remaining balance (deficit) of unrestricted net assets may be used to meelthe Village's ongoing obligations to citizens and creditors.

4


Management's DiScussion and Analysis As ofand for the Year Ended December 31, 20 I0

As of December 31, 20 I0, the Village was able to report positive balances in all three categories of net assets, both for the government as a whole, as well as for its separate governmental and business-type activities except for a deficit in unrestricted assets of the govemmenlal-activilies.

The following summarizes lhe Village's nel assel changes between the two years ended December 31:

1010 2009

Program revenues; Charges for services S 169,365 $ 154,141

Operating grants and contributions 34,431 19,367

Capital grants and contributions 100,857

General revenues: Property laXes 15,018 7,306

Sales and use taxes 17,274 21,222

Olher laXest licenses and permits 7,805 4,271

Other 13,864 6,143

Total revenues 368,615 212,450

Expenses: General government 41,659 48,760

Public safety 14,705 15,120

Public w<lIl,s 13,650

Depreciation 7,130 7,512

Water and sewer 197,774 192,293

Total expenses 261,268 277,335

Change In net assets 107,35'7 (64,885) Net assets at beginningofyesr 707,544 772,429 Net assets at end of ye.r S 814,901 $ 707,544

The Village's lotal revenues increased mainly due to a capilal grant reeeived for street improvements while the tolal cost of all programs and services decreased by approximalely S16,000. The Village's expenses cover a range of services wiih approXimately 75% of the total related to the provision of water and sewer services.

General revenues are those available for the Village to pay for lhe governmental activities. For the year ended December 31, 20 I0, sales taxes were the largest general revenue source for the Village.

Property taxes are also a general revenue source for lhe Village. For the year ended December 31, 2010, taxes of 7.8 mills were levied on property within the Village's limits. The Village's taxable assessed valuation decreased by $9,392 from the prior year while ad valorem taxes levied decreased by only $73.

5


Management's Discussion and Analysis As of and for the Year Ended December 31, 2010

Program revenues derive directly from the program itself or from parties outside the Village's taxpayers or citizenry. As a whole, they reduce the cost of the function to be financed from the Village's general revenues.

Business-Type Activities

The business-type activities of the Village are the water and sewer services that the Village charges fees to customers to help cover all or most of the costs of providing the services. Operating revenues for the year ended December 31, 2010, of SI61,970 increased by S27,415 from $134,555 of the previous year. Operating expenses of $179,475 for the year ended December 31, 2010, increased from the previous year's total·of SI72,053 by $7.422.

Financial Analysis ofGovemmental Funds

As of December 31, 2010, the General Fund reported an ending deficit fund balance ofS8,I54, a decrease in the deficitofSI2,689 from DecemberJI, 2009.

Budgetary Highlights

The Village made one amendment to its General Fund bUdget for the year ended December 31, 2010. Actual revenues and other financing sources of the General Fund ofS69,053 failed to meet budgeted revenues and other financing sources of $80,752 by SII,699 or 14.5% while actual expenditures and other financing uses did not exceed budgeted expenditures and other financing uses.

Capital Assets and Debt Administration

The Village's investment in capital assets, net of accumulated depreciation, for its governmental and business-type activities as of Oeeember 31. 2010 was $t,130.659 compared to SI.069.583 as of December 31, 2009. This investment in capital assets includes infrastructure, buildings, improvements, machinery, equipment, and land. There were two acquisitions and no dispositions ofcapital assets during the year ended December 31, 2010.

As of Deeember 31, 2010, the Village had total bonded debt outstanding of$397.072. The debt is payable by liens on and pledges of the Village's water and sewer revenues. The Village's total debt decreased $10,798 dUring the year ended December 31,2010, with all debt obligations being timely met. .

Economic Factors and Next Year's Budget

As the Village fo~es an increase in operations for the next fiscal year, a budget for the General Fund ofS208,900. for revenues and expenditures was adopted.

6


Management's Discussion arid Analysis As ofand for the Year Ended December 3 J, 2010

Request for Infonnation

This financial report is designed to provide a geneml overview of the Village's finances for all of those with an interest in such. Questions concerning any ofthe infonnation provided in this report or requests for additional infonnation should be addressed to the Cieri<, P.O. Box 148, Collinston, Louisiana 71229-0148.

7

BASIC FINANCIAL STATEMENTS

VILLAGE OF COLLINSTON COLLINSTON, WUISIANA

STATEMENT OF NET ASSETS AS OF DECEMBER 31, 1010

Primary Covemmenl Governmental Bu.lu...-type

ASSETS Actlvltle. Actlvltles Total Cash and cash equivalents. Receivabl.... net ofallowance for uncollectibles Internal balances Capital assets not being depreeiated Capital assets, net of accumulated depreciation TOTAL ASSETS

LIABILITIES

5 10,580 7,495

(6.688) 3.650

149,553 164,590

$ 87,154 5 97,734 18.322 15,817 6,688 5,500 9,150

971,956 1,IlLS09 1,089,620 1,254,210

Accounts payable 1.546 2.487 4,033 Payroll and related liabilities 17,995 8.873 16,868 Accrued liabilities 11,336 11,336 Noncurrent liabilities:

Due within one year 10,949 10,949 Due in more than one year 386.123 386,123

TOTAL LIABILITIES 19,541 419.768 439,309

NET ASSETS Invoslmenl in capital assets. net ofrel.ted debl 153,203 5S0.384 733,587 Restricted for debt service 69,097 69,097 Unrestricted (8,154) 20,371 11,117 TOTAL NET ASSETS .$ 145,049 $ 669,852 $ 814,901

See accountant ',$ review report and notes to financial statements. 8

· VILLAGE OF COLLINSTON COLLINSTON, LOUISIANA

STATEMEr<fOF ACTIVITIES mR TIlE YEAR ENDED DECEMBER JI, 1010

PROGRAM REVENUES NET(EXPDlSES) R£VEriUi.S AND

On:RATlNG CAI'IT'" CHANGES IN NET ASSETS

CllARC<S Faa GlW<TS_ CJlAImlAM> COVIRNMDifAL 1VS1Nf.SS-TY1'£

SERVICES CONTRIBUTIONS C01l1"RlBUTTONS AnTVmES ACTMTTES ror... Govcmmentalacbvities:

Genen!.I government S 41,6~9 S 3.m S S S (36.139) S 136,159) Public ga(ety 14.70~ 1.89~ 11.480 (1)30) II,3JO)

HighWl.Y5and meets 100,857 rOO,BS7 11IO,B57 Depreciation 7.130 (7.130) cr,IJO)

Tcalgovemmensa.lactivilies 63.494 7.39~ 11,480 IOO l 8H 36,238 56,lll1

BtlSinc:s:s-rype activities: Water and sewer 197.n4 161 1 970 22.932 S (12.832) (1;852)

Totll bllSiness-rype activities 197.n4 161,970 22.932 (121 852) (1;851) ,.mal prin1.uy aovemmm\ S 261.26& SI~9.363 S 34,432 S 100.857 . 56,238 (\2.&52) 43,31l6

Gc:nt:rDI revenues.: Property taxes IS,028 15,018 5DJes and USll IllXC5 27;174 17,27' Franchise taxes 5.170 5,170 Licell5eS and permit3 2,63~ 2,635 Unrestricted invt:S1mem earnings 71 101 171 01,,", 13,6~O 42 1J,69l

ToW general revenues !Wi nns(m 63.828 143 63,911 ChanCIr 10 lid IUtb 120.066 (12.709) 1117,357 Net assets at begiMin8 or yenr 24.983 ~82.361 707544 Nf11SSt1l al tnd or Yf'll' S 14S,049 S 66918~2 S 814,901

See occolllllalll'.r revit!W reJKN1 and ntxes to jifUlncial.rtaU7nDlu. 9

VILLAGE OF COLLINSTON

COLLINSTON, LOUISIANA

GOVERNMENTAL FUND-GENERAL FUND

BALANCE SHEET

AS OF DECEMBER JI, 2010

ASSETS

Cash and cash equivalents $ 10,580

Receivables, net 7,495

TOTAL ASSETS S 18,075

LIABILITIES AND FUND BALANCES

Liabilities: Accounts payable S 1,546

Payroll and related liabilities 17,995

Due to other funds 6.688

Total liabilities 26,229

Fund balances:

Unreserved - uodesil!J1llled (8,154)

TOTAL LIABILITIES AND FUND BALANCES $ /8.075

See a,ccountant's review report and notes to financial statements. 10


RECONCILIATION OF THE GOVERNMENTAL FUND BALANCE SHEET TO THE STATEMENT OF NET ASSETS

AS OF DECEMBER 31, 2010

AIIIOUDls reported for governmental activities ID tbe statemeDI or Det ...... are dlffereDt ben...:

Total rDDd balaDe.. S (8,154)

Ca?ilal assets used in governmental activities are nol financial resourCes and, thorefore, are deferred in the funds. 153,203

Net assets of governmeutal 'letlvldes $ 145,049

See accountant's review report and notes to financial statements. II

VILLAGE OF COLLINSTON COLLINSTON. LOUISIANA

GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES. AND CHANGES IN FUND BALANCES AS OF AND FOR THE YEAR ENDED DECEMBER 31. 2010

General Revenues:

Propeny taxes $ 15,028 Sales and use taxes 27,274 fTlIm:hise la.US 5,170 licerlSe'S and permits 2,635 Int~r8overnmcfllal revtnues 11,480 Fines 1,895 lease income 5,500 Interest earned 71

Total revenues 69,053 Expenditu=:

Current General government 41,659 Public safety 14,705

Capital outlay Total clQ'CDdiNres 56,364

Excess ofrevenues over expcndilurtS 12,689 Nft cblngt ia flUId balances 12,689 Fund balances BI beginning of~ar (20,843) Fand balances at eod or ytar $ (8,154)

T.ta1 Capilal Projects

GonrnmeataJ F.....

$ $ 15,028 27,274 5,170 2,635

100,857 112,337 1,895 5,500

71 100,857 169,910

100,857 100,857

41,659 14,705

100,857 157,221

12,689 12,689

(20,843) $ $ (8,154)

See accountanl 's review report and noJes 10 financial statements. 12


RECONCILIATION OF THE GOVERNMENTAL FUNDS' STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES TO

THE STATEMENT OF ACTIVITIES AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2010

Amounts reported {or gO'Yernmental aetl'Yltles 10 tbe statement of net assets are durerent beea.se:

Net ebange in fnnd balanees - total governmental funds S 12,689

Governmental funds report capital outlays as expenditures. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation expense in the current period. 107,377

Cbange In net assets o{ governmental aeti'Yities S 120,066

See accountant's review report and notes to financial statements. IJ

VILLAGE OF COLLINSTON COLLINSTON, LOmSIANA

PROPRIETARY FUND- WATER AND SEWER FUND

STATEMENT OF NET ASSETS AS OF DECEMBER 31, 2010

ASSETS Current assets:

Cash and cash equivalents Receivahles, net Due from other funds

Total current assets Noncurrent assets:

Cash and cash equivalents - restricted Capital assets, net

Total noncurrent assets TOTAL ASSETS

S 18,057 18,322 6,688

·43,067

69,097 977,456

1,046,553 1,089,620

LIABILITIES Current liabilities:

Accounts payable Payroll and related liabilities Accrued liabilities Revenue bonds payable - current

Total current liabilities Noncurrentliabililies:

Revenue bonds payable Total noncurrent liabilities

TOTAL LIABILITIES

NET ASSETS

2,487

8,873 11,336 10,949

33,645

386,123 386,123 419,768

Invested in capital assets, net of related debt 580,384 ReslTiCled for debt service 69,097 Unrestricted 20,371 TOTAL NET ASSETS S 669,852

See accountant's review report and notes to financial statements. 14

VILLAGE OF COLLINSTON COLLINSTON, LOIDSIANA

PROPRIETARY FUND - WATER AND SEWER FUND STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET ASSETS

AS OF AND FOR TIlE YEAR ENDED DECEMBER 31, 2010

Operating revenues: Charges for sales and services:

Water and sewer fees Other revenues

Total operating revenues

Operating expenses: Administration Depreciation

Total operating expenses

Operating loss

Nonoperating revenues (expenses): Intergovernmental revenues Il)lerest earned Interesl expense

Total nonoperating revenue (expenses)

Cbange In net assets Net assetS at beginning of year Netassels at end ofyear

S 161,970 42

162,012

110,072

69,253 179,325

(17,313)

22,952 101

(18,449)

4,604

(12,709)

682,561 S 669,852

See accountolll's review report and nOles 10 financial statements. 15


PROPRIETARY FUND - WATER AND SEWER FUND STATEMENT OF CASH FLOWS AS OF AND FOR THE YEAR ENDED DECEMBER 31,2010

Cash flows from operating activities: Receipts from customers and users Payments to suppliers Payments to employees

Net cash provided by operatlDg actlvltle.

S 154,773 (~6,641)

(5~,49g)

42,634

Cash flows from noncapital financing activities: Intergovernmental granls

Net ca.b provided by Doneapital aDd related financlDg actlvld.. 22,952 Z2,9SZ

Cash flows from capital and rela1ed financing activities: Acquisition and conSlnJction ofcapital assel.. Principal paid on capital debt Interest paid on capital debt

Net cash Dsed by capital aDd related flna.dDg actlviti..

(22,952) (10,948) (18,499) (52,399)

Cash flows from investing activities: Interest received

Net cash provided by I....tlng aetlvltles 101 161

Net increase in cash and cash equivalents Cash and cash equivalents, beginning ofyear (including amounts in restricted accounts) Cub and usb eqolvaltDt&, end ofyur (Incloding amonots In restricted accounts) 5

13,2M 73,866 87,154

'Reconciliation of operating loss to net cash provided by operating activities: Operating loss Adjusbnents to reconcile operating loss to cash provided by operating activities:

Depreciation expense (Increase) d""rea.se in accounts recei.able (Increase) d""rease in due from other funds Increase (decrease) in ac;:counts payable Increase (decrease) in due to other funds Increase (decrease) in accrued liabililies

Total adjustments Net casb provided by operadDg actl.itle.

5

5

(17,313)

69,253 (7,ll9)

150 (2,739)

(ISO) 672

59.947 41,634

See accountant's review report and notes to financial statements. 16

VILLAGE OF COLLINSTON COLLINSTON, LOUlSIANA

NOTES TO THE FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2010

NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Village of Collinston, Louisiana, (the Village) operates under a mayor-board of aldermen form of government in accordance with the provisions of the Lawrason Act. Citizens elect the mayor (at large) .and three council members (by districts) who are each compensated. The Village is located in northeast Louisiana, its population is approximately 375, and it employs three fulltime people. As of December 31, 20 I0, the Village services approximately 220 utility customers and maintains approximately three miles of streets.

The Village provides general government, public safety (police), public works (streets), sanitation, and public improvement services.

Governmental Accounting Standards Board (GASB) Slatement No. 14, The Reporting Entity, established criteria for determining the governmental reporting entity and component units that should be included within the reporting entity. Under provisions of this Statement, the Village is considered a primary government, as it is a spedal purpose government that has a separately elected governing body, i. legally separate, and is fiscally independent of other state or local governments. As used in GASa Statement No. J4, fiscally independent means that the Village may, without the approval or consent of another governmental entity, determine or modifY its Own budget, levy its own laXes or set rares or charges, and issue bonded debt.

The basic criterion for including a potential component unit within the reporting entity is financial accountability. The GASa has set forth criteria to be considered in determining finandal accountability. This criteria includes:

I. Appointing a voting majority ofan organization's governing body, and

a. the ability of the municipality to impose its will on that organization and/or b. the potential for the organization to provide speci fic financial benefits to or

impose specific financial burdens on the municipality.

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

3. Organizations for which the reporting entity's financial statements would be misleading if data of the organization is not inclUded because of the nature or significance of the relationship.

Based on tbe criteria, the Village has determined that Sewer District No. I of Village of Collinston, Louisiana, is a component unit of the reporting entity. As required by generally accepted accounting principles, these financial statements present the primary government (the Village) and its component unit. The component unit is reported as part of the municipality and blended with the appropriate municipality funds.

Component units that are legally separate from the municipality, but are so intertwined with the m~icipa/ity that they are, in substance, the same as the municipality are blended component Units.

See accountanr 's review report. 17



NOTE 1-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

For a component unit to be blended, the organization's board and the municipality, must be substantively the same, or the organization must provide services entirely or almost entirely to the municipality.

Considered in the determination ofcomponent units ofthe reporting entity were Eighth Ward Fire Protection District No. I of Morehouse Parish, Louisiana. It was determined that this governmental entity is not a component unit of the Village's reporting entity.

Government-wide and fnnd financial statements The government-wide financial statements (i.e" the statement of net assets and the statement of activities) report information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities which rely to a . significant extent on fees and charges for support. Likewise, the primary government is reported separately from certain legally separate component units for which the primary government is financially accountable.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include I) charges to customers or applicants who purchase, use or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues.

Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.

Measurement focus. basis of 8~~oDnting,and finandal statement presentadoD The government-wide, proprietary fund, and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Governmental fund' financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period.

See accountant's review report. 18



NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continned)

for this pwpose, the Village considers revenues to be available if they are collected within 60 days of the end of lbe current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting.

However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due.

Property laxes, franchise laxes, licenses, and interest associated with the current fiscal period are .11 considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessment receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the Village.

The Village reports lbe following major governmental fund:

The General Fund is the Village's primary operating fund. It accounts for aU financial resources of the general government, except those required to be accounted for in another fund.

The Village reports one major proprietary fund, the Water and Sewer Enterprise fund.

Private-sector standards of accounting and financial reporting issued prior to December I, 1989, generally are followed in both the government-wide and proprietary fund fmancial statements to the extent that those standards do not conflict with Or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent privatesector guidance for their business-type activities and enterprise funds, subject to this same limitation. The Village has elected not to follow subsequent private-sector guidance.

As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are payments-in-lieu of laxes and other charges between the Village's enterprise operations. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. However, there were no payments-in-Iieu oflaxes for the year ended December 31. 2010.

Amounts reported as program revenues include I) charges to customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grnnts and contributions, including specia' assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include a1llaxes.

",

See accountant's review repon. 19



NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POUCIES (Cootlooed)

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The Water and Sewer Fund's principal operating revenues are water and sewer usage fees. Operating expenses for enterprise funds include the cost of services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

When both restricted and unrestricted resources are available for use, it is the Village's policy to use restricted resources first, then unrestricted resources as they are needed.

Receivable. aod payable. AClivity between funds outstanding at the end of the fiscal year, including lending and borrowing arT1Illgernents, is referred to as either "due to/from other funds" (i.e., Ihe current portion of inlerfund loans) or "advances to/from other funds" (i.e~ the non-current portion of inlerfund loans). Any residual balances outstanding between the governmental activities and business-type activilies are reported in the government-wide financial statements as "intemal balances."

Advances between funds, as reported in the fund financial statemenls, are offset by a fund balance reserve account in applicable governmental funds 10 indicate thaI Ihey are nol available for appropriation and are nol expendable available financial resources. All trade and property tax receivables are shown net ofan allowance for uncollectibles, when malerial.

Property laxes attach as an enforceable lien on property as of January I. Taxes are levied by the 'Village in Seplember or October, are actually billed 10 Ihe iaxpayers in November and are due and payable lin lit befllre Dccembet 3I of the same year. Billed taxes become delinquent on January I of the following year. Revenues from ad valorem taxes are budgeted in the year they are billed. The Village bills and collects its own property taxes using the assessed values determined by the tax assessor of Morehouse Parish. For the year ended December 31, 2010, taxes of7.80 mills were levied on property with assessed valuations totaling $897,882.

Bodgets The Village of Collinslon (Mayor and Bllard of Aldermen) adopt an annual budget for the General Fund prior to December 31. The annual budget is prepared in accordance with the basis of accounting utilized by the funds. The Village Clerk is authorized 10 transfer budgeted amounts within and among departments; however, any revisions that alter the total expenditures resulting from revenues exceeding amounts estimated must be approved by the Board of Aldermen. The budgetary comparison schedule, included as Supplementary information in the accompanying financial statements, includes the original and amended budgeted amounts. All annual appropriations lapse at fiscal year end.

See accountant's review repori. 20



NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cootlnued)

Casb and usb equivalents Cash includes amounts in demand deposits, interest-bearing demand deposits, and money market accounts. Cash equivalents include amounts in time deposits and those investments with original maturities of 90 days or less. Under state law, the Village of Collinston may deposit funds in demand deposits, interest-bearing demand deposits, money market accounts, or time deposits with state banks organized under Louisiana law and national banks having their principal offices in Louisiana. Some of the cash and cash equivalents are restricted. Cash deposits are reported BI

carrying amount which reasonably approximBles fair value.

Investments Under state law, the Village may invest in United States bonds, nates, or certificates. If the original maturities of investments exceed 90 days, they are classified as investments; however, if the original maturities are 90 days or less, they are classified as cash equivaients. Investments are stated at cost.

Sbort-term interfond r..,eivables/oavables During the course of operations, numerous transactions occur between individual funds for services rendered. These receivables and payables are classified as due from other funds or due to other funds on the fund fin8l1cial statements balance sheet. Short-term interfund 108l1s are classified as imerfund receivables/payables.

Elimination and r..,lassili.allons In the process of aggregating data for the statement of net assets and the statement of activities, some amounts reported as interfund activity and balances in the funds were eliminBled or reclassified. Inlerfund receivables 8I1d payables were eliminated to minimize the "grossing up" effect on assets and liabilities within the govemmental activities column.

.Invento..... Inventories are accounted for using the consumption method, where expenditures are recognized as the inventory is used. All purchased invenlory items are valued at cost using the first-in/Ii"lout method.

Capital assets Capital assets are recorded at either historical cost or estimated historical COsl and depreciated over their eStimated uscfullives (exclUding salvage value). Donated capital assets are recorded at their estimated fair value at the date of donation. The capitalization threshold for equipment is $2,500. Estimated useful life is management's estimBle of how long the asset is expected to meet service demands. Straight-line depreciation is used based on the following estimated useful lives:

Streets 20 years Buildings 8I1d building improvements 20·25 years Machinery and equipment 5-10 years Water and sewer system 10-25 years


VILLAGE OF COLLINSTON COLLINSTON, LOUISIANA.


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CoDtlnued)

Com peDsated absences Allowable annual vacation and sick leave is prescribed by municipal ordinance and based on length of continuous employment by the Village, Compensatory time is also granted to supervisory per.;onnel in lieu of overtime pay and should be used by the end of the fiscal year, Payment for unused compensatory time requires approval of the mayor and Board of Aldennen.

The Village's recognition and measurement criteria for compensated absences are as follows:

GASB Staiement No. 16 provides that vacation leave and other compensated absences with similar characteristics should be accrued as a liability as the benefits are earned by the employees if both ofthe following conditions are met:

I. The employees' rights to receive compensation are attributable to services already rendered.

2. It is probable chat the employer will compensate the employee for the benefits through paid time ofT or some other means, such as cash payments at tennination or retirement.

GASB Slatement No. 16 provides that a liability for sick leave should be accrued using One of the following approaches:

I. An accrual for earned sick leave should be made only to the extent it is probable that the benefits will result in termination payments, rather than be taken as absences due to illness or other contingencies, such as medical appointments and funerals.

2. Alternatively, a governmental entity should estimate its accrued sick leave liability based on the sick leave accumulated at the balance sheet date by those employees who currently are eligible to receive termination payments as well as other employees who are expected to become eligible in the future to receive such payments.

Compensated absences are paid from the fund responsible for the employee's compensation.

No liability existed as of December 3 t, 2010, for accrued compensated absences resulcing from unused vacation time at the end of the year and no liability was recorded for non-vesting accumulating rights to receive sick pay benefits.

Restrlded Del 8ssets For the government-wide slatement of net assets, net assets are reported as restricted when constraints placed on net asset use are either:

I. Externally imposed by creditor.; (such as debt covenants), grantors, contributor.;, or laws or regulations of other governments.

2. Imposed by law through constitutional provisions or enablinglegisJation.




NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continned)

When both restricted and unrestricted resources are available for use, it is the Village's policy to use restricted resources first, then the unrestricted resources as they are needed.

Fund egulty Reservations of fund balance represent amounts that are not appropriable for expenditure or are legally segregated for a specific purpose. Designations of fund balance represent tentative management plans that are subject to change. Equity is classified as net assets and displayed in three components:

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

Restricted net assets - Consists of net assets with constraints placed on the use either by (I) external groups, such as creditors, grantors, contributors, or laws or regulations ofother governments; or (2) law lhrough constitutional provisions or enabling legislations.

Unrestricted net assets - All other net assets that do not meet the definition of "restricted" or "invested in capital assets, net of related debt."

Int.nund activity .Interfund activity is reported either as loans, services provided, reimbursements, or transfers. Loans are reported as interfund receivables and payables as appropriate and are subject to elimination upon consolidation. Services provided, deemed to be at market or near market rates, are treated as revenues and expendinirestexpenses. All other interfund transactions are treated as transfers.. Transfers between governmental or proprietary funds are netted as part of the reconciliation to the government-wide financial statements.

Use ofosllmates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the fmandal statements and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those estimates.

See accountant's Tl!lJiew report. 23



NOTE 1 - CASH AND CASH EQUIVALENTS

Custodial credit risk is the risk that, in the event of a bank failure, the Village's deposits may not be returned to it. The Village's policy to ensure that there is no exposure to this risk is to require each financial institution to pledge its own securities to cover any amount in excess of Federal 'Depository IIISurance Coverage. Louisiana Revised Statute 39: I229 imposes a statutory requirement on the custodial bank to advertise and sell the pledged securities within ten days of being notified by the Village that the fiscal agent bank has failed to pay deposited funds upon demand.

At December 31, 2010, the Village has cash and cash equivalents (book balances) totaling $97,734 as follows:

Casb aDd casb eqDivalents:

Demand deposits $ 23,637

Time deposits 5,000

Total 28,637

Casb aDd casb equivalents - restricted:

Demand deposits 69,097

Total 69,097

Total $ 97,734

These deposits are stated at cost which approximates market. Under state law, these deposits (or the resulting bank balances) must be secured by federal deposit insurance or the pledge of securities owned by the fiscal agent bank. The market value of the pledged securities plus the federal deposit insurance must at all times equal the amount on deposit with the fiscal agent.

These securities are held in the name of the pledging fiscal agent bank in a holding or custodial bank that is mutually acceptable 10 both parties. As of December 31, 2010, the Village had $99,096 in deposits (collected bank balances). These deposits were secured from risk by federal deposit insurance.

NO'fE 3 - RECEIVABLES

The following is a summary of receivables at December 31, 20 I0:

Water!

Taxes: Geoenl Sewer Total

Ad valorem Sales Franchise

Accounts

$ 3,697 2,868

930

S

18,322

$ 3,697 1,868

930 18,311

Total $ 7,495 $ 18.322 S 15,817



NOTES TO THE FINANCIAL STATEMENTS AS OF AND FORTHE YEAR ENDED DECEMBER 31, 2010

NOTE 4 - CAPITAL ASSETS

A schedule ofchanges in capital asselS for the year ended December 3',2010, follows:

Btginning Eacllq Balance Increases D«rrases B.(aace

Goyern_ntU acdvttles: C.pl......... no, bolllll d.preda....' Land S 3,650 S S S 3,650

C.pl..I ...... brlag dopr..lalrd: Sllftl> 29,451 114,507 143,958 Buildings 82,712 82,7\2 Building improvements 30,097 30,097

MBC:hinery and equipment ·89,950 89,950

Total capital assets be(ng depreciiJIed 232,210 11907 346,717

Less Bcmmolated dtprcdadon ror: SIT<CtS 28,841 2,041 30,882 Buildings 82,712 82.712 Building improvements 17,952 1.017 18,969 Machinery and equipmenl 60,529 4.072 64,601 Total accumulated depreciation 190,034 7.130 197.164 Total capital 8S$el'5

being deprecimed 42,176 107.377 149,553 Governmental activities.

capi tal assets. nel S 45,826. S 107,)77 S S \53,203

IIegIIIllIJII £adlog Sal8Det Increaws Drrru... SaIBate

BQ~~ ••drid6' C.pl.., ...... not beiDg d.predated: Land S 5,500 S S S 5,500

Capital assel! briDg deprulated: WmB and sewer systems 2,052,532 22.952 2.075,484 Mschinery and equipment 63.415 63,415 Total capilal assets

being depruilll:cd 2.115,947 22,952 2.138.899

L.ess accumulated deprcdadoD ror: WoIer and sewer systems 1.073,654 61.657 1,135,311 Machinery and equipment 24,036 7,596 31,632 Total BCCumulatcd depreciation 1,097,690 69.253 1,166,943 Ta's) capitallSSCts

being depreciated 1,018,257 (46,301) 971,956 Business-type activities.

,apilat assets. net S 1.023,757 S (46,301) S S 977,456




NOTE 4 - CAPITAL ASSETS (Contioued)

Depreciation expense of the govenunental activities of$7,130 is reported separately in the statement of activities in that the expense essentially serves all functions.

NOTE 5- LONG-TERM OBLIGATIONS

The Village issues bonds where the Village pledges income derived from the acquired or constructed asset to pay debt service.

Bonds payable at December 31, 2010, are comprised of the following issues:

Revenue BODds: 5110,000 Woter and Sewer Revenue Bonds dated August 20, 1976, payable in incrementally increasing Bnnual installments commencing August 20, ·1971, through August 20, 2016, including interest 01 5%. The Water and Sewer Fund serviees this debt. 5 31,390

S4II,ooO Woter Revenue Bonds, Series 2000 dOled September 27, . 2000, payable in monthly installments of51,g66 begiMing October 27, 2001, and ending Oclober 27, 2040, including interest 01 4.5%. The Water and Sewer Fund services this debt. 365,68%

TOIa' S 397,071

Long-term liability activity for the year ended December 31, 20 I0, was as follows:

BOllID.lag EudlDg DD. WlthlD

BIII.ee AddltloD' ReduetloD' Balance ODe 'Vear Bosiness--type aettvldrs:

Water and $eMf Rc~cnue Bonds - SI J0.000 Bonds 5 36,g50 5 5 (5,460) 5 31,390 5 5,000 Water Re~cnue Bonds. Series 2000 . S4J 1,000 Bonds 371,218 (5,536) 365,682 5,949 Buslness-ty~ acdvity IODg,..urm UabWdn 5408,068 5 $(10,996) 5397,072 510,949


VILLAGE OF COLLINSTON COLLINSTON, LOmSIANA


NOTE 5 - LONG-TERM OBLIGATIONS (CoDtiDU~d)

Annual debt service requirements to maturity for bonds are as follows: .

$110,000 Water and Sewer $411,000 Water Revenue

Revenue Bonds Bonda, Serl.. 1000

Principal Interest Prlodpal Interest

2011 $ 5,000 $ 1,600 $ 5,949 $ 16,473

2012 5,000 1,350 6,223 16,200

2013 5,000 1,\00 6,509 15,914

2014 5,000 850 6,808 15,615

2015 5,000 600 7,120 15,303

2016·2020 6,390 300 40,819 71,294

2021·2025 -' 51,097 61,017

2026-2030 63,963 48,152

2031-2035 80,069 32,044

2036-2040 97,125 . 11,887

Totals $ 31,390 $ 5,800 $ 365,682 $ 303,899

The revenue bonds will be liquidated by liens on and pledges of the Village's water and sewer revenues. Interest expense for the year ended December 31, 2010, totaled $18,499.

NOTE 6 - CONTINGENCIES

The Village operates water and sewer treatment plants. These operations pose a high risk for environmental liabilities. The Village is required to have EPA pennits for wastewater. The Village relies on the EPA for periodic testing and inspections to help identify environmental liabilities or contingencies.

There was no Iitigation pending at December 31, 20 IO.

NOTE 7- RISK MANAGEMENT

The Village is exposed' to various risks of loss relaling to torts, theft of, damage to, and deslrUetion of assets, errors, and omissions, injuries to employees, and natural disasters. These risks are covered by commercial insurance purchased from independent third parties.




NOTE 8- NEW ACCOUNTING STANDARD

The requirements of Governmental Accounting Standards Board Statement No. 54, Fund Balance Reporling and Governmental Fund Type Definitions, are effective for the Village's financial statements for the year ending December 31, 2011. The Village has not yet determined the effect that implementation of the requirements of the statement will have on its financial statements.

NOTE C).... SUBSEQUENT EVENTS

Management has evaluated subsequent events through July 5, 2011, the date on which the financial statements were available to be released.


REQUIRED SUPPLEMENTAL INFORMATION

VILLAGE OF COLLINSTON COLLINSTON. WUlSIANA

GENERAL FUND STATEMENT OF REVENUES. EXPENDITURES. AND CHANGES

IN FUND BALANCE - BUDGET AND ACTUAL AS OF AND FOR THE YEAR ENDED DECEMBER 31.2010

Budgeted Amounts Original Final

Revenues: Taxes $ 36,100 $ 35.450 Licenses and pennits 4,800 2,800 Intergovernmental revenues 159,000 34,452 Fines 100 2,000 Lease income 6,000 6,000 Interest earned 100 50 Other revenues 7.000

Total revenues 213,700 80.752

Actual

S 47.472 1,635

11.480 1,895 5,500

71

69.053

Variance with

Final Budget

$ 12,022 (165)

(22,972) (105) (500)

21

(11,699)

Expenditures: Current:

General government Public safety

Capital outlay TaIBI expenditures

48,430 15,210

150,000 213,100

43,350 14,450 22,952 80.752

, 41.659 14.705

56,364

1,691 (255)

22,952 24,388

EKcess of re\'tnues over expenditures 12,689 ·12,689

Other financing sources (uses): Transfers in Transfers out

'TaIBI other fmoocing sources (uses)

9,500 (9,500)

9,500 (9.500)

(9,500) 9.500

Net cbaogcto food balao... Fund balances 1Il beginning of year Fuod balaoc.. at cod of year

(20,843) $(20,843)

(20.843) $(20,843)

12.689 (20.843)

S (8,154)

12.689

S 12.689

29

OTHER SUPPLEMENTAL SCHEDULE

VILLAGE OF COLLINSTON COLLINSTON. LOUISIANA

SCHEDULE OF COMPENSAnON TO MAYOR AND BOARD OF ALDERMEN AS OF AND FOR THE YEAR ENDED DECEMBER 31. 2010

Wayne Gilbreath. Mayor $ 1,500 Terri Fosler 1,200 Fmnk Miller 1,200 Betty Jones 1,200 Total $ 5,100

30

OTHER REPORTS

m Hulsey, Harwood & Sheridan, LLC


Independent Acconntant's Report on Applying Agreed-Upon Procedures

Mayor and Members of the Board of Aldermen Village of ColUnston, Louisiana

We have performed the procedures included in the Louisiana Government Audit Guide and enumerated below, which were agreed to by the management of Village of Collinston, Louisiana (the Village) and the Legislative Auditor, State of Louisiana. solely to assist the users in evaluating management's assertions about the Village's compliance wilh certain laws and regulations during the year ended December 31, 20 I0, included in the accompanying Louisiana Allestation Questionnaire. This agreed-upon procedures engagement was performed in accordance with standards established by lhe American Institute of Certified Public Accountants and applicable standards of GOvernment Auditing Standards. The sufficiency of these procedures is solely the responsibility of. the specified users of the report. Consequently, we make no representation regarding the sufficiency of lhe procedures described below either for the purpose for which this report has been requested or for any other purpose.

Public Bid Law I. Select all expenditures made during the year for material and supplies exceeding S20,000, or public

works exceeding SI00,000, and determine whether such purchases were made in accordance with LSA-RS 38:2211-2251 (the public bid law).

OIM' Ye\lieIu of ~e- tota4- L'Lftd, the- demll' ~e;U, ~~ "lWeale.d,rthi.ndWid<,wL~~$20.000(or matlwia4L'Lftd, &uppUe1r nor ~ i.ndWldw1c.lI ~e- (or publ.l.o 1lI0y4

~$lOO,OOO.

Code ofEthics for Public OffiCials and Public Employees 2. Obtain from management a list of the immediate family members of each board member as defined

by LSA-RS 42:1101-1124 (lhe code of ethics), and a list of outside business interests of all board members and employees, as well as their immediate families.

3. Obtain from management a listing ofall employees paid during the period under examination.

M~p,.oviQ.e.d,1A4'wuJ"the- reql.ll¥elL l4t:

1900 Roselawn Avenue. Monroe, LA 71201 • Phone (318) 325-6500 • Fax (318)325-1423

4. OeIennine w'nell1er any of those employees included in the listing obtained from managem""l in agreed-upon procedure (3) were also included on Ihe listing obtained from managemenl in agreed-upon procedure (2) as immediale family members.

71Ie- employ~ ~ 0rIt f:he, employee- l4t provided.- by ~ if1t p,.~ (3) cUd- not" ~pear 0rIt f:he, l4t provided.-by ~if1tpr~(2). ,

Budgeting 5. Oblained a copy of the legally adopted budget and all amendments.

M~prov(ded, IA4'W~"'copy off:he,or~~fint;U, ~Iher/1/WN'<me--~m-f:he,budgetdur~f:he,

year.

6. Trace the budgel adoplion and amendments 10 Ihe minule book.

'W/1/ tycued- f:he, adopt;(on, of f:he, or~ budget m- f:he, ~

of '" meet'Lt'Iit held, 0rIt Vuem.ber 8, 2009. W/1/ tyeu;e.d, f:he, 0rI1:Y budget" r.unend.ment m- f:he, ,1tI.it1.utiw of '" ~ he.ld- 0rIt

ve.ce-mber- 14,2010.

7. Compare the revenues and expenditures of the final budge! to actual revenues and expenditures to detennine ifactual revenues failed to meet budgeted revenues by 5 % or more or ifactual expenditures exceed budgeted amounts by 5% or more.

W/1/ CO»1{Ja¥ed- f:he, nw~ ~~ of f:he, fint;U, budget"m-~~~~ Actuat-r!W~

~ other' ~C8Y for f:he, year {aaed.- m- mut" ~'

~ by $21,199 or 23%. A ~ grlM'tt for f:he, Water ~

Sewu fLUId- WN' ~ if1tf:he, G_cxL.f~ if1tf:he, ~ of $22,952. In- f:he, COW"~ of f:he, rlWieW, thW ~ WN'

recl.cf.Med, out" of f:he, GenucxL fLUId-~ it1to- f:he, corre<:t" Weue.r ~Se.wer fLUld-~f:he,b«¥"m-~VW"~

Accounting and Reporting 8. Randomly select 6 disbursements made during the period under examination and:

a. Trace payments to supporting documentation as to proper amount and payee;

W/1/ ~w.p~ ~ for e.aQI., of f:he, ~

sele<:tetL d40w"~ ~ (ou.nd,- tMt- ~rrumt" WN' for f:he, propu a-m.ount~mad.e.-m-f:he,correet"~

b. Detennine if payments account; and

were properly coded to the correct fund and general ledger

32

c. Detennine whether payments recei.ed appro..1from proper authorities.,

, AlL~{rw the-~~~tlld,.~~were-~by two~mettt.bu1':

Meetings 9. Examine ""idence indicating that agendas for meetings recorded in the minute book were

posted or ad.ertised as required by LSA-RS 42:1 through 42:12 (the open meetings law).

(he., Valage- w~ reqlotiYed- m:- po¢ &1/ n.otU;e.- of eadv ~ IUIdt the-~~~ 01'lI the- door- of the- Valage:~~ locatLon< We-~ &l/P~~ ofthe- ~a.t'llLt(.me,

ofthe- I'\£1Gt ~ (he., ~w~ &lot ~ meettng-p~ (he.,Valage-~&I/~of~tha.t"~~of

~~

Debt .10. Examine bank deposits for the period under examination and detennine whether any such

deposits appear to be proceeds of bank loans, bonds, or like indebtedness.

We-~~~ and- the- dem.a,ed, genemlt ~ {rw the- period- LlNIdu ~~ n.otedt no-~ whidl.appearedtw-be-pr0c.eet4-of~~bofl4or liJc.e, ~

Advances and Bonuses II. Examine payroll records and minutes for the year to detennine whether any payments ha.e

been made 10 employees which may consliMe bonuses, ad.ances, or gifts.

We-,.~the-mitualWa.t'llL~1'«)',.oU-YeCOY~of~Valage

{rw ~ year iNldicatM- a.t'llL noted- no- approvaL (rw the- 1'«)'~

noted<

We were not engaged to, and did not; perfonn an examination, the objecti.e of which would be the expression ofan opinion on managemen(s assertions. Accordingly, we do not express such an opinion. Had we perfonned additional procedures, other mallers might ha.e come to our attention that would ha.e been reported to you.

This report is intended solely for the use of management of the Village and the Legislati.e Auditor, State of Louisiana, and should not be used by those who ha.e not agreed to the procedures IUId taken responsibility for the sufficiency ofthe procedures for their purposes. Under LouisilUla Re.ised Statute 24:513, this report is distributed by the Legislati.e Auditor as a public document.

HULSEY, HARWOOD & SHERIDAN, LLC

#14'~~~ July 5, 2011

33

LOUISIANA AlTESTAnON QUESnONNAIRE (For Atl8818Uon Engagemen18 of Govemmenll

______(Date Transmmedj

Hulsey, Harwood & Sheridan, LLC

1900 Roselawn Avenue

UeftFee, bSle1isi.aRa' 7140' __________________(Audilolll)

In cOnneCtion with your r8IIt8w of our financial statements a9 of [date) and for the year lhen ended, and as requinsd by louisiana Revl&ed Statute 24:513 and the Louisiana GOIlf/trlnl8(/IB/ . Audit Guide, _ make the following represanlations 10 you. We accapt fulllllBpOn91bilily lor our compliance with the fallowfng laws and regulations and tha Intamel controls ovar complianca with such Iaw8 and regulations. We have ewluated our compliance with tha following laws and regulat1on9 prlorlo making these I1Illrasentalions.

Th_ repnssentalions are baaed on tha informallon ewllabla to US as of (data of complation/raprasentatlollll).

Public BkILaw

It is true that _ haYe compUad with tha public bid law, RS. rille 38:2211-2298. and, wlt818 applicabla, the regulations oIl11e DivIsIon ofAdministration and lhe State Purdlaslng '?"I~

. .. . Yes VI No[

. Code of Ethics for Public OffIcials and Public Employeea

It is true that no employees or officlals have sccapted anything of valua, whether In tha form of a service, loan, or promise, fran enyone that would COII8litu18 a violation 01 RS. 42:1101-1124.

Y88~O[ I

It 1& true lIlat no memberollila Immadlata family of any member oItha QCMlmlng aulhorlty, or lIle chlefaxaeutive of the govemmenlal antlty, has been employed by the govammardal antIty aIlar April 1, 1980, underclrcumslanl:88 that would con&lltute e violaIion afRS. 42:1119. , .-{;_

YeslVl "'" [

Budgeting

We heve complied with the state budgetfng lllqull1llllllntB 01 the Local Govemment Budget Ad. (R.S. 39:1301.16), RS. 39:33, «the budget requirements of RS. 39:1331-1342, 88l1P1lllcBble.

Yes~[ I

Accounting and Reporting

. All non-exarnpt QCMlmmental recoras are evaUable as a public record and have been ratalned fer at Ie8&l lllree years,. required by RS. 44:1, 44:7, 44:31, and 44:36.

we have filed our annual financial statements in accordance wIlh R.S. 24:514. and 33:463 where applicable.

YescVYNo[ I

We have had our financial &tatements lIllIlawed in aceonIance with R.S. 24:513. _/: YasVINo[ l

Meetings

We h_ complied with the provlslon8 of the Open MBBting8 Law, prolridBd In R S. 42:1 through 42:13.

YB8 vt'fl"o( I Debt

\I iIllJuB we h_ not InculTBll any tndeblednau, clIlar than credit for 90 days or IB&& to make pureha8e& in the ordinary cowse of edminhltmllon, nor have we entered Into any Ieae-purchBllll agraemem, without the approval of the S1ate Bond Commillslon, IIll provided by ArtIcle V1I, 5ecIion 8 of the 1974 louisiana Con8lftutlon. AJtIcIe VI, secUon 33 of the 1974 louisiana Constitution. and R.S. 39:141D.8().141D.85.

YB8u&1 I

AclYancea and Bon_

\lIs trIlB we have not advanced wages or saJarielI to emp/oyellll or paid bonusealn violation of Ar1IcIeVlI, Section 14 01 the 1974 louisiana Con8tiMlon, R.S. 14:138, and AG opinion 79-7~

. Yes~o( I

We have dillclosed to you aU known noncompUanoe of !he foregoing laws and regulat1on8, as well as any conlladictioll9 to the foregoing replllllBntallon8. We have made avelJable to you documentation relaling to the foregoing laws and regulations.

We hlMl provided you wtth any communlcatione Irom regulatory agencies or other sources concerning any potllIibIe noncompliance wIlh the foregoing laws and regulations, including any communications reoeivecl be~ !he end of !he period under elC8lTllnation and !he issuance of this report. We acknowlsdge our respon8ibility to disclose to you any known noncomplianoe that may occur subsequent to the Issuance of your report.

-=~ ,8acnltary _ _Dale

-=...,.... Treasur&r _ _Dale

~'J.~1''l<11( - M.!.Wvrll -:if"SZ;!,dl::- presidenl,.()ulOeG\2 Ju h t'


SCHEDULE OF FINDINGS FOR THE YEAR ENDED DECEMBER 31, 2010

2010-1 Noocompllaoce witb Local Goveromeot Bodget Act

Coodilioo The General Fund's actual revenues and other financing sources of $69,053 failed to meet budgeted revenues and olher financing sources of$80,752 by $11,699 or 14.5%.

Criteria The Louisiana Local Government Budget Act requires the Village to amend the budget when projected revenues and other sources fail to meet budgeted revenues and other sources by more than 5% and when projected expenditures and other uses exceed budgeted expenditures and other uses by more than 5%.

Caose TheVillage bUdgeted in the General Fund a grant for a water and sewer project in the amount of $22,952. An adjustment made during the review of the financial statements moved the grant revenue and expenditure to the Enterprise Fund.

Effect The Village is not in compliance with the Louisiana Local Government Budget Act.

Recommeodatioo We recOmmend that the Board carefully consider all activities before finalizing the budget.

Correcdve Actioo Plao aod ResD90slble Persoo We will follow the accountant's recommendations.

2010-2 Fooding Reqolremeots of Loao Resolotloos

Coodltloo The 2009 report included a finding that required reserves and sinking funds were underfunded. We were unable to obtain sufficient documentation to determine what the requirements were. However, we noted that the balances in reserve accounts changed only slightly.

Criteria The loan agreements with United States Department of Agriculture require that certain amounts be set aside in specific bank accounts each year to be used only for repairing or improving the water and sewer systems or to make loan repayments.

Caose h appear.; that inadequate transfers were made to the specific accounts required by the resolution for the water loan during the year ended December 31, 2010, and previous years.

36


SCHEDULE OF FINDINGS (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2010

2010-2 Fnndlng Requirements of Loan Resolutions (Conllnued)

.Eatt! The Village appears to be in violation with the requirements ofthe loan resolution.

Recommendation We recommend that management locate copies of the debt agreements and other documents. The Village should also timely make the required monthly deposits and fund the deficit..

Corredjve Action Plan and Responsible Person The Village will make the monthly deposits required by USDA to equal the amount that is required for each bank account. The Village will also repay the $1 ,866 that was expended with the pennission of me USDA.

2010-3 Lack of or Not Implementing Internal Control PoDces and Procedures

Condition The utiliI)' accounts receivable system is not reconciled on a monthly basis to the Village's trial balances.

Payroll tax liabilities from previous years are still outstanding as of December 31, 2010. The Village paid the balance during 20' I.

Time cards and compensatol)' time records are not being adequately maintained. Leave time records are completed. However the time cards do not reflect that any time was taken for a meal break. Additionally, the leave records do not appear to track the amount of leave or compensatol)' time accumulated for use by employees.

Criteria Management is responsible for establishing and implementing internal control policies and procedures that provide for proper accounting, reasonable assurance that assets are safeguarded against loss resulting from unauthorized use, and that transactions are executed in accordance with management's authorization.

The Village's payroll procedures adopted on JanUBl)' 9, 2007, include the following requirements:

• Time and anendance cards will be completed by each employee at the beginning and end ofeacllday.

• Pay will not be made if the time card is not completed. • Time and attendance records will be mainwned and filed at the end of the fiscal year. • Compensatol)' time must be documented and should be used by the end of the fiscal year. • Payment for compensatol)' time requires the approval of the mayor and council.

Canse . The mayor and council have not .insisted on adherence by the employees to policies and procedures both written and standing.

37

VILLAGE OF COLLINSTON COLLINSTON, WUlSIANA

SCHEDULE OF FINDINGS (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, Z010

2016-3 Lack oC or Not Implementing Int.roal Control PoUces and Procednres (Condnned)

~ The Village continues to be susceptible to the assessment of penalties and interest as long as payroll related liabilities are outsranding.

The lack of establishing and implementing internal control policies and procedures may result in improper accounting, assets not safeguarded against loss, and transactions not executed in accordance with management's authorization.

Recommendation We recommend that the Village continue to endeavor to improve the Village's financial condition and thus keep payroll tax returns and payments current.

Management has been evaluating the Village's personnel policies and other policies. We recommend that management finalize an amended policy to be adopted by the Mayor and Council by December 31, 20 II. The Mayor and Council should ensure that the policy is complete and clear. We further recommend that all suggested policies per the Louisiana Legislative Auditor's website be implemented by December 31, 2012.

Though time sheets are often unnecessary for salaried employees for payroll purposes, they are necessary for purposes of tracking leave and compensatory time accumulated balances. We recommend that a uniform time sheet, leave record, and compensatory time record be implemented and utilized for all employees. The leave record and compensatory time record should present beginning balances, hours earned, and hours taken. The time sheets should support the entries on the leave and compensatory time records. Any approvals required by the Village's personnel policy should be evident on the records.

Corrective Actiop Plan and Resnopsible F......n Accounts receivable balances will be reconciled to the Village's trial balances monthly.

Time cards and compensatory time records will be maintained and the personnel policy will be reviewed and a revised policy will be adopted.

38


STATUS OF PRIOR AUDIT FINDINGS FOR THE VEAR ENDED DECEMBER 31, 2010

Planned Conectl.. Descliption Conedi've ActlonIPartIaI

of Action Taken Corrective Ref. No. Finding Ve., No, Partially Action Taken 2009-1 Noncompliance with Local Govemmenl No See 2010-1

BudgcIAct 2009·2 FWlding requirements of loan No See 2010-2

resolutions 2009-3 Lack of or nol implementing inlemal Partially Sec 2010-3

control policies and procedures

39

I

III Hulsey, Harwood & Sheridan, JLJLC


Independent Accountant's Report on Applying Agreed-Upon Procedures

Honorable Mitch leselink, Mayor and Honorable Members of the Board of Aldennen

Village of Collinston

We have perfonned the procedures enumerated below as they are a required part of the engagement. We are required to perfonn each procedure and report the results, including any exceptions. Management is required to provide a corrective action plan thai addresses all exceptions noted. For any procedures thai do not apply, we have marked "not applicable."

Management of the Village is responsible for its financial records, establishing internal controls over financial reporting, and compliance with applicable laws and regulations. These procedures were agreed to by the Mayor and Board of Aldennen of the Village and the Legislative Auditor, State of Louisiana, solely to assist the users in assessing certain controls and in evaluating management's assertions about the Village's compliance with certain laws and regulations during the year ended December 31, 20 IO.

This agreed-upon procedures engagement was perfonned in accordance with alleslation standards eSlablished by the American Institute of Certified Public Accountants and applicable slandards of Government Auditing Standards. The sufficiency of these procedures is solely the responsibility of the specified users of this report. Consequently, we make no represenlation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose.

AGREED UPON PROCEDURES

Financial Management

I. Detennine if management (chief executive and board members) was presenled wilh timely and accurate monthly financial statements, including budget-to~actual comparisons on funds (General Fund, Special Revenue Fund, Utility Fund, etc.) of the entity, during the year under examination.

PU" the- Cl.e.-ks a.t' 2010 rn.eet'~ the- BOtU'"d,. wcw pr~ with, ...,

~ of av"h. ~ befor/?/ ~~ ba4 WU"/?/ p~ for' themonth< W/?/~cop~ of the-~ whc:ch- IU"/?/ ~m-the

m.ontho/ ~ VUY~2011, the-Cl.e.-~~pr~~the-BOO¥d,. with, ..., profit ~ !.ow ~~ itw0ice4- that' wpporl: ba4 p~

~the-la¢~rJte,Cl.e.-~p~tv-~pr~~t",the-BOtU'"d,.

~m-~repom-a.t'the-sepmm.ber ~2011

1900 Roselawn Avenue. Monroe, LA 71201. Phone (318)325-6500. Fax (318)325-1423

-------_._--- ._._-_.

Village of Collinston Collinston, Louisiana Report on Agreed-Upon Procedures, 20 I0

Financial Management (continued)

2. If management was deficit spending during the period under examination, detennine if there is a fannal/written plan to eliminate the deficit spending and whether management is monitoring the plan.

rhe- Ge+1.e+'"cU" flM'ld- reported" '" net" i¥I.cY~ i,w{i.utd; ~of$12,689. tiowevu, the-~ {i.utd; ~ wcw '" defidt of $8,15'+. T'het'"e- w no(o.-moJ(wri.t:t:ll.ro pl.o.Kv tv-~ the- de{idt: Pu the-V~ Cl£.r1o, theCl£.r1o, the-t-1~OY, Ct-t'\d.-the-13OW"d.-are- monitor"~ e1'P~lW~.

rhe- WetWr Ct-t'\d.- 5eM1u flM'ld- reported" '" net" d.e.cr~ i,w net" ~ of $12,709. U",...~i.<:tec/,-net" ~ tom.le,d, $20,371. Pet"" the-V~ Cl£.r1o, the-Cl£.r1o, the- t-1~OY Ct-t'\d.-the-13OW"d.-are- monitor"~ e1'P~lW~

Ct-t'\d.-cc.tremp~t"o-preved" '" defidt i,w net" ~

3. Determine if there are adequate written policies and procedures for the financiallbusiness functions of the entity (e.g., budgeting, receipts, purchasing, disbursements, payroll, etc.).

• opuat'lO>'WpoU.<:i.lWe{fect'we-~2007 ~pu~ p~ pW'"~ poU.<:i.lW, p~roUt p~ Ct-t'\d.- trcw4 poU.<:i.lW. rhe-Cl£.rlowwOY~tv-~the-poU.<:i.lW. fh£,~poU.<:i.lW

wiUt i.t'lcl«.de- G«:C01M'lt'~ proced<M-ey, iNwet'ltvry proced<M-ey, CO>'\tYCId'proced<M-ey, Ct-t'\d.-~proced<M-lW.

• R~Ct-t'\d.-R~lO>'W(o.- the-V~ofc~WetWr W0y4

We- c.onWierw the- adeqt.<.a.0' of the- p<i/.i.ci.ey Ct-t'\d.-~ the- foUow~ r~umv.

• . E~e- thc.t' the- poU.<:i.lW are-~ Ct-t'\d.- completlv. Compl.eID ~

thc.t' the- poU.<:i.lW covet"" a.lL ~tr~ Ct-t'\d.-ev~ i,w

d.efu<.l, ~ tv- e..w.ve- thc.t' a.lL PIM"t'WII Ut'ld.u~ what' ~ 00 done; who-~ do- ir, whe+-v ir ~ 00 dofU'l Ct-t'\d.what'~LOfI,~oo~Ct-t'\d.-r~

• E~e-thc.t' poU.<:i.lW are- cuk>pted.-(o.- the-foUow~ ar~:

o 13~~

o PrOC<M"emet'\t"!pW'"~VfM,w-~

r~lO>'W

o 5tr~ Pl.o.Kv(o.- {tA:tw-e- opuat'lO>'W

o f~!t"~ Ct-t'\d.- i.+'l{onnat-LOfI, provi.delL tv- the130W"d.

2



o Ccm.tycux'lK1.f!'for .leYV~

o Cyedi:t~d.ebUC(U"c4-

o ~ifU-,~, ~lJt"£U'It¥

o Tn;weJ..,

o P~yoU,~~Y&CYc4-

o C~Y~~Y~L01'W

o II'W~

o ACC01M'\tl-YEl(:ew~

o C~itl:d-~

o T~

o ~&CYc4-~ meet'~

o E~

o~~~

o TYa(fioticl<.et:Y~~~

o EViden.ce.- YOQ>tW

o V~ yecovery~contt+'l.«ity

oI~~~

o FY~~CIti01'W

The,-L~ L~e- Auditor Pyavide'.r- CN ~ Py~

~~!tMttPz.e,p~CLt"

http://www.!La< "La:< f!OY/w.e.rl1le1.IfiLelb;pcbedcJM.tCWy11 .doo~

http://www.!La< "La:<f!OY~eYY\.m~HI)€{t{;pyad;fcW.

• I.",(;he,peno~p~:

o StlttE- CLt" wha..t-pOU1t empIoy~ Cl.CC4'"ue- !el:vve-.

o StlttE- whether 07" not ~t'vm.e-4-~CLt"yea¥-e.nd.:

o StlttE- whether empIoy~ CM'"e-p~ for ~ !el:vve- t.qJow tu~

• I.",(;he,tycweJ..,p~:

o Cwif; wha..t-1!lCP~ CM'"e-etUowa.bie<

o specify tha..t" (;he, M~ wilL ciete..-mU1.£- whether 1!lCP~

Py~ for Ye£mbuneme.."t" CM'"e- n.ecewuy, Y~,

~etUowa.bie<

3

Village of Collinston Collinston, Louisiana Report on Agreed-Upon Procedures, 2010


• 111I(;he,plM'"~Poi.:q:

o Cwify W~IMPIM'"~orde.-WY'equu-ed<

o Cwify for what" typl?/ of PIM'"~a.f'ld, what" dol«M cwt.OfMl.t

M~'l'"PpmvuJ., WY'equu-ed<

o Cwify for what" typl?/ of PIM'"~a.f'ld, what" dol«M cwt.OfMl.t

80tUel.- "PPY'OVuJ., WY'equu-ed<

WI?/ Y'~ that" (;he, Cluk-~ ~ tn<M1-icip~ (;he,

L~ MlM1.idpuJ., A~W>'4 a.f'ld, (;he, L~ L~INI?/

A~for~~poUdet:

Credit Cards

1. Obtain from management a listing of all active credit cards (and bank debit cards if applicable) for the period under examination, including the card numbers and the names of the persons who maintained possession of the cards.

[Note: There are three types or credit cards: (I) general (e.g., VISA, MasterCard, etc.), (2) store (e.g., Wal Mart, Office Depot, Sam's Club, etc.); and (3) gasoline (e.g., Fuelman, Exxon, etc.)].

Per nWLe.w of (;he, ~uJ.,~ a.f'ld, ~ wi.th- (;he, V~Cluk" (;he, V~~ 1M Cf'"~ CAMel.- Cl-CCOUt'It" wi.th-f~ fhe, M~, Chief ofPoU.c€" a.f'ld,(;he,PubUoWor4vweaor h<WI?/CAMc4<

fhe, V~~ h<WI?/ 1M debi:t" CAMet: Per (;he, Cluk" (;he, CAMel.- W Y'w-~ ~ fhe, cluk- "I-t.okW (;he, debi:t" CAMel.- U+'Ile»- M\.Other employee-~ beer\,

~~to-~it:

2. Obtain and evaluate the adequacy of the entity's written policies and procedures for credit cards (and debit cards if applicable).

fhe, V~~ I'1.Ot' h<WI?/ ~ wY'~ p~ or pY'oc.edure4' for debi:t" a.f'ld, Cf'"~CAMc4<

3. Obtain the monthly statements for all credit cards (general, stores, and gasoline) used during the period under examination and select for detailed review, the two largest (dollar amount) statements

for each card. (Note: For a debit card, select the two monthly bank statements with the largest dollar amount of debit charges): .

WI?/ ~ (;he, oo..w ~ for (;he, debi:t" CAMel.- a.f'ld, (;he, »t.O>'Ith.o/ ~for (;he, fu.e.l.m.cwv~

fhe, two-w~~ for fu.e.l.m.cwv werl?/ for Mw-cJt, 2010 a.f'ld,J I.J.KI.I?/

2010 for $468.38 a.f'ld,$454.26, Y'etpect'IN~.

4


Credit Ca,ds (continued)

T'he-clebit"=rwwc;wort.o/ ~intJM\UiMY2010 tv-p~ (or computer VlrCW YetnOVlW "",the-CleYkJ~ computer. T'he- cha.-fJ€' wc;w $B9.95.

A. Obtain the entity's supporting documentation for the purchases/chargcs shown on the selected monthly statements:

T'he-F~~ l4t'the- ~ofoo.cJt,pun:.hw.,e,-(V~ d.a.ttJ" ~ MiNer, odcme.te..- Y~ fuel; type-, ~ ~). WeoMcW't.ed.- '" ,.~t'(or the- clebit" =rwpu.-cJu;v"e,.

• Determine if each purchase is supported by:

o An original itemized receipt (i.e., identifies precisely what was purchased)

o Documentation of the business/public purpose (Note: For meal charges, there should also be documentation of the individuals participating)

See- above< T'he- purpow- wc;w wi.de.t1t a.t'\d, cq>pOO¥w tv- becq>PYopyi.t;U;lv.

o Other documentation as may be required by policy (e.g., purchase order, authorization, etc.)

T'he- Po'l.i.«Y ~ tha.t' "1M l4t' of ~ yequiYw "'" '" ,.ecw-Y~ ~~ be-~ tv- the-~ (or cq>pyovcM!' a.t'\d, "no- pu.-~~ be- ma.de- without'the- cq>PYOVlW of the~or a.t'\d,the-cay C01M1.Cil!'. T'he-F~~~ a.t'\d,they~t' (or the- clebit" =rw pu.-cJu:v..e, were-~ by theAlde...ne.ru T'he-F~ pu.-~ cq>pOO¥ tv- be- Yecw-Y~

pu.-~ tha.t' Cl¥e- YW(e.ww a.t'\d, cq>pYOvw by the- Bo<uw CI.(te¥ pu.-cJu;v"e,. It' w rl.Ot' clea.Y whether cq>pYOVlW (or the- VlrCW YetnOVlW wc;w ~ before-the- cha.-fJ€' wc;w iN1.ac.Yyed,

• Detenninc ifeach purchase is:

o Reasonable in amount

o For an appropriate and necessary business purpose relative to the entity

See- above< T'he-pu.-~ cq>pOO¥ tv- MNe- £U'II cq>pyopy~a.t'\d, ~~purpow<

5


Credit Cards (continued)

• Detennine if any purchases were made for personal purposes, and if so, detennine the daters)

of reimbursement.

We.- n.otul,. I1b i.rt.di.cat'lOY\I that fhe, PIA¥~ wue.- (0.- pu~

PIA¥prne4'.

• Detennine if any purchases effectively circumvented the entity's nonnal proeurement/purchasing process and/or the Louisiana Public Bid Law (i.e., large or recurring purehases requiring the solicitation of bids or quotes).

See.- fhe, cWove.- comtl1.et'Itl- "~d.i¥u,r comp~ wi,th, fhe, V~~ pd/.i.dv.r. None- of fhe, cWove.-PIA¥~ require.-comp~ wi,th, fhe, P~13i,d,L,"".

B. Detennine if there was any duplication of expenses by comparing all travel and related purchases

to the appropriate person's expense reimbursement report(s).

C. Detenninc if each monthly credit eard statement (including supporting documentation) was

reviewed and approved, in writing, by someone other than the person making the purchases. [Note: Requiring such approval may constrain the legal authority of certain public officials (e.g., mayor of a Lawrason Act municipality.)

/he,-f~~ (0.- uu;h, ~ wue.-~ by fhe, 13oa.rd< /he,-Yi¥"~"emove;U,WG4'fhe,Ot1.o/ d.ebitCGWd-PIA¥~clM.Y~2010.

D. Detennine if finance charges and/or late fees were assessed on the monthly statements.

Travel and Expense Reimbursement

I. Obtain and evaluate the adequacy of the entity's written policies and procedures for travel and expense reimbursement.

2. Obtain a listing of all travel and related expense reimbursements during the period under examination and select for review, the one person who was reimbursed the most money:

We.-"eq~fhe, l4t'~ CI.t'l.d-fhe, ,.eimbt.u--~frO»1/ fhe, V~Clerlv. Pu fhe, Clerlv the.-e.- wue.- I1b t:YevveL ~~ We.-~ fhe, ~e;U,

~ CI.t'l.d- n.otul,.l1b ~,.eimbt.u--~

6


Travel and Expense Reimbursement (continued) A. Obtain all of the expense reimbursement reports of the selected person, including the supporting

documentation, and choose the three largest expense reports to review in detail (Note: Choose 100% for review if there are less than three expense reports.):

• Detennine jf each expenditure is:

o Reimbursed in accordance with written policy (e.g., rates established for meals, mileage, lodging, etc.)

o Reasonable in amount

a For an appropriate and necessary business purpose relative to the travel

• Determine if each expenditure is supported by:

o An original itemized receipt (i.e., identifies precisely what was purchased) [Note: An expense that is reimbursed based on an established per diem amount (e.g., meals) generally does not require a receipt.]

o Documentation of the business/public purpose (Note: For meal charges, there should also be documentation of the individuals participating)

o Other documentation as may be required by policy (e.g., authorization for travel, conference brochure, certificate of attendance, etc.)

• Determine if any of the expenditures were for personal purposes (e.g., extended hotel stays before or after training class, meals for spouses, entertainment, etc.).

See- etbo-ve-.

• Dctennine if each expense report (including documentation) was reviewed and approved. in writing, by someone other than the person receiving reimbursement.

B. Determine if there was any duplication of expenses by comparing the expense reports to charges/purchases made on credit card(s).

7

Village of Collinston Collinston, Louisiana Report on Agreed-Upon Proeedures, 20 I0

Contracts

1. Obtain and evaluate the adequacy of the entity's written policies and procedures for eontracts/contraeting, including leasing.

2. Detennine if the entity has centralized control and oversight of eontracts to ensure that services/deliverables reeeived and payments made comply with the tenns and conditions of the contraets.

~ 'B()(U"cl,. cq;.pYOVe¥ rorttYcu:t¥. ~ ~~aY ~ tJte, Clerk.- oveneecomp~witJt, rorttYcu:t¥.

3. Review accounting records (e.g., general ledgers, aceounts payable reports, ete.) for the period under examination to identify individualslbusinesses being paid for contracted services (e.g., professional, technical, ete.). Select the five "vendors" that were paid the most money during the period and detennine if there is a fonnaVwritten contract that supports the services arrangement and payments.

We- Y/WLe.woo, tJte, ~cW~ for" tJte, Yea.¥" ~V~ 31, 2010. We- rtOt"ed- tJte, {oUowiA17f "yet'ldon-''' that were- p~ tJte, mmt" ItI.O>\e}'

d«..-iA17f tJte,Yea.¥":

• L~rte'-$11,752.00

• J~ElectYi.oSe.-vice.- - $11,200.00 • lW.Lq I~: $8,351.50 • C~EvwL..-~- $3,287.36 • T~J.oy Power - $2/1-63.00

C:>"-o/ H.a.Lq I~ W w.pp~ by '" rorttYaa-(~lettu).~ oth.« pW'~ a¥'e- w.pp~ by cq;.pyoycW L+-\.- tJte, ~~ em- tJte,

L+w~

4. Obtain a listing of all aetive contraets and the expenditures made during the period under examination. Select for detailed review, the largest (dollar amount) contract in eaeh of the following eategories that was entered into during the period.

We-Yeq~ tJte, ~~ Clerk.-1«bmi.ttoo, fi1e¥ for" t.W cO- Y/WLe.w. Vue.tv- tJte, natu.-e- r>f tJte, pW'~aY tJte, waY"" the.--e- w~ rIOt" '" rorttYaa- L+-\.every WM!< Se€/ bclow.

(1) Services

V. L~rte' Yet'IOY~PlM11fJiA17f equipm.e¥lt: ~e-W n.o-rorttYGl.d: 1M H.a.Lq I~PY()Yi.ded,-~....-u,r!e.-Yi.clw. We-~

tJte,~lettu.

8


Contracts (continued) uv. cet'i.Uv EI'WL.-~ pr-ov(ded, e+WL.-ontne+'ItcW m«~

.\&"V~ for th4v watBf" CLt'\d; .\€MIe.. ~~ T'/1.e..-e- W rwrorltnut:

(2) Materials and supplies Tet:YloY POWe..- Pyov(ded, et-~aWr". T'/1.e..-e- wrw- rorttY£<d:

(3) Public works J 0t'I,(W El.e.ctYio SeYVi.<» fu.y~ CLt'\d; ~aUed" three- 'IiycircAuID-5wifthove..- ChloriN\l:l.IDr'!'. T'/1.e..-e- wrw- rorttY=t:

A. Obtain the selected conlracts and the related paid invoices and:

• Detennine ifthe contract is a related party transaction.

We-r\OtEd, rw-~th<;tt" ~ ofahove-81<P~lWwe..-e- with, ye.l.ct/:ed; pa-r-t'"lM<

• Detennine if the transaction is subjeet to the Louisiana Public Bid Law:

o If yes, determine if the entity complied with all requirements (e.g., solicited quotes or bids, advertisement, selected lowest bidder, etc.)

rOt' th4v puy~ {yom; Let:YnR/ Chr~ Comp~, the¥e- we..-erw-!peci.fi.o bi,d,0t' qlA.Ote-Yequir~

rOt' th4v puy~ {yom; Tet:YloY Powe..-, th4v Vill.age- w~ YequinJd, to-~ three-q~ M th4v Vill.age- 1NWCLr'd.ed- th4v rorttYaabefoye- 201 0, we- cUd, Mt" te¢for comp~ with, th4v PubUc-13i,d, LINW.

rOt' th4v puy~ {yom; JOt'I,(W El.e.ctYio SeYVi.ce', the¥e- we..-e- rw!peci.fi.o bi,d, Ot' qlA.Ote- Yequir~ We-~ et- Pyop01iMt {yom;J 0t'I,(W th<;tt" q~ th4v eqlA-ipme.rtt pYi.ce< "(he, C«nOtM'tt" pai,d, w~$50 lowe..-~th4vpyop01iMtpYi.ce<

o If no, detennine if the entity provided an open and eompelilive atmosphere (a good business praetiee) for the transaction/work.

A.l-" th4v rorttYe<.<;.Q- We..-e-INWCLr'd.ed- ...", et- PyeviOl.W yea¥', we- cUd, Mt" pe.for'l11I th4- pYoc.ed.«Ye.-.

9


Contracts (continued)

• Determine if the contract was awarded under the requestfor proposals (RFP) method. Ifso, obtain all proposals and the evaluation/scoring documents to determine if the contract was awarded to the most responsible offeror whose proposal was the most advantageous taking into consideration price and other evaluation factors set forth in the request/or proposals.

• Determine if the procurement was made "off' state contract (as opposed to following the competitive bidding requirements of the Louisiana Public Bid Law). If so, determine if the

board formally adopted the use of the Louisiana Procurement Code (R.S. 39:1551-1755), the set of laws that govern most state agencies' purchases of certain services, materials and supplies, and major repairs.

• Determine if the procurement related to homeland security and was made from federal General Services Administration (GSA) supply schedules. If so, determine if the entity (I) utilized a Louisiana licensed distributor; (2) used the competitive ordering procedures of the federal GSA; and (3) received prior approval from the director of the State Office of Homeland Security and Emergency Preparedness, or his designee.

• Determine if the entity "piggybacked" onto another agency's contract. If so, determine if there is documentation on file that clearly demonstrates the contract was a previously bid, viable contract and the price paid by the entity was the same as that contract's bid price.

• Determine if the contract was amended. If so, determine whether the original contract contemplated or provided for such an amendment. Furthermore. determine if the amendment is outside the scope of the original contract, and if so, whether it should have been separately bid and contracted.

• Determine if the invoices received and payments made during thc period complied with the terms and conditions of the contract.

• Determine if there is written evidence that the entity's legal advisor reviewed the contract and advised entering into the contract.

We- n.oted.- no-~ evLclence< Howevet', ~ cWovEII the¥e- wcw ~ 01'le' e<mtYact" CLWIM"ded- d<.u-""fJ' 201O.

10


Contracts (continued)

• Detennine if there is documentation of board approval, if required.

Payroll and Personnel

I. Obtain and evaluate the adequacy of the entity's written policies and procedures for payroll and

personnel.

2. Obtain a listing of employment contracts/agreements in force during the period under examination. Seleet the largest (dollar amount) employment contract and detennine if all payments issued during

the period under examination were done in strict accordance with the tenns and conditions of the eontract.

3. Seleet the attendance and leave reeords for one pay period and:

We- ~the"pCl?' period" ~SeptwWe.-20, 2010 et.+'\d. ~ SeptwWe.- 24, 2010.

• Detennine if all employees are documenting their daily attendance and leave (e.g., vacation, siek, etc.). (Note: Generally, an elected official is not eligible to earn leave and does not document his/her attendance and leave. However, if the elected official is earning leave aceording to policy and/or contract, the offieial should document hislher daily attendance and leave.)

We-~ the" ~ et.+'\d. l.ecwe- I"'eeor4 for the" ~

period", T'/;.e,ye- CU"e- only tw& emplcy~ N& e-;u;e:pt:u:m¥ were-~ 114 "" I"'~of tJw..- pY'Cx.edure:

• Delennine if supervisors are approving, in writing, the attendance, and leave of all employees.

A", ald.e.nna,.., et.+'\d. the" MCI?'O'Y ~ the" t:~ T'/;.e,ye- WI14 I'\C' l.ecwe-~for the"PCl?' period" we-~ T'/;.e,ye- were-I'\C' ~fW 01'11 the" l.ecwe- I"'eeordt:

• Detennine if the entity is maintaining accurate written leave records (e.g., hours earned, hours used, and balanee available) on all eligible employees.

A",et'1try wonly I"'eeorded.-wh.en,l.ecwe-W~Th,e,I"'eeord,~nnt'

~ hot,(,yJ.' earned.- et.+'\d. hot,(,yJ.' WJc«.la.lile:

1\


Payroll and Personnel (continued) 4. Select the five highest paid employees and detennine if changes made to their hourly pay

rates/salaries during the period under examination were approved in writing and in accordance with policy.

The,v~onl:Yha.1r-two-etnploy~ We-l.tUfuif"ed,whethuthe¥e-were-~

yC\.ID ~ /he, cluj;, ~ the¥e- were- >'10" YC\.ID ~ We- yead"fhe, ~ c<Nt.<L YeNie.wed,fhe, e<:w~h4t"ory c<Nt.<L t1.Oted" >'10" YMe-~

5. Select the five largest tennination payments (e.g., vacation, sick, compensatory time, etc.) made during the period under examination. Detennine if the payments were supported by adequate

documentation, made in strict accordance with policy and/or contract, and properly approved.

6. Detennine if any employccs were also being paid as contract labor during the period of the examination.

We- PY"l~p~ C<-' y.part" i+'\; Ql..ti.cUloo4 by ~ c<Nt.<L t1.Oted" >'10" ~

p~~to-etnp~

We were not engaged to perfonn, and did not perfonn, an audit, the objective of which would be the expression of an opinion on managemenCs assertions. Accordingly, we do not express such an opinion. Had we perfonned additional procedures, other matters might have come to our attention that would have been reported to you.

This report is intended solely for the use of the management of the Village of Collinston and the Legislative Auditor, State of Louisiana, and should not be used by those who have not agreed to the procedures and taken responsibility for the sufficiency of the procedures for their purposes. Under Louisiana Reviscd Statute 24:513, this report is distributed by the Legislative Auditor as a public document.

HULSEY, HARWOOD & SHERJDAN, LLC

September 6, 2011

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Village of Collinston ,161 KMain Slrel.'l Phone: 31 8-874-2b3 I I:mail: [email protected] Mitchell Jeselink; Mayor p.o.nm.148 Fllx:]18·874·219b Julie Single; Clerk C'ullinslon, l.ouisillllll 71229 Councilmen;

Belly Jones Fmnk Miller

Dawn Gilbrcalh

September 6, 20 I I

Hulsey, Harwood & Sheridan, LLC 1900 Roselawn Avenue Monroe, Louisiana 71201

Re: Correclive Action Plan

We respectfully submit the following corrective action plan in response to the results of your agreed-upon procedures:

Financial Management I. The Clerk will submit to the Board budget to actual reports alall future meetings. 2. We will prepare a wrillen plan 10 eliminate deficits. 3. We will implement the accountant's recommendations for policies.

Credit Cards I. We will prepare a written policy for credil and debit cards. 2. We will oblain Board approval for each purchase. Recurring purchases will be approved once.

Cootrael. I. We will obtain the advice of legal counsel before awarding any significant future contracts.

Payroll I. The Clerk will ensure that leave records and time records include a supervisor's signature.

WI. I Mitch Jese2t)~-

This instUution is an equal oppurtunity provider.

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