Kisatchie-Delta Regional Planning and Development District...

KISATCHIE-DELTA REGIONAL PLANNINGAND DEVELOPMENT DISTRICT, INC.

ANNUAL FINANCIAL REPORT

FOR THE YEAR ENDED JUNE 30,2006

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

Release Date

Table Of Contents

INDEPENDENT AUDITORS' REPORT 1 - 2

REQUIRED SUPPLEMENTAL INFORMATIONManagement's Discussion And Analysis 3-6

GOVERNMENT-WIDE FINANCIAL STATEMENTSStatement Of Net Assets 7Statement Of Activities 8

FUND FINANCIAL STATEMENTSGovernmental Funds

Balance Sheet 9Reconciliation of Fund Balances on the Balance Sheet for Governmental

Funds to Net Assets of Governmental Activities on the Statement ofNet Assets 10

Statement of Revenues, Expenditures and Changes in Fund Balance 11-12Reconciliation of the Statement of Revenues, Expenditures, and Changes in

Fund Balance of Governmental Funds to the Statement of Activities 13Notes to Financial Statements 14-22

SUPPLEMENTAL FINANCIAL INFORMATIONCombining Statement of Revenue, Expenditures and Changes in Fund Balances 23

OTHER REPORTSIndependent Auditors' Report On Compliance and on Internal Control Over

Financial Reporting Based On An Audit Of General Purpose FinancialStatements Performed In Accordance With Government Auditing Standards 24 - 25

Schedule Of Findings and Questioned Costs 26Management's Corrective Action Plan 27Schedule of Prior Year Findings and Questioned Cost 28

Rozier, Harrington & McKayCertified Public Accountants

1407 Peterman Drive • Alexandria, Louisiana 71301MAILING ADDRESS

JOHN S. ROZIER, IV, CPA Post Office Box 12178MARKS. MCKAY, CPA Alexandria, Louisiana 71315-2178LEE W. WILLIS, CPA Telephone (318) 442-1608

STEVEN E. KIMBALL, CPA Telecopier (318) 487-2027

M. DALE HARRINGTON, CPARETIRED -2005

August 29,2006

INDEPENDENT AUDITORS' REPORT

Kisatchie Delta Regional Planning andDevelopment District, Inc.

Alexandria, Louisiana

We have audited the accompanying financial statements of the governmental activities, each majorfund, and the aggregate remaining fund information of the Kisatchie Delta Regional Planning andDevelopment District, Inc. as of and for the year ended June 30, 2006, which collectively comprisethe District's basic financial statements as listed hi the table of contents. These financial statementsare the responsibility of Kisatchie Delta's management. Our responsibility is to express an opinionon these general purpose financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the UnitedStates of America and the standards applicable to financial audits contained in the GovernmentAuditing Standards, issued by the Comptroller General of the United States. Those standards requirethat we plan and perform the audit to obtain reasonable assurance about whether the general purposefinancial statements are free of material misstatements. An audit includes examining, on a test basis,evidence supporting the amounts and disclosures in the general purpose financial statement. Anaudit also includes assessing the accounting principles used and significant estimates made bymanagement, as well as evaluating the overall general purpose financial statement presentation. Webelieve that our audit provides a reasonable basis for our opinion,

In our opinion the financial statements referred to above present fairly, In all material respects, therespective financial position of the governmental activities, each major fund, and the aggregateremaining fund information of the Kisatchie Delta Regional Planning and Development District, toe.as of June 30, 2006 and the respective changes in financial position, thereof for the year then endedin conformity with accounting principles generally accepted in the United States.

The management's discussion and analysis and budgetary comparison information listed in theaccompanying table of contents are not a required part of the financial statements but aresupplementary information required by accounting principles generally accepted in the United Statesof America. We have applied certain limited procedures, which consisted principally of inquires of

-Members-American Institute of Certified Public Accountants • Socfety of Louisiana, CPAs

-1-

INDEPENDENT A UDITORS ' REPORTAUGUST29,2006PAGE 2

management regarding the methods of measurement and presentation of the required supplementalinformation. However, we did not audit the information and express no opinion on it.

In accordance with Government Auditing Standards, we have also issued our report dated August 29,2006 on our consideration of the Kisatchie Delta's internal control over financial reporting and ourtests of its compliance with certain provisions of laws, regulations, contracts and grants. That reportis an integral part of an audit performed in accordance with Government Auditing Standards andshould be read in conjunction with this report in considering the results of our audit.

Our audit was conducted for the purpose of forming an opinion on the financial statements thatcollectively comprise Kisatchie-Delta's basic financial statements. The combining financialstatements listed in the table of contents are presented for the purpose of additional analysis and arenot a required part of the general purpose financial statements of the Kisatchie Delta RegionalPlanning and Development District, Inc. Such information has been subjected to the auditingprocedures applied in the audit of the basic financial statements and, in our opinion, is fairlypresented in all material respects in relation to the basic financial statements taken as a whole.

ROZIER, HARRINGTON & McKAYCertified Public Accountants

-2-

KISA TChIE-DEL TAREGIONAL PLANNING AND DEVELOPMENT DISTRICT, INC.

Management's Discussion and AnalysisFor the Year Ended June 30,2006

This section of Kisatchie-Delta Regional Planning and Development District's annual financialreport presents our discussion and analysis of the District's financial performance during the yearended June 30,2006.

OVERVIEW OF FINANCIAL STATEMENTSThe basic financial statements include government-wide financial statements and fund financialstatements. These two types of financial statements present Kisatchie-Delta's financial position andresults of operations from differing perspectives, which are described as follows:

Government-Wide Financial Statements

The government-wide financial statements report information about Kisatchie-Delta as a whole usingaccounting methods similar to those used by private-sector companies. These report all revenues andexpenses regardless of when cash is received or paid. Furthermore, the government-wide statementsinclude all of Kisatchie-Delta's assets and all of it's liabilities (including long-term debt). Expensesincurred in connection with the operation of Kisatchie-Delta's programs are reported asgovernmental activities. The governmental activities are financed by grants, fees and membershipdues.

Fund Financial Statements

Fund financial statements provide detailed information regarding Kisatchie-Delta's most significantactivities and are not intended to provide information for Kisatchie-Delta as a whole. Funds areaccounting devices that are used to account for specific sources of funds. Kisatchie-Delta's funds areall classified as governmental funds. These funds are used to account for essentially the samefunctions that are reported as governmental activities in the government-wide financial statements.However, unlike government-wide financial statements, the governmental funds use a modifiedaccrual basis of accounting that provides a short-term view of Kisatchie-Delta's finances. Assetsreported by governmental funds are limited to amounts that are available for current needs. Inaddition, liabilities are limited to amounts that are expected to be paid from currently availableassets.

FINANCIAL ANALYSIS OF KISATCHIE-DELTA AS A WHOLEGovernment-wide financial data for Kisatchie-Delta are presented as follows:

Net Assets

A condensed version of the government-wide Statement of Net Assets is presented as follows:

-3-

KISA TCHIE-DEL TAREGIONAL PLANNING AND DEVELOPMENT DISTRICT. INC.

Management's Discussion and AnalysisFor the Year Ended June 3O, 2OO6

June 30,2006 2005

Assets:Current and Other Assets $ 958,565 $ 1,084,287Capital Assets 9,094 2,607Total Assets _ 967,659 1,086,894

Liabilities:Current and Other LiabilitiesLong-term LiabilitiesTotal Liabilities

122,1601,270,3011,392,461

114,3391,339,1691,453,508

Net Assets:Invested in Capital Assets 9,094 2,607Unrestricted (433,896) (369,221)Total Net Assets $ (424,802) $ (366,614)

In order to promote economic development, Kisatchie-Delta has borrowed $2,000,000 from theUSDA's Intermediary Relending Program (IRP) for the purpose of establishing a revolving loanfund, Kisatchie-Delta's IRP loan program has originated numerous loans and these loans haveexperienced a substantial rate of default. Due to losses associated with these problem loans,liabilities currently exceed assets and Kisatchie-Delta has a substantial deficit in unrestricted netassets. However, long-term liabilities are payable in annual installments, which are due over a seriesof years. Since, payments are structured over a series of years, Kisatchie-Delta has sufficientresources on hand to meet is ongoing obligations for the foreseeable future.

Changes in Net AssetsA condensed version of the government-wide Statement of Changes in Net Assets is presented asfollows:


Management's Discussion and AnalysisFor the Year Ended June 30, 20O6

Revenues:Program Revenue:

Charges for ServicesOperating Grants and

ContributionsGeneral Revenue:

June 30,2006 2005

$ 64,769 $ 91,104

173,248 142,802

Membership DuesMiscellaneous

Total Revenue

Program Expenses:General Government

Finance & AdministrativeEconomic Development

Federal ProcurementEDA Regional PlanningBusiness LoansEnterprise Zone ProjectsAssistance to Local GovernmentsRural Business EnterpriseRenewal Community ProjectsDelta Regional AssistanceHazard Mitigation AssistanceOther

Total Expenses

Change in Net AssetsNet Assets Beginning

Net Assets Ending

42,92716,472

297,416

22,420

40,74480,896

120,169

—9,451

47,34519,31914,722

—538

355,604

(58,188)(366,614)

$ (424,802)

37,8147,973

279,693

35,311

46,72865,939

122,5729,424

—14,90617,43515,61012,055

—339,980

(60,287)(306,327)

$ (366,614)

As presented above, Kisatchie-Delta's net assets have decreased as a result of current operations. Thedecrease is attributable to losses involving Kisatchie-Delta's IRP loan portfolio.

FINANCIAL ANALYSIS OF KISATCHIE-DELTA'S FUNDSActivity for Kisatchie-Delta's major funds and the aggregate remaining funds is presented asfollows:

-5-


Management's Discussion and AnalysisFor the Year Ended June 30, 2O06

General FundEDAIntermediary RelendingFederal ProcurementRBEGRenewal CommunityOther Governmental Funds

Total

Revenues

$ 61,62862,50052,86236,97343,04817,15523,250

$ 297,416

Expenditures

$ 35,32580,896

179,65240,74447,34519,31924,711

$ 427,992

OtherSources

And Uses

$ 28,31918,000

—3,3704,297

—(53,986)

$

Excess(Deficiency)

$ 54,622(396)

(126,790)(401)

—(2,164)

(55,447)

$ (130,576)

The General Fund balance increased as a result of the transfer of resources from funds that were usedto account for projects that have been completed. This also resulted in a decrease in fund balance forOther Governmental Funds.

The Intermediary Relending Program experienced a deficiency because principal payments on long-term debt are reported as expenditures by the governmental funds. For the year ended June 30, 2006,principal payments totaled $68,186. In addition, the Intermediary Relending Program experiencedloan losses totaling $63,300 as a result of default on loans originated under the program.

GENERAL FUND BUDGET HIGHLIGHTSKisatchie-Delta is a non-profit organization governed by a Board of Directors that is appointed byvarious governmental units. Since it is organized as a nonprofit organization, Kisatchie-Delta is notrequired to adopt or amend budgets for its funds and no budget comparisons are presented.

CAPITAL ASSET ADMINISTRATIONCapital asset activity for the year ended June 30, 2006 is limited to making improvements to thefacility that is utilized as office space.

DEBT ADMINISTRATIONFor the year ended June 30, 2006, debt activity was limited to the contractual maturity of existingobligations and changes in compensated absences.

FACTORS EXPECTED TO EFFECT FUTURE OPERATIONSAt the present time, no significant factors are expected to effect further operations.

-6-

KISA TCHIE-DELTAREGIONAL PLANNING AND DEVELOPMENT DISTRICT. IMC.

Statement of Net AssetsJune 3O, 2006

AssetsCash and cash equivalentsAccounts receivableReal estate held for resaleOther assetsLoans receivable, net of allowance for loan lossesDepreciable capital assets, net

Total assets

GovernmentalActivities

S 364,00670,90699,000

900423,753

9,094

967,659

Liabilities:Accounts and other payablesDeferred revenueLong-term liabilities

Accrued leaveNote Payable-USDA

Due within one yearDue in more than one year

Total liabilities

18,07525,600

9,617

68,8681,270,301

1,392,461

Net AssetsInvested in capital assets, net of related debtUnrestricted

Total net assets (deficit)

9,094(433,896)

(424,802)

The accompanying notes are an Integral part of the financial

-7-

i

iK*0

£iki*52Q

B

KIS

A T

CH

IE-D

EL

TA

RE

GIO

NA

L P

LAN

NIN

G A

ND

J

Sta

tem

ent of A

ctiv

ities

Yea

r Ended

June

30, 2

006

*"Nu3BS*•ae.•**i

te

IS>-Sa3Ss

fa

10 5 SIII> n BIV * **

1 x

„ s1 s 1p, g »BA 9 S*0 I I

U

3

f l 5- S iS -s a| § So 5 i

w

**«2 g

S ^CD >*• r« O

J2 03

S

isw

O *— < VO O <-< O O1* OO OOOl O* CTv V> C3 C*— »~* P*~ CO^- t * * c o V O o l * o c o o | v »oi co oo co" *-T ir> ofoi ^^ >— * VD ^^ ^^^ ' ^"^-' ^~^ ' ^

-

i i i * i i i i i

e*

co O in O O0*0 r> o o

* <J\ in ' ' f*- ^3 ^3 *VO oi *"•* o* mco vo ^* i— t i— «

£9

ON O• • « «n o! • ' • '

vo" oo"

-o ^ - v o o s ^ t n o ^ o i o oOI * " ON VO TJ ^J" •— * Ol CO

OI ' OO Ol - r-f •— t1—4

fie-

1 fl

O S f l J -=> <D

"•° on ? -™ & 8

•B w + i ^ ' 3 W f i > » c n*s "§ S S S "a -^ -s »

1 111 Jl-a 1|«s|

oo*of*rr-tt— f

00^J*

°iCO**t .

VO

.o«o"CO

Tota

l Gov

ernm

enta

l Act

ivities

t"- Ol O\ OO ^ OlOl 1*- ON OO f-i Oos -^- to •— » vo ooOl VO ON OO VO 1 --sr i-< «o m so oi

^•^ CO f

-

M

§ -^ °°55 S o -S

Is I -3 J J*S >^ K ^ DO *9S Q 55 S o Jf o> _ p c3 »£J DQ moi ,s* o ••* Z *^ 'eg ^ g S rt iS £1-I e S S -s » »2 Jl o a § §« -f g X s^^ •<S § to -S S •*.* •*-•0 S 2 t2 6 55 S5

1E

i?"o10

•5t•0.

ED

5£0

|0

5oeIBB

f

f200

1-

g

t5sQ*k

§

k

SISUl

KIS

A T

CH

IE-D

EL

TA

RE

GIO

NA

L P

LAN

NIN

G A

ND

O

i"1

Bala

nce

Shoot

Gove

rnm

enta

l Funda

- J

kMf0

301,

«•g 5 5

I

1<• H •

J § 1

O 0 S

e

.

11j i

u

S

i1 iM Hu £•O p

t e

^« "514

<s

1J

o o o o o *no^ os_ cs_ o^ ov r• F *^ ob" o\ tnm T

«

• * * * " • • •t^ m

oo• o • • •

*"*

CO

00i o • ' ' *

of

VJ

Mrt » 1 to"

m o eno o « Q**! P. vlOS OS Is)

O OS«o ^~

in" en—* en

CO

^-t -«• « Oo ift r> . ofi w ^* os

so n cs

w

|t«.MO(

OOf*

3

ooo_r^

OBO«

CH

•rto

oo

5|>H

00

o»OSoK"*

tonarj

Afti

eta

Cas

h an

d cu

b eq

ulva

lent

BAc

coun

ts re

ceiva

ble

Inte

rfund

nce

lvab

let

Rea

l est

ate

held

for

resa

leO

ther

oaa

otBLo

ons

rece

ivabl

e, n

et o

fal

low

ance

for l

oan

leas

esTot

al a

ucta

W1 Or- 5.s

*O 00 OO VI2 S•-« OB

£

oo o m«n o -*\0 SO -H

OS C3O Oen o

§

GO

00«n

K

O

c

I7C

S;o00*o

KISATCHIE-DELTAREGIONAL PLANNING AND DEVELOPMENT DISTRICT. INC.

Reconciliation of Fund Balances on tits Balance Sheet for Governmental

Funds to Met Assets of Governmental Activities on the Statement Met Assets

June 3Q? 2OO6

Total FundBaknces-Gcrvemmental Funds $ 914,890

Amounts reported, for governmental activities in the statement of net assets arc

different because:

Long term liabilities are not due and payable in Ihe current period and

therefore they are not reported in the Governmental Fund Balance Sheet (1348,786)

Capital assets used in governmental activities are not financial resources and

therefore are not reported in the funds. 9,094

Net Assets of Governmental Activities $ (424,802)

The accompanying notes are an integral part off the financial statements.

-10-

y5

tliKgQL.5

%iQ

K/5

X T

C H

IE- D

EL

TA

RE

GIO

NA

L P

LAN

NIN

G A

ND

DE

VE

L

ftt)

iQtl

5•2—8d 5c s1 i§ 21 *0] £

Sta

tem

ent of R

even

ues,

Exp

and/

tune

s

Gove

rnm

enta

l Fun

ds - K

M/*

End

ed Jun

H-ta•**C

1 if® E _H^ S fc

S:oa

1c*• 2 JSa» g *o

O S £

1

.fc

11PS 1

U

oH

g

*•e

^1"S gt=, 1

a-

>.? u

^llSK

<Q

1agO

1oc*

co o o r» o* 01TT O VI M -^ t^O\ O CM OS Mi Tj-KO t*- CO C4 *O \OMl —» - Wl «-«'

M

O OO Mlo • r^ • » '«n oo»-«

B9

O VI.O . "rt' 0 ' ' » -«

t^

M

MI m« - . . . . < >t"l • * • * 04• p

w

»nr^

*o~fn

M

. «n o' * ' * ri

CO* O*•«•

M

Oo

<2to

M

r- « MId »o m1 • • O» OO 00of rf «nr ™^

Gra

nts

- Fed

eral

S

Stat

e fu

nds

Loca

l flu

ids

Mem

bers

hip

due

sIn

tere

st a

nd fe

es fr

om lo

ans

Misce

llane

ous

jo£r-^°1M

OMIcsmM

MlMl

^"l>

OO

.mTt

enr-OA*otn

%oGOCIvi

oo"1NM?

OO_

~+\o

Tot

al re

venu

es

oo •&• \o v\ — • wi o* c» OB -4- o« •3-o»o»Mi-*r^e4m«rtvoo r -aoo- i rmenr^v iv i c^MJ cT o" «f aC t- cC - o" oi•— • ^- oo o ^^ •—* •— * ••* oo

"*

<-« c* aa«n cs mt 1 * 1 ^ . 1 * f« Vk ' '

av - r—4

ov1-*

o\

Ml

r^•*

•*

o•*

r« oS €t- 01O 00

>o

C3"en

03 m -3-\o o in

v> 06" o

III! Iff!lllllll'lllE ^ J S S g S o S G s ™

Mjiv-iJa? 18 lill^llii^li-8

i |l|llslllSS|]° ^ "§•-§^0 0 Q

Matent^r*

^

^^*~*o*SM

C*•~*

Oj

Ml•3-

<*lt»•«•

?I**

O^~

csMlV£3_

O\r-1—1

ig

>nnn,mm

Tot

al e

xpen

ditu

res

/~*tor*mCS"fl

> f

r~i•M

*o^w

"

^>

S•o*~i

a.

SQ\

S

f^t•Mr-mv^

i~*oG\**i\OOJ*k_t

G*CA

00*^s

S5Oi

Hxo

ess

(doQ

oion

oy) o

fre

venu

es o

ver e

xpen

ditu

res

I

•5Iia

s2g

D.

|

KIS

A T

CH

IE-D

EL

TA

BiSU

s1C%J

B5Q&^isi1§H

RE

GIO

NA

L P

LAN

NIN

G A

ND

DE

\

5t§tj6aCe

S5»eSS<U

{

Sta

tem

ent o

f Reve

nues,

Exp

end/tu

<o*™of

|

Gove

rnm

enta

l Funds -

Year E

nded

•a•**go 1 1

£•" g £oo

1eb ft( B

g g "So i £

1 "§o Eg gK 1

U

CD

i4*§

"Hia £

1 1t*cu

f"

_P B

s

gB3

"3

i

to"r-«nO«n

^to•*"4«U

Ic>Tx_^

1*Nr-rJo*

•Ni— «r-r^rn"%u

*«»or-to"M

C?

«*loo

mo* .cs

Exce

ss (d

efic

ienc

y) o

fre

venu

es o

ver

expe

nditu

res

Oth

er F

inan

ouia

Sou

rces

(Use

s):

*5?r-*inoCO

y~S ^— \o r-oo°irn•n<•_>•

•

tat

«rt"•ftv^

*-H

&

1

^No •-»t-rnen

Os

^^o

•

ooooo"

atnoon

atr^to

"

*»-v

at**s

§•

#

Ope

ratin

g tra

nafe

rs in

(ou

t)

Exce

ss (d

ofic

ionc

y) o

f rev

enue

s and

and

othe

r res

ourc

es o

ver

othe

r re

sour

ces

over

(und

or)

expe

nditu

res

and

othe

r use

s

1

C3

S

Omci

oat

1

Iu.

KISATCHIE-DELTAREGIONAL PLANNING AND DEVELOPMENT DISTRICT. INC.

Reconciliation of the Statement of Revenues, Expenditures, and Changes in

Fund Balance of Governmental Funds to the Statement of Activities

rear Ended June 3O, 2OOB

Net change in fund balances of Governmental Funds S (130,576)

Amounts reported for governmental activities in the statement of

activities are different because:

Governmental funds report capita! outlays as expenditures. However, in the

statement of activities the cost of those assets is allocated over

estimated useful lives and reported as depreciation expense. Capital

outlays and deprecinHon ore presented as follows:

Capital Outlay 10,554

Depreciation (4,067)

Repayment of debt principal is an expenditure in the governmental fiinds, but

the repayment reduces long-term liabilities in the statement of net assets. 65,901

Change in net assets of governmental activities $ (58.188)

The accompanying notes are an integral part off the financial statements.

-13-

Kisatchie-DeltaRegional Planning and Development District

Notes to Financial StatementsJune 3O, 2006

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESKisatchie-Delta Regional Planning and Development District, Inc. is a non-profit organizationorganized under the Laws of the State of Louisiana. The District represents a portion of CentralLouisiana that includes eight (8) parishes. Kisatchie-Delta is governed by a Board of Directors andmembers of the Board are appointed by the governing bodies of various political subdivisions that liewithin the boundaries of the District.

Kisatchie-Delta was organized in order to promote economic development and alleviateunemployment. Its activities are financed by Federal and State grants, as well as support from localgovernmental units. Since Kisatchie-Delta is financed by governmental sources and, since its Board ofDirectors is appointed by various local governments, Kisatchie-Delta is considered to be a quasi-governmental unit for financial reporting purposes. The accompanying financial statements wereprepared in conformity with generally accepted accounting principles for governmental units.

The following is a summary of certain significant accounting policies and practices:

Financial Reporting Entity

Kisatchie-Delta is considered a legally separate stand-alone government as defined by Statement No. 14of the Governmental Accounting Standards Board. The reporting entity is composed of the activitiesthat are under the direct control of the Board of Directors. Kisatchie-Delta is not financiallyaccountable for any organizations that maintain separate legal standing; therefore, it has no componentunits.

Basic Financial Statements

All of Kisatchie-Delta's operations are classified as governmental activities. Governmental activitiesinvolve government services that are normally supported by intergovernmental revenues and certainfees. The basic financial statements include both government-wide and fund financial statements.The government-wide and fund financial statements present the District's financial position andresults of operations from differing perspectives which are described as follows:

Government-Wide Financial Statements

The Statement of Net Assets and the Statement of Activities display informationabout Kisatchie-Delta as a whole. The effect of interfund activity is eliminated fromthese financial statements. Furthermore, government-wide financial statementsexclude any fiduciary activities which are reported hi the fund financial statements.

Program revenues reported in the Statement of Activities consist of amounts that aredirectly associated with a governmental service. Program revenues include charges forservices, fees, contributions associated with a particular function and most grants.

-14-


Notes to Financial StatementsJune 3O9 2006

Fund Financial Statements

Funds are separate accounting entities that are designed to assist with demonstratinglegal compliance and segregating transactions by activity. Major individual funds arereported as separate columns in the fund financial statements. The District's majorfunds are described as follows:

• General Fund - The general fund is the primary operating fund and is used toaccount for all governmental activities that are not required to be presentedelsewhere.

• EDA - This fiind accounts for activity related to regional planning activitiessupported by EDA grants and local matching funds.

• Intermediary Relending - This fund accounts for revolving loan activity that isfinanced by a loan from the United States Department of Agriculture.

• Federal Procurement - This fund accounts for assistance provided to business thatare interested in doing business with federal agencies. Federal procurement isfinanced with grant funds provided by the Louisiana Productivity Center and localmatching funds.

• RBEG — Fund established to account for resources devoted to provide training forrural entrepreneurs.

• Renewal Community - Fund established to account for resources devoted toadministering programs associated with the Central Louisiana Renewal Community.

Basis Of Accounting and Measurement Focus

Basis of accounting refers to when revenues and expenditures or expenses are recognized in theaccounts and reported in the financial statements. Basis of accounting relates to the timing of themeasurements made, regardless of the measurement focus applied. The basis of accounting andmeasurement focus used for various financial statement presentations are described as follows:

Financial Statement Presentation Basis of Accounting Measurement FocusGovernment-Wide Financial Statements Accrual Basis Economic ResourcesFund Financial Statements Modified Accrual Basis Current Financial Resources

Under the accrual basis of accounting and the economic resources measurement focus, revenues arerecorded when earned and expenses are recorded when a liability is incurred.

Under the modified accrual basis of accounting and the current financial resources measurementfocus revenue is recognized when it is considered measurable and available. Revenue is consideredavailable if it is collected within 90 days of year end. In addition, expenses are generally recordedwhen a liability has been incurred. Furthermore, when the current financial resources measurementfocus is used, amounts recorded as assets exclude capital assets and the acquisition of capital assetsis treated as an expenditure. In addition, long-term debts are excluded from amounts reported as

-15-


Notes to Financial StatementsJune 30, 20O6

liabilities. Proceeds from issuing long-term debt is reported as an other financing source andrepayment of long-term debt is reported as an expenditure.

Accumulated Unpaid Vacation

The District's employees earn from one to one and a half hours of vacation pay for every twenty hoursworked depending upon their length of service. Vacation time not taken may be carried forward tosubsequent periods; but upon termination, no more than thirty days of accrued vacation will be paid tothe employee. Earned vacation has been charged to the funds based on the same allocation asregular salary.

Capital Assets

Capital assets include significant acquisitions of equipment that are expected to remain in service for aperiod of years. Capital assets are reported in the government-wide financial statements but are excludedfrom the fund financial statements. Instead, the funds report the acquisition of capital assets asexpenditures rather than asset acquisitions. Capital assets are depreciated using the straight-line methodand useful lives ranging from 5 years to 7 years.

Interfiind Receivables And Pavablcs

Amounts of cash held or disbursed by the General Fund on behalf of other funds are recorded asInterfund Payables and Receivables. These Interfund Payables and Receivables are eliminated from thegovernment-wide financial statement presentation.

Loans and Allowance for Loan Losses

Loans are reported at the amount of unpaid principal reduced by an allowance for loan losses. Theallowance for loan losses is based on an amount that management believes will be adequate to absorbpotential losses on existing loans. The allowance is established through a provision for loan lossescharged to expenditures. Loans are charged against the allowance for loan losses when managementbelieves that the collectability of principal is unlikely.

Real Estate Held for Resale

Certain real estate that served as collateral to secure loans has been repossessed. The repossessed realestate is reported at its estimated fair market value. Kisatchie-Delta has placed the property on themarket and is actively seeking buyers.

Cash And Cash Equivalents

Cash includes amounts hi demand deposits, interest-bearing demand deposits, and money marketaccounts. Cash equivalents include amounts in time deposits and those investments with originalmaturities of 90 days or less. Under state law, the District may deposit funds in demand deposits,interest-bearing demand deposits, money market accounts, or time deposits with state banks organizedunder Louisiana law and national banks having their principal offices in Louisiana.

-16-


Notes to Financial StatementsJune 3O, 2006

Credit risk associated with bank deposits is limited by requiring fiscal agent banks to pledge securities asrequired by State Law. Furthermore, interest rate risk associated with certificates of deposits is typicallymitigated by purchasing instruments that mature in one year or less.

Use Of Estimates

The preparation of financial statement in conformity with generally accepted accounting principlesrequires management to make estimates and assumptions that affect certain reported amounts anddisclosures. Accordingly, actual results could differ from those estimates.

Budgets

As discussed previously, Kisatchie-Delta is organized as a non-profit corporation rather than apolitical subdivision. Accordingly, Kisatchie-Delta is not required to prepare a formal budget orpresent budget comparisons with its financial statements.

NOTE 2 - INTERNAL BALANCES AND ACTIVITYThe interfund receivables and payables at June 30,2006 are as follows:

General FundSpecial Revenue Funds:

Economic Development AdministrationIntermediary RelendingFederal ProcurementRural Business EnterpriseRenewal CommunityOther Governmental Funds

Total

InterfundReceivables

$ 21,171

33,849

—10,532

——

3,357$ 68,909

InterfundPayables

i;q>

—30,765

—7,113

26,3354,696

$ 68,909

Various funds deposit cash into a single bank account and money is disbursed from the account onbehalf of these funds. This commingling of resources results in the interfund receivables andpayables presented above.

Operating transfers for the year ended June 30,2006 are presented as follows:

-17-


Notes to Financial StatementsJune 30, 2006

General FundSpecial Revenue Funds:

Economic Development AdminFederal ProcurementRural Business EnterpriseOther Governmental Funds

Total

OperatingTransfers In

$ 53,986

18,0003,3704,297

—$ 79,653

OperatingTransfers Out Net

$ 25,667 $ 28,319

— 18,000— 3,370— 4,297

53,986 (53,986)$ 79,653 $

The transfers described above were made for various purposes, which are described below:

• In order to provide matching funds required by certain grants, the general fund transferred$25,667 provided by membership dues to various programs. Recipients of these transfersincluded Economic Development Administration, Federal Procurement and Rural BusinessEnterprises.

• Funds created to account for certain projects have been closed out due to completion of theprojects. Resources remaining in these funds totaling $53,986 were transferred to the generalfund.

NOTE 3 - CAPITAL ASSETSChanges in capital assets are presented as follows:

Beginning, Balance

Depreciable Capital AssetsFurniture, Fixtures and EquipmentLeasehold ImprovementsAccumulated DepreciationTotal

$

$

36,745

(34,138)2,607

Additions

$

$

10,554(4,067)6,487

Disposals

$ (1,270)

1,270<K,p ——

EndingBalance

$

$

35,47510,554

(36,935)9,094

Capital assets are limited to furniture, fixtures, equipment and improvements used in theadministration of Kisatchie-Delta's activities. Accordingly, depreciation expense is reported in theaccompanying government-wide financial statements as a finance and administrative expense.

NOTE 4 ~ INTERMEDIARY RELENDING PROGRAMKistachie-Delta has been selected to participate in the Intermediary Relending Program sponsored bythe United States Department of Agriculture. As an intermediary, Kisatchie-Delta has borrowed$2,000,000 from the Fanners Home Administration at an interest rate of one percent (1%). Funds

-18-



borrowed from the Farmers Home Administration were used to create a portfolio of revolving loans toeligible borrowers within the Kisatchie-Delta District.

As of June 30, 2006, the loan portfolio consist of nine (9) loans mat are secured by a variety ofcollateral that includes real estate, equipment and inventories. The amount currently outstanding ispresented as follows:

Loans Receivable $ 761,778Allowance for Loan Losses (338,025)Loans (net) $ 423,753

An analysis of activity effecting the allowance for loan losses for the year ended June 30, 2006 ispresented as follows:

Allowance For Loan Losses:Balance, Beginning of the Year $ 274,726Provision for Bad Debts 63,299Loans Charged Off —Recoveries —Balance, End of the Year i S 338,025

NOTE 5 - LONG-TERM DEBTThe following is a summary of long-term debt transactions for the year ended June 30,2006

Beginning of YearAdditionsLong-term Debt RetiredEnd of YearDue Within One YearDue in More Than One Year

AccruedLeave

Liability

$ 7,3322,285

—9,617

—$ 9,617

Farmers HomeAdministration

$ 1,407,355

—68,1861,339,169

68,868$ 1,270,301

Total

$ 1,414,6872,285

68,1861,348,786

68,868$ 1,279,918

Notes payable at June 30,2006 are comprised of the following general obligations:

-19-


Notes to Financial Statements

June 30, 2006

A $2,000,000 loan from the USDA at 1% for the purpose offinancing Kisatchie-Delta's participation in the IntermediaryRelending Program. Interest is due in semi-annualinstallments beginning July 8, 1994. Principal and interestwill be paid in a series of equal installments beginningFebruary 8, 1997 and continuing for a period of thirty (30)years. The note is secured by Kisatchie-Delta's intermediaryloan portfolio. $ 1,339,169Total General Obligations $ 1,339,169

Since Kisatchie-Delta's general obligations were incurred to finance the IRP loan program, the IRPloan fund has provided resources to service the general obligation debt. In addition, interest incurred inconnection with the general obligations has been reported in the Statement of Activities as a businessloan program expense. For the year ended June 30,2006, the business loan program expenses includedinterest expense totaling $14,074.

Compensated absences are usually liquidated by Kisatchie-Delta's general fund

Future payment of principal and interest on outstanding general obligations is presented as follows:

Year Ended June 30"* Principle Interest Total

200620072008200920102011-20152016-20202021-2025Total

$ 68,86869,55770,25370,95571,665

369,217388,051230,603

$ 1,339,169

$ 13,39212,70312,00711,30510,59542,08323,249

4,511$ 129,845

$ 82,26082,26082,26082,26082,260

411,300411,300235,114

$ 1,469,014

NOTE 6 - ACCOUNTS RECEIVABLEAccounts receivable at June 30,2006 are presented as follows:

Grant contracts $ 49,502Service fees 20,604Other 800Total $ 70,906

-20-


Notes to Financial StatementsJune 3O9 2OO6

NOTE 7 - COMPENSATION OF BOARD MEMBERSDuring the year, no compensation was paid to any member of the District's Board of Directors.

NOTE 8 - CASHAt June 30, 2006 the District's cash balances totaled $364,006 (Book Balance) and $377,700 (BankBalance). The bank balance of is secured by FDIC insurance totaling $166,443 and collateralized bypledged securities held by the custodial bank in the name of the fiscal agent bank with a market value atJune 30, 2006 of $278,987. Even though the pledged securities are held in the name of the fiscal agentbank, State law imposes a statutory requirement on the custodial bank to advertise and sell the pledgedsecurities within 10 days of being notified that the fiscal agent has failed to pay deposited funds ondemand.

A portion of the bank balance was held hi an account that was not insured or collateralized by pledgedsecurities. The portion of deposits that were unsecured at June 30,2006 totaled $1,277.

NOTE 9 - RISK MANAGEMENT:Kisatchie-Delta is exposed to various risks of loss related to torts; theft of, damage to, and destructionof assets; errors and omissions; injuries to employees; and natural disasters. These risks of loss arecovered by a comprehensive commercial insurance policy and workers compensation insurance.Claims resulting from these risks have historically not exceeded insurance coverage.

NOTE 10 - FUND BALANCESAt June 30,2006, the following funds reported deficit balances:

Enterprise Zone $ 3,351Pineville Infrastructure 1,201LED 538RBEG 290Renewal Community 10,903Total Deficits $ 16,283

The General Fund will provide operating transfers to eliminate any deficit that cannot be eliminatedthrough ordinary operations.

NOTE 11-LEASEKisatchie-Delta has acquired office facilities necessary for operations by executing a leaseagreement. The obligation for future minimum rental payments under this rental arrangements ispresented as follows:

-21-

KisatchiG-DeltaRegional Planning and Development District


For the Year Ended June 30th:2007 $ 10,2002008 1052002009 4,250

Total Future Minimum Rental Payments $ 24,650

For the year ended June 30, 2006, lease expenditures totaling $5,950 were incurred and reported asfinance and administration expenditures.

-22-

-

BlXocIs•M^Q§£*£•

g5• •ogIEc*<0s§

K>

VE

LOP

ME

I

KIS

A T

CH

IE-D

EL

TA

RE

GIO

NA

L P

LAN

NIN

G A

ND

DE

1!? 25I §s s% c£S IsC t)

" «to &

S 1s ^& "&

99, E

xpend

YearE

nde

Com

bin

ing S

tate

ment ofR

eve

nm

Non M

ajo

r G

ove

rnm

enta

l Funds -

"3•**oH

a•83a BM CI

£ ^g

tnaHH <Q

Hi

I * *<

s—g

o .3S O*& go -S5 3S i

S

i

l§CU fio< 2a ee> o« ""

__ i.« S5 « fc.s; o o

° IS J3Q^ =P5 4f*"•* i.

e>•>*5 o& =

f«H

£a

Pi

o oo «nO, CMUT" oo!—•

&e

* i

^

i i

w

i i

V*

o<nCMmCM

1

1

i

Otn• CM

CO

w

OmCM00

1 1

69

OO0, «vf

99

1

ooo»n"

I i

M

i

Gra

nts

-Fed

eral

Loca

l fund

s

Tot

al re

venu

es

Exp

endi

ture

s:

^ CM DO»o CM m•*Tm t- mcT -^

* i i

i > i

00mi i m

r^f-H

r^• rCM

I

t

00en«n

*-"» *^- VOVD OOTT O\t-T m^ »nv_i

***\Ov• *-

' r-*

****.\OO

• CM

t— •>iu/

>- .00m«n 'v_^

f? \D•<r CM•* «3irT i-*«n \D

*-NOt O\•<*• •*vo_ vqr^" r^

X-N

VO VOo o°l 'Hf— t 1— «

v_^

y— \00m«n «v_x

or*»n*n

fie

*

69

i

&3

*— vCO«nJP*•_'

ta

•*•

io

/-N /—* *^W H^^»n•^ « •oC

^_,<Ti-•srcC

(-4OCM «

•»**

^^OCM »

V-*

v—toCMt— «^_-

W

•

7"3c•cg««••o

_ _ t:i i i

cMCMi c*_ »

^

i

CMCMt ;T

'm

« i—

>nm%_>

oor-CM «

' "*

m mi— « ^-«in" intn env^

00 -«t^ o\CM cn

O

t

Wi

O\VONOO

<w

BB,

eB

iBaSB

I0

01£"&

i i i i i i

X— i,t— "m

' •*!m\-rf

*- ,»— ••n<nenVrf

GO

aa

ooa•a

| 1

i o s l ! ^ s ^ B l|| I l ^ | g l 3 c s^1 1 a -^ I f 1 S 1*3£ «I ^R iS ^ ^ § ° '1 ^135 I ft If il|i ii

l -s 1 l § | g S i s i E * 'III i if LI in! iiHill fi ft ful 13| < Q 6 ^ i a a f f g 9f B -a -aB x s x ^3O W OI W PH fo

JOHN S. ROZIER, IV, CPAMARKS. MCKAY, CPALEEW. WILLIS, CPA

STEVEN E. KIMBALL, CPA

Rozier, Harrington & McKayCertified Public Accountants

1407 Peterman Drive • Alexandria, Louisiana 71301MAILING ADDRESS

Post Office Box 12178Alexandria, Louisiana 71315-2178

Telephone (318) 442-1608Telecopier (318) 487-2027

M. PALE HARRINGTON, CPARETIRED-ZOOS

August 29, 2006

INDEPENDENT AUDITORS' REPORT ON COMPLIANCE ANDON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT

OF GENERAL PURPOSE FINANCIAL STATEMENTS PERFORMED INACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

Kisatchie-Delta Regional Planningand Development District

Alexandria, Louisiana

We have audited the basic financial statements of the Kisatchie-Delta Regional Planning andDevelopment District, as of and for the year ended June 30, 2006 and have issued our report thereondated August 29, 2006. We conducted our audit in accordance with auditing standards generallyaccepted in the United States of America and the standards applicable to financial audits contained inGovernment Auditing Standards, issued by the Comptroller General of the United States.

ComplianceAs part of obtaining reasonable assurance about whether Kisatchie-Delta's financial statements are freeof material misstatement, we performed tests of its compliance with certain provisions of laws,regulations, contracts and grants, noncompliance with which could have a direct and material effect onthe determination of financial statement amounts. However, providing an opinion on compliance withthose provisions was not an objective of our audit and, accordingly, we do not express such an opinion.The results of our tests disclosed no instances of noncompliance that are required to be reported underGovernment A uditing Standards.

Internal Control Over Financial ReportingIn planning and performing our audit, we considered Kisatchie-Delta1 s internal control over financialreporting in order to determine our auditing procedures for the purpose of expressing our opinion on thefinancial statements and not to provide assurance on the internal control over financial reporting. Ourconsideration of the internal control over financial reporting would not necessarily disclose allmatters in the internal control over financial reporting that might be material weaknesses. A materialweakness is a condition in which the design or operation of one or more of the internal controlcomponents does not reduce to a relatively low level the risk that misstatements hi amounts that

-Members-American Institute of Certified Public Accountants • Society of Louisiana, CPAa

-24-

KISATCHIE-DELTA REGIONAL PLANNING AND DEVELOPMENT DISTRICTAUGUST29, 2006PAGE 2

would be material in relation to the financial statements being audited may occur and not be detectedwithin a timely period by employees in the normal course of performing their assigned functions. Wenoted no matters involving the internal control over financial reporting and its operation that weconsider to be material weaknesses.

This report is intended for the information of management. However, this report is a matter of publicrecord and its distribution is not limited.

ROZffiR, HARRINGTON & McKAYCertified Public Accountants

-25-

KISATCHIE-DELTAREGIONAL PLANNING AND DEVELOPMENT DISTRICT

SCHEDULE OF FINDINGS AND QUESTIONED COSTFOR THE YEAR ENDED JUNE 30,2006

We were engaged to audit the financial statements of Kisatchie-Delta Regional Planning andDevelopment District as of and for the year ended June 30, 2006, and have issued our report thereondated August 29, 2006. We conducted our audit in accordance with auditing standards generallyaccepted in the United States of America and the standards applicable to financial audits contained inGovernment Auditing Standards, issued by the Comptroller General of the United States. Our reportexpresses an unqualified opinion on the financial statements for the year ending June 30,2006.

SECTION I - SUMMARY OF AUDITOR'S RESULTS:a. The report on internal control and compliance material to the financial statements reported the

following items:

• Internal Control - There were no reportable conditions• Compliance - No noncompliance that is material to the financial statements.

b. Federal Awards:

• N/A, Federal Awards received during the year ended June 30,2006 were not sufficient inamount to require a single audit.

c. Identification of Major Programs:

• N/A

SECTION n - FINDINGS RELATTNC TO TWIT. FINANCIAL STATEMENTS WHICH AREREQUIRED TO BE REPORTED IN ACCORDANCE WITH GENERALLY ACCEPTEDGOVERNMENTAL AUDITING STANDARDS:• None

SECTION DDE - FINDINGS AND QUESTIONED COSTS FOR FEDERAL AWARDS WHICHSHALL INCLUDE AUDIT FINDINGS AS DEFINED BY OMB CIRCULAR A-133;• None

-26-

KISATCfflE-DELTAREGIONAL PLANNING AND DEVELOPMENT DISTRICT

MANAGEMENT'S CORRECTIVE ACTION PLANFOR THE YEAR ENDED JUNE 30,2006

SECTION IINTERNAL CONTROL AND COMPLIANCE MATERIAL TO THE FINANCIAL STATEMENTS.

No findings were reportedquestioned costs.

in the schedule of findings and Response - N/A

SECTION HINTERNAL CONTROL AND COMPLIANCE MATERIAL TO FEDERAL AWARDS

No findings were reportedquestions cost.

in the schedule of findings and Response -N/A

SECTION mMANAGEMENT LETTER

No findings were reportedquestions cost.

in the schedule of findings and Response - N/A

-27-

KISATCHIE-DELTAREGIONAL PLANNING AND DEVELOPMENT DISTRICT

SCHEDULE OF PRIOR YEAR FINDINGSFOR THE YEAR ENDED JUNE 30,2006

SECTION IINTERNAL CONTROL AND COMPLIANCE MATERIAL TO THE FINANCIAL STATEMENTS.

No findings of this natureprevious audit.

were reported as a result of the Response - N/A

SECTION nINTERNAL CONTROL AND COMPLIANCE MATERIAL TO FEDERAL AWARDS


were reported as a result of the Response— N/A

SECTION mMANAGEMENT LETTER


were reported as a result of the Response- N/A

-28-

Kisatchie-Delta Regional Planning and Development District...

Documents

Transcript of Kisatchie-Delta Regional Planning and Development District...