Sabine Parish Council on Aging, Inc.app.lla.la.gov/PublicReports.nsf/158A9A81C43B9F... ·...

SABINE COUNCIL ON AGING, INC.Many, Louisiana

FINANCIAL STATEMENTSAs of and for the Year Ended June 30, 2006

Under provisions of state law, this report is a publicdocument Acopy of the report has been submitted tothe entity and other appropriate public officials. Thereport is available for public insecti

oer 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

Deborah D. Dees, MBA, CPA122 Jefferson Street

Mansfield, Louisiana 71052318-872-3007


FINANCIAL REPORTAs of and for the Year Ended June 30, 2006

Table of ContentsStatement

Independent Auditor's Report

Required Supplemental Information (Part I)

Management's Discussion and Analysis

Basic Financial Statements:

Government Wide Financial Statements:

Statement of Net Assets

Statement of Activities

Fund Financial Statements:

A

B

Page

3-4

6-14

17

18

Balance Sheet-Governmental Funds

Statement of Revenues, Expenditures, and Changes in Fund BalancesGovernmental Funds

Reconciliation of the Statement of Revenues, Expenditures, and Changesin Fund Balances of Governmental Funds to the Statement of Activities

Notes to the Financial Statements:

Notes to the Financial Statements

Reauired Suoolemental Information (Part II):

Budgetary Comparison Schedule - General Fund

Budgetary Comparison Schedule -Title IIIB

Budgetary Comparison Schedule -Title IIIC-1

Budgetary Comparison Schedule -Title IIIC-2

Supplementary Financial Information Reauired bv GOEA

Schedule of Revenues, Expenditures, and Changes in Fund BalancesGovernmental Funds- Non-Major Funds

Comparative Schedule of General Fixed Assets and Changes inGeneral Fixed Assets

C

D

E

Schedule

1

2

3

4

5

6

20

21

22

24-39

Page

41

42

43

44

46

47

Table of Contents (Continued) Schedule Page

Supplementary Financial Information Required bv OMB Circular A-133;

Schedule of Expenditures of Federal Awards 7 49

Other Reports Required by Government AuditingStandards:

Report on Internal Control over Financial Reporting and on Compliance andOther Matters Based on an Audit of Financial Statements Performed inAccordance with Government Auditing Standards 51

Schedule of Findings and Responses 52

Schedule of Prior Year Findings 53

122 JEFFERSON STREET • MANSFIELD. LOUISIANA 71052 • (318) B72-30D7 • FAX (318) 872-1357

CERTIFIED PUBLIC ACCOUNTANT

Independent Auditor's Report

To the Board of Directors ofSablne Council on Aging, Inc.Many, Louisiana

I have audited the accompanying financial statements of the governmental activities, each majorfund, and the aggregate remaining fund information of the Sablne Council on Aging, Inc. as ofand for the year ended June 30, 2006, which collectively comprise the Council's basic financialstatements as listed in the table of contents. These financial statements are the responsibility ofthe Sabine Council on Aging, Inc.'s management. My responsibility is to express an opinion onthese basic financial statements based on my audit.

E conducted my audit in accordance with auditing standards generally accepted in the UnitedStates and the standards applicable to financial audits contained in Government AuditingStandards, issued by the Comptroller General of the United States of America. Those standardsrequire that I plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free of material mlsstatement. An audit includes examining, on a testbasis, evidence supporting the amounts and disclosures in the financial statements. An auditalso includes assessing the accounting principles used and significant estimates made bymanagement, as well as evaluating the overall financial statement presentation. I believe that myaudit provides a reasonable basis for my opinions.

In my opinion, the financial statements referred to above, present fairly, in all material respects,the financial position of the governmental activities, each major fund, and the aggregateremaining fund information of the Sabine Council on Aging, Inc., as of June 30, 2006, and thechanges in financial position for the year then ended In conformity with accounting principlesgenerally accepted In the United States of America.

In accordance with Government Auditing Standards. I have also issued my report datedDecember 15, 2006, on my consideration of the Sabine Council on Aging, Inc.'s internal controlover financial reporting and my tests of its compliance with certain provisions of laws, regulations,contracts and grants. The purpose of that report is to describe the scope of my testing of internalcontrol over financial reporting and compliance and the results of that testing and not to providean opinion on the internal control over financial reporting or on compliance. That report is anintegral part of an audit performed In accordance with Government Auditing Standards andshould be considered in conjunction with this report in considering the results of my audit.

The Management's Discussion and Analysis on pages 6 through 14 and the requiredsupplementary information on pages 41 through 44 are not a required part of the basic financialstatements but are supplementary information required by the Governmental AccountingStandards Board. I have applied certain limited procedures, which consisted principally ofinquiries of management regarding the methods of measurement and presentation of the requiredsupplementary information. However, I did not audit the information and express no opinion on it.

My audit was conducted for the purpose of forming opinions on the financial statements thatcollectively comprise the Sabine Council of Aging, Inc.'s basic financial statements. Thesupplementary financial information on pages 46 and 47 is not a part of the basic financialstatements but are required by the Governor's Office of Elderly Affairs, State of Louisiana. Theaccompanying schedule of expenditures of federal awards Is presented for purposes of additionalanalysis as required by U.S. Office of Management and Budget Circular A-133, Audits of States,Local Governments, and Non-Profit Organizations, and is also not a required part of the basicfinancial statements of the Sabine Council of Aging, Inc. This supplementary financial informationand schedule of expenditures of federal awards have been subjected to the auditing proceduresapplied In the audit of the basic financial statements and, in my opinion, are fairly presented in allmaterial respects in relation to the basic financial statements taken as a whole.

Mansfield, LouisianaDecember 15, 2006

REQUIRED SUPPLEMENTAL INFORMATION (PART I)


MANAGEMENTS DISCUSSION AND ANALYSISAs of and for the Year Ended June 30, 2006

The following discussion and analysis of the Sabine Council on Aging's financial performance Is providedas overview of the Council's financial activities for the year ended June 30, 2006. Please read it inconjunction with the financial statements, which begin on page 17.

FINANCIAL HIGHLIGHTS

• The Council showed a net increase in overall net assets of $649,362 this year.

• Net Capital Assets of the Council rose by $870,300 primarily due to the addition of construction ofthe new senior citizens' building of the Sabine Council on Aging, Inc.

• The unreserved, undesignated fund balance for the Council's General Fund was $338,365, whichis a $334,036 decrease from the prior year.

HOW TO USE THIS ANNUAL REPORT

This annual report consists of a series of financial statements. The Statement of Net Assets and theStatement of Activities (on pages 17 and 18) provide information about the activities of the Council as awhole and present a longer-term view of the Council's finances. Fund financial statements begin on page20. For governmental activities, these statements tell how services were financed in the short-term as wellas what remains for future spending. Fund financial statements also report the Council's operations inmore detail than the government-wide statements by providing information about the Council's mostsignificant funds.

Our auditor has provided assurance in her independent auditor's report, located immediately before thisManagement's Discussion and Analysis, that the Basic Financial Statements are fairly stated. The auditoris providing varying degrees of assurance about Supplementary Financial Information Required by GASBStatement 34 and Supplementary Financial Information Required by GOEA and OMB Circular A-133 thatfollow later in this reporting package. A user of this report should read the independent auditor's reportcarefully to ascertain the level of assurance being provided for each part of the financial section of thereport.

REPORTING THE COUNCIL AS A WHOLE USING GOVERNMENT-WIDE STATEMENTS

Our analysis of the Council as a whole begins on page 17. An important question to ask about theCouncil's finances is, "Is the Council as a whole better off or worse off as a result of the year's activities?"The Statement of Net Assets and the Statement of Activities (referred to collectively as the Government-Wide Financial Statements) report information about the Council as a whole and about its activities in away that helps answer this question. These statements include all assets and liabilities using the accrualbasis of accounting, which is similar to the accounting method used by most private-sector companies. AHcurrent year revenues and expenses are taken into account regardless of when cash Is received or paid.

The Government-Wide statements report the Council's net assets and changes in them. Some of the netassets are restricted which means they can only be used for a specific purpose. The Statement of NetAssets is designed to present the financial position of the Council as of year-end. Over time, increases ordecreases in the Council's net assets are one indicator of whether its financial position Is improving ordeteriorating. However, to assess the overall financial position of the Council, other nonfinancial factors,such as the condition of the council's capital assets and facilities, the addition or termination of grants and

other revenue sources, and the expansion or contraction of programs and services, should be considered.The Statement of Activities provides information that shows how the Council's net assets changed as aresult of this year's activities. All of the Council's significant activities are reported in the Statement ofActivities. These activities include an Administration function, Medicaid Transportation function, and aHealth, Welfare, and Social Services function. The Health, Welfare, and Social Services function iscomprised of various programs that include various supportive social services, nutritional services, utilityassistance, and disease prevention and health promotion. The Medicaid Transportation is relevant to theactivities of transporting the elderly, which are services reimbursable by Medicaid. All activities of theCouncil are considered to be governmental activities. A governmental activity is one where the Counciluses money it receives from government grants and contracts, along with donations from the generalpublic, and in the case of the Sabine Council, an assessed sales tax, to pay for the services it provides tothe general public, or a segment of the general public, such as the elderly. In other words, the peoplebenefiting from the services are not required to pay for what they receive. If the Council charged fees tocover all or most of the cost of providing a service, that activity would be classified as a business-typeactivity. The council does not have any business-type activities. However, the Council does charge a feefor persons under 60 years old to ride the Council's vans. We do not view the fees we charge for theseactivities as a business-type activity because we do not intend to make a profit or recover the full cost ofproviding the service.

REPORTING THE COUNCIL'S MOST SIGNIFICANT FUNDS USING FUND FINANCIAL STATEMENTS

Our analysis of the Council's major funds begins on page 20. The Fund Financial Statements can be foundon pages 20 to 22 and provide detailed information about the most significant funds - not the Council as awhole. In the Fund Financial Statements, you will see a General Fund and a variety of major SpecialRevenue Funds. The General Fund is used to account for all financial resources except those that arerequired to be accounted for in another fund. The Special Revenue Funds account for the proceeds ofspecific revenue sources that are legally restricted to expenditure for specified purposes. By usingseparate funds to track revenues and expenditures, we can control and manage funds for particularpurposes or we can show that the fund is meeting legal responsibilities for using certain grants and othermoney.

The General Fund and Special Revenue Funds are considered governmental funds. Governmental fundsfocus on how money flows into and out of funds and the balances left at year-end that are available forspending. These funds are reported using an accounting method called the modified accrual accounting,which measures cash and all other financial assets that can be readily converted to cash. Thegovernmental fund statements provide a detailed short-term view of the Council's general governmentoperations and the basic services it provides. Governmental fund information helps you determine whetherthere are more or fewer financial resources that can be spent in the near future to finance the Council'sprograms. We have presented the difference between the net assets of governmental activities and thefund balance of the governmental funds in a reconciliation at the bottom of the Balance Sheet forGovernmental Funds. In addition, the difference between the change in net assets for the governmentalfunds and the change in net assets for the governmental activities has been presented in a reconciliationon a separate page that follows the Statement of Revenues, Expenditures, and Changes in Fund Balancesfor the Governmental Funds.

NOTES TO THE FINANCIAL STATEMENTS

The notes provide additional information that is essential to a full understanding of the data provided in thegovernment-wide and fund financial statements. The notes to the financial statements can be found onpages 24 to 39. You should read the notes before making assumptions or drawing conclusions about theCouncil's financial conditions.

The Governmental Accounting Standards Board (GASB) Statement 34 requires budgetary comparisonschedules for the General Fund and each major Special Revenue Fund that "has a legally adopted annualbudget The schedules compare the original and final appropriated budgets to actual budget results for theCouncil's fiscal year. We have also opted to present positive and negative variances between the finalbudget and actual amounts.

Major funds are those funds whose revenues, expenditures, assets, or liabilities are at least 10% ofcorresponding totals for all governmental funds. In addition, a major fund could be a fund that does notmeet these criteria but which we believe is important to present for the Council's financial statement users.

Management's Discussion and Analysis is also required supplementary information (RSI) by GASBStatement 34. However, it is presented under Required Supplementary Information (Part I) at thebeginning of the reporting package and not with the other RSI by GASB Statement 34.

OTHER SUPPLEMENTARY FINANCIAL INFORMATION REQUIRED BY GOEA AND OMB CIRCULARA-133

The Council has also presented other required supplemental information in this report package.

The Governor's Office of Elderly Affairs (GOEA) has required the Council to present as schedules theinformation on pages 47 to 48. This information will be used by GOEA to verify the accuracy of informationthe Council submitted to it during the year and to help GOEA monitor certain compliance requirements setforth in the grants that it has with the Council.

The Office of Management and Budget (OMB) through its Circular A-133 requires a Schedule ofExpenditures of Federal Awards. This schedule will present required information about the Council'sfederally funded programs in a manner that can facilitate financial and compliance analysis by the agenciesthat have granted federal money to the Council.

AN ANALYSIS OF THE COUNCIL AS A WHOLE USING GOVERNMENT-WIDE FINANCIALSTATEMENTS

The following table reflects condensed information on the Council's net assets:

Governmental Activities2006 2005

Current and other assets $ 409,732 $ 721,882Capital assets, net of depreciation 1,273.489 403.189

Total Assets $ 1,683,221 $ 1,125,071

General obligation bonds $ $ 112,111Other liabilities 62,695 41.796

Total Liabilities $ 62,695 $ 153,907

Net Assets:

Invested in capital assets,net of related debt $ 1,273,489 $ 291,078

Restricted 8,672 7,685Unrestricted 338.365 672.401

Total Net Assets $ 1,620.526 $ 971.164

As of June 30, 2006, the Council "as a whole" had assets greater than its liabilities by $1,620,526. TheCouncil's total net assets increased significantly from $971,164 to $1,620,526. This is due primarily to the10-year sales tax passed July 2003 and the finished construction of the Council's new building in June2006.

The Council's unrestricted net assets actually decreased by $334,036 from last year's amount. About 20%of the Council's net assets are unrestricted as of June 30, 2006. It is important that the Council haveunrestricted net assets so there will be resources available to adapt to changes in the economy,emergencies, unexpected needs, reductions in or termination of grant revenues by government agenciesand future capital expenditures.

The Council's restricted net assets of $8,672 are for utility assistance. Net assets are reported as restrictedwhen the constraints placed upon the asset's use are either (a) externally Imposed by a grantor,contributor, or laws or regulations of other governments, or (b) imposed by law through constitutionalprovisions or enabling legislation. The net assets that have been invested in capital assets ($1,273,489)are presented net of depreciation and any related outstanding debt incurred to acquire them.

Total liabilities decreased by $91,212 this year or 60%. The primary reason for the decrease is the payoffof general obligation bonds.

The table below illustrates the revenues and expenses that caused the change in net assets over the year.

2QQ6 2005Revenues

Program Revenues:Charges for ServicesOperating Grants and ContributionsCapital Grants and Contributions

General Revneues:Sales Tax RevenueUnrestricted Grants and ContributionsInterest IncomeOther General Revenues

Total RevenuesProgram Expenses of the Health

Welfare, and Social Services Function:Supportive Services:

HomemakerPublic EducationInformation and AssistanceLegal AssistanceOutreachTransportation

Nutrition Services:Congregate MealsHome Delivered MealsNutrition Education

Disease Prevention and Health PromotionMedication Management and WetlnessNational Family CaregiverUtility Assistance

Program Expenses of Medicald TransportationAdministration Expenses

Total ExpensesExcess of revenues over expenses before special ItemsGain on sale of asset

Increase in Net Assets

46.200 $333,080245,000

638,1197,2945,2373,999

54,896344,042

597,811

24,4083,5344,154

1,278.929 1,028,845

24,9752,1103,981

" 3,0008,158

98,986

67.772188,785

126

4,76624,9741,014

107,99093,430

630,067648,862

500

649,362 $

31,853

2,4461,4835,343

73,497

84,368183,133

27,810

23,1211,896

63,30875,253

573,511455,334

1,500456,834=^=^̂ =

The Council's total revenues were $1,278,929 for government-wide financial statements. The prior year'srevenue was $1,028,845, which reflects an increase of revenue of $250.084. Total expenses outside of theactivities related to the new construction increased by $56.556 from $573,511 in 2005 to $630,067 in 2006.

The Council sold one van during the year at a gain of $500. By reporting the sale of this asset this way, weare better able to see how the Council is performing without the transfer of assets.

AN ANALYSIS OF GOVERNMENTAL ACTIVITIES

Most of the Council's activities are funded by federal, state, and local grants. These grants amount toapproximately 91% of the revenues restricted for specific programs of the Council in 2006. These grantsare restricted which means that the money can only be used in certain programs. The amount of funds

10

available from most of the grants remains rather constant from year to year, however, some grant amountsmay change based upon the level of service provided by the Council under the terms of the particular grantaward.

In 2003, the Council began receiving monies from a sales tax passed for a term of ten years beginningOctober 2003. This revenue, which increased in 2006 by $40,308, was used to construct the new center,update the equipment and vehicles, and to expand and provide better services to the senior citizens ofSabine Parish.

The Council also receives donations from its clients and the general public. These revenues help to lessenthe financial burden on the Council and allow it to maintain and expand services. Public support revenuesrepresented only a small portion of revenues for the predominately rural area.

When reviewing the Government-Wide Statement of Activities, there are relationships that are important tothe understanding of the Council's operations. As you can see, the Council's largest activities are relatedto transportation and nutrition services. The Council's main focus is to meet the needs of the elderlycitizens of Sabine Parish. Demand for these services is high; therefore, resources are channeled tomeeting the demand.

Comparison of Revenues and Expenses

$200,000$180,000$160,000 -$140,000 -$120,000 -$100,000 -$80,000$60,000$40,000$20,000

$0 Ioi 1 & I

fi «

T*V

• RevenuesD Expenses

f"

oii t

o

You will note that most of the governmental activities have more expenses than revenues. We expect thissituation to occur and have prepared the Council's budgets for these activities with this In mind. As you willnote, not all program revenues are Included in this chart Other types of grant monies are available to assistin the cost of certain programs, for instance, NSIP monies are utilized with the Cl and CH programs for thecost of raw materials for meal served to the qualified individuals. This chart fs only to demonstrate thoserevenues and expenses that have been either directly or indirectly allocated to these specific funds prior totransfers. Traditionally, once qualified transfers from all grant sources have been exhausted, generalrevenues are used to cover the excess of expenses over revenues In these activities.

11

Another indication of how we are using money and resources efficiently can be analyzed by calculating thepercentage of administration and in-kind expenses in relation to total expenses.

Statement of Activities Expenses

Administrative14%

In-Kind10%

ALL Other76%

Finally, the Utility Assistance program has revenues greater than expenses for the year after all qualifiedtransfers have been exhausted. No indirect costs can be charged to this program because under the termsof the contract, the contributions given by the donor may only be used to pay for utility bills for certainneedy people who meet the guidelines to receive assistance. In any given year, the amount ofcontributions received in this program may exceed the demand from qualified recipients.

AN ANALYSIS OF THE COUNCIL'S FUNDS USING GOVERNMENTAL FUND FINANCIALSTATEMENTS

Fund Balances

The Council showed a combined governmental fund balance of $347,037 (as shown on the Fund FinancialStatement's balance sheet on page 20) at the end of this year, which is a decrease of $220,938 versus lastyear. When you took at the funds individually you will see that the Council's General Fund decreased by$221,925 this year, while the Special Revenue Funds had a combined fund balance increase of $987.

The primary reason for the decrease in the General Fund's fund balance is as follows:

• Construction costs and other capital outlays of $951,641.• Payoff of general obligation bonds totaling $112,111.

Revenues

The combined fund revenues increased $278,633 this year versus last year. The primary reason is:

• A state capital grant for $245,000.• Increase in sales tax revenue of $40,308.

12

Expenditures

Current total expenditures increased by $943,154 this year, which is larger than last year's increase of$27,321. Some of the notable reasons why this occurred are as follows:

• Construction of the new Council building was completed. The increase in capital outlayexpenditures over the previous year where $755,539.

AN ANALYSIS OF THE GENERAL FUND BUDGET

Our GOEA budget was approved October 2006. You can find schedules of the original budget for theGeneral Fund in the Supplementary Financial Information Required by GASB 34 section of this report onpages 42 to 45. When you review the budget versus actual schedule, you will note the favorable andunfavorable variances. Sales tax revenue and program revenue fees were significantly higher thanbudgeted. The capital outlays were not budgeted in the original budget

AN ANALYSIS OF CAPITAL ASSETS AND DEBT ADMINISTRATION

At the end of the year, the Council had $1,273,489 in fixed assets net of accumulated depreciation. Thisamounted to a net increase of $870,300 over last year.

Buildings and landFurniture and equipmentAutomotive equipmentConstruction-in-prog ress

Total general fixed assets

BalanceJune 30.2005

175.283 5

13,396183.249

200.352572.280 $

Additions

1,029,332 $

18,195

50,081

6.000

1,103,609 $

Deletions

(26,643)

(200,352)

(227,195)

Balance June30, 2006

$ 1,204,615

31,591

206,487

6,000

$ 1.448,694

Accumulated DepreciationBuildings and landFurniture and equipmentAutomotive equipmentConstruction-in-prog ress

Total accumulated depreciation

Total Net Assets

s

$

$

37,935 $

9,927121,229

169,091 $

403,189 $

4,6771,733

26,546

32,956 $

1,070,652 $

$

(26,843)

(26,843) $

(200,352) $

42,613

11,660120,932

175,205

1.273,489

The major addition this year to the Council's fixed assets was the new building. More detailed informationcan be found about the Council's capital assets in Notes 1(L) and 5 to the financial statements.

The Council paid in full ($112,111) the general obligation bonds issued in the prior year to finance the start-up costs of the new building construction. At the end of June 30, 2006, the Council had no long-term debt.

13

ECONOMIC FACTORS AND NEXT YEAR'S BUDGET

As in the past, the Council receives funding from federal and state agencies for specific programs.Because of this, the source of incoOme for the Council Is rather steady. However, some of the Council'sgrants and contracts are contingent upon the level of service provided by the Council, and therefore,revenues may vary from year to year. Due to the sales tax revenue, a large percentage of funding ispresently coming from a new taxpayer source. In setting the budget for fiscal year 2006-2007, it wasimportant that we deliver at least the same level of service to our clients and the public as we did in 2005-2006. All of the Council's grants and contracts from the usual federal and state agencies have beenapproved for FYE 2007. There have been no significant changes to the funding levels from the Governor'sOffice of Elderly Affairs or terms of the grants and contracts. Accordingly, we have set our initial budget toprovide the same programs and levels of service next year.

CONTACTING THE COUNCIL'S MANAGEMENT

Our financial report is designed to provide government agencies and the general public an overview of theCouncil's finances and to demonstrate accountability for the money that It receives. If you have anyquestions about this report or wish to ask for more information, you should contact Linda Rigsby, theCouncil's Executive Director, at the Council's main office located at 200 Legacy Drive, Many, Louisiana,71449, by phone at (318) 256-4140, or by email [email protected].

14

BASIC FINANCIAL STATEMENTS

GOVERNMENT WIDE FINANCIAL STATEMENTS

SABINE COUNCIL ON AGING, INC

Many, Louisiana

STATEMENT OF NET ASSETS

For the Year Ended June 30, 2006

STATEMENT A

ASSETSCashRestricted cash for utility assistanceReceivablesPrepaid insuranceUtility depositsCapital assets, net of accumulated depredation

Total Assets

LIABILITIESCurrent:

Accounts payablesPayroll taxes withheld and accrued

Total Liabilities

NET ASSETSInvested In capital assetsRestricted for

Utility AssistanceUnrestricted

Total Net Assets

GOVERNMENTALACTIVITIES

302,9848,672

95,0922,464

5201,273.469

1.683.221

52,7759.920

62.695

1,273,489

8,672338.365

1.620.526

The accompanying notes are an integral part of this statement. 17

SABINE COUNCIL ON AGING, INCMany, Louisiana

STATEMENT OF ACTIVITIESFor the Year Ended June 30, 2006

STATEMENT B

Net (Expenses)Revenues and

Function/ProgramsGovernmental Activities;

Health, Welfare & SocialServices:

Supportive Services:HomemakerPublic educationInformation and assistanceLegal assistanceOutreachTransportation

Nutrition Services:Congregate mealsHome delivered mealsNutrition education

Utility assistanceMedication Management and

WellnessNational family caregiven

Respite careSitter service

Medlcald TransportationAdministration

Total Governmental Activities

Program Revenues Change In Net Assets

Operating Capital GrantsDirect Charges for Grants and and Governmental

Expenses Indirect Expenses Services Contributions Contributions Activities

$ 14,998 $1,5572,6813.0004,669

59,604

50,205145,794

1261,014

3.228

23.7981,176

65,18366.481

$ 445,874 S

General revenues:

9,977 $ $553

1.300

3,28939,182

17,58742.991

1,538

42,827 46,20024,969

164.193 S 46.200 S

9,449 $ $1,8041.804

02t154

78.877

55,459132,780

2,256

3,558

20,169996

23.774 245,000

333.080 S 245.000

Grants and contributions not restricted to specific programsSales tax revenueMiscellaneousGain on Sale of assetInterest Income

Total general revenuesIncrease (decrease) of net assets

Net Assets Beginning

Net Assets Ending $

(15,526)(306)

(2.177)(3,000)(6,004)

(20,109)

(12,313)(56,005)

(128)1,242

(1,208)

(3,629)(180)

(61.790)175,344

(5,7871

7.294638.119

3,999500

5.237655.14964Q.362

971,164

1.620,526


FUND FINANCIAL STATEMENTS


BALANCE SHEET - GOVERNMENTAL FUNDSFor the year ended June 30,2006

STATEMENT C

GENERAL TITLE 1KB

TOTALGOVERNMENTAL

TITLE IK C-1 TITLE HI C-2 NON-MAJOR FUNDS

ASSETS

CashGrants and Contracts Receivable

Sales Tax ReceivableDue from General FundPrepaid Insurance

Utilities Deposits

Total Assets

LIABILITIES AND FUND BALANCES

LIABILITIES:

Accounts PayableAccrued Payroll Taxes

Due to Special Revenue Fund

Total Liabilities

FUND BALANCES:

Reserved for

Utility AssistanceUnreserved/Undeslgnated

Total Fund Balances

Total Liabilities and Fund Balances

$ 311,656 $ $ $ $ $

00,0 oU Q Q2858.534

0 10.1142,464

620

$ 406.704 $ OS 0 $ 0 $ 13.142 $

$ 48,305 $ $ $ $ 4,470 $9.920

10.114

68,339 0 0 0 4.470

8,872338,365

338,385 8,672

$ 406.704 $ 0 $ 0 $ 0 $ 13.142 $

Fund BalancesAmounts reported for governmental activities in the statements of net assets are different because:Capital assets used in governmental activities are not financial recources and therefore are not reported In the funds.

Net Assets of Governmental Activities $

311,65636,558

58,53410.114

2.464520

419.846

52,775

9,92010.114

72,809

8.672338,365

347,037

419,846

347,037

1.273,489

1.620.526

The accompanying notes are an Integral part of this statement20


STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCESGOVERNMENTAL FUNDS

For the Year Ended June 30,2006

STATEMENT D

NONMAJORGENERAL TITLE III-B TITLE IIIC-1 TITLE IlIC-Z FUNDS TOTAL

REVENUES

Intergovernmental:

Governor's Office of Elderly Affairs

State capital grantFEMA

Sales tax revenuePublic SupportProgram service fees

Medicsid TransportationClient Contributions

Interest IncomeMiscellaneousTotal Revenues

EXPENDITURES

Health, Welfare & Social Services

CurrentPersonnelFringe benefits

TravelOperating services

Operating supplies

Other costs

MealsUtility assistance

Debt Service

Principal paymentsInterest expense

Capital outlaysTotal Expenditures

Excess (deficiency) of revenuesover expenditures

OTHER FINANCING SOURCES (USES)

Gain on sale of assetBond amortization costsOperating Transfers InOperating Transfers out

Total Other Financing Sources and Uses

Net Increase (Decrease) In Fund Balances

FUND BALANCES

Beginning of the year

End of the year

$ 21,048 $ 78.877 $245,000

638,119

1,237

46,2009,449

5,237

3,999960,640 88,326

53,118 61,8725,841 6,804

515 5,497

31,675 30,40442,321 15,6667,865 9,213

112,1112,029

951,641

1.207.116 129.456

(246.276) (41.130)

500

(1,325)41,130

(135,320)(136.145) 41,130

(382,421)

720,786

$ 336,365 $ $

46,096 $ $ 58,230 $

5,538 13,548

51.634 71,778

31,901 51,7093,608 5,688

495 25,019

5,373 15,596

2,025 4.822

3,410 8,07923,881 80,387

70.393 191.280

(18.759) (119.502)

18,759 119,502

18,759 119.502

$ $

98,037 $

6,057

2,258

106,350

13,370

1,470

52537,711

1,053

6,149

1,014

61.292

45,058

6,019(50,090)(44.071)

987

7,685

8,672 $

302,288

245,0006,057

638,1193,493

46,20028,5355,237

3,9991,278,928

211,970

23,31132,051

120,75965,88734,716

104,0481.014

112,1112,029

951,641

1.659.537

(380,609)

500

(1.325)185,410

(185,410)(825)

(381,434)

728,471

347,037

The accompanying notes are an Integral part of this statement 21

STATEMENT ESABINE COUNCIL ON AGING, INC

Many, LouisianaRECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES

AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDSTO THE STATEMENT OF ACTIVITIES


Net Increase (Decrease) in fund balances - total governmental funds $ (381,434)

Repayment of debt consumes the current financial resourcesof governmental funds. This transaction has no effect on netnet assets and is not reported in the Statement of Activities 112,111

Governmental funds report capital outlays as expenditures.However, in the statement of activities the cost of these assetsis allocated over their estimated useful lives and reported asdepreciation expense. This is the amount by which capital outlays($951,641) exceed depreciation ($32,956) in the current period. 918,665

Increase (Decrease) of net assets of governmental activities $ 649,362


NOTES TO THE FINANCIAL STATEMENTS


NOTES TO THE FINANCIAL STATEMENTSAs of and for the year Ended June, 2006

1. Summary of Significant Accounting Policies

A. Purpose of the Council on Aging:

The purpose of the Council is to collect facts and statistics and make special studies ofconditions pertaining to the employment, financial status, recreation, social adjustment, mentaland physical health or other conditions affecting the welfare of the aging people in SabineParish; to keep abreast of the latest developments in these fields of activity throughoutLouisiana and the United States; to interpret its findings to the citizens of the parish; to providefor a mutual exchange of ideas and information on the parish and state level; to conduct publicmeetings to make recommendations for needed improvements and additional resources; topromote the welfare of aging people when requested to do so; to coordinate and monitorservices of other local agencies serving the aging people of the parish; to assist and cooperatewith the Governor's Office of Elderly Affairs {GOEA) other departments of state and localgovernment serving the elderly; and to make recommendations relevant to the planning anddelivery of services to the elderly of the parish.

Specific services provided by the Council to the elderly residents of Sabine Parish includeproviding congregate and home delivered meals, nutritional education, personal care,information and assistance, outreach, material aid, utility assistance, homemakers, recreation,legal assistance, disease prevention, health promotion, and transportation.

B. Reporting Entity:

In 1964, the State of Louisiana passed Act 456 authorizing the charter of a voluntary council onaging for the welfare of the aging people in each parish of Louisiana. However, before thecouncil on aging can begin operations in a specific parish, its application for a charter mustreceive approval from the Governor's Office of Elderly Affairs pursuant to LA R.S. 46:1602.The functions of each council on aging in Louisiana must comply with the objectives of statelaws and each council is governed by the policies and regulations established by GOEA.

The Sabine Council on Aging is a legally separate, non-profit, quasi-public corporation. Itreceived its charter and began operations 34 years ago. A board of directors, consisting of 15voluntary members, who serve three-year terms, governs the Council. The board of directorsis comprised of, but not limited to, representatives of the Parish's elderly population, generalpublic, private businesses, and elected public officials.

Membership in the Council Is open at all times, without restriction, to all residents of SabineParish who have reached the age of majority and who express an interest in the Council andwish to contribute to or share in its programs. Membership fees are not charged.

Based on the criteria set forth in GASB Statement 14, the Sabine Council on Aging is not acomponent unit of another primary government nor does it have any component units that arerelated to it. In addition, based on the criteria set forth in GASB Codification Section 2100, theCouncil has presented its financial statements as a primary government because it is aspecial-purpose government that has a separately elected governing body, is legally separate,and is fiscally independent of other state and local governments. As used in GASB Statement14, the term fiscally independent means that the Council may, without approval or consent ofanother governmental entity, determine or modify its own budget, levy its own taxes or setrates or charges, and issue bonded debt. As previously mentioned, GOEA establishes thepolicies and

24



1. Summary of Significant Accounting Policies (continued)

B. Reporting Entity: (continued)

regulations that all councils must follow. Included In its policies is a provision that the Council'sbudget be approved by GOEA. However, this approval process is part of GOEA's generaloversight responsibility for the Council and is more ministerial or compliance oriented thansubstantive.

Accordingly, the Council is viewed as being fiscally independent for purposes of applying thereporting entity criteria of GASB Statement 14.

C. Presentation of Statements:

The Council's statements are prepared in accordance with accounting principles generallyaccepted (GAAP) in the United States of America as applicable to governmental entities. TheGovernmental Accounting Standards Board (GASB) is responsible for establishing GAAP forstate and local governments through its pronouncements (Statements and Interpretations).Governments are also required to follow the pronouncements of the Financial AccountingStandards Board (FASB) Issued through November 30, 1989 (when applicable) that do notconflict with or contradict GASB pronouncements.

The Council has the option to apply FASB pronouncements issued after that date to itsbusiness-type activities and enterprise funds; however, the Council has chosen not to do sobecause it does not have any business-type activities or enterprise funds. The more significantaccounting policies established in GAAP and used by the Council are discussed below.

In June 1999, the Governmental Accounting Standards Board (GASB) unanimously approvedStatement No. 34, Basic Financial Statements-and Management's Discussion and Analysis-forState and Local Governments.

The financial statements include:

• A Management Discussion and Analysis (MD&A) section providing ananalysis of the Council's overall financial position and results ofoperations.

• Governmental-Wide Financial statements prepared using full accrualaccounting for all of the Council's activities.

• A change in the fund financial statements to focus on the major funds.

These elements are reflected in the accompanying financial statements (including notes tofinancial statements).

25




D. Basic Financial Statements - Government-Wide Statements

The Council's basic financial statements Include both Government-Wide (reporting the Councilas a whole) and fund financial statements (reporting the Council's major funds). Both theGovernment-Wide and Fund Financial Statements categorize primary activities as eithergovernmental or business type. The Council's functions and programs have been classified asgovernmental activities. The Council does not have any business-type activities, fiduciaryfunds, or any component units that are fiduciary in nature. Accordingly, the Government-Widefinancial statements do not include any of these activities or funds.

In the Government-Wide Statement of Net Assets, the governmental type activities column (a)is presented on a consolidated basis by column, (b) and is reported on a full accrual, economicresource basis, which recognizes all long-term assets and receivables as well as long-termdebt and obligations. The Council's net assets are reported in three parts - invested in capitalassets, net of related debt; restricted net assets; and unrestricted net assets. Invested incapital 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, orimprovement of those capital assets. Restricted net assets consist of net assets withconstraints placed on the use either by (1) external groups such as creditors, grantors,contributors, or laws or regulations of other governments; or (2) law through constitutionalprovisions or enabling legislation. Unrestricted net assets include all other net assets that donot meet the definition of "restricted" or "invested in capital assets, net of related debt."

The Council's policy is to use restricted resources first to finance its activities except fornutrition services. When providing nutrition services, revenues earned by the Council under itsNSIP contract with GOEA can only be used to pay for the raw food component of each mealthat is bought and served to a person eligible to receive a meal under one of the nutritionprograms. The Council's management has discretion as to how and when to use the NSIPrevenues when paying for nutrition program costs. Quite often unrestricted resources areavailable for use that must be consumed or they will have to be returned to GOEA. In suchcases it is better for management to elect to apply and consume the unrestricted resourcesbefore using the restricted resources. As a result, the Council wiil depart from its usual policy ofusing restricted resources first

The Government-Wide Statement of Activities reports both the gross and net cost of each ofthe Council's functions and significant programs. Many functions and programs are supportedby general government revenues like intergovernmental revenues, and unrestricted investmentincome, particularly if the function or program has a net cost The Statement of Activitiesbegins by presenting gross direct and indirect expenses that include depreciation, and thenreduces the expenses by related program revenues, such as operating and capital grants andcontributions, to derive the net cost of each function or program. Program revenues must bedirectly associated with the function or program to be used to directly offset its cost Operatinggrants include operating-specific and discretionary (either operating or capital) grants, while thecapital grants column reflects capital-specific grants. The Council did not receive any capital-specific grants this year.

26




D. Basic Financial Statements - Government-Wide Statements: (continued)

The Council allocates its indirect costs among various functions and programs in accordancewith Circular A-B7> The Statement of Activities shows this allocation in a separate columnlabeled "indirect cost allocation." In addition, GOEA provides grant funds to help the Councilpay for a portion of its indirect costs. As a result, only the indirect costs in excess of the GOEAfunds are allocated to the Council's other functions and programs. The Government-WideStatements focus upon the Council's ability to sustain operations and the change in its netassets resulting from the current year's activities.

E. Basic Financial Statements - Fund Financial Statements:

The financial transactions of the Council are reported in individual funds in the Fund FinancialStatements. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, equity, revenues, and expenditures.Resources are allocated to and accounted for in individual funds based upon the purpose forwhich they are to be spent and the means by which spending activities are controlled. Thevarious funds are reported by generic classification within the financial statements.

The Council uses governmental fund types. The focus of the governmental funds'measurement (in the fund statements) is on determination of financial position and changes infinancial position (sources, uses, and balances of financial resources) rather than on netincome. An additional emphasis is placed on major funds within the governmental fund types.A fund is considered major if it is the primary operating fund of the Council or if its total assets,liabilities, revenues, or expenditures are at least 10% of the corresponding total for all funds ofthat category or type.

Governmental fund equity is called the fund balance. Fund balance is further classified asreserved and unreserved, with unreserved being further split into designated andundesignated. Reserved means that the fund balance is not available for expenditure becauseresources have already been expended (but not consumed), or a legal restriction has beenplaced on certain assets that makes them only available to meet future obligations. Designatedfund balances result when management tentatively sets aside or earmarks certain resources toexpend in a designated manner. In contrast to reserved fund balances, designated amountscan be changed at the discretion of management.

The following is a description of the governmental funds of the Council:

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

• Special Revenue Funds are used to account for the proceeds of specific revenuesources that are legally restricted to expenditures for specified purposes. A largepercentage of the Council's special revenue funds are Title ill funds. These funds areprovided by the United States Department of Health and Human Services-Administration on Aging to the Governor's Office of Elderly Affairs, which in turn"passes through" the funds to the Council.

27




E. Basic Financial Statements - Fund Financial Statements: (continued)

The following is a brief description of each fund's purpose:

General Fund

The General Fund accounts for the following types of revenue and expenses:

Medicaid Transportation costs are accounted for under the general fund. This is a programwhere the Council transports certified Medicaid participants for medical treatments to and fromthe medical facilities. The Council Is reimbursed based on mileage by the Department ofHealth and Hospitals (DHH). During the year the Council served 2,084 people eligible toparticipate in this program

Other Local Funds are revenues, such as, (1) donations from the general public, (2) incomefrom various fund raisers, (3) program service revenue from providing Medicaid transportationservices, (4) interest income earned on idle funds which have been invested, and (5) the salestax revenue assessed in the parish. Expenses incurred which are not chargeable to specificprograms and expenses incurred to produce related program service fees and fund raisingincomes are recorded as general fund expenditures. These local revenues are also used astransfers to special revenue funds to supplement those programs. In addition, fixed assetadditions are generally paid with local funds.

The PCOA (Act 735) revenue recorded in the general fund is appropriated for the Council bythe Louisiana Legislature and remitted to the Council via the Governor's Office of ElderlyAffairs (GOEA). The council may use these "Act 735" funds at its discretion provided theprogram is benefiting people who are at least 60 years of age,

Major Special Revenue Funds

The Title III B Fund is used to account for funds, which are used to provide various units ofsupportive social services to the elderly. GOEA has established the criteria for defining aqualifying unit of service for each Title III program. Specific supportive social services, alongwith the number of units provided during the fiscal year, are as follows:

UnitsInformation and assistance 426Legal assistance 78Homemaker 1,216Material aid 32Outreach 100Recreation 8,202Telephone reassurance 1,994Transportation 4,173

28





The Title III C-1 Fund is used to account for funds that are used to provide nutritional,congregate meals to the elderly at meal sites located in the Many, Converse, Pleasant Hill andZwolle areas. During the year the Council provided 8,845 units of service to people eligible toparticipate in this program. They also provided 53 units of nutritional education to participantsat these sites.

The Title III C-2 Fund is used to account for funds that are used to provide nutritional meals tohomebound older persons. Using Title ill C-2 funds the Council served meals totaling 32,082units of service during the year to people eligible to participate in this program.

Non-Major Special Revenue Funds

The Title III C Area Agency Administration Fund is used to account for a portion of theindirect costs of administrating the Council's programs. Each fiscal year GOEA provides theCouncil with funds to help pay for the costs of administering the Council's special programs forthe elderly. The amount of funding is not enough to pay for all the indirect costs. As a result,the Council will allocate its indirect costs to this fund first Once the GOEA funds arecompletely used, any indirect costs, in excess of the funds provided by GOEA, are distributedto other funds and programs using a formula based on the percentage each program's directcosts bear to direct costs for ail programs.

The Title III D Fund is used to account for funds used for disease prevention and healthpromotion activities. During the year 3,469 units of wellness service were provided to eligibleparticipants in this program.

The Title III E Fund is used to account for National Family Caregiver Support Program(NFCSP) funds used to provide a multi-faceted system of support services for familycaregivers and for grandparents or older individuals who are relative caregivers. NFCSPCaregiver Services include (1) information about services/education, (2) assistance withaccess to services, (3) counseling/support groups, (4) respite care, (5) supplemental servicesincluding material aid, personal care and sitter services. During the year 1,134 units of servicewere provided.

The Senior Center Fund is used to account for the administration of Senior Center programfunds appropriated by the Louisiana Legislature to GOEA, which in turn "passes through" thefunds to the Council. The purpose of this program is to provide a community service center atwhich elderly people can receive supportive social services and participate in activities whichfoster their independence, enhance their dignity, and encourage their involvement in and withthe community. The senior center for Sabine Parish is located in Many. Senior Center fundscan be used at management's discretion to support any of the Council's programs that benefitthe elderly. Accordingly, during the fiscal year, the Senior Center Fund transferred all of itsgrant revenue to the Title III C-11 Fund to subsidize -that program's cost of providing supportiveservices to elderly persons who use the senior center.





The Audit Fund is used to account for funds received from the Governor's Office of ElderlyAffairs that are restricted to use as a supplement to pay for the cost of having an annual auditof the Council's financial statements. The cost allocated to this fund is equal to the GOEAsupplement Excess audit costs were recorded in the General Fund.

The Utility Assistance Fund is used to account for the administration of utility assistanceprograms that are sponsored by local utility companies. The companies collect contributionsfrom service customers and remit the funds to the parish councils on the aging to provideassistance to the elderly for the payment of utility bills. The Council receives its Project Caredonations directly from Entergy Corporation. LP&L Helping Hands donations are providedthrough the Louisiana Association of Councils on Aging, Inc. (LACOA). During the year, theCouncil was able to provide $1,896 of service with these funds.

The Supplemental Senior Center Fund was established to account for funds that wereappropriated by the Louisiana Legislature for the various councils on aging throughoutLouisiana to supplement each council's primary grant for senior center operations andactivities. The Sabine Council on Aging was one of the parish councils to receive asupplemental grant of $3,825. The money received by this fund during the year wastransferred to the Title III C-1 Fund to supplement the supportive services provided by thisfund. GOEA provided these funds to the Council.

The EFSP Fund is used to account for the administration of the Emergency Food and ShelterNational Board Program whose purpose is to supplement food and shelter assistance toindividuals who might currently be receiving assistance, as well as to assist those who are notreceiving any. Funds are provided by the Federal Emergency Management Agency (FEMA)to help provide additional home-delivered meals.

The FTA Fund was established to account for funds under the U.S. Department ofTransportation's Public Transportation for the acquisition of vehicles purchased in part withfederal funds under various capital assistance programs. The Louisiana Department ofTransportation and Development (DOTD) receives these funds for the State of Louisiana andpasses them through to the Council via the Sabine Parish Council. The Louisiana Departmentof Transportation and Development also coordinated the receipt of the required match fundsfrom the Council.

The N.S.I.P. Fund is used to account for the administration of the Nutrition Program forElderly funds provided by the United States Department of Agriculture through the Governor'sOffice of Elderly Affairs, which in turn "passes through" the funds to the Council. BeginningOctober 1, 2000, GOEA began distributing NSIP funds to each parish council on aging inLouisiana based on how many meals each council on aging served in the previous year inrelation to the total meals served statewide by all councils. The primary purpose of the NSiPreimbursement is to provide money to the Council so that United States food and commoditiesmay be purchased to supplement nutrition programs.

30




F. Measurement Focus and Basis of Accounting:

Basis of accounting refers to when revenues or expenditures/expenses are recognized in theaccounts and reported in the financial statements. It relates to the timing of themeasurements made regardless of the measurement focus applied.

1. Accrual Basis - Government-Wide Financial Statements (GWFS):

The Statement of Net Assets and the Statement of Activities display informationabout the Council as a whole. Both of these statements have been prepared usingthe economic measurement focus and the accrual basis of accounting. Revenues,expenses, gains, losses, assets, and liabilities resulting from exchange andexchange-like transactions are recognized when the exchange takes place.

2. Modified Accrual Basis - Fund Financial Statements (FFS):

The accounting and financial reporting treatment applied to a fund is determined byits measurement focus. Governmental fund types use the flow of current financialresources measurement focus and the modified accrual basis of accounting. Underthe modified accrual basis of accounting, revenues are recorded when susceptible toaccrual; i.e., when they are both measurable and available. "Measurable" means theamount of the transaction can be determined and "available" means collectible withinthe current period or soon enough thereafter to pay liabilities of the current period.The Council considers all revenues "available" if they are collected within 60 daysafter year-end. Expenditures are generally recorded under the modified accrualbasis of accounting when the related liability is incurred. The exceptions to thisgeneral rule are that (1) unmatured principal and interest on long-term debt, if any,are recorded when due and (2) claims and judgments and compensated absencesare recorded as expenditures when paid with expendable available financialresources.

G. Interfund Activity:

Interfund activity is reported as either loans or transfers. Loans between funds are reportedas interfund receivables and payables as appropriate and are subject to elimination uponconsolidation. All other interfund transactions are treated as transfers. Transfers represent apermanent reallocation of resources between funds. Transfers between funds are nettedagainst one another as part of the reconciliation of the change in fund balances in the fundfinancial statements to the change in net assets in the Government-Wide FinancialStatements.

H. Cash and Investments:

Cash includes amounts in demand deposits, interest-bearing demand deposits, and pettycash. Cash equivalents include amounts in time deposits and those investments with originalmaturities of 182 days or less. Cash and cash equivalents are reported at their carryingamounts that equal their fair values. Under state law, The Council may deposit funds indemand deposits with state banks organized under Louisiana law or any other state of theUnited States, or under the laws of the United States. The Council may invest in certificates

31




H. Cash and Investments: (continued)

and time deposits of state banks organized under Louisiana law and national banks havingprincipal offices in Louisiana

Under state law, the Council may invest in United States bonds, treasury notes, or certificates.These are classified as investments if their original maturities exceed 182 days. The Councildoes not hold investments as described.

I. Reservation and Designations of Fund Balances:

The Council "reserves" portions of its fund balances that are not available for expenditurebecause resources have already been expended (but not consumed), or a legal restrictionhas been placed on certain assets which make them only available to meet future obligations.Designated allocation of fund balances result when the Council's management intends toexpend certain resources in a designated manner.

J. Restricted Assets:

Restricted assets represent assets which have been primarily acquired through donationswhereby the donor has placed a restriction on how the donation can be used by the Council(i.e., utility assistance funds). Restricted assets are offset by a corresponding reservation ofthe Council's fund balance.

K. Prepaid Expenses/Expenditures:

Prepaid expenses include amounts paid for services in advance. These expenses are shownas assets on the Government-Wide Statement of Net Assets. However, in the Fund FinancialStatements, the Council has elected not to include amounts paid for future services asexpenditures until those sen/ices are consumed to comply with the cost reimbursement termsof grant agreements. As a result, the prepaid expenditures are shown as an asset on thebalance sheet of the Fund Financial Statements until they are consumed. In addition, acorresponding amount of the fund balance of the General Fund has been reserved to reflectthe amount of fund balance not currently available for expenditure.

L. Capital Assets:

The accounting and reporting treatment applied to the capital assets associated with a fundare determined by its measurement focus. Capital assets are long-lived assets that havebeen purchased or acquired with an original cost of at least $1,000 and that have anestimated useful life of greater than one year. When purchased or acquired, these assets arerecorded as capital assets in the Government-Wide Statement of Net Assets. In contrast, inthe Fund Financial Statements, capital assets are recorded as expenditures of the fund thatprovided the resources to acquire the asset. If the asset was purchased, it Is recorded in thebooks at its cost. If the asset was donated, then it is recorded at its estimated fair marketvalue at the date of donation.

32




L. Capital Assets: (continued)

For capital assets recorded in the Government-Wide Financial Statements, depreciation iscomputed and recorded using the straight-line method for the asset's estimated useful life.The estimated useful lives of the various classes of depreciable capital assets are as follows:

Building Improvements 20 yearsEquipment 5-7 yearsVehicles 5 yearsComputers 3 years

Salvage values have not been estimated by management when calculating how much of anasset's cost needs to be depreciated except for vehicles. For that category of capital asset,management has established 10% of the vehicle's initial cost as a salvage value estimate.Depreciation is not computed or recorded on capital assets for purposes of the Fund FinancialStatements.

M. Unpaid Compensated Absences:

The Council's policies for vacation time permit employees to accumulate earned but unusedvacation leave up to twelve days. Accordingly, a liability for the unpaid vacation leave has beenrecorded. Management has estimated this liability to be current based on historical trends andtherefore is recorded as a payroll payable. The amount accrued as the compensated absenceliability was determined using the number of vested vacation hours for each employeemultiplied by the employee's wage rate in effect at the end of the year.

The Council's sick leave policy does not provide for the vesting of sick leave thereby requiringthe employee to be paid for any unused leave upon termination of employment. Accordingly,no amounts have been accrued as unpaid compensated absences In the Government-WideFinancial Statements relative to sick leave.

N. Allocation of Indirect Expenses:

The Council reports all direct expenses by function and programs of functions in the Statementof Activities. Direct expenses are those that are clearly identifiable with a function or program.Indirect expenses are recorded as direct expenses of the Administration function. GOEAprovides funds to partially subsidize the Council's Administration function. The unsubsidizednet cost of the Administration function is allocated using a formula that is based primarily onthe relationship the direct cost a program bares to the direct cost of all programs. There aresome programs that cannot absorb any indirect cost allocation according to their grant orcontract limitations.

O. Management's Use of Estimates:

The preparation of financial statements in conformity with generally accepted accountingprinciples requires management to make estimates and assumptions that affect certainreported amounts and disclosures. Accordingly, actual results may differ from those estimates.

33




P. Elimination and Reclassifications:

In the process of aggregating data for the Statement of Net Assets and the Statement ofActivities, some amounts reported as interfund activity and balances in the funds wereeliminated or reclassified. Interfund receivables and payables were eliminated to minimize the"grossing up" effect on assets and liabilities within the governmental activities column.

Q. Deferred Revenues:

The Council reports deferred revenues on its Statement of Net Assets and on the balance sheetof the Fund Financial Statements. Deferred revenues arise when the Council receivesresources before it has a legal claim to them, as when grant monies are received before theoccurrence of qualifying expenditures. In subsequent periods, when the Council has a legalclaim to the resources, the liability for deferred revenue is removed from the combined balancesheet and the revenue is recognized.

2. Revenue Recognition

Revenues are recorded in the Government-Wide Statements when they are earned under theaccrual basis of accounting.

Revenues are recorded in the Fund Financial Statements using the modified accrual basis ofaccounting. In applying the susceptible to accrual concept using this basis of accounting,intergovernmental grant revenues, program service fees, and interest income are usually bothmeasurable and available. However, the timing and amounts of the receipts of public supportand miscellaneous revenues are often difficult to measure; therefore, they are recorded asrevenue in the period received.

3. Cash

The Council maintains a consolidated bank account to deposit most of the monies it collectsand to pay its bills. The consolidated bank account is available for use by all funds. Thepurpose of this consolidated account is to reduce administration costs and facilitate cashmanagement The consolidated account also allows those funds with available cash resourcesto temporarily cover any negative cash balances in other funds. In addition to the consolidatedbank account, the Council has a separate bank account to'deposit and disburse sales taxrevenue funds, payroll, and capital outlays. The Council also has an interest bearing savingsaccount.

At year-end, the carrying amount of the Council's cash balances on the books, which includes$100 of petty cash, was $311,556, whereas the related bank balances totaled $358,705. Thedifference in the book, and bank balances for cash relates primarily to deposits made andchecks written which did not clear the bank accounts by year-end. Bank balances of $262,648are secured from risk by federal deposit insurance and $196,057 of pledged securities held bythe custodial bank in the name of the fiscal agent bank

34



3. Cash (continued)

Accordingly, bank and deposits are classified as a "Category 3" credit risk in accordance withGASB Statement 3. GASB Statement 3 categorizes deposits into three categories of credit risk:

1. Insured by FDIC or collateralized with securities held by the Council or by its agent in theCouncil's name. (Category 1)

2. Uninsured but collateralized with securities held by the pledging financial institution's trustdepartment or agent in the Council's name. (Category 2)

3. Uninsured and uncollateralfzed; or collateralized with securities held by the pledging financialinstitution, or by its trust department or agent but not in the Council's name; or coilateralizedwith no written or approved collateral agreement. (Category 3)

Even though the pledged securities are considered uncollateralized (Category 3) under theprovisions of GASB Statement 3, Louisiana Revised Statute 39:1229 imposes a legalrequirement on the custodial bank to advertise and sell the pledged securities within 10 days ofbeing notified by the Council that the fiscal agent has failed to pay deposited funds upondemand.

Under state law, all bank deposits must be (1) secured by federal deposit insurance or by thepledge of securities owned by the fiscal agent bank, or (2) invested exclusively in instrumentsbacked by the U.S. government. The fair value of the pledged securities plus the federal depositinsurance must always equal or exceed the amount on deposit with the fiscal agent.

4. Government Grants and Contracts Receivable

Government grants and contracts receivable represent amounts owed to the Council under agrant award or contract with a provider of federal, state, or local funds; such amounts beingmeasurable and available as of year-end. Government grants and contracts receivable atyear-end consist of reimbursements for expenses incurred under the following programs:

Program Fund Provider AmountNutrition Services FEMA Direct $ 3,028Administration General State Capital Outlay 33.530

$ 36.558

35



5. Changes in Capital Assets

A summary of changes in capital assets is as follows:

Buildings and landFurniture and equipmentAutomotive equipmentConstruction-in-progress

Total general fixed assets

BalanceJune 30, 2005

$

$_

175.283 $13,396

183,249200,352572,280 $

BalanceAdditions Deletions June 30, 20061,029.332$ $

18,19550,081 (26,843)6,000 (200,352)

1,103,609$ (227,195)$

1,204,61531,591

206,4876,000

1,448,694

Accumulated DepreciationBuildings and landFurniture and equipmentAutomotive equipmentConstruction-in-progress

Total accumulated depreciation

Total Net Assets

37,935 $9,927

121,229

4,6771,733

26,546 (26.843)

42,61311,660

120,932

169,091 $ 32,956 $ (26,843) $

403.189 $ 1.070.652$ (200.352) $

175,205

1.273,489

Depreciation expense of $32,956 wasgovernment-wide Statement of Activities.

6. Board of Directors1 Compensation

charged to the Administrative function on the

The Board of Directors is a voluntary board; therefore, no compensation has been paid to anymember. However, board members are reimbursed for any out-of-pocket costs they mightincur on behalf of the Council in accordance with the Council's reimbursement policy.

7. In-Kind Contributions

The Council received $30,536 in various in-kind contributions during the year, which havebeen valued at their estimated fair market value. The in-kind activities have been presented aspart of the government-wide activities on Statement B to demonstrate their overall effect Thepresentation of this revenue and the related expenditures are equal, thereby, producing noeffect on net income (loss). The in-kind have however, been omitted from the generalgovernmental statements in order to demonstrate better the effects of current financialresources from the GOEA and other governmental sources to their applicable expense. Theprimary in-kind contributions consisted of labor, free rent, materials and activities related tohealth fairs, fundraisers and the buildings. A summary of the in-kind contributions and theirrespective values is as follows;

Salary and fringe benefitsTravelRentSupplies

Total in-kind

$ 7.5361,000

14,4007.600

$ 30.536

SAB1NE COUNCIL ON AGING, INC.Many, Louisiana


8. Interfund Receivables and Payables

Because the Council operates most of its programs under cost reimbursement type grants, ithas to pay for costs using its General Fund money and then request reimbursement for theadvanced costs under the grant programs. Such advances create short-term interfund loans inthe Fund Financial Statements. A summary of these interfund loans at year end is as follows:

Due From Due ToOther Funds Other Funds

General Fund $ $ 10,502Special Revenue Funds 10,502

$

These loans have been eliminated as a part of the consolidation process in preparing theGovernment-Wide Financial Statements.

9. Interfund Transfers

Interfund transfers to and from are listed by fund for the fiscal year as follows:

________^_^_^_^-___ Funds Transferred In

Funds Transferred Out

Senior Center $

Supp. Senior Ctr

NSIP

FEMA

PCOA (Act 735)

General Fd/Local

Total $

Transfers are used to (1) move revenues from the fund that statute or budget requirescollecting them, to the fund that statute or budget requires to expend them, and to (2) useunrestricted revenues collected in the General Fund to finance various programs accounted forin other funds in accordance with budgetary authorizations.

These transfers were eliminated as a part of the consolidation process in preparing theGovernment-Wide Financial Statements.

Title III-B

$

41,130

41,130 $

Title III-G-I

S3,825

K934

18,759 $

Title III-C-II Title III-D Title III-E

19,153 $ $ $

21,055

6,057

21,048

52,189 1,208 4,811

119,502 $ 1,208 $ 4,811 $

Total

19,153

3,825

21,055

6,057

21,048

114,272

185,410

37


NOTES TO THE FINANCIAL STATEMENTSAs of and for the year Ended June. 200B

10. General Obligation Bonds

The Council authorized $250,000 of general obligation bonds to be used to purchase a tract ofland as a senior citizens center, and paying costs pertaining to the construction of the centerand related improvements, including equipment and furnishings The Council Is in compliancewith all significant financial requirements as of June 30, 2006.

The following is a summary of the obligation transactions for the year ended June 30, 2006:

Bondeddebt

Obligations at beginning of year $ 112,111AdditionsDeductions (112.111)

Obligations at end of year $ __-

Interest paid for the year ended June 30, 2006 was $2,029. Interest expense is included as adirect administrative expense in the government-wide Statement of Activities.

11. Income Tax Status

The Council, a non-profit corporation, is exempt from federal income taxation under Section501 (c)(3) of the Internal Revenue Code, and as an organization that is not a private foundationas defined in Section 509(a) of the Code. It is also exempt from Louisiana income tax.

12. Related Party Transactions

There were no significant related party transactions during the year.

13. Risk Management

The Council is exposed to various risks of loss related to torts; theft of, damage to, anddestruction of assets; errors and omissions; job related illnesses or injuries to employees; andnatural disasters. The Council has purchased commercial insurance to cover or reduce therisk of loss that might arise should one of these incidents occur. There have been nosignificant reductions in coverage from the prior year. No settlements were made during thecurrent or prior three fiscal years that exceeded the Council's insurance coverage.

The Council's management has not purchased commercial insurance or made provision tocover or reduce the risk of loss, as a result of business interruption and certain acts of God,like floods or earthquakes.

The Council's management is not aware of any potentional judgments, claims or similarcontingencies pending at year end.

14. Construction in Progress

The Council completed the building of the senior center with substantial completion on June19, 2006. The total cost of the new Legacy Building is $1,026,332. Construction in progress atJune 30,2006 consists of the approximately 50% of the uncompleted landscaping.

38



15. Sales Tax Revenue

The Sabine Council on Aging, Inc. acting through the Policy Jury of Sabine Parish wassuccessful in passing a one-fourth of one percent (1/4%) sales and use tax on July 19, 2003.This is a tax for ten years beginning October 1, 2003. These funds are to provide fiinds foradministering, acquiring, constructing, improving, maintaining, supporting and operatingauthorized activities, services, programs, and/or facilities for the council. The revenuerecognized for the year ended June 30,2006 is $638,119.

16. Contingencies-Grant Programs

The Council participates in a number of state and federal grant programs, which are governedby various rules and regulations. Costs charged to the respective grant programs are subjectto audit and adjustment by the grantor agencies; therefore, to the extent that the Council hasnot complied with the rules and regulations governing the grants, refunds of any moneyreceived and the collectibility of any related receivable at year-end may be impaired. Inmanagement's opinion, there are no significant contingent liabilities relating to compliancewith the rules and regulations governing state and federal grants; therefore, no provision hasbeen recorded in the accompanying financial statements for such contingencies. Audits ofprior years have not resulted in any significant disallowed costs or refunds. Any costs thatwould be disallowed would be recognized in the period agreed upon by the grantor agencyand the Council.

17. Economic Dependency

The Council receives the majority of its revenue through grants administered by the LouisianaGovernor's Office of Elderly Affairs (GOEA) and the Louisiana Department of Transportationand Development (DOTD). The grant amounts are appropriated each year by the federal andstate governments. If significant budget cuts are made at the federal and/or state level, theamount of funds the Council receives could be reduced significantly and have an adverseimpact on its operations. Management is not aware of any actions that will adversely affectthe amount of funds the Council will receive in the next fiscal year.

39

REQUIRED SUPPLEMENTAL INFORMATION (PART II)

SCHEDULE 1SABINE COUNCIL ON AGING, INC

Many, LouisianaBUDGETARY COMPARISON SCHEDULE

GENERAL FUNDFor the Year Ended June 30,2006

REVENUESIntergovernmental:


State capital grant

Sales tax revenuePublic Support

Interest Income

Medicald TransportationClient ContributionsMiscellaneousTotal Revenues

EXPENDITURES

Current:PersonnelFringe benefits

TravelOperating services

Operating supplies

Other costsCapital outlaysTotal Expenditures



Operating Transfers In

Operating Transfers outTotal Other Financing Sources and Uses

Net Increase (Decrease) in Fund Balances

FUND BALANCES

Beginning of the yearEnd of the year

Adjustments to conform to GAAP:

Non-budgetary payables

Fund Balance, end of year, (GAAP basis)

BUDGET AMOUNTSORIGINAL FINAL

$ $250,000

600,0001.0003,000

45,000

2,0007,000

908,000

250,000

600,0001,000

3,00045,000

2,000

7,000906,000

VARIANCEPOSITIVE

ACTUAL (NEGATIVE)

$ 21,048

245,000638,119

1,237

5,23746.200

4,499

961,340

21,048(5,000)

36,119237

2,237

1.200

(2,000)(2,501)

53,340

48,7226.644

778

41,37424,350

7,494

35,000

164.362

53,9257,440

2,471

42,26524,5458,547

895,000

1.034.213

63,118

5,841515

35,02942,321

7,865951.641

1.098.330

807

1,599

1,958

7,256(17,776)

682

(56,641)

(62.117)

743.638

743,638

720.786

(128.213) M34.990)

(135.320)(135.3201

(126,213)

720.786

(270,310)

720.7BS450,476

(112.1111

(8.777)

135,320135.320

(144,097)

$ 338.365

The accompanying notes are an Integral part of this statement. 41


BUDGETARY COMPARISON SCHEDULETITLE III B Supportive ServicesFor the Year Ended June 30, 2006

SCHEDULE 2


REVENUES

Intergovernmental:


Client ContributionsTotal Revenues

EXPENDITURES

Current:Personnel

Fringe benefits

Travel

Operating services

Operating supplies

Other costs

Total Expenditures

Excess (deficiency) of revenues

over expenditures


Operating Transfers in

Operating Transfers out


Net Increase (Decrease) in Fund Balances

FUND BALANCES


End of the year

$ 78,877 $

8,500

87.377

63,727

8,690

5.469

47.548

28,796

9,299

163.529

(78.152)

76,152

76.152

78,877

8,500

87.377

65,134

8,988

5,984

49.512

24,873

9,907

164.398

(77.021)

77,021

77.021

$ $

ACTUAL

78,877

9,449

68.326

61,872

6,804

5,497

30,404

15,666

9.213

129.456

(41.130)

41,130

0_41.130

VARIANCEPOSITIVE

(NEGATIVE)

949

949

3,262

2.184

487

19.108

9,207

694

34.942

35.891

35,891

35,891



BUDGETARY COMPARISON SCHEDULETITLE III C-1 Congregate MealsFor the Year Ended June 30,2006

SCHEDULE 3

REVENUESIntergovernmental:


Client Contributions

Total Revenues

EXPENDITURES

Current:

Personnel

Fringe benefits

Travel

Operating services

Operating supplies

Other costsMeals

Total Expenditures

Excess (deficiency) of revenues

over expenditures


Operating Transfers In

Operating Transfers out



FUND BALANCES


End of the year

VARIANCEBUDGET AMOUNTS POSITIVE

ORIGINAL FINAL ACTUAL (NEGATIVE)

$ 46,096 $5,000

51 ,096

37.837

5,160

2,628

13,200

3,953

3,660

25,260

91898

46,096 $

5,000

51,096

32,476

4,481

1,475

10,769

3,831

3,468

25,260

81.760

46.096

5,536

51,634

31,901

3,508

495

5,373

2,025

3,410

23,681

70.393

538

53B

575973

980

5,396

1,806

58

1,579

11.367

(40.8021

40,802

40,802

J30.684>

30,664

30,664

Jia.7581

18,759

18,759

11.905

11,905

11.905

The accompanying notes are an integral part of this statement 43

SCHEDULE 4SABINE COUNCIL ON AGING, INC

Many, LouisianaBUDGETARY COMPARISON SCHEDULE

TITLE HI C-2 Home Delivered MealsFor the Year Ended June 30,2006

REVENUES

Intergovernmental:Governor's Office of Elderly Affairs

Client Contributions

Total Revenues

EXPENDITURES

Current

Personnel

Fringe benefitsTravelOperating servicesOperating suppliesOther costsMeals

Total Expenditures



Operating Transfers InOperating Transfers out



FUND BALANCES


End of the year


$ 58,23012,00070,230

53,508

7,29728,79330,1306,9237,788

71,060

205.499

$ 56,23012,000

70,230

48,8506,741

28,507

27,5676,8577,752

80,860

207,134

ACTUAL

$ 58,23013,54871,778

51,709

5,688

25,01915,5964,8228,079

80,367

191.280

VARIANCEPOSITIVE

(NEGATIVE)

1.5481,548

(2,859)1,053

3,488

11,9712,035(327)

493

15.854

(135.269)

135,269

135,269

(136,904)

136,904

136,004

f 119.502)

119,502

119,502

17.402

17,402

17,402


SUPPLEMENTARY FINANCIAL INFORMATION REQUIRED BY GOEA

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SCHEDULES


COMPARATIVE SCHEDULE OF GENERAL FIXED ASSETS AND CHANGES IN GENERAL FIXED ASSETS


General Rxed Assets at costBuildings and LandFurniture and EquipmentAutomotive EquipmentConstruction in Progress

Total General Rxed Assets

BalanceJune 30, 2005

175,283 $13.396

183.249200.352

572,280

Additions

1.029,332 $18.19550,0826,000

1.103.609

BalanceDeletions June 30, 2006

$

(26,843)(200,352)

(227,195) $

1.204,61531,591

206,4886.000

1,448,694

Investment in General Fixed AssetsProperty Acquired from:Medlcaid ProgramsTitle IIIB OmbudsmanTitle IMFTitle 11IC-1Title IIIC-2Senior CenterPCOA(Act735)General FundsTitle IIIB SupportiveDonationsPriorto1999- AAA, IIIB. Cl, CII, HID.OMB, IMF. and Waiver

Title IIIC AdministrativeTitle HIDMisc. Grants

5.633232231

4.1102.382

02,513

198,69020.33119.193

13,7585,015

462299.730

1,103,609 (200,352)

(26.843)

5,633232231

4,1102,382

02,513

1,101,94720,33119.193

13.7585,015

462272,687

Total Investments in General Rxed Assets $ 572.280 1.103.609 (227,195) $ 1.448,694

The accompanying notes are an integral part of this statement 47

SUPPLEMENTARY FINANCIAL INFORMATION REQUIRED BY OMBCIRCULAR A-133

SCHEDULE 7

SABINE COUNCIL ON AGING, INC.

Many, LouisianaSCHEDULE OF EXPENDITURES OF FEDERAL AWARDS

For the Year Ended June 30.2008

FEDERAL GRANTOR/PASS- THROUGH GRANTORS/PROGRAM OF CLUSTER TITLE

U. S. Department of Health and Human Services - Administrationon Aging

Federal Grant ProgramCFDA Year or Award Revenue

Number Ended Amount Recognized Expondltures

Passed through the Governor's Office of Elderly Affairs:Special Programs for the Aging:Title III, Part B - Supportive Services and Senior Center

Title III, Part C - Area Agency AdministrationTitle HI, Part C -1- Nutrition Services - Congregate MealsTitle III, Part C -2- Nutrition Services - Home Delivered Meals

Subtotal CFDA #93.045

Title 111, Part D - Preventive Health

Title III Part E • National Family Caregiver Support Program

Nutritional Services Incentive ProgramFor 2006 Grant

Totals for U. S. Department of Health and Human Services -Administration on Aging

Federal Emergency Management AgencyPassed through the United Way

Emergency Food and Shelter Program

Totals for the Federal Emergency Management Agency

93.044 06/30/06 $ 48.687 $ 48.687 $ 48.687

93.04593.04593.045

93.043

93.052

93.052

06/30/0606/30/0606/30/06

06/30/06

06/30/06

06/30/06

16,77146,09631,886

94.553

3,558

20.924

20.800

16,77146,09631.686

94.553

3,558

20,924

20,600

16,77146,09631,686

94.553

3,556

20.924

20,800

97.024 11/30/06

188,522

6,057

6.057

188,522

6,057

6.057

188,522

8,057

6,057

Total Federal Grants $ 194.579 $ 194.579 $ 194.579

Note A - Basis of Accounting - The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity ofSablne Council on Aging and has been prepared using the accrual basis of accounting as contemplated under generallyaccepted accounting principles and which Is the same basis of accounting used for presenting the fund financialstatements.

Note B - The Sabine Council on Aging, Inc. did not pass-through any of its federal awards to a sub recipient during the fiscal year.

Note C - No federal awards were expended in the form of non-cash assistance during the fiscal year.

The accompanying notes are an Integral part of this statement. 49

OTHER REPORTS REQUIRED BY GOVERNMENT AUDITINGSTANDARDS

122 JEFFERSON STREET • MANSFIELD, LOUISIANA 71052 • (318) 872-3007 • FAX (318) 872-1357

CERTIFIED PUBLIC ACCOUNTANT

Report on Internal Control over Financial Reporting and on Compliance and OtherMatters Based on an Audit of Financial Statements Performed in Accordance with

Government Auditing Standards

To the Board of DirectorsSablne Council on Aging, Inc.Many, Louisiana

I have audited the basic financial statements of the governmental activities of the Sabine Council on Aging,Inc. as of and for the year ended June 30, 2006, and have issued my report thereon dated December 15,2006. I conducted my audft in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in Government Auditing Standards, issuedby the Comptroller General of the United States.

Internal Control Over Financial Reporting

In planning and performing my audit, I considered Sabine Council on Aging, Inc.'s internal control overfinancial reporting in order to determine my auditing procedures for expressing my opinions on the financialstatements and not to provide an opinion on the Internal control over financial reporting. My consideration ofthe Internal control over financial reporting would not necessarily disclose all matters In the internal controlover financial reporting that might be material weaknesses. A material weakness is a condition in which thedesign or operation of one or more of the internal control components does not reduce to a relatively low levelthe risk that misstatements caused by error or fraud in amounts that would be material in relation to thefinancial statements being audited may occur and not be detected within a timely period by employees In thenormal course of performing their assigned functions. I noted no matters involving the internal control overfinancial reporting and Its operation that I consider material weaknesses.

Compliance and Other Matters

As part of obtaining reasonable assurance about whether the Sabine Council on Aging, Inc.'s, financialstatements are free of material misstatement, I performed tests of Its compliance with certain provisions oflaws, regulations, contracts and grant agreements, noncompllance with which could have a direct andmaterial effect on the determination of financial statement amounts. However, providing an opinion oncompliance with those provisions was not an objective of my audit and, accordingly, I do not express such anopinion. The results of my tests disclosed on instance of noncompliance or other matters that is required tobe reported Government Auditing Standards and which Is described In the accompanying schedule of findingsand other responses as item 2006-1.

This report Is intended solely for the information and use of the Sabine Council on Aging, Inc., Board ofAldermen and management, cognitive agencies, and the Legislative Auditor, is not intended to be, and shouldnot be used by anyone other than these specified parties. Under Louisiana Revised Statute 24:513, thisreport is distributed by the Legislative Auditor as a public document.

Mansfield, LouisianaDecember 15, 2006

51

SABINE COUNCIL ON AGING, INC.Schedule of Findings and Responses

For the Year ended June 30, 2006

SUMMARY OF AUDITOR'S REPORTS

INDEPENDENT AUDITOR'S REPORT:

I have audited the basic financial statements of Sabine Council on Aging, Inc. as of and for the year endedJune 30, 2006, and have issued my report thereon dated December 15, 2006. I conducted my audit inaccordance with auditing standards generally accepted in the United States of America and the standardsapplicable to financial audits contained In Government Auditing Standards, issued by the Comptroller Generalof the United States. My audit of the basic financial statements as of June 30, 2006, resulted in anunqualified opinion.

REPORT ON INTERNAL CONTROL AND COMPLIANCE MATERIAL TO THE FINANCIAL STATEMENTS:

Internal Control

Material Weaknesses D Yes E3 NoOther Conditions U Yes Kl No

Compliance

Compliance Material to Financial Statements E3 Yes D No

There was no management letter Issued.

FEDERAL AWARDS

Not applicable

FINANCIAL STATEMENT FINDINGS

Compliance finding 2006-1

Criteria. The Council is subject to R.S. 39:1301-15 Local Government Budget Act.

Finding. There was no public budget process In accordance with the budget act. The General Fundexpenditures exceeded the total budgeted expenditures by 5%.

Condition: In previous years, the Council did not receive monies from the public in quantities that required abudget with public participation. The sales tax revenue received now requires the Council to follow the statebudget act.

Recommendation. Management and the Board should monitor the general fund reports comparing actual tobudgetary amounts so that amendments are made or costs are controlled.

Management's response. A public meeting will now be held as required and the expenses will monitoredand amended as needed.

52

SABINE COUNCIL ON AGING, INC.Schedule of Prior Years FindingsFor the year ended June 30, 2006

INTERNAL CONTOL AND COMPLIANCE MATERIAL TO THE FINANCIAL STATEMENTS

2005-1 Budget: Partially resolved. See finding 2006-1. The GOEA budgets were in compliance.

2006-2 Pledging: Resolved.

53

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