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Home My WebLink About2005 FIFD ISHERS ISLAND FERRY DISTRICT FINANCIAL STATEMENTS DECEMBER 31, 2005 f" . ) < , \ . I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT FINANCIAL STATEMENTS DECEMBER 31, 2005 CONTENTS Independent Auditor's Report....... ..... .................................................... ....... ................................... .............................. I Statement of Net Assets........... ...................................................................................................................................... 2 Statement of Revenues, Expenses, and Changes in Net Assets ................................................................................................................................................3 Notes to Financial Statements....... ................................................................................................................................ 4 DOHERTY, BEALS & BANKS, P.C. . I I I I I I I I I I I I I I I I I I I DOHERTY, BEALS & BANKS, p.e. CARL A. BANKS, CPA STACEY L. GUALTIERI, CPA KATHLEEN A. STEAMER. CPA DAVID J. MICELI, CPA CERTIFIED PUBLIC ACCOUNTANTS 187 WILLIAMS STREET POST OFFICE BOX S9 NEW LONDON. CONNECTICUT 06310 (860) 443-1033 FAX (860) 444-7086 WWW.DBBCPA.COM Board of Commissioners Fishers Island Ferry District Fishers Island, NY 06390 INDEPENDENT AUDITOR'S REPORT We have audited the accompanying financial statements of the Fishers Island Ferry District, (a component unit of The Town of Southold) as of and for the year ended December 31, 2005, which collectively comprise the District's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the Fishers Island Ferry District's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller Geneml of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe 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, the financial position of the Fishers Island Ferry District as of December 31, 2005, and the results of its operations for the year then ended in conformity with accounting principles generally accepted in the United States of America. In accordance with Government Auditing Standards, we have also issued our report dated June 15,2006, on our consideration of the District's internal control over financial reporting and on our tests of its compliance with certain provisions oflaws, regulations, contracts, and grants. That report is an integral part of an audit performed in accordance with Government A uditing Standards and should be read in conjunction with this report in considering the results of our audit. L9~> ~) , 13""/"$/ f'. C. DOHERTY, BEALS & BANKS, P.c. June 15,2006 -J - . I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT COMPONENT UNIT TOWN OF SOUTHOLD STATEMENT OF NET ASSETS AS OF DECEMBER 31, 2005 ASSETS Cash and investments Other receivables Due from grants Prepaid expenses Land Buildings Machinery and equipment Less accumulated depreciation TOTAL ASSETS LIABILITIES AND NET ASSETS LIABILITIES Accounts payable Other liabilities Wages payable Bond anticipation notes General obligations bonds payable TOTAL LIABILITIES NET ASSETS Investments in fixed assets Unrestricted (deficit) TOTAL NET ASSETS TOTAL LIABILITIES AND NET ASSETS See notes to financial statements. -2- DOHERTY, BEALS & BANKS, P.C. $ 303,346 40,638 48,767 65,650 41,717 18,078,208 2,717,436 (4,989,358) $ 16,306,404 $ 223,326 419,236 205,734 1,725,000 2,850,000 5,423,297 15,848,003 (4,964,895) 10,883.107 $ 16,306,404 .u I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT COMPONENT UNIT OF TOWN OF SOUTHOLD STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS FOR THE YEAR ENDED DECEMBER 31, 2005 OPERATlNG REVENUES Operations $ 1,796,314 Charters 23,336 Mail 18,449 Theater 17,626 Other revenues 54,276 TOTAL OPERATlNG REVENUES 1,910,001 OPERA TlNG EXPENSES Personnel 1,161,068 Employee benefits 340,022 Equipment maintenance 150,088 Contractual services 434,586 Depreciation 326,780 Airport 35,449 Theater 16,942 Mail 6,225 Insurance 74,562 PropertY tax 33,402 Repairs - docks 57,413 Bond payments 39,617 Administration 17,133 Insurance claims 12,257 TOTAL OPERA TlNG EXPENSES 2,705,544 OPERA TlNG INCOME (LOSS) (795,543) NONOPERATlNG REVENUE (EXPENSES) Interest income 17,420 Capital grants 1,983,823 PropertY taxes 400,000 Interest expense (5,815) TOTAL OPERA TlNG REVENUE (EXPENSE) 2,395,428 CHANGE IN NET ASSETS 1,599,885 NET ASSETS - BEGINNING 9,283,223 NET ASSETS - ENDING $ 10,883,108 See notes to financial statements. - 3 - DOHERTY, BEALS & BANKS, P.C. - I I I I I I I I I I I I I I I I I I I 2. FISHERS ISLAND FERRY DISTRICT NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2005 I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Purpose The Fishers Island Feny District operates through the Town of South old as an organization exempt from income tax. It is a component unit of the Town of South old. The Fishers Island Feny District's function is to provide residents of Fishers Island with transportation to and from Fishers Island, New York, and New London, Connecticut. Method of Accounting The Fishers Island Feny District uses the accrual basis of accounting. Under this basis of accounting, revenues are recognized when measurable and earned. Expenditures are recorded when measurable and incurred. Financial Statement Presentation Financial statement presentation follows the recommendation of Statement No. 34 of the Government Accounting Standards Board, Basic Financial Statements- and Management's Discussion and Analysis- for State and Local Governments. Under GASB No. 34, the District is required to report information regarding its fmancial position and activities using the economic resources measurement focus and the accrual basis of accounting. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, and revenue and expenses during the reporting period. Actual results could differ from those estimates. Cash Equivalents The Organization considers all unrestricted highly liquid investments with a maturity of three months or less to be cash equivalents. Property and Equipment Property and equipment are carried at cost or, if donated, at the approximate fair value at the date of donation. Depreciation of the Organization's assets is calculated using the straight-line method over the estimated useful lives of the assets ranging from five to thirty years. CONCENTRATION OF CREDIT RISK The Organization maintains cash balances at several financial institutions. Accounts at each institution are insured by the Federal Deposit Insurance Corporation up to $100,000. At December 3 I, 2005, the Organization's uninsured cash balances total $190,151. -4 - DOHERTY, BEALS & BANKS, P.C. - I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2005 3. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are recorded at cost and consist of the following classes of assets: Land Buildings Machinery and equipment $ 41,717 18,078,208 2,717,436 TOTAL PROPERTY, PLANT AND EQUIPMENT $ 20,837,361 4. BONDS PAYABLE Serial Bonds dated March 8, 2005. Denominations maturing on September I" each year through 2021, interest rate is 3.75%. The outstanding balance on the bonds at year-end is $2,850,000. The maturities of the bonds for the next five years is as follows: 2006 2007 2008 2009 2010 $178,125 178,125 178,125 178,125 178,125 Bond Anticipation Note Bond anticipation notes (BAN's) are generally accounted for in the capital projects funds. The notes or renewal thereof may not extend more than two years beyond the original date of issue unless a portion is redeemed within two years and within each 12-month period thereafter. State law requires that BAN's issued for capital purposes be converted to long-term obligations within five years after the original issue date. However, BAN's issued for assessable improvement projects may be renewed for periods equivalentto the maximum life of the permanent financing, provided that stipulated annual reductions of principal are made. Description Interest Rate Bonds Budget Appropriations Amount New London Terminal Project $ 1,725,000 $ 2.75% $ 1,725,000 Total $ 1,725,000 - 5- DOHERTY, BEALS & BANKS, P.C. u_. I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2005 5. RETIREMENT SYSTEM Plan Description The Fishers Island Ferry District, a component unit of the Town of Southold, participates in the New York Employee's Retirement System, the New York State Policemen's and Firemen's Retirement System and the Public Employee's Group Life Insurance Plan (Systems). These are cost-sharing multiple-employer retirement systems. The Systems provide retirement benefit as well as death and disability benefits. The New York State Retirement and Social Security Law (NYSRSSL) govern obligations of employers to contribute and benefits to employees. As set forth in the NYSRSSL, the Comptroller ofthe State of New Yark (Comptroller) serves as sole trustee and administrative head of the Systems. The Comptroller shall adopt and may amend rules and regulations for the administration and transactions of the business of the Systems and for the custody and control of their funds. The Systems issue a publicly available fmancial report that includes fmancial statements and required supplementary information. That report may be obtained by writing the New York State and Local Retirement System, Gov. Alfred E. Smith State Office Building, Albany, NY 12244. Funding Policy The Systems are noncontributory except for employees who joined the New York State and Local Employees' Retirement System after July 27, 1976, who contribute 3% oftheir salary. Under the authority of the NYSRSSL, the Comptroller shall certifY annually the rates expressed as proportions of payroll of members, which shall be used in computing the contributions required to be made by employers to the pension accumulation fund. The Town of Southold is required to contribute at an actuarially determined rate. The Town's contributions made to the Systems were equal to 100% of the contributions required for each year. The districts portion ofthe contribution was $61,448 in 2005. Since 1989, the Systems' billings have been based on Chapter 62 of the Laws of 1989 of the State of New York. This legislation requires participating employers to make payments on a current basis, while amortizing existing unpaid amounts relating to the Systems' fiscal years ending March 3 I, 1988, and 1989, (which otherwise were to have been paid on June 30, 1989, and 1990, respectively) over a 17-year period, with an 8.75% interest factor added. Local governments were given the option to prepay this liability. The Town elected to make the full payment on December 15, 1993, by issuing serial bonds to replace this debt. -6 - DOHERTY, BEALS & BANKS, P.C. - _-n- I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2005 6. POST RETIREMENT BENEFITS In addition to providing pension benefits, the District provides health insurance coverage and survivor benefits for retired employees and their survivors. Substantially, all District employees may become eligible for these benefits if they reach normal retirement age while working for the District. Health care benefits and survivors' benefits are provided through either an insurance company or a self-funded plan whose premiums are based on the benefits paid during the year. The District recognizes the cost of providing benefits by recording its share of insurance premiums or the actual benefits paid from the Special Revenue Fund as expenditures in the year paid. During the year $166,333 was paid on behalf of 8 retirees and 14 active employees and is recorded as expenditures in the Special Revenue Fund. The cost of providing benefits for retirees is not separable from the cost of providing benefits for active employees. 7. SUBSEQUENT EVENTS The operations manager of the Ferry District has been convicted of criminal charges for allowing the dumping of raw sewage from onboard the ferry's owned by the Ferry District into the Thames River and Long Island Sound from 2000 to 2004. Although no additional parties have been named, there is a pending evaluation of possible claims against the Fishers Island Ferry District being conducted by the Office of the Attorney for Connecticut. -7 - DOHERTY, BEALS & BANKS, P.C. FISHERS ISLAND FERRY DISTRICT, A COMPONENT UNIT OF THE TOWN OF SOUTHOLD FINANCIAL REPORTS IN ACCORDANCE WITH THE OMB CIRCULAR A-I33 DECEMBER 31, 2005 :'- ~, - I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT, A COMPONENT UNIT OF THE TOWN OF SOUTHOLD SUPPLEMENTAL FINANCIAL REPORTS IN ACCORDANCE WITH THE OMB CIRCULAR A-133 DECEMBER 31, 2005 CONTENTS Report on Compliance with Requirements Applicable to each Major Program, on Internal Control over Compliance in Accordance with OMB Circular A-133, and on the Schedule of Expenditures of Federal Awards............................................................................................................... ....................................... I Schedule of Expenditures of Federal Awards.................................................................. .............................................. 3 Notes to the Schedule of Expenditures of Federal Awards................. ...................................................... ........................... .................................................... 4 Schedule of Findings and Questioned Costs..................................................................................................................5 Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit Of Financial Statements Performed in Accordance with Government Auditing Standards ....................................................................................................7 DOHERTY, BEALS & BANKS, P.C. - I I I I I I I I I I I I I I I I I I I DOHERTY, BEALS & BANKS, P.C. CARL A. BANKS, CPA STACEY L. GUALTIERI, CPA KATHLEEN A. STEAMER, CPA DAVID J. MICELI, CPA CERTIFIED PUBLIC ACCOUNTANTS 187 WILLIAMS STREET POST OFFICE BOX 59 NEW LONDON, CONNECTICUT 06320 (ll6<l) 443-'.33 FAX (860) 444-7086 WWW.DBBCPA.COM Board of Directors Fishers Island Ferry District A component unit of the Town of South old New London, CT 06320 REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM, ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-I33, AND ON THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Compliance We have audited the compliance ofthe Fishers Island Ferry District, a component unit of the Town of South old, with the types of compliance requirements described in the u.s. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each ofits major federal programs for the year ended December 31,2005. The major federal programs are identified in the summary of auditors' results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements oflaws, regulations, contracts and grants applicable to each of its major federal programs is the responsibility of the Fishers Island Ferry District's management. Our responsibility is to express an opinion on the Fishers Island Ferry District's compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-I33, Audits of States, Local Governments, and Non- profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence aboutthe Fishers Island Ferry District's, compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination ofthe Fishers Island Ferry District's, compliance with those requirements. In our opinion, the Fishers Island Ferry District complied, in all material respects, with the requirements referred to above that are applicable to each of its major federal programs for the year ended December 31, 2005. -1- -. I I Internal Control Over Compliance I The management of the Fishers Island Ferry District is responsible for establishing and maintaining effective internal control over compliance with the requirements oflaws, regulations, contracts and grants applicable to federal programs. In planning and performing our audit, we considered the Fishers Island Ferry District's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on the internal control over compliance in accordance with OMB Circular A-133. I I Our consideration ofthe internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a reportable condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that noncompliance with applicable requirements of laws, regulations, contracts and grants caused by error or fraud that would be material in relation to a major federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. I I Schedule of Expenditures of Federal Awards I We have audited the basic financial statements of the Fishers Island Ferry District as of and for the year ended December 31,2005, and have issued our report thereon dated June 15,2006. Our audit was performed for the purpose offorming an opinion on the basic financial statements taken as a whole. The accompanying schedule of expenditures offederal awards is presented for purposes of additional analysis as required by OMB Circular A-133 and is not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a whole. I I This report is intended solely for the information and use ofthe management, Board of Directors, and cognizant audit agencies, is not intended to be, and should not be used by anyone other than these specified parties. I V 41 ~ If t!....k.J p, c . DOHERTY, BEALS & BANKS, P.C. I I I June 15,2006 I I I -2 - I DOHERTY, BEALS & BANKS, P.c. I ~-. I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT, A COMPONENT UNIT OF THE TOWN OF SOUTHOLD SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED DECEMBER 31, 2005 Federal Grantor Pass-throngh Grantor Prol!ram Title Federal CFDA Number Pass-Through Grantor's Number U.S. Department of Transportation Direct: Airport Improvement Program 20.106 N/A Pass Through Connecticut Department of Transportation Ferry Boat Discretionary Program 20.500 94-212 TOTAL EXPENDITURES OF FEDERAL AWARDS See notes to schedule. -3- DOHERTY, BEALS & BANKS, P.c. Federal Exnenditures $ 412,974 1.570.165 $ 1.983.139 - I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT A COMPONENT UNIT OF THE TOWN OF SOUTHOLD NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED DECEMBER 3t, 2005 BAStS OF PRESENTATION The accompanying schedule of expenditures offederal awards includes the federal grant activity of the Fishers Island Ferry District, a component unit of the Town of Southold, and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements ofOMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. -4- DOHERTY, BEALS & BANKS, p.e. ~- I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT, A COMPONENT UNIT OF THE TOWN OF SOUTHOLD SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED DECEMBER 31, 2005 SECTION I - Summary of Auditor's Results Financial Statements Type of auditor's report issued: unqualified Internal control over financial reporting: Material weakness(es) identified? Reportable condition(s) identified that are not considered to be material weaknesses? Noncompliance material to financial statements noted? Federal A wards Internal control over major programs: Material weakness(es) identified? Reportable condition(s) identified that are not considered to be material weakness(es)? Type of auditor's report issued on compliance for major programs: unqualified Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A-133? Identification of major programs: _ yes X none reported _ yes X none reported _yes Xno _ yes X none reported _ yes X none reported _yes Xno CFDA Number(s) Name of Federal Program or Cluster 20.5 Dollar threshold used to distinguish between type A and type B programs: Auditee qualified as low-risk auditee? - 5 - DOHERTY, BEALS & BANKS, P.e. Ferry Boat Discretionary Program $300.000.00 Xyes _no - I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT, A COMPONENT UNIT OF THE TOWN OF SOUTHOLD SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED DECEMBER 31, 2005 SECTION Il - Financial Statement Findings No findings or questioned costs are reported. SECTION III - Federal Award Findings and Questioned Costs No findings or questioned costs are reported. -6- DOHERTY, BEALS & BANKS, P.C. --. I I I I I I I I I I I I I I I I I I I - DOHERTY, BEALS & BANKS, P.C. CARL A. BANKS, CPA STACEY L. GUALTIERI, CPA KATHLEEN A. STEAMER, CPA DAVID J. MICELI, CPA CERTIFIED PUBLIC ACCOUNTANTS 187 WILLIAMS STREET POST OFFICE BOX 59 NEW LONDON, CONNECTICUT 06310 (860) 443-2033 FAX (860) 444-7086 WWW.DBBCPA.COM REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Board of Directors Fishers Island Ferry District A component unit of the Town of Southold New London, CT 06320 We have audited the financial statements ofthe Fishers Island Ferry District, a component unit of the Town of South old, as of and for the year ended December 31, 2005, and have issued ourreport thereon dated June 15,2006. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Fishers Island Ferry District's financial statements are free of material misstatement, we performed tests ofits compliance with certain provisions oflaws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those 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 under Government Auditing Standards. Internal Control over Financial Reporting In planning and performing our audit, we considered the Fishers Island Ferry District's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide an opinion on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a reportable condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by error or fraud in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. This report is intended for the information of the board of directors, management, and cognizant audit agencies. However, this report is a matter of public record and its distribution is not limited. /J J -r /7 IJ , 6-.h. /', C, ?>"~I /~I .- J DOHERTY, BEALS & BANKS, P.c. June 15,2006 .7.