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HomeMy WebLinkAbout2006 FIFD . I RECEIVED JUL 20 2007 I I I I I I I I I I I I I I I I Soulhold TClwn Clerk FISHERS ISLAND FERRY DISTRICT FINANCIAL STATEMENTS DECEMBER 31,2006 c)H~RTV ~ALS & AN KS7 P.C. C!;:RTII=I!;:D PUBLIC ACCOUNTANTS . I I I I I I I I I I I I I I I I I I I FISHERS ISLAND FERRY DISTRICT }'INANCIAL STATEMENTS DECEMBER 31, 2006 . n__ I I I I I I I I I I I I I I I I I I I Independent Auditor's Report... Statement of Net Assets........ FISHERS ISLAND FERRY DISTRICT FINANCIAL STATEMENTS DECEMBER 31, 2006 CONTENTS ................................................................ I .... ..................................................................................................................2 Statement of Revenues, Expenses, and Changes in Net Assets ............. Notes to Financial Statements ......... ..............................................................................................3 ....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.c. CARL A. BANKS, CPA STACEY L. GUALTIERI, CPA KATHLEEN A. STEAMER, CPA DAVID J. MICELI, CPA CERTIFIED PlJBLlC ACCOl:NTANTS 187 WILLlAJ\.IS STREEt POST OIit'lCE BOX 59 NEW l.ONDON. CONNECTICUT 06320 (860)443-2033 FAX (860) 444.7086 WWW.DBBCPA.COI\I Board of Commissioners Fishers Island Ferry District Fishers Island, NY 06390 INDEPENDENT AUDITOR'S REPORT We have audited the accompanying tinancial statements ofthe Fishers [sland Ferry District, (a component unit of The Town of Southold) as of and for the year ended December 3 I, 2006, which collective[y comprise the District's basic tinancial statements as listed in the table of contents. These tinancia[ 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 tinancial audits contained in Government Auditing Standards, issued by the Comptroller Genera[ 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 31,2006, and the results of its operations for the yearthen 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 May 22, 2007, on our consideration of the District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grants. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. 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. n "t...t . .6~4 t ..:h..)..L/ jJ, G . .L,/., .; i / DOHERTY, BEALS & BANKS, P.c. May 22, 2007 -1- . 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 SOUTH OLD STATEMENT OF NET ASSETS AS OF DECEMBER 31, 2006 ASSETS Cash and investments Other receivables Due from grants Due from other funds Prepaid expenses Land Buildings Machinery and equipment Less accumulated depreciation TOTAL ASSETS LIABILITIES AND NET ASSETS LIABILITIES Accounts payable Other liabilities Due to other funds Judgements and claims payable 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. $ 266,669 76,426 237,056 182,783 68,900 41,7]7 ]8,277,528 2,787,] 14 (5,339,945) $ 16,598,248 $ 109,664 364,384 1]5,994 200,000 250,350 1,625,000 2,700,000 5,365,392 15,766,414 (4,533,558) 1] ,232,856 $ 16,598,248 I 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 31,2006 OPERATING REVENUES Operations $ 1,925,100 Charters 22,948 Mail 18,905 Theater 15,467 Other revenues 60,830 TOTAL OPERATING REVENUES 2,043,250 OPERATING EXPENSES Personnel 1,110,773 Employee benefits 332,474 Equipment maintenance 135,169 Contractual services 489,637 Depreciation 350,587 Airport 27,124 Theater 18,602 Mail 3,300 Insurance 70,952 Property tax 45,706 Repai rs - docks 34,661 Bond payments 154,867 Administration 20,463 Insurance claims 4,667 TOTAL OPERA TlNG EXPENSES 2,798,982 OPERATING INCOME (LOSS) (755,732) NONOPERATING REVENUE (EXPENSES) Interest income 14,332 Capital grants 810,646 Property taxes 400,000 Judgements and claims (200,000) Interest expense (14) TOTAL OPERA TlNG REVENUE (EXPENSE) 1,024,964 CHANGE IN NET ASSETS 269,232 NET ASSETS - BEGINNING 10,963,624 NET ASSETS - ENDING $ 11,232,856 See notes to financial statements. -3- DOHERTY, BEALS & BANKS, r.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 NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2006 I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Purpose The Fishers Island Ferry District operates through the Town of South old as an organization exempt trom income tax. It is a component unit of the Town of South old. The Fishers Island Ferry 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 Ferry 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 financial 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 reveuue 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 ofthe Organization's assets is calculated using the straight-line method over the estimated useful lives of the assets ranging from five to thirty years. 2. 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 31, 2006, the Organization's uninsured cash balances total $135.030. 3. SUBSEQUENT EVENTS During 2007 The Fishers Island Ferry District had been charged with civil violations of the Federal Rivers and Harbors Act, which prohibits discharges of waste from any ship into navigable waters. In March of2006 the District agreed to pay a fine of$186, 417 plus interest to settle the lawsuit filed against the District for dumping raw sewage into Long Island Sound and the Thames River between 2000 and 2004. - 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 I FISHERS ISLAND FERRY DISTRICT NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2006 4. PROPERTY AND EQUIPMENT Property, plant and equipment are recorded at cost and consist of the following classes of assets: Land Buildings Machinery and Equipment $ 47,717 18,277,528 2,787,114 Total Property and Equipment $ 21,112,359 5. 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 $2,700,000. The maturities of the bonds for the next five years is as follows: 2008 2009 2010 2011 2012 $ 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 equivalent to 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 $ 1,625,000 $ 2.75% $ 1,625,000 TOTAL $ 1,625,000 - 5 - 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 31,2006 6. 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 York 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 financial report that includes financial 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. Underthe authority ofthe 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% ofthe contributions required for each year. The districts portion of the contribution was $ 99,882 in 2006. 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 31, 1988, and 1989, (which otherwise were to have been paid on June 30, 1989, and 1990, respectively) over a I 7-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. 7. 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 $150,346 was paid on behalf of 3 retirees and 17 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. - 6- DOHERTY, BEALS & BANKS, P.c. . f~.;'LL:'\/tD JUl 20 2007 S"""I,+J T!,wn Clerk 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 31,2006 OH~RTV ~ALS & AN KSp P.C. C!;:RTII=I!;:D PUBLIC ACCOUNTANTS . 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-I33 DECEMBER 31, 2006 . 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-I33 DECEMBER 31, 2006 CONTENTS Report on Compliance with Requirements Applicable to each Major Program, on Internal Control over Compliance in Accordance with OMB Circular A-l33, and on the Schedule of Expenditures afFederal Awards... . .. ............................. .... ..................................................................... I Schedule of Expenditures of Federal Awards ...3 Notes to the Schedule of Expenditures offederal 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 A IIditing 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. DANKS, CPA STACEY L. GUALTIERI, CPA KATHLEEN A. STEAJ\1ER, CPA DA VID J. MICELI, CPA CERTIFIED PUBLIC ACCOUNTANTS 187 WILLIA\lS STREET POST OFFICE BOX 59 NEW LO:-.rVON, CO~~'ECTICVr 06320 (860) 44]~2033 FAX (860) 444-7086 WWW.DBBCPA.COM Board of Commissioners Fishers Island Ferry District Fishers Island, NY 06390 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 Compliance We have audited the compliance of the Fishers Island Ferry District, a component unit of the Town of South old, with the types of compliance requirements described in the US Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each of its major federal programs for the year ended December 31,2006. The major federal programs arc identified in the summary of auditors' results section ofthe accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, 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-133, 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 about the 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 of the 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, 2006. -I - . I I I I I I I I I I I I I I I I I I I Internal Control Over Compliance The management orthe 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. Our consideration afthe 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. Schedule of Expenditures of Federal Awards We have audited the basic financial statements of the Fishers Island Ferry District as of and for the year ended December 31,2006, and have issued our report thereon dated May 22,2007. Our audit was performed for the purpose offorming an opinion on the basic financial statements taken as a whole. The accompanying schedule of expenditures of federal 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. This report is intended solely for the information and use of the management, Board of Commissioners, and cognizant audit agencies, is not intended to be, and should not be used by anyone other than these specified parties. ,5::-dL~-.. &J~> ~ A'",y~ / /, ( . DOHERTY, BEALS & BANKS, r.c. May 22, 2007 - 2- 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 A COMPONENT UNIT OF THE TOWN OF SOUTH OLD SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED DECEMBER 31, 2006 Federal Grantor Pass-through Grantor Program Title Federal CFDA Number Pass-Through Grantor's Number U.S. Department of Transportation Direct: Airport Improvement Program 20.106 N/A U.S. Department of Homeland Security Pass through New York Department of Transportation Urban Areas Security Initiative Project 504 -New London Project 97.008 N/A TOTAL EXPENDITURES OF FEDERAL A WARDS See notes to schedule. - 3 - DOHERTY, BEALS & BANKS, r.c. Federal Expenditures $555,308 $235.275 $ 790.583 ----.-- 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 31, 2006 BASIS Of PRESENT A nON The accompanying schedule of expenditures offederal awards includes the federal grant activity ofthe 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-I33, 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.c. ----. 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, 2006 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? _ yes X none reported Reportable condition(s) identified that are not considered to be material weaknesses? _ yes X none reported Noncompliance material to financial statements noted? yes X no Federal AH'ards Internal control over major programs: Material weakness(es) identified? __yes Xno Reportable condition(s) identified that arc not considered to be material weakncss(es)? _ yes X none reported 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 51 O(a) of Circular A-133? .__ yes X no Identification of major programs: CFDA Number(s) Name of Federal Program or Cluster 20.106 Airport I mprovernent Program Dollar threshold used to distinguish between type A and type B programs: $300,00000 Auditee qualified as low-risk auditec? Ayes ~no - 5 - 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 A COMPONENT UNIT OF THE TOWN OF SOUTHOLD SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED DECEMBER 31, 2006 SECTION II - Financial Statement Findings No findings or questioned costs are reported. SECTION 111- 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 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 Fishers Island, NY 06390 We have audited the financial statements of the Fishers Island Ferry District, a component unit of the Town of South old, as of and for the year ended December 31,2006, and have issued ourreport thereon dated May 22,2007. 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 of its compliance with certain provisions of laws, 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 ]n 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 commissioners, management, and cognizant audit agencies and is (tU:t,/ldced to be and ShOU,ld no~, he ~S~d by:nyone other than these specified parties. U{tL~t; L~L < /.~j~, oJ < J/ , DOHERTY, BEALS & BANKS, PC May 22. 2007 - 7 - DOHERTY, BEALS & BANKS, P.c.