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Home My WebLink About1993I ~ RECEIVED AU3 ,:~ ,nq~ $outhold Town Cbrk I I I SOUTHOLD FIRE DISTRICT JENERAL PURPOSE FINANCIAL STATEMENTS I AND SUPPLEMENTARY SCHEDULE DECEMBER 31, 1993 I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I SOUTHOLD FIRE DISTRICT TABLE OF CONTENTS DECEMBER 31, 1993 Inder~ndent Auditors' Rer>ort General Purpose Financial Statements Combined Balance Sheet - All Fund Types and Account Groups Combined Statement of Revenues, Expenditures and Changes in Fund Equity - All Fund Types Statement of Revenues and Expenditures - Budget and Actual - General Fund Notes to General Purpose Financial Statements Supplementary_ Schedule Schedule of Fire Protection Expenditures - Budget and Actual - General Fund Page 1 4 5 15 I I I I I I I I ! I I I I I I I I I I Ooughlin, Foundotos, Oullen & Danowski CEErrlFIED PUBLIC AOOOUNTANTS Ten t~k~osevelt Avenue, Port Jefferson Station · New York 'H776-3337 Tel: [5'16] 473-3400 · Fox: [5'16] 473-4863 Gearge T Founaotos, CPA Vincent D Cullen, CPA James E Danowski, CPA Jill $ Fichter. CPA Peter F Podr~guez, ePA Walter C, Schmidt, CPA William M. Coughfin, CPA Independent Auditors' Report To the Board of Fire Commissioners Southold Fire District Southold, New York We have audited the accompanying general purpose financial statements of the Southold Fire District as of December 31, 1993 and for the year then ended. These general purpose financial statements are the responsibility of the District's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and 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. As explained in Note 2, the general fixed assets are reported at essentially appraisal values. In our opinion, except for the effect on the general purpose financial statements of not valuing general fixed assets at historical cost as explained in Note 2, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the Southold Fire District at December 31, 1993, and results of its operations and changes in fund equity for the year then ended, in conformity with generally accepted accounting principles and the requirements mandated by the State of New York in its Uniform System of Accounts for Fire Districts (State System). Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The accompanying supplementary schedule listed in the table of contents is presented for purposes of additional analysis, and is not a required part of the general purpose financial statements. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairy presented in all material respects in relation to the general purpose financial statements taken as a whole. February 3, 1994 Members: American Institute of Certified Public A~ountants, Private Companies Practice Section SOUTHOLD FIRE DISTRICt COMBINED BALANCE SHEET -/~lJ. FUND TYPES AND ACCOUNT GROUPS DECEMBER 31, 1993 ASSETS Unrestricted cash Restricted cash Due from other funds Service Award Program A~set* Property, plant and equipment Amount to be provided for retirement of long term debt Total Assets Fiduciary Totals Governmental Fund Types Fund Type Account Groups (Memorandum Only) Trust And General Long-Term General Capital Agency Fixed Assets Debt 1993 1992 $ 20,512 $ $ $ $ $ 20,512 $ 111,131 400,744 400,744 497,087 17,385 17,385 - 183,347 183,347 - 4,893,070 4,893,070 4,497,214 301,100 301,100 338,000 $ 37,897 $ 400,744 $ 183,347 $ 4,893,070 $ 301,100 $ 5,816,158 $ 5,443,432 LIABILITIES Accounts payable Accrued liabilities Due to other funds Service Award Bonds payable Compensated absences Total Liabilities FUND EQUITY Investment in general filed asset* Fund Balances: Reserved for encumbrances Reserved for capital Unreserved - undesignated Total Fund Equity Total Liabilitics and Fund Equity $ 2,004 $ $ $ $ $ 2,004 S 39,941 8,520 8,520 136 17,385 17,385 - 183,347 183,347 - 299,000 299,000 338,000 2,100 2,100 - 10,524 17,385 183,347 - 301,100 512,356 378,077 4,893,070 4,893,070 4,497,214 22,266 22,266 346,439 383,359 383,359 221,702 5,107 5,107 - 27,373 383,359 - 4,893,070 - 5,303,802 5,065,355 $ 37,897 $ 400,744 $ 183,347 $ 4,893,070 $ 301,100 $ 5,816,158 $ 5,443,432 - See Notes to General Purpose Financial Statements -- SOUTHOLD FIRE DISTRICT COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES l~ FUND EQUITY - ALL FUND TYPES FOR THE YEAR ENDED DECEMBER 31, 1993 Real property taxes Use of money and property Insurance recoveries Refund of prior year's expenditures Miscellaneous Total Revenues Governmental Fund Types Totals (Memorandum Only) General Capital 1993 $ 816,004 $ $ 816,004 4,851 10,508 15,359 9,163 9,163 2,395 2,395 145 145 832,558 10,508 843,066 EXPENDITURES Personal services Equipment and capital outlay Fire protection Service award program Social security Worker's eompansation Medical and accident insurance Principal retirement Interest Total Expenditures Excess (Deficiency) of Revenues Over Expenditures OTHER SOURCES AND USES Operating transfers in Operating transfers (out) Proceeds of obligations Total Other Sources (Uses) 1992 $ 589,374 32,041 572 621,987 626,390 374,085 1,000,475 747,524 206,168 (363,577) (157,409) (125,537) 150,000 150,000 277,295 (150,000) (150,000) (277,295) - 190,000 (150,000) 150,000 - 190,000 56,168 (213,577) (157,409) 64,463 71,054 497,087 568,141 503,678 (99,849) 99,849 - - $ 27,373 $ 383,359 $ 410,732 $ 568,141 Excess (Deficiency) of Revenues and Other Sources Over Expenditures and Other Uses Fund Equity -- Beginning of Year Prior Period Adjustment Fund Equity - End of Year - See Notes to General Purpose Financial Statements -- 59,081 59,081 54,119 21,770 374,085 395,855 477,043 219,405 219,405 173,766 249,409 249,409 -- 4,460 4,460 4,140 12,072 12,072 4,981 1,133 1,133 -- 39,000 39,000 22,000 20,060 20,060 11,475 SOUTHOLD FIRE DISTRICT STATEMENT OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL - GENERAL FUND FOR THE YEAR ENDED DECEMBER 31, 1993 REVENUES Real property taxes Use of money and property Insurance recoveries Refund of prior year's expenditures Miscellaneous Total Revenues EXPENDITURES Equipment and capital outlay Fire protection Service award program Social security Worker's compensation Medical and accident insurance Principal retirement Interest Total Expenditures Excess (Deficiency) of Revenues Over Expenditures OTHER USES Operating transfers (out) - Capital fund Excess (Deficiency) of Revenues Over Expenditures and Other Uses Variance Original 1993 Favorable Budget Actual (Unfavorable) $ 815,985 $ 816,004 $ 19 4,851 4,851 9,163 9,163 2,395 2,395 145 145 815,985 832,558 16,573 64,500 59,081 5319 45,000 21,770 23,230 230,963 219,405 11,558 247,825 249,409 (1,584) 4,934 4,460 474 19,000 12,072 6,928 3,703 1,133 2,570 39,000 39,000 - 11,060 20,060 (9,000) 665,985 626,390 39,595 150,000 206,168 56,168 (150,000) (150,000) - $ - $ 56,168 $ 56,168 (Memorandum Only) Variance Original 1992 Favorable Budget Actual (Unfavorable) 588,975 $ 589,374 $ 399 12,868 12,868 572 572 588,975 602,814 13,839 61,000 54,119 6,881 36,500 170,062 (133,562) 209,923 173,766 36,157 4,667 4,140 527 19,360 4,981 14,379 5,050 5,050 47,000 22,000 25,000 16,475 11,475 5,000 399,975 440,543 (40,568) 189,000 162,271 (26,729) (189,000) ~ (88,295) - $ (115,o ) $ (115,o24) -- See Notes to General Purpose Financial Statements -- I I I I I I I I I I I I I I I I I I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 1 ~ SUIVIMARY OF SIGNIFICANT ACCOUNTING POLICIES The general puq~ose financial statements of the Southold Fire District have been prepared in conformity with the accounting practices required by the New York State Uniform System of Accounts for Fire Districts (State System) which is in substantial agreement with generally accepted accounting principles (GAAP) as applied to government units which is promulgated by the Governmental Accounting Standards Board (GASB). The more significant of the District's accounting policies are described below. A. Financial Reportine Entity The Fire District is governed by the Municipal Law and other laws of the State of New York. The governing body is the Board of Fire Commissioners. The scope of activities included within the accompanying financial statements are those transactions which comprise Fire District operations, and are governed by, or significantiy influenced by, the Board of Fire Commissioners. Essentially, the primary function of the Fire District is to provide service to the community. Services such as fire fighting and fire prevention support the primary function. The financial reporting entity includes all funds, account groups, functions and organizations over which the Fire District officials exercise oversight responsibility. Oversight responsibility is determined on the basis of financial interdependency, selection of governing authority, designation of management, ability to significantly influence operations and accountability for fiscal matters. B. Basis of Presentation The accounts of the Fire District are organized on the basis of funds and account groups, each of which is considered to be a separate accounting entity. These funds and account groups are based upon the requirements of Generally Accepted Accounting Principles (GAAP) for local governmental units as prescribed by the Governmental Accounting Standards Board as well as the Uniform System of Accounts for Fire Districts (State System). The operations of each fund are accounted for within a separate set of self- balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses. Governmental resources are allocated to and accounted for in individual funds segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions or limitations. The various funds are grouped in the general purpose financial statements in the following fund types and account groups: -5- I I I I I I I I I i I I I I I i I i I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 1. Governmental Funds Governmental funds are those through which most govemmental functions are financed. The acquisition, use and balances of expendable financial resources and the related liabilities are accounted for through governmental funds. The measurement focus of the governmental funds is based upon determination of financial position and changes in financial position. The following are the Fire District's governmental fund types: a. General Fund The general fund is the principal operating fund of the Fire District and is used to account for all financial resources except those required to be accounted for in another fund. b. Capital Projects Fund The capital projects fund is used to account for the accumulation of financial resources and the disbursement for the acquisition, construction or renovation of major capital facilities, or equipment. 2. Fiduciary_ Fund Types Fiduciary funds are used to account for assets held by the Fire District in a trustee or custodial capacity: a. Trust and Aeency Fund The trust and agency fund is used by the Fire District to account for and report assets held by the District in a trustee capacity or as an agent for subsequent distribution or transmittal to individuals, private organizations, other governments, and or funds. These include expendable trusts, non-expendable trusts and agency funds. Agency funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. 3. Account Groups The account groups are used to establish accounting control and accountability for the Fire District's general fixed assets and general long-term obligations. The two account groups are not "funds". They are concerned only with the measurement of financial position, and not with the results of operations. -6- I I I I I I I I I I I I I I I I I I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued] a. General Fixed Assets Account Grouo The general fixed assets account group is used to account for land, buildings, improvements and equipment used by the Fire District. b. General Long-Term Debt Account Grouv The general long-term debt account group is used to account for all long-term debt and other obligations of the Fire District. Long-term indebtedness includes obligations such as bonds and capital notes. Other obligations include any vested or accumulated vacation and/or sick leave, etc. to be provided for in future budgets. C. Basis of Accountim,/Measurement Focus The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included in the fund types on the balance sheet. Operating statements of these fund types present increases (i.e. revenues and other soumes) and decreases (i.e. expenditures and other uses) in fund equity. The State System offers the option for a Fire District to use the modified accrual basis of accounting for recording transactions in its governmental and expendable trust and agency fund types as applicable. Under this basis of accounting, revenues are recorded when they become both measurable and available. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. A one- year availability period is used for recognition of governmental and expendable trust fund revenues. If "expenditure" is the primary factor for determining reimbursement under the terms of a grant, revenue is recognized when the expenditure is incurred. Expenditures are recorded when incurred except for: Expenditures for prepaid expenses and inventory type items which are recognized at the time of the disbursements when the Fire District is liable for payments. Expenditures for principal and interest on long-term debt which are recognized when due. Expenditures for pension costs for which funding has not yet been provided are recognized in the year that they are billed by the State. -7- I I I I I I I I I I I I I I I I I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Expenditures for compensated absences, such as vacation or sick leave which is either vested or expected to be vested for which funding has not yet been provided, are charged as an expenditure when paid. Unfunded liabilities which are to be provided for in future years' budgets are recognized in the Fire District's general long-term debt account group. D. Prooerty Taxes Property taxes, unless partially deferred as a planned balance, are recognized as revenue in the year for which taxes have been levied. Uncollected real property taxes are subsequently collected from the County. E. Budgetary_ Data 1. Budget Policies The Fire District administration prepares a proposed budget for approval by the Board of Fire Commissioners for the general fund. 2. Encumbrances Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded for budgetary control purposes to reserve that portion of the applicable appropriations, is employed as a control in preventing overexpenditure of established appropriations. Open encumbrances are reported as reservations of fund balance since they do not constitute expenditures or liabilities and will be honored through budget appropriations in the subsequent year. 3. Budget Basis of Accountine The general fund's budget is adopted annually on a basis consistent with generally accepted accounting principles. Appropriations authorized for the current year are increased by the amount of encumbrances carried forward from the prior year. F. Cash and Cash Equivalents For financial statement purposes, the Fire District considers ail highly liquid investments of three months or less as cash equivalents. -8- I I I I I I I I I I I I I I I I I I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) General fixed assets purchased are recorded at cost as expenditures in the respective funds at time of purchase. Such assets are accounted for in the general fixed asset group of accounts. Fixed asset values as shown on the combined balance sheet for the fiscal year ended December 31, 1993 are reported at essentially appraisal value. Donated amounts are valued at estimated fair market value when given (Note 2). H. General Long-Term Debt 1. General Obligation Debt Long-term debt used to finance various capital projects is accounted for in the General Long-Term Debt Account Group. 2. Compensated Absences Unfunded accumulated vacation and sick leave is recorded in the General Long- Term Debt Account Group as a non-current liability inasmuch as it will be funded from future resources or budgets. Payment of vacation and compensated absences recorded in the General Long-Term Debt Account Group is dependent upon many factors, therefore, timing of future payments is not readily determinable. I. Interfund Transfers The operations of the Fire District gives rise to certain transactions between funds, including transfers of expenditures and transfers of revenues to provide services and construct assets. J. Fund Eo~uity Reserves and designations of fund balance are portions of fund equity that segregated for future use and are, therefore, not available for appropriation or expenditure. Designation of unreserved fund balances in govemmental funds indicates the use of these resources in the ensuing year's budget or tentative plans for future use. K. Total Columns on Combined Statements Total columns on the combined statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position or results of operations in conformity with generally accepted accounting principles. Certain account balances from the prior year have been restated. -9- I I I I I I I I I ! I I I I I I I I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 2 - DEPARTURES FROM GENERALLY ACCEPTED ACCOUNTING PRINCIPLES Generally accepted accounting principles require that long lived assets be capitalized in a general fixed assets group of accounts and be recorded at historical cost. Since historical costs are not fully available, assets have been recorded at replacement value from an independent insurance appraisal report. The effect on the general purpose financial statements has not been determined as of December 31, 1993. NOTE 3 - DETAIL NOTES ON ALL FUNDS AND ACCOUNT GROUPS A. Assets 1. Cash and Investments The Fire District's investment policies are governed by State statutes. The Fire District's monies must be deposited in FDIC-insured commercial banks or trust companies located within the State. The treasurer is authorized to use demand accounts and certificates of deposit. Permissible investments include obligations of the U.S. Treasury and U.S. Agencies, repurchase agreements, and obligations of New York State or its localities. Collateral is required for demand and time deposits as well as certificates of deposit not covered by Federal Deposit Insurance. Obligations that may be pledged as collateral include obligations of the United States and its agencies and obligations of the State and its municipalities. Deposits are valued at cost or cost plus interest and are categorized as either (1) insured, or for which the securities are held by the District's agent in the District's name, (2) uninsured, and for which the securities are held by the financial institutions trust department in the District's name, (3) uninsured, and for which the securities are held by the financial institution or its trust department but not in the District's name, or (4) uninsured and uncollateralized. The District's bank balances as of December 31, 1993 were fully collateralized under category (1). No balances fall under categories (2) through (4). -10- I I I I I I I I I I I I I I I I I I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 3 - DETAIL NOTES ON ALL FUNDS AND ACCOUNT GROUPS 2. Changes in Fixed Assets A summary of changes in general fixed assets per an independent insurance appraisal report dated January 17, 1992; together with additions and disposals through December 31, 1993 is as follows: January 1, Net December 3 i, 1993 Additions 1993 Land $ 206,892 $ $ 206,892 Buildings 1,555,389 10,261 1,565,650 Equipment 2.734.933 385,595 3.120.528 $4,497,214 ~ $4.893.070 The land purchased in previous years, is recorded at original cost. B. Long Term Debt 1. Changes in Long-Term Debt The changes in the District's long term debt during the year ended December 31, 1993 are summarized as follows: Serial Bonds Compensated Absences Balance January 1, Additions December 31, 1993 (Reduction) 1993 $ 338,000 $( 39,000) $ 299,000 2.100 2,100 $ 338.000 $(36,900) $ 301,100 -11- I I I I I I I I I ! I I I I I I I ,I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 3 - DETAIL NOTES ON ALL FUNDS AND ACCOUNT GROUPS (continued) 2. $~rial Bonds Details pertaining to long-term serial bonds outstanding at December 31, 1993 which were issued for capital improvement are summarized as follows: Date of Date of Original Original Outstanding Issue Maturity Rate Issue Amount 09/15/88 09/15/98 6.75% $ 225,000 $ 124,000 07/15/92 07/15/02 5.30% 190,000 175.000 $ 299,000 General fund payments relating to the above bonds are as follows: (Memorandum) Fisgal Year Principal Interest 1994 $ 39,000 $ 17,645 1995 45,000 15,230 1996 45,000 12,483 1997 45,000 9,735 1998 45,000 6,988 1999-02 80~000 10.600 $ 299,000 $ 72 681 Compensated Absences Payment of compensated absences is dependent upon many factors, therefore, timing of future payments is not readily determinable. -12- I I I I I I I I ! I I I I I I I I I I SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER 31, 1993 NOTE 4 - SERVICE AWARD PROGRAM The District voters approved a Service Award Program effective January 1, 1993. Under the State enabling legislation, the Service Award Program was specifically excluded from the State's retirement systems. This program is a Qualified Funded Deferred Compensation Arrangement. It does not fall under the requirements of ERISA nor the reporting requirements of Form 5500 of the Internal Revenue Service and the Pension Benefit Guarantee Corporation. In the Service Award Program there is a minimum of twelve months of service required to be a participant in the plan. The minimum age of a participant is 18, completion of one year of participation in the plan is required to collect benefits. Participants are fully vested in the fifth year of the plan. Benefits begin in the first month coincident with or following attainment of age 65. The maximum number of past service years credit is five. The maximum benefit per month is $400 and the minimum benefit per month is $50. The following table sets forth the financial status of the plan at December 31, 1993 as determined by actuarial consultants per their report dated June 8, 1994. Actuarial present value of benefit obligations Accumulated benefit obligation Projected benefit obligation Plan assets at fair value Unfunded projected benefit obligation 12/31/93 $1,645,321 $ 800,749 183,347 $ 617,402 Assumption used in the accounting for the plan Pre-retirement interest assumed for deposit Post-retirement annuity interest 7.0% 7.0% -13- SOUTHOLD FIRE DISTRICT NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS DECEMBER Bl, 1993 NOTE ~ - PRIOR PERIOD ADJUSTMENT The prior period adjustment of $99,849 represents excess 1992 funds transferred from the general fund to the capital fund during 1993. NOTE 6 - SPENDING LIMITATION The District did not exceed the statutory spending limitation imposed by state law. NOTE 7 - SUBSEOUENT EVENTS Serial Bonds During 1994, the Board of Fire Commissioners passed a resolution for the issuance of $400,000 in serial bonds for the construction of a new sub-station. ~14- I I I I I I I I I I I I I I I I I I I SOUTHOLD FIRE DISTRICT SUPPLEMENTARY SCHEDULE SCHEDULE OF FIRE PROTECTION EXPE~qDITURES - BUDGET AND ACTUAL -- GENERAJ~ FUND FOR THE YEAR ENDED DECEMBER 31, 1993 Repairs to apparatus and equipment Repairs and maintenance to building Medical examinations Insurance Hydrant rental Wells Utilities Annual inspection dinner Conventions, meetings and travel Fire training Professional fees Miseellaneous Total Fire Protection Expenditures Original 1993 Budget Actual $ 37,000 $ 40,767 40,000 26,995 5,000 2,798 70,000 51,471 16,000 15,350 10,000 28,100 30,029 8,820 12,527 2,000 1,668 12,500 13,380 10,363 15,600 230,963 $ 219,405 $ Favorable (Unfavorable) $ (3,767) $ 13,005 2,202 18,529 650 10,000 (1,929) (8,820) (12,527) 332 (SSO) (5,z37) 11,558 $ (Memorandum) 1992 Actual 33,028 20,869 47,601 14,516 24,446 33,306 173,766 -- See Notes to General Purpose Financial Statements - - 15 -