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FISHERS ISLAND WASTE MANAGEMENT DISTRICT
A COMPONENT UNIT OF
THE TOWN OF SOUTHOLD
FINANCIAL STATEMENTS
DECEMBER 31,2013
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
A COMPONENT UNIT OF THE
TOWN OF SOUTHOLD
BASIC FINANCIAL STATEMENTS
AS OF DECEMBER 31,2013
TOGETHER WITH
INDEPENDENT AUDITORS'REPORT
AND
REQUIRED SUPPLEMENTARY INFORMATION
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FISHERS ISLAND WASTE MANAGEMENT
A COMPONENT UNIT OF
THE TOWN OF0KDUTHKDLD
FINANCIAL STATEMENTS
DECEMBER 31, 2013
'
Independent Auditor's Depmrt-.---...'.-.......'-...-.--..-..-...---....-_......-...---.----1
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Management's Discussion and Aouh/ is--_------.-.--........ -. ......... ....... ...--............3-7
Statement of Net Aometm__--_-__----_--......... .-__- ...... ............. ......... ...... 8
Statement of Activities.......-......................-. .............. . .............. .................... . ......... y
Statement ofActivities-Governmental Activities- ........... -- ............... - .......... ...... ......... ........1,0
Reconciliation o[the Govermoent Funds
Balance Sheet tothe Statement o[Net Assets...... ....... ............ ....... ll
Statement o[Revenues,Expenditures, and Changes
luFund Balances-Governmental Funds......_-.--__..-........ ....... ......... _-----...-i2
Balance Foudm ... ...-- ....-.....-_-._..-... ...-.....-.__..--.--...----B
Reconciliation o[the Government Funds
Statement o[Revenues,Expenditures and Changes 6zFund Balances
Tothe Statement ofActivities..........................................................................................-.i4
Notes to the Financial Statements......_._....-......... ........ ..................~_...... ..............................U5
DOHERTY,DQAL8&BANKS,P.C.
P
Board of Commissioners 7a
Fishers Island Waste Management District
PO Box 22
Fishers Island,NY 06390
INDEPENDENT AUDITOR'S REPORT
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities of the Fishers Island Waste
Management District, A Component Unit of the Town of Southold as of and for the year ended December 31, 2013,
and the related notes to the financial statements, which collectively comprise the District's basic financial statements
as listed in the table of contents. The prior year summarized comparative information has been derived from the
District's 2012 financial statements and, in our report dated July 29, 2013, we expressed an unmodified opinion on
those financial statements.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
accounting principles generally accepted in the United States of America; this includes the design, implementation,
and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are
free from material misstatement,whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions 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. 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 involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the circumstances,but not for the
purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly,we express no such
opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
significant accounting estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinions.
Stacey L. Gualtieri, CPA
Kathleen A. Steamer, CPA
David 1. Miceli, CPA
1Audrey A. Leone, CPA
- -
187 Williams St. I New London, CT 06320 1 (v) 860.443.2033 1 (f) 860.444.7086 1 dbbcpa.com
38 East Main St. Suite 6 1 Mystic, CT 06355 1 (v) 860.572.7373 1 (f) 860.572.0107
Opinions
In our opinion,the financial statements referred to above present fairly, in all material respects,the respective financial
position of the governmental activities of the Fishers Island Waste Management District, A Component Unit of the
Town of Southold, as of December 31,2013, and the respective changes in financial position thereof for the year then
ended in conformity with accounting principles generally accepted in the United States of America.
Other Matters
Accounting principles generally accepted in the United States of America require that the management's discussion
and analysis and budgetary comparison information on pages 3 through 6 be presented to supplement the basic
financial statements. Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing
the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain
limited procedures to the required supplementary information in accordance with auditing standards generally
accepted in the United States of America,which consisted of inquiries of management about the methods of preparing
the information and comparing the information for consistency with management's responses to our inquiries, the
basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do
not express an opinion or provide any assurance on the information because the limited procedures do not provide us
with sufficient evidence to express an opinion or provide any assurance.
C)N 11�;1�TYb�� S&BANKS,P.C,.
June 30,2014
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31,2013
The following is a discussion and analysis of the Fishers Island Waste Management's financial performance,
providing an overview of the Fishers Island Waste Management's financial activities for the year ended December 31,
2013. Use this section in conjunction with the Fishers Island Waste'Management's basic financial statements.
FINANCIAL HIGHLIGHTS
• Net assets for 2013 increased by$38,181,due to total revenue exceeding expenses for the year.
• The General Fund's fund balance increased by$99,172 to$1,009,056.
• Revenues were slightly lower than anticipated and operating expenses were also lower than expected for the
2013 fiscal year.
USING THIS ANNUAL REPORT
This annual report consists of a series of financial statements. The Statement of Net Assets and the Statement of
Activities provide information about the activities of the District as a whole and present a longer-term view of the
District's finances. Fund financial statements start with page eight(8). For governmental activities, these statements
tell how these services were financed in the short term as well as what remains for future spending. Fund financial
statements also report the District's operations in more detail than the government-wide statements by providing
information about the District's most significant funds.
Reporting the Fishers Island Waste Management District as a Whole
Our analysis of the District as a whole begins with page eight(8). One of the most important questions asked about
the District finances is, "Is the District as a whole better or worse off as a result of the year's activities?" The
Statement of Net Assets and the Statement of Activities report information about the District as a whole and about its'
activities in a way that helps answer this question. These statements include all assets and liabilities using the accrual
basis of.accounting, which. is similar to the accounting used by most private-sector companies. All of the current
year's revenues and expenses are taken into account regardless of when cash is received or disbursed.
These two statements report the District's net assets and changes in them. Think of the District's net assets—the
difference between assets and liabilities—as .one way to measure the District's financial health, or financial position.
Over time, increases or decreases in the District's net assets. are one indicator of whether its'financial health is
improving or deteriorating. However, you will need to consider other non-financial factors such as changes in the
population levels of the District's member towns,to assess the overall health of the District.
In the Statement of Net Assets and the Statement of Activities,the District shows the following activity:
• Governmental activities—The District's governmental services are reported here. Most of these activities are a
result of taxes levied on the residents of Southold.
Reporting the Fishers Island Waste Management District's Most Significant Funds
• Our analysis of the District's major funds begins in the section titled "Fishers Island Waste Management
District's". The fund financial statements begin on page eight(8)and provide detailed information about the most
significant funds—not the District as a whole. Some funds are required to be established by State law and by
bond covenants,if any.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31,2013
USING THIS ANNUAL REPORT(Continued)
• Governmental funds—The District's basic services are reported in governmental funds, which focus on how
money flows into and out of those funds and the balances left at year-end that are available for spending. These
funds are reported using an accounting method called modified accrual accounting, which measures cash and all
other financial assets that can be readily converted to cash. The governmental fund statements provide a detailed
short-term view of the District's general government operations and the basic services it provides. Governmental
fund information helps determine whether there is an excess or deficiency of financial resources that can be spent
in the near future to. finance the District's programs. We describe the relationship (or differences) between
governmental activities (reported in the Statement of Net Assets and the Statement of Activities) and
governmental funds in a reconciliation provided on page thirteen(13)of the fund financial statements.
FINANCIAL ANALYSIS OF THE FISHERS ISLAND WASTE MANAGEMENT
Our analysis below focuses on the net assets and changes in net assets of the Fishers Island Waste Management's
activities.
Condensed Statement of Net Assets
Primary Activities
December 31,2013 and 2012
Assets _ 2013 2012
Current and other assets $ 1,160,458 $ 946,329
Capital assets 2,660,8092,721,800
Total assets ........3_.g2.�.��............� _..........�.....�....�_�,_.�
3267 3,668,129
Liabilities
Current and other liabilities 151,401 36,444
Total liabilities
.._.....1.5140 ..... 36,444
Net Assets
Unrestricted(deficit) 3,669,866 3,631,685
Total net assets m$mmm 3,821,267µµµW µ$µµµµW3,668,129
Changes in Net Assets
Fishers Island Waste Management
For the years ended December 31,2013 and 2012
Program Revenues 2013 2012
Charges for services $.............. .W___..........
42,997 $ 48,969
42,997 48,969
General Revenues
Property taxes 536,950 526,900
Interest earnings 3,872 2,333
Grant revenue 11,517
552,339 529,233
Total Revenues 595,336 578,202
Program Expenses
Operating expenses 557,155 618,554
Total Expenses 557,155 618,554
Increase(decrease)in Net Assets $ 38,181 $ (40,352)
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31,2013
FINANCIAL ANALYSIS OF THE FISHERS ISLAND WASTE MANAGEMENT(continued)
The following schedule presents a summary of Fishers Island Waste Management revenues and expenses for the year
ended December 31,2013 and the amount of change and percentage of total in relation to the prior year.
Increase %
2013 2012 (Decrease) Change
.... .....__...._ . ...m ..._._�_ _
Revenues
Charges for services $ 42,997 $ 48,969 (5,972) (12.20%)
Property taxes 536,950 526,900 10,050 1.91%
Interest earnings 3,872 2,333 1,539 65.97%
Grant revenue 11,517 - 11,517 100.00%
Total Revenues $ 595,336 $..... 578 202 IT $ ....w_
17,.134 2.96%
Program Expenses
, 618,554 $ (61,399 ° )
Operating expenses $ 557 155 $ ..............�a._ ) (�7.9'r1'�w
Total Expenses $ 557,155 $ 618,554 $ (61,399)
GOVERNMENTAL ACTIVITIES
The table below presents the cost of each of the District's governmental programs as well as each governmental
program's net cost(total cost less revenues generated by the activities).
Governmental Type Activities
Total Cost Net Cost
oeCV1CeSIncr.) of Se
f S of..Services (Incr.)
...................................... .. . ...._ ( _ ..�.�_
2013 2012 Deer. 2013 2012 Deer.
_._ _ �,,,-----.,-- ...._......e�...
Governmental
Activities
Waste services $ 557,155 $ 618,554 -9.9% $ 34,369 $ (42,685) 180.37%
Totals $ 557,155 $ 618,554 ° -9.9% $ 34,309 $ (42,685) 180.37%
BUDGETARY HIGHLIGHTS
Over the course of the year,the Fishers Island Waste Management revises the budget as needed so that expenditures
do not exceed appropriations. Various transfers between appropriations were approved for this purpose. Transfers do
not increase the total budget,but instead pull appropriations from one expense line to another.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31,2013
BUDGETARY HIGHLIGHTS(continued)
Below is a summarized view of the final budget and actual results for the General Fund:
General Fund—Budget Summary
Final
Revenues Budget _ Actual Variance
Property Taxes $ 536,950 $ 536,950 $
Charges for Services 66,000 42,997 (23,003)
Grants - 11,517 11,517
Interest 4,000 3,872 (128)
Total Revenues $ 606,950 $ 595;336 $ (11,614)
Expenditures
Current—waste services 629,450 496,t64 (133 286)
Total ex enditures 629,450 ,
496164_ (13
p 3,286)
Excess(deficiency)of
Revenues over expenditures (22,500) 99,172 (144,900)
Increase(decrease)
in fund balance $ (22,500) $ 99,172 $ (144,900)
• Charges for services were$23,003 less than anticipated,interest income was$128 lower than anticipated and
other income was$11,571 higher than anticipated.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets - At the end of fiscal year 2013, the Fishers Island Waste Management District had $3,658,786
invested in capital assets. Capital assets purchased during fiscal year 2013 totaled$44,812. More detailed information
about the Fishers Island Waste Management District's capital assets is presented in Note One to the financial
statements.
Debt — At the end of fiscal year 2013, the Fishers Island Waste Management District had no bonds or notes
outstanding.
ECONOMIC FACTORS AND NEXT YEAR'S BUDGET
The Fishers Island Waste Management District considers many factors when setting the annual budget including tax
levies imposed by the Town of Southold and fees that will be charged for the governmental activities. These factors
include budget projections, economic and housing trends, emerging waste service needs, state matching funds and
available fund balance.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31,2013
CONTACTING THE DISTRICT
This financial report is designed to provide the reader with a general overview of Fishers Island Waste Management's
finances and to demonstrate Fishers Island Waste Management's accountability for the funds it receives. Requests for
additional information can be directed to:
Sara Rafferty,Chairperson,Fishers Island Waste Management District,Fishers Island,NY 06390.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT
COMPONENT UNIT OF THE TOWN OF SOUTHOLD
STATEMENT OF NET ASSETS
AS OF DECEMBER 31,2013
WITH COMPARATIVE TOTAL'S FOR 2012
ASSETS
Governmental Activities
2013 2012
CURRENT ASSETS
Cash and cash equivalents $ 21,763 $ 30,371
Accounts receivable 800 206
Due from primary government 139,854 -
Prepaid expenses 28,774 24,555
TOTAL CURRENT ASSETS 191,191 55,132
NONCURRENT ASSETS
Garbage facilities and improvements 3,294,475 3,294,475
Equipment 364,311 319,499
3,658,786 3,613,974
Less:accumulated depreciation (997,977) (892,173)
TOTAL NONCURRENT ASSETS 2,660,809 2,721,801
OTHER ASSETS
Investments-Fixed Income 969,267 891,197
TOTAL ASSETS $ 3,821,267 $ 3,668,129
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES
Accounts payable $ 9,978 $ 34,926
Payroll taxes payable 1,569 1,518
Deferred revenue 139,854 -
TOTAL CURRENT LIABILITIES 151,401 36,444
NET ASSETS
Investments in fixed assets 2,660,809 2,721,800
Unrestricted 1,009,057 909„885
TOTAL NET ASSETS 3,669,866 3,631,685
TOTAL LIABILITIES AND NET ASSETS $ 3,821,267 $ 3,668,129
The accompanying notes are an integral part of these Financial Statements.
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,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
COMPONENT UNIT OF THE TOWN OF SOUTHOLD
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31,2013
WITH COMPARATIVE TOTALS FOR 2012
2013 2012
REVENUE
Town of Southold $ 536,950 $ 526,900
Interest 3,872 2,333
Grant revenue 11,517 -
Landfill revenue 42,997 48,969
TOTAL REVENUE 595,336 578,202
EXPENSES
Accounting 8,425 7,385
Bank charges 5,595 2,346
Building maintenance 499 1,126
Building utilities 8,163 9,228
Casual labor 8,101 1,675
Commissioners'fees 14,130 11,940
Compost equipment maintenance 30,751 18,346
Compost station utilities 3,316 2,037
Consultants 3,700 1,600
Depreciation 105,804 103,020
Employee benefits 56,030 66,532
Employee training _ 432
Equipment maintenance 4,611 16,207
Ferry transportation 47,063 53,752
Garbage tipping fees and hauling 74,262 77,615
Hazardous waste removal - 16,525
Insurance 19,896 21,704
Landfill maintenance 8,790 9,162
Legal fees 6,469 13,210
Office expense 3,137 3,166
Payroll expenses 12,362 13,894
Transfer station utilities 2,999 3,914
Transfer station improvements 10,441
Wages 114,996 154,067
Workmens compensation insurance 7,615 9,671
TOTAL EXPENSES 557,155 618,554
CHANGE IN NET ASSETS 38,181 (40,352)
NET ASSETS-BEGINNING 3,631,685 3,672,037
NET ASSETS-ENDING $3;669,866 $3,631,685
The accompanying notes are an integral part of the Financial Statements
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
COMPONENT UNIT OF THE TOWN OF SOUTHOLD
STATEMENT OF ACTIVITIES - GOVERNMENTAL ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31,2013
Net
Program Revenues (Expense)
Operating
Grants
Charges and Govern-
for Contribu- mental
Functions/Programs Expenses Services tions Activities
GOVERNMENTAL ACTIVITIES
Waste Services $ (496,164) $ 42,997 $548,467 $ 95,300
GENERAL REVENUES
Interest income 3,872
Total general revenues 3,872
Change in net assets 99,172
NET ASSETS,beginning of year 909,885
NET ASSETS,end of year $1,009,057
The accompanying notes are an integral part of these Financial Statements,.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT
COMPONENT UNIT OF TOWN OF SOUTHOLD
RECONCILIATION OF THE GOVERNMENT FUNDS BALANCE SHEET
TO.THE STATEMENT OF NET ASSETS
AS OF DECEMBER 31,2013
Total Governmental Fund Balances $ 1,009,057
Amounts reported for governmental activities in the
Statement of Net Assets are different because:
The cost of building and acquiring capital assets(land,buildings,equipment)
financed from the governmental funds are reported as expenditures in the year
they are incurred,and the assets do not appear on the balance sheet. However,
the Statement of Net Assets includes those capital assets among the assets of Fishers Island
Waste Management as a whole,and their original costs are expensed over their useful lives.
Original cost of capital assets 3,658,786
Accumulated depreciation (997,977)
2,660,809
Total net assets $ 3,669,866
See notes to f nancial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT
COMPONENT UNIT OF TOWN OF SOUTHOLD
STATEMENT OF REVENUES,EXPENDITURES
AND CHANGES IN FUND BALANCES- GOVERNMENTAL FUNDS
FOR THE YEAR ENDED DECEMBER 31,2013
Total
Governmental
REVENUES General Fund
Real property taxes $ 536,950 $ 536,950
Landfill revenue 42,997 42,997
Grants 11,51.7 11,517
Use of money and property 3,872 3,872
Total revenues 595,336 595,336
EXPENDITURES
General government support 58,215 58,215
Landfill operation 270,067 270,067
Transportation 47,063 47,063
Employee benefits 76,007 76,007
Capital outlay 44,812 44,812
Total expenditures 496,164 496,164
Excess(Deficiency)of Revenues over Expenditures 99,172 99,172
Fund balances-beginning of the year 909,885 909,885
Fund balances-end of the year $ 1,009,057 $ 1,009,057
See notes to finandal statements.
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ERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT
COMPONENT UNIT OF THE TOWN OF SOUTHOLD
BALANCE SHEET- GOVERNMENTAL FUNDS
AS OF DECEMBER 31,2013
Total
Governmental
ASSETS General Fund
Cash and investments $ 991,030 $ 991,030
Accounts receivables 800 800
Due from primary government 139,854 139,854
Prepaid expenses 28,774 28,774
Total assets $ 1,160,458 $ 1,160,458
LIABILITIES
Current Liabilities
Accounts payable $ 9,978 $ 9,978
Deferred revenue 139,854 139,854
Payroll taxes payable 1,569 1,569
Total liabilities 151,401 151,401
FUND BALANCES
Nonspendable fund balance 28,774 28,774
Unassigned fund balance 980,283 980,283
Total fund balances 1,009,057 1,009,057
Total liabilities and net assets $ 1,160,458 $ 1,160,458
Amounts reported for governmental activities in the statement of net assets are different because:
Capital assets used in governmental activities are not fmanical resources and therefore are not
reported in the funds. 2,660,809
Net assets of governmental activities $ 3,669,866
The accompanying notes are an integral part of these Financial Statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT
COMPONENT UNIT OF TOWN OF SOUTHOLD
RECONCILIATION OF THE.GOVERNMENT FUNDS STATEMENT REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF
ACTIVITIES
AS OF DECEMBER 31,2013
Net Change in Fund Balances $ 99,172
Amounts reported for governmental activities in the
Statement of Activities are different because:
Capital Related Differences
Capital outlays to purchase or build capital assets are reported in governmental funds
as expenditures. However,for governmental activities those costs are capitalized and
shown in the statement of net assets and allocated over their useful lives as annual
depreciation expenses in the Statement of activities
Capital outlays 44,812
Depreciation expense (I 1_11,8114)
w50,992)
Total change in net assets $ 38,180
See notes to financial statements.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2013
1, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Fishers Island Waste Management District(FIWMD)have been prepared in
conformity with accounting principles generally accepted in the United States of America (GAAP) for
governmental units. The Governmental Accounting Standards Board(GASB)is the standard-setting body for
establishing governmental accounting and financial reporting principles. Significant accounting principles
and policies used by FIWMD are as follows:
A. Reporting Entity
FIWMD is governed by the laws of New York State. FIWMD is an independent entity governed by
an elected Board of Commissioners consisting of five members. The Board is responsible for, and
controls all activities within FIWMD. Board members have authority to make decisions, power to
appoint management,and primary accountability for all fiscal matters,
The financial reporting entity is based on criteria set forth by GASB Statement No. 14, The
Financial Reporting Entity and No. 39, Determining Whether Certain Organizations are
Component Units. The financial reporting entity consists of the primary government, organizations
for which the primary government is financially accountable and other organizations for which the
nature and significance of their relationship with the primary government are such that exclusion
would cause the reporting entity's financial statements to be misleading or incomplete.
The accompanying financial statements present the activities of FIWMD. FIWMD is a component
unit of The Town of Southold,another reporting entity.
B. Basis of Presentation
Fund Financial Statements
The fund financial statements provide information about FIWMD's funds. The emphasis of fund
financial statements is on major governmental funds as defined by GASB. The financial statements
reflect the following fund category:
Governmental Fund:
General Fund — is the general operating fund and is used to account for all financial
transactions except those required to be accounted for in another fund.
C. Basis of Accounting and Measurement Focus
The Statement of Activities and the Statement of Net Assets are reported on the accrual basis of
accounting using the economic resources measurement focus. Revenues are recorded when earned
and expenses are recorded at the time liabilities are incurred, regardless of when the related cash
transaction takes place. On the accrual basis,revenues from real property taxes are recognized in the
fiscal year for which the taxes are levied. Revenue from ferry operations and grants are recognized
in the fiscal year in which all eligibility requirements have been satisfied and the related
expenditures are incurred.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2013
1, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(continued)
The fund statements are reported on the modified accrual basis of accounting using the current
financial resources measurement focus. Revenues are recognized when measurable and available.
FIWMD considers all revenues reported in the governmental funds to be available if the revenues
are collected within 180 days after the end of the fiscal year, except for real property taxes, which
are considered to be available if they are collected within 60 days after the end of the fiscal year.
Expenditures are recorded when the related fund liability is incurred, except for principal and
interest on general long-term debt, claims and judgments, and compensated absences, all of which
are recognized as expenditures to the extent they have matured. General capital asset acquisitions
are reported as expenditures in governmental funds. Proceeds of general long-term debt and
acquisitions under capital leases are reported as other financing sources.
D. Real Property Taxes
Calendar
Real property taxes are levied annually by the Town of Southold no later than October 1" and
become a lien on December I". Taxes are collected by the Town of Southold and remitted to
FIWMD from December to June.
Enforcement
Uncollected real property taxes are subsequently enforced by the County of Suffolk in June.
E. Restricted Resources
When an expense is incurred for purposes for which both restricted and unrestricted net assets are
available, FIWMD's policy concerning which to apply first varies. The policy depends on the
intended use, and the associated legal requirements,many of which are described elsewhere in these
Notes to Financial Statements.
F. 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 amount of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported revenues and expenses during the reporting period.
Accordingly, actual results could differ from those estimates. Estimates and assumptions are made
in a variety of areas, including computation of encumbrances, compensated absences, potential
contingent liabilities and useful lives of long-lived assets.
G. Cash and Cash Equivalents/Investments
Cash and cash equivalents consist of cash on hand and bank deposits with a maturity date of three
months or less from date of acquisition.
H. Receivables
Receivables include amounts due from customers for services provided by the FIWMD.Receivables
are recorded and revenues recognized as earned or as specific program expenditures are incurred.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2013
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
1, Prepaid Items
Prepaid items represent payments made by FIWMD for which benefits extend beyond year-end.
These payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items in the fund financial statements. A current asset for the prepaid amounts is recorded at
the time of purchase and an expense/expenditure is reported in the year.the goods or services are
consumed.
1'. Capital Assets
Capital assets purchased or acquired with an original cost of $10,000 or more are reported at
historical cost or estimated historical cost. Contributed assets are reported at fair market value as of
the date received. Additions, improvements, and other capital outlays that significantly extend the
useful life of an asset are capitalized. Other costs incurred for repairs and maintenance are expensed
as incurred. Depreciation on all assets is provided on the straight-line basis over the following
estimated useful lives:
Buildings 10-40 years
Improvements and other 20 years
Machinery and equipment 5-10 years
Infrastructure 20-30 years
Infrastructure assets,consisting of certain improvements other than buildings including roads, curbs,
sidewalks,bridges and street lighting are capitalized along with other capital assets.
In the fund financial statements, capital assets are recorded as capital outlay expenditures in the
governmental fund upon acquisition.
K. Deferred Revenue
Deferred revenue arises when potential revenues do not meet both the measurable and available
criteria for recognition in the current period. Deferred revenues also arise when resources are
received by FIWMD before it has a legal claim to them, as when grant monies are received prior to
the incurrence of qualifying expenditures. In subsequent periods, when both recognition criteria are
met,or when FIWMD has legal claim to the resources,the liability for deferred revenues is removed
and revenues are recognized.
L. Accrued Liabilities and Long-Term Obligations
In the governmental funds, payables and accrued liabilities are paid in a timely manner and in full
from current financial resources.
M. Equity Classifications
In the Government-Wide Financial Statements,net assets are classified in the following categories:
Invested in Capital Assets—this category groups all capital assets into one component of net assets.
Accumulated depreciation that is attributable to the acquisition, construction, or improvement of
these assets reduces these balances.
Unrestricted Net Assets — this category represents the net assets of the District, which are not
restricted for any project or other purpose.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2013
Equity Classifications(continued)
In the Fund Financial Statements, fund balances of governmental funds are classified in five separate
categories as follows:
Nonspendable—represents amounts associated with nonspendable assets.
Restricted Fund Balance—represents that portion of fund equity that can be spent only for specific
purposes stipulated by constitution, external resource providers,or through legislation.
Committed Fund Balance—represents that portion of fund equity that can only be used for specific
purposes determined by a formal action of the government's highest level of decision-making
authority.
Assigned Fund Balance— represents that portion of fund equity to be used by the government for
specific purposes but do not meet the criteria to be classified as restricted or committed.
Unassigned Fund Balance — represents that portion of fund equity which is available for
appropriation and expenditures in future periods.
2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND
STATEMENTS AND THE DISTRICT-WIDE STATEMENTS
Due to the differences in the measurement focus and basis of accounting used in the governmental fund
statements and the district-wide statements, certain financial transactions are treated differently. The basis
financial statements contain a full reconciliation of these items. The differences result primarily from the
economic resource measurement focus of the Statement of Activities, compared with the current financial
resource measurement focus of the governmental funds.
A. Total Fund Balances of Governmental Funds vs.Net Assets of Governmental Activities
Total fund balances of FIWMD's governmental funds differ from "net assets" of governmental
activities reported in the Statement of Net Assets. This difference primarily results from the
additional long-term economic focus of the Statement of Net Assets versus the solely current
financial resources focus of the governmental fund Balance Sheets.
B. Statement of Revenues,Expenditures and Changes in Fund Balance vs. Statement of Activities
Differences between the Statement of Revenues, Expenditures and Changes in Fund Balance and
the Statement of Activities fall into one of three broad categories.
Long-Term Revenue and Expense Differences
Long-term revenue differences arise because governmental funds report revenues only when they
are considered "available," whereas the Statement of Activities reports revenues when earned.
Differences in long-term expenses arise because governmental funds report on a modified accrual
basis,whereas the accrual basis of accounting is used on the Statement of Activities.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2013
2. EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND
STATEMENTS AND THE DISTRICT-WIDE STATEMENTS (continued)
Capital Related Differences
Capital related differences include the difference between proceeds for the sale of capital assets
reported on fund statements and the gain or loss on the sale of assets as reported on the Statement of
Activities, and the difference between recording an expenditure for the purchase of capital items in
the fund statements and depreciation expense on'those items as recorded in the Statement of
Activities.
Long-Term Debt Transaction Differences
Long-term debt transaction differences occur because the issuance of long-term debt provides
current financial resources to governmental funds, but is recorded as a liability in the Statement of
Net Assets. In addition, both interest and principal payments are recorded as expenditures in the
fund statements when due and payable, whereas interest expense is recorded in the Statement of
Activities as it accrues, and principal payments are recorded as a reduction of liabilities in the
Statement of Net Assets. There are no Long-Term Debt Transaction differences in current year.
3. STEWARDSHIP.COMPLIANCE AND ACCOUNTABILITY
A. Budgets
The FIWMD administration prepares a proposed budget for approval by the Board of Commissions
for the general fund,the only fund with a legally adopted budget.
Appropriations are adopted at the program line item level.
Appropriations established by the adoption of the budget constitute a limitation on expenditures
(and encumbrances)that may be incurred. Appropriations lapse at the end of the fiscal year unless
expended or encumbered. Encumbrances will lapse if not expended in the subsequent year.
Appropriations authorized for the current year are increased by the planned use of specific reserves,
and budget amendments approved by the Board of Commissions as a result of selected new revenue
sources not included in the original budget (when permitted by law). These supplemental
appropriations may occur subject to legal restrictions, if the Board approved them because of a need
that exists which was not determined at the time the budget was adopted.
Budgets are adopted annually on a basis consistent with GAAP. Appropriations authorized for the
year are increased by the amount of encumbrances carried forward from the prior year.
Budgets are established and used for individual capital project funds expenditures as approved by a
special referendum of FIWM's voters. The maximum project amount authorized is based primarily
upon the cost of the project, plus any requirements for external borrowings, not annual
appropriations. These budgets do not lapse and are carried over to subsequent fiscal years until the
completion of the projects.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2013
3. STEWARDSHIP,COMPLIANCE AND ACCOUNTABILITY(continued)
B. Encumbrances
Encumbrance accounting is used for budget control and monitoring purposes and is reported as a
part of the governmental funds. Under this method, purchase orders, contracts and other
commitments for the expenditure of monies are recorded to reserve applicable appropriations.
Outstanding encumbrances as of year-end are presented as reservations of fund balance and do not
represent expenditures or liabilities. These commitments will be honored in the subsequent period.
Related expenditures are recognized at that time, as the liability is incurred or the commitment is
paid.
4. DEPOSITS WITH FINANCIAL INSTITUTIONS AND INVESTMENTS
The FIWMD's investment policies are governed by state statutes and District policy. Resources must be
deposited in Federal Deposit Insurance Corporation (FDIC) insured commercial banks or trust companies
located within the state. 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 and certificates of deposit not covered by FDIC insurance. Obligations that may be pledged
as collateral are obligations of the United States and its Agencies and obligations of New York State and its
municipalities. Investments are stated at fair value.
Custodial credit risk is the risk that in the event of a bank failure,FIWM's deposits may not be returned to it.
GASB directs that deposits be disclosed as exposed to custodial credit risk if they are not covered by
depository insurance and the deposits are either:
A. Uncollateralized,
B. Collateralized by securities held by the pledging financial institution, or
C. Collateralized by securities held by the pledging financial institution's trust department or agent but
not in FIWM's name.
None of FIWM's aggregate bank balances, not covered by depository insurance, were exposed to custodial
credit risk as described above at year-end.
The District did not have any investments at year-end or during the year. Consequently, FIWM was not
exposed to any material interest rate risk or foreign currency risk.
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DOHERTY,BEALS&BANKS,P.C.
FISHERS ISLAND WASTE MANAGEMENT DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31,2013
5. CAPITAL ASSETS
Capital asset balances and activity for the year ended December 31,2013 were as follows:
Balance Balance
1/1/2013 Additions Reductions 12/31/13
Governmental activities
__.__...........� _.....
Capital assets not being depreciated
Land $ 517,262 $ $ - $ 517,262
Total capital assets
not being depreciated 517,262 - - 517,262
Capital assets being depreciated
Buildings and improvements 2,777,213 - 2,777,213
Machinery and equipment 319,499 44,812 - 364,311
Total capital assets
being depreciated 3,096,712 44,812 - 3,141,524
Less accumulated depreciation for:
Buildings and improvements 637,225 92,751 - 729,976
Machinery and equipment 254,949 13,052 - 268,001
Total accumulated depreciation 892.174 105,803 997,977
Total capital assets,
being depreciated,reciated net 2,204,538 (6�,991) 2,143,547
Capital assets,net $ 2,721,800 $ (60,991) $ - $2,660,809
6. RISK MANAGEMENT
The District is exposed to various risks of losses related to torts;theft of, damage to, and destruction of assets;
errors and omissions; injuries to employees; and natural disasters. The District has obtained coverage from
commercial insurance companies and has effectively managed risk through various employee education and
prevention programs. There have been no significant reductions in insurance coverage and settlements have
not exceeded insurance coverage for each of the past three fiscal years. All risk management activities are
accounted for in the general fund.
7. EXPENSES IN EXCESS OF APPROPRIATIONS
For the year ended December 30, 2013, the following expenses were in excess of their budgeted
appropriations by the following amounts:
Commissioner Fees $2,130
Transfer Station Improvements $5,441
Compactor Maintenance $2,783
Total expenses were not in excess of total appropriations for the year.
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DOHERTY,BEALS&BANKS,P.C.