HomeMy WebLinkAbout2014ORIENT FIRE DISTRICT
FINANCIAL STATEMENTS
December 31, 2014
ORIENT FIRE DISTRICT
TABLE OF CONTENTS
December 31, 2014
Page
INDEPENDENT AUDITOR'S REPORT.........................................................................................1-2
GENERAL PURPOSE FINANCIAL STATEMENTS
Balance Sheet - Governmental Funds (Regulatory Basis).............................................................3
Statement of Revenues, Expenditures and Changes in
Fund Balances — Governmental Funds (Regulatory Basis) ................................................ 4-5
Statement of Fiduciary Net Assets — Agency Funds (Regulatory Basis) ............................... 6
Budgetary Comparison Schedule — General Fund (Regulatory Basis) ................................. 7
Notes to Financial Statement...................................................................................................... 8-15
Report on Internal Control over Financial Reporting and on
Compliance and other Matters Based on an Audit of
Financial Statements Performed in Accordance with Government Auditing Standards ............ 16-17
Georee R. RehnCertified Public Accountant
Board of Fire Commissioners
Orient Fire District
23300 Main Road
Orient, NY 11957
286 Main Street • East Setauket • New York 11733
(631) 751-3886 • Fax (631) 751-2740
INDEPENDENT AUDITOR'S REPORT
I have audited the accompanying financial statements of the Orient Fire District as of and for the year
ended December 31, 2014, as listed in the table of contents and the related notes to the financial statements.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of this financial statement 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
My responsibility is to express an opinion on this financial statement based on my audit. I conducted my
audit in accordance with auditing standards generally accepted in the United States of America. Those
�i standards require that I plan and perform the audit to obtain reasonable assurance about whether the
financial statement is free from material misstatement.
F -
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 entity's preparation and
I fair presentation of the financial statements in order to design audit procedures that are appropriate in the
l circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal
control. Accordingly, I 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.
I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my.
audit opinion.
Opinion
In my opinion, the financial statements and budgetary comparison schedule referred to above present fairly,
in all material respects, the assets, liabilities and fund balances of the Orient Fire District as of December
31, 2014, and the revenues it received and expenditures it made for the year then ended in conformity with
the basis of accounting described in Note 1.
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In accordance with Government Auditing Standards, I have also issued my report dated May 15, 2015, on
my consideration of the Orient Fire District's internal control over financial reporting and on my test of its
compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters.
F The purpose of that report is to describe the scope of my 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 Auditing Standards and should be considered in assessing the results of my audit. This
i report is intended solely for the information and use of the Board of Fire Commissioners, management,
others within the Organization and the New York State Office of the State Comptroller and is not intended
{ to be and should not be used by anyone other than these specified parties.
May 15, 2015
Setauket, N.Y.
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geO/LC,e aJL. uD 0
LPi"
Certified Public Accountant
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ORIENT FIRE DISTRICT, NEW YORK
BALANCE SHEET - GOVERNMENTAL FUNDS ( REGULATORY BASIS)
i
December 31, 2014
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-
'Truck
capital
_
General
Reserve
Improvement
i
Fund
Fund
Fund
Total
- Assets:
Cash
$45,668
$227,491
$32,454
$305,613
-' Total Assets
$45,668
$227,491
$32,454
$305,613
} Liability and fund balances:
Liability:
Accrued expenses
$918
$ --
$ --
$918
_ Fund balances:
Restricted for capital purposes
--
227,491
32,454
259,945
Unassigned
44,750
--
--
44,750
f Total fund balances
443750
227,491
32,454
304,695
r Total liability and fund balances
$45,668
$227,491
$32,454
$305,613
3
See notes to financial statements
ORIENT FIRE DISTRICT, NEW YORK
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCES - GOVERNMENTAL FUNDS (REGULATORY BASIS)
For the Year Ended December 31, 2014
Truck capital
General Reserve Improve -
Fund Fund ment Fund Total
Revenues
Real property taxes
$608,296 $ -- $ --
$608,296
Interest and earnings
114 462 98
674
Rental income
50,761 -- --
50,761
Rental income
20,000 -- --
20,000
Refund of prior year's expenditures
1,528 -- --
1,528
Total revenues
680,699 462 98
681,259
Expenditures:
Personal services
26,860 -- --
26,860
Equipment and capital outlay
35,200 -- --
35,200
Contractual expenditures
380,766 -- --
380,766
Local service award pension
135,000 -- --
135,000
Social security
2,055 -- --
2,055
Workers compensation and
employee benefits
17,035 -- --
17,035
Total expenditures
596,916 -- 0
596,916
Excess of revenues over expenditures
83,783 462 98
84,343
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See notes to financial statements
ORIENT FIRE DISTRICT, NEW YORK
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCES - GOVERNMENTAL FUNDS (REGULATORY BASIS)
For the Year Ended December 31, 2014
Truck Capital
General Reserve Improvement
Fund Fund Fund Total
Other financing sources (uses):
Transfers in
--
105,755
--
105,755
Transfers out
(40,000)
--
(65,755)
(105,755)
Total other financing sources (uses)
(40,000)
105,755
(65,755)
--
Net changes in fund balances
43,783
106,217
(65,657)
84,343
Fund balance, beginning of year
967
121,274
98,111
220,352
Fund balance, end of year
$44,750
$227,491
$32,454
$304,695
5
See notes to financial statements
ORIENT FIRE DISTRICT, NEW YORK
STATEMENT OF FIDUCIARY NET ASSETS - AGENCY FUND
(REGULATORY BASIS)
December 31, 201-4
Agency Fund
Assets:
Service award program assets $1,210,509
Total assets $1,210,509
Liabilities:
Service award program liability $1,210,509
Total liabilities $1,210,509
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See notes to financial statements
ORIENT FIRE DISTRICT, NEW YORK
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND (REGULATORY BASIS)
For the Year Ended December 31, 2014
Variance
With Budget
Budget Actual Unfavorable
Revenues
- Real property taxes
$608,295
$608,296
$1
Interest and earnings
250
114
(136)
Rental income
49,000
50,761
1,761
,- Refund of prior year's expenditures
--
1,528
1,528
Refund of prior year's expenditures
--
20,000
20,000
Amounts available for appropriation
657,545
680,699
23,154
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Expenditures
Personal services
37,000
26,860
10,140
Equipment and capital outlay
67,000
35,200
31,800
Contractual expenditures
353,795
380,766
(26,971)
Local service award pension
135,000
135,000
--
NYS Retirement
100
--
100
'• Social security
2,900
2,055
845
Workers compensation and
employee benefits
16,750
17,035
(285)
Total expenditures
612,545
596,916
15,629
,- Other financing sources (uses):
Transfers out
45,000
40,000
5,000
Total other financing sources (uses)
45,000
40,000
5,000
Excess of revenues
over expenditures and other uses
7
See notes to financial statements
$43,783
ORIENT FIRE DISTRICT, NEW YORK
NOTES TO FINANCIAL STATEMENTS
December 31, 2014
Note 1— Summary of Significant Accounting Policies:
The financial statements of the Orient Fire District (the "District"), as of and for the year ended
December 31, 2014 have been prepared in conformity with modified accrual regulatory basis of
accounting as prescribe by the State Comptroller's Office, which is a comprehensive basis of
accounting other than United States generally accepted accounting principles.
Financial reporting entity: The District is a governmental entity that provides fire protection
to the local community. The District receives most of its funding from property taxes.
The District is governed by laws of the State of New York. The Board of Fire Commissioners is
the legislative body responsible for the overall operation of the District. All activities and
functions performed for the District are its direct responsibility. The Treasurer serves as chief
fiscal officer of the District.
Basis of presentation: The fund financial statements provide information about the District's
funds, including fiduciary funds. The accounts of the District are organized on the basis of funds,
each of which is considered a separate accounting entity. The operations of each fund are
segregated for the purpose of carrying on specific activities or attaining certain objectives in
—ry accordance with special regulations, restrictions or limitations. The following fund types are used:
Governmental:
General Fund
The General Fund is the principal operating fund of the District and is used to account for
all financial resources except those required to be accounted for in another fund. Debt
service is also accounted for in the General Fund.
Capital Improvement Fund
The Capital Improvement Fund is used to account for and report financial resources to be
used for the acquisition, construction, or renovation of major capital facilities.
Truck Reserve Fund
The Truck Reserve Fund is used to account for and report financial resources to be
used for the acquisition of all large equipment.
Fiduciary Fund
Fiduciary funds are used to account for assets held by the District in a trustee or custodial
capacity. The District utilizes the following fund:
ORIENT FIRE DISTRICT, NEW YORK
NOTES TO FINANCIAL STATEMENTS
December 31, 2014
Azency Fund
The Agency Fund is used to account for and report assets held by the District in
the capacity of trustee, custodian or agent for individuals. Agency funds are
- custodial in nature and do not involve measurement of results of operations.
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Basis of accounting: The accompanying governmental fund financial statements are reported on
the modified accrual regulatory basis of accounting using the current financial resources
measurement focus. Revenues are recognized when measurable and available. "Available" means
collectible within the current period or within 60 days after year-end. Expenditures are generally
recognized under the modified accrual basis of accounting when the related liability is incurred.
The exception to this general rule is that principal and interest on general obligation long-term
debt, if any, is recognized when due.
Cash and cash equivalents: Cash and cash equivalents include demand deposits and temporary
investments with original maturities of three months or less from date of acquisition.
Interfund transfers: The operations of the District give rise to certain transactions between
funds, including transfers of expenditures and revenues to provide services and construct assets.
This is either by budget, Board resolution or permissive referendum.
Fund balance — reserves and designations: Portions of fund balance are reserved or designated
to either satisfy legal restrictions or to plan for future expenditures. The following is a description
of the reserves utilized 'by the District:
Reserve for Capital Improvements— used for the acquisition construction or renovation of
major capital facilities.
Reserve for Truck — used for the acquisition of large equipment.
Real property taxes: All real property assessments are made by the Town of Southold. Real
property tax payments are due in two equal installments; the first half payable on December 1
(lien and levy date) preceding the year for which the same is levied and the second half payable
May 10, with the first half payable without penalty to January 10 and the second half payable
without penalty to May 31. After May 31, all taxes must be paid to the Suffolk County Treasurer
with a 5% penalty charge and interest at the rate of I% per month for February 1.
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ORIENT FIRE DISTRICT, NEW YORK
NOTES TO FINANCIAL STATEMENTS
December 31, 2014
The Town of Southold Receiver of Taxes collects all real estate taxes for the District. The Town
of Southold Receiver of Taxes distributes the tax collections to the District. All payments made to
the District are made in the year for which the tax has been levied. The Town of Southold
Receiver of Taxes turns over uncollected items to the Suffolk County Treasurer who continues
the collection of these items. Responsibility for the collection of unpaid taxes rests with Suffolk
County.
Budgetary data: The District prepares an operating budget for the General Fund each year. The
budget is adopted by the Board of Fire Commissioners in the prior year for the coming year.
The budget is not subject to referendum. All budget appropriations lapse at the end of the year.
Use of estimates: The preparation of financial statements in conformity with the modified
accrual regulatory basis of accounting requires management to make estimates and assumptions
that affect certain reported amounts and disclosures. Accordingly, actual results could differ from
those estimates.
Note 2 - Deposits with financial institutions and investments:
The District's investment polices 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 special time deposit
" accounts, certificates of deposit, and obligations of the United States of America, obligations
guaranteed by agencies of the United States of America where the payment and interest are
guaranteed by the United States of America, and obligations of the State of New York. Collateral
is required for demand and time deposits.
Custodial credit risk is the risk that in the event of a bank failure, the District'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:
1. Insured by FDIC insurance
2. Collateralized by securities held by the pledging financial institution's trust
department or agent but not in the District's name.
3. Collateralized by securities held by the pledging financial institution but not in
the District's name.
4. Uncollateralized.
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ORIENT FIRE DISTRICT, NEW YORK
NOTES TO FINANCIAL STATEMENT
DECEMBER 31, 2014
The District's deposits held by the banks are categorized, based on the above criteria, as follows:
Category Amount
1 $500,000
2 --
3 --
4 --
' Total $500.000
Note 3 - Length of Service Awards Program - LOSAP
The Orient Fire District financial statements are for the year ended December 31, 2014. The
information contained in this note is based on information for the Length of Service Awards
Program for the plan year ending on December 31, 2014.
The Orient Fire District established a defined benefit LOSAP for the active volunteer firefighters
of the Orient Fire Department. The program took effect on January 1, 1995. The program was
established pursuant to Article 11-A of the General Municipal Law. The program provides
municipally -funded pension -like benefits to facilitate the recruitment and retention of active
volunteer firefighters. The Orient Fire District is the sponsor of the program.
Program Description
Participation, vesting and service credit
Active volunteer firefighters who have reached the age of 18 and who have completed 1 year of
firefighting service are eligible to participate in the program. Participants acquire a nonforfeitable
right to a service award after being credited with 5 years of firefighting service or upon attaining
the program's entitlement age. The program's entitlement age is age 65. In general, an active
volunteer firefighter is credited with a year of firefighting service for each calendar year after the
establishment of the program in which he or she accumulates fifty points. Points are granted for
the performance of certain activities in accordance with a system established by the sponsor on
the basis of a statutory list of activities and point values. A participant may also receive credit for
5 years of firefighting service rendered prior to the establishment of the program.
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-- ORIENT FIRE DISTRICT, NEW YORK
NOTES TO FINANCIAL STATEMENT
r ? DECEMBER 31, 2014
1 Benefits
A participant's benefit under the program is a life annuity with ten years certain equal to $20.00
multiplied by the person's total number of years of firefighting service. The number of years of
firefighting service used to compute the benefit cannot exceed thirty. Benefits are not payable
until entitlement age. On and after that date, except in the case of disability or death, benefits are
payable when a participant reaches entitlement age. The program provides statutorily mandated
death and disability benefits.
Fiduciary Investment and Control
Service credit is determined by the governing board of the sponsor, based on information certified
to the governing board by each fire company having members who participate in the program.
Each fire company must maintain all required records on forms prescribed by the governing board.
The governing board of the sponsor has retained and designated Wachovia Securities to assist in
the administration of the program. The designated program administrator's functions include
record keeping and payment calculation and verification. Disbursements of program assets for
the payment of benefits or administrative expenses must be approved by the Orient Fire District
Board of Commissioners.
Program assets are required to be held in trust by LOSAP legislation, for the exclusive purpose of
_. providing benefits to participants and their beneficiaries or for the purpose of defraying the
reasonable expenses of the operation and administration of the program. The trust agreement is
dated January 1, 1995, and the trustee is Orient Fire District Commissioners.
Authority to invest program assets is vested in Orient Fire District Commissioners. Program
assets are invested in accordance with a statutory "prudent person" rule.
The sponsor is required to retain an actuary to determine the amount of the sponsor's
contributions to the plan. The actuary retained by the sponsor for this purpose is Penflex.
Portions of the following information are derived from a report prepared by the actuary dated
April 13, 2015.
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ORIENT FIRE DISTRICT, NEW YORK .
NOTES TO FINANCIAL STATEMENT
DECEMBER 31, 2014
Program Financial Condition
Assets and Liabilities
Actuarial Present Value of Benefits at December 31, 2014
Less: Assets Available for Benefits
% of total
Cash & cash equivalents 32.74%
Fixed income 9.48%
Mutual funds 57,78%
100%
Less: Liabilities
Total Net Assets Available for Benefits
Total Unfunded Benefits
Less: Unfunded Liability for Prior Service
Unfunded Normal benefits
$ 396,335
114,710
699,464
1,210,509
Prior Service Costs
Prior service costs are being amortized over 15 years at a discount rate of 5.5%.
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$1,728,915
1,210,509
518,406
492,410
$ 2
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ORIENT FIRE DISTRICT, NEW YORK
NOTES TO FINANCIAL STATEMENT
DECEMBER 31, 2014
Receipts and Disbursements
Plan Net Assets, beginning of year $ 1,085,820
Changes during the year:
+ Plan contributions $135,000
+ Changes in fair market value of investments 74,097
- Plan Benefit Withdrawals (84,408)
124,689
Plan Net Assets, end of year
Contributions
Amount of sponsor's contribution recommended by actuary: $106,101
Amount of sponsor's actual contribution: $135,000
Administration Fees
Fees paid to trustee: $ --
Fees paid for investment management (if separate from fee paid to trustee): --
Fees paid to actuary and program administrator --
Other administration fees --
Funding Methodology and Actuarial Assumptions
Normal Costs
The actuarial valuation methodology used by the actuary to determine the sponsor's contribution
is the entry age normal -frozen initial liability cost method. The assumptions used by the actuary.
to determine the sponsor's contribution and the actuarial present value of benefits are:
Assumed rate of return on investment 5.5%
Mortality Tables used for
Withdrawal
Disability
Retirement
Death (Actives)
Death (In -actives)
1983 Unisex Mortality Table
1983 Unisex Mortality Table
1983 Unisex Mortality Table
1983 Unisex Mortality Table
1983 Unisex Mortality Table
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ORIENT FIRE DISTRICT, NEW YORK
NOTES TO FINANCIAL STATEMENT
DECEMBER 31, 2014
NOTE 4 — EVALUATION OF SUBSEQUENT EVENTS
The organization has evaluated subsequent events through May 15, 2015, the date which the
financial statements were available to be issued.
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GR
Georo,e R. Rehia,,ertified Public Accountant
286 Main Street • East Setauket • New York 11733
(631) 751-3886 • Fax (631) 751-2740
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND
ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF
FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
P GOVERNMENT A UDITING STANDARDS
Board of Fire Commissioners
Orient Fire District
23300 Main Road
Orient, NY 11957
I have audited the financial statements of Orient Fire District for the year ended
December 31, 2014, and have issued my report thereon dated May 15, 2015. I conducted
my 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.
Internal Control over Financial Reporting
In planning and performing my audit, I considered the District's internal control over
financial reporting as a basis for designing my auditing procedures , for the purpose of
expressing my opinions on the financial statements, but not for the purpose of expressing
j an opinion on the effectiveness of the District's internal control over financial reporting.
l Accordingly, I do not express an opinion on the effectiveness of the districts internal
control over financial reporting.
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A control deficiency exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions,
to prevent or detect misstatements on a timely basis. A significant deficiency is a control
deficiency, or combination of control deficiencies, that adversely affects the ability to
initiate, authorize, record, process or report financial data reliably in accordance with
generally accepted accounting principles'such that there is more than a remote likelihood
that a misstatement of the District's financial statements that is more than inconsequential
will not be prevented or detected by the District's internal control.
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A material weakness is a significant deficiency, or combination of significant
deficiencies, that results in more than a remote likelihood that a material misstatement of
I a financial statement will not be prevented or detected by the District's internal control.
My consideration of internal control over financial reporting was for the limited purpose
described in the first paragraph of this section and would not necessarily identify all
deficiencies in internal control that might be significant deficiencies or material
weaknesses. I did not identify any deficiencies in internal control over financial reporting
that I consider to be material weakness, as defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether The District's financial
statements are free of material misstatement, I 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 this audit, and accordingly, I do not express such an opinion. The
results of my tests disclosed no instance of noncompliance or other matters that are
required to be reported under Government Auditing Standards.
This report is intended solely for the information and _use of Board of Fire Commissioners
of Orient Fire District and is not intended to be and should not be used by .anyone other
than these specific parties.
May 15, 2015
Setauket, New York
,q ea r a. Rim..
Certified Public Accountant
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