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FY1996 Audit Report AirportAIRPORT AUTHORITY OF THE CITY OF BLAIR SEPTEMBER 30, 1996 EDWARD W. SCHROEDER CERTIFIED PUBLIC ACCOUNTANT 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 Airport Authority of the City of Blair 218 S. 16th Street Blair, NE 68008 February 14, 1997 "Independent Auditor's Opinion" RESIDENCE: (402) 468-S2S3 OFFICE: (402) 426-4080 I have audited the general purpose financial statements of the Airport Authority of the City of Blair, as of September 30, 1996, and for the fourteen months then ended. These financial statements are the responsibility of the Authority. My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with generally accepted auditing standards and GOVERNMENT AUDITING STANDARDS. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion. In my opinion the general purpose financial statements referred to above present fairly in all material respects the financial position of the Airport Authority of the City of Blair, as of September 30, 1996, and the results of its operations and changes in fund balances for the fourteen months then ended in conformity with generally accepted accounting principles. Edward W. Schroeder Certified Public Accountant EDWARD W. SCHROEDER CERTIFIED PUBLIC ACCOUNTANT 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 RESIDENCE: (402) 468-5253 OFFICE: (402) 4264080 AIRPORT AUTHORITY OF THE CITY OF BLAIR COMBINED BALANCE SHEET - ALL FUNDS AND ACCOUNT GROUPS SEPTEMBER 30 1996 ASSETS General Fund General Fixed Assets CASH IN CHECKING $50,345 - DUE FROM THE COUNTY TREASURER REAL ESTATE AND EQUIPMENT TOTAL ASSETS GENERAL FIXED ASSETS FUND BALANCE - UNRESERVED TOTAL LIABILITIES AND FUND BALANCES 1,232 - $195,743 $51,577 $195,743 LIABILITIES AND FUND BALANCES - $195,743 $51,577 - $51,577 $195,743 See Notes to Financial Statements. -2- AIRPORT AUTHORITY OF THE CITY OF BLAIR STATEMENT OF REVENUES, AND EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET (CASH BASIS) AND ACTUAL FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30 1996 See Notes to Financial Statements. -3- Variance Favorable (Unfavorable) $ 8,168 1,068 -0- 44 (24,050) 24 636 (1,576,800) (423,200) (2,014,110) 810 2,391 500 1,337 6,086 32,703 4,380 100 2,500 310 1,000 281 (91) 2,000,000 2,052,307 $ 38,197 Budget Actual REVENUES: Property taxes $ 24,038 $32,206 Homestead exemption -0- 1,068 In -lieu of tax 1,000 1,000 Motor Vehicle pro -rate 100 144 Rent income 32,500 8,450 Gas sales 50 74 Interest 400 1,036 Grants 1,576,800 -0- Loans 423,200 -0- Total revenues 2,058,088 43,978 EXPENDITURES; Insurance 5,600 4,790 Utilities and telephone 4,720 2,329 Dues and training 500 -0- Maintenance and repair 2,000 663 Legal 7,500 1,414 Engineering/appraisal 40,000 7,297 Mowing/snow 4,800 420 Janitorial 100 -0- Sand/rock/gravel 2,500 -0- Audit fees 1,000 690 Equipment rental 1,000 -0- Office Expense 600 319 County commission 238 329 Capital outlay - land 2,000,000 -0- Total expenditures 2,070,558 18,251 REVENUES AND OTHER SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES (12,470) 25,727 FUND BALANCE - July 31, 1995 25,850 25,850 FUND BALANCE - September 30, 1996 $ 13,380 $51,577 See Notes to Financial Statements. -3- Variance Favorable (Unfavorable) $ 8,168 1,068 -0- 44 (24,050) 24 636 (1,576,800) (423,200) (2,014,110) 810 2,391 500 1,337 6,086 32,703 4,380 100 2,500 310 1,000 281 (91) 2,000,000 2,052,307 $ 38,197 AIRPORT AUTHORITY OF THE CITY OF BLAIR STATEMENT OF CHANGES IN GENERAL FIXED ASSETS FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30 1996 Balance July 31, 1995 Additions Dispositions FIXED ASSETS: Real estate $137,069 $ 7,297 Equipment 51,377 - TOTALS $188,446 7,297 See Notes to Financial Statements -4- Balance Sept 30, 1996 $144,366 51,377 $195,743 AIRPORT AUTHORITY OF THE CITY OF BLAIR NOTES TO FINANCIAL STATEMENTS 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Basis of Accounting: All governmental fund types are accounted for using the modified accrual basis of accounting. Their revenues are recognized when earned and expenditures are recognized when incurred except in the case of property tax revenues recognized when received, and in the recording of interest on general obligation bonds only when the coupons mature. The Authority does not apply encumbrance accounting on any of its funds. The Authority was activated by The City of Blair Resolution 1993-22 as of August 1, 1993 and pursuant to Sec.3-503RRS NEB. the City of Blair conveyed to the Authority its existing airport facilities. B. Fixed Assets: All fixed assets are recorded at cost or estimated fair value if actual cost is not available. Assets are recorded as expenditures at the time of purchase with accumulated costs being presented in the general fixed assets group of accounts for measurement purposes only. No depreciation is provided for assets in the general fixed asset group of accounts. C. Rental Income: The Authority receives rental income from its land and buildings not in use by the authority. The rents are on an annual or monthly basis. 2. PROPERTY TAX CALENDAR The Airport Authority levy date is December 31 with tax due in halves on May and September of the following year. The December 31, 1995 valuation was $204,487,657. The tax levey for the fourteen months ended September 30, 1996 was $24,751. 3. SUBSEQUENT EVENT The Airport Authority entered into a purchase agreement to u purchase a new airport (EAGLE FIELD) at Highway 133 south of Blair for $1,200,000. The property was purchased October 10, 1996. The old airport on Highway 75 north of Blair was closed effective January 1, 1997. -5- EDWARD W. SCHROEDER CERTIFIED PUBLIC ACCOUNTANT 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 Airport Authority of the City of Blair 218 S. 16th Street Blair, NE 68008 Gentlemen: I have audited the general Authority of the City of Blair, 1996, and have issued my report RESIDENCE: (402) 468-5253 OFFICE: (402) 426-4080 February 14, 1997 purpose financial statements of the Airport for the fourteen months ended September 30, thereon dated February 14, 1997. I have conducted my audit in accordance with generally accepted auditing standards and GOVERNMENT AUDITING STANDARDS. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. In planning and performing my audit of the general purpose financial statements of the Airport Authority of the City of Blair for the fourteen months, ended September 30, 1996, I considered its internal control structure in order to determine my auditing procedures for the purpose of expressing my opinion on the general purpose financial statements and not to provide assurance on the internal control structure. The management of the Airport Authority of the City of Blair is respon- sible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. -6- Page 2 For the purpose of this report, I have classified the significant internal control structure policies and procedures in the following categories: Accounting Controls Administrative Controls Cycles of the Entities' Activity General Requirements Treasury or financing Political activity Revenue/receipts Davis -Bacon Act Purchases/disbursements Civil Rights External financial reporting Cash management Federal financial reports Financial Statement Captions Cash and cash equivalents Receivables Inventory Property and equipment Payables and accrued liabilities Debt Fund balance Accounting Applications Billings Receivables Cash receipts Purchasing and receiving Accounts payable Cash disbursements Payroll Inventory control Property and equipment General ledger Specific Requirements Types of services Eligibility Matching level of effort Reporting Cost allocation Special requirements, if any For all of the internal control structure categories listed above, I obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation, and I assessed control risk. I noted certain matters involving the internal control structure and its operation that I consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to my attention relating to significant deficiencies in the design or operation of the internal control structure that, in my judgment, could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements. The Airport Authority of the City of Blair does not have adequate segregation of duties. -7- Page 3 A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. My'consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses as defined above. However, I believe none of the reportable conditions described above is a material weakness. This report is intended for the information of management, and the Airport Authority of the City of Blair Board. However, this report is a matter of public record and its distribution is not limited. �v Edward W. Schroeder Certified Public Accountant IM s 1904 SOUTH STREET BOX 486 i BLAIR, NEBRASKA 68008 EDWARD W. SCHROEDER CERTIFIED PUBLIC ACCOUNTANT February 14, 1997 Airport Authority of the City of Blair 218 S. 16th Street Blair, NE 68008 RESIDENCE: (402) 468-5253 OFFICE: (402) 426-4080 I have audited the general purpose financial statements of the Airport Authority of the City of Blair, as of and for the fourteen months ended September 30, 1996, and have issued my report thereon dated February 14, 1997. I conducted my audit in accordance with generally accepted auditing standards and GOVERNMENT AUDITING STANDARDS issued by the Comptroller General of the United States. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. Compliance with laws, regulations, contracts, and grants applicable to the Airport Authority of the City of Blair, is the responsibility of the Authorities management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, I performed tests of the Authorities compliance with certain provisions of laws, regulations, contracts, and grants. However, the objective of my audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, I do not express such an opinion. The results of my tests indicate that, with respect to the items tested, the Airport Authority of the City of Blair, complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to my attention that caused me to believe that the Authorities had not complied, in all material respects with those provisions. This report is intended for the information of the management, and the Authority Board, However, this report is a matter of public record and its distribution is not limited, 1� Edward W. Schroeder Certified Public Accountant M