FY2003 Audit Report AirportBLAIR AIRPORT AUTHORITY
SEPTEMBER 30, 2003
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EDWARD W SCHROEDER
CERTIFIED PUBLIC ACCOUNTANT
1904 SOUTH STREET
BOX 486
BLAIR, NEBRASKA 68008
Honorable Chairman and Members
of the Blair Airport Authority Board
Blair, Nebraska
"Independent Auditor's Report"
Gentlemen:
December 5, 2003
OFFICE:
(402)426-4080
FAX:
(402)426-9340
I have audited the accompanying general purpose financial statements of the Blair Airport Authority, as of and
for the year ended September 30, 2003. These general purpose financial statements are the responsibility of
the Blair Airport Authority's management. My responsibility is to express an opinion on these general purpose
financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards 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. 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. 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 general purpose 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 Blair Airport Authority as of September 30, 2003, and for the year then
ended inconformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, I have also issued my report dated December 5,
2003, on my considerations of the Blair Airport Authority's internal control over financial reporting and my
tests of its compliance with certain provisions of laws, regulations, contracts and grants.
My audit was conducted for the purpose of forming an opinion on the general purpose financial
statements taken as a whole and on the combining and individual fund and account group financial
statements. The accompanying financial information listed as supporting schedules is presented for
purposes of additional analysis and is nota required part of the financial statements of the Blair Airport
Authority. Such information has been subjected to the auditing procedures applied in the audit of the
general purpose, combining, and individual fund and account group financial statements and, in my
opinion, is fairly presented in all material respects in relation to the financial statements of each of the
respective individual funds and account groups taken as a whole.
Edward W. Schroeder
Certified Public Accountant
BLAIR AIRPORT AUTHORITY
COMBINED BALANCE SHEET - ALL FUND AND ACCOUNT GROUPS
SEPTEMBER 30, 2003
ASSETS
Cash equivalents
Accounts Reveivable
Due from the County Treasurer
Real Estate and Equipment
Amount to be provided for retirement
of general long-term debt
TOTAL ASSETS
LIABILITIES
Warrants payable
Accrued interest payable
Deposits payable
Bond payable
TOTAL LIABILITIES
FUND EQUITY
General fixed assets
Fund balance - Reserved
Fund balance - Unreserved
Total Fund Equity
TOTAL LIABILITIES AND
FUND EQUITY
General
Fund
$ 14,234
0
4,475
0
General
Fixed Assets
General
Long -Term
Debt
$ 0 $ 0
0 0
0 0
3,115,436 0
0 0 2,051,152
$ 18,709 $ 3,115,436 $ 2,051,152
$ 66,200 $ 0 $ 0.
17,008 0 0
1,680 0 0
0 0 2,051,152
84,888 0 2,051,152
0 3,115,436 0
0 0 0
(66,179) 0 0
$ (66,179) $ 3,115,436 $ 0
$ 18,709 $ 3,115,436 $ 2,051,152
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See Notes to Financial Statements
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BLAIR AIRPORT AUTHORITY
STATEMENT OF REVENUES AND EXPENDITURES,
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED SEPTEMBER 30, 2003
REVENUES:
Property taxes
Interest on taxes
Motor vehicle pro -rata
Carline tax
Homestead exemption
Motor vehicle taxes
Miscellaneous income
In Lieu of tax
Rent income
Gas sales
Interest
Grants
Total revenues
EXPENDITURES:
Audit fees
County commission
Dues and training
Engineering/appraisals
Equipment rental
Gas/Oil/Diesel
Insurance
Janitorial
Legal
Maintenance and repair
Mowing/snow
Office expense
Printing & publications
Travel
Utilities
Capital outlay
Bond principal
Interest expense
Total expenditures
- continued -
Budget
$ 42,840
100
340
0
0
0
0
4,200
30,000
24,000
5,400
2,790,000
2,400
1,680
0
0
500
18,000
10,000
1,800
500
1,800
2,900
2,850,000
470,000
27,502
3,411,382
See Notes to Financial Statements
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Actual
$ 42,694
190
186
86
2,016
0
0
11943
32,646
33620
3,501
76,027
192,909
1,990
526
0
0
0
22,0,19
12,510
5,659
0
25,546
3,946
598
809
2,736
2,283
1,895,349
460,000
39,186
2,473,457
Variance
Favorable
(Unfavorable)
$ 146
(90)
154
(86)
(2,016)
0
0
2,257
(2,646)
(9,620)
1,899
2,713,973
2,703,971
(410)
(854)
0
0
(500)
4,019
2,510
3,859
0
9,546
(4,054)
298
309
936
(617)
(954,651)
(10,000)
11,684
(937,925)
BLAIR AIRPORT AUTHORITY
STATEMENT OF REVENUES AND EXPENDITURES,
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED SEPTEMBER 30, 2003
- continued -
EXPENDITURES OTHER
FINANCING SOURCES (USES):
Bonding fees
Bond proceeds
REVENUES AND OTHER SOURCES
OVER (UNDER) EXPENDITURES
AND OTHER USES:
FUND BALANCE - September 30, 2002
FUND BALANCE - September 30, 2003
See Notes to Financial Statements
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Variance
Favorable
Budget
Actual
(Unfavorable)
$ (514,502)
(2,280,548)
$ 1,766,046
0
. (6,675)
6,675
300,000
2,051,152
(1,751,152)
(214,502)
(236,071)
$ 21,569
169,892
169,892
$ (44,610)
$ (66,179)
See Notes to Financial Statements
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FIXED ASSETS
1
Real estate
Equipment
TOTAL
BLAIR AIRPORT AUTHORITY
STATEMENT OF CHANGES IN GENERAL FIXED ASSETS
FOR THE TWELVE MONTHS ENDED SEPTEMBER 30, 2003
Balance Balance
Sept. 30, Sept. 30,
2002 Additions Dispositions 2003
$ 1,220,086 $ 1,895,350 $ 0 $ 3,115,436
0 0 0 0
$ 1,220,086 $ 1,895,350 $ 0 $ 3,115,436
See Notes to Financial Statements
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BLAIR AIRPORT AUTHORITY
STATEMENT OF CHANGES IN GENERAL LONG-TERM DEBT
FOR THE YEAR ENDED SEPTEMBER 30, 2003
Interest
Dated Description
Balance
Sept 30,
2002
Balance
Sept 30,
Additions Deductions 2003
12/1/96
Airport Authority
Bonds
4.00-5.80%
$ 460,000
$ 0
$ 460,000
$ 0
4/23/03
Refunding Bonds
1.40-4.35%
0
445,000
0
445,000
7/07/03
BANS
4.00%
0
1,332,837
0
1,332,837
a 7/07/03
BANS
4.00%
0
273,315
0
273,315
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Total
$ 460,000
$ 2,051,152
$ 460,000
$ 2,051,152
See Notes to Financial Statements
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Year Ending
September 30,
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
BLAIR AIRPORT AUTHORITY
STATEMENT OF GENERAL OBLIGATION BONDS
PRINCIPAL AND INTEREST REQUIREMENTS
BY YEAR OF MATURITY
September 30, 2003
Principal
Interest
Requirements
Requirements
Total
$ 1,352,837
$ 39,747
$ 1,392,584
30,000
24,562
54,562
303,315
18,613
321,928
30,000
12,583
42,583
30,000
11,907
41,907
30,000
11,120
41,120
30,000
10,228
40,228
30,000
9,231
39,231
35,000
8,058
43,058
35,000
6,736
41,736
35,000
5,362
40,362
35,000
3,945
38,945
35,000
2,484
37,484
40,000
870
40,870
$ 2,051,152
$ 165,446
$ 2,216,598
See Notes to Financial Statements
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BLAIR AIRPORT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Introduction:
The Blair Airport Authority (Airport) complies with Generally Accepted Accounting
Principles, (GAAP). The Airport's reporting entity applies relevant Governmental
Accounting Standards Board (GASB) pronouncements.
In June 1999, the Governmental Accounting Standards Board (GASB) issued Statement
34 "Basic Financial Statements and Management's Discussion and Analysis for the
State and Local Governments." This Statement establishes new financial reporting
requirements for state and local governments throughout the United States. When
implemented, it will require new information and restructure much of the information that
governments have presented in the past. Comparability within reports issued in all prior
years will be affected. The Airport is required to implement this standard for the fiscal
year ending September 30, 2004. The Airport has not yet determined the full impact
that adoption of GASB Statement. 34 will have on the financial statements.
The accounting and reporting framework and the more significant accounting principles
and practices are discussed in subsequent sections of this note. The remainder of the
notes are organized to provide explanations including required disclosures of the
Airport's financial activities for the fiscal year ended September 30, 2003.
B. Reporting Entity:
All significant activities and organizations in which the Airport exercises oversight
responsibility have been included in the Airport general purpose financial statements for
the year ended September 30, 2003. The following criteria regarding manifestation of
oversight were considered by the Airport in its evaluation of Airport organizations and
activities:
I Financial interdependency: The Airport is responsible for its debts and is entitled to
surpluses. No separate agency receives a financial benefit nor imposes a financial
burden on the Airport.
Election of the government authority: The locally elected Airport Authority Board is
exclusively responsible -for all public decisions and accountable for the decisions it
makes.
n.
BLAIR AIRPORT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
C. Fund Types and Account Groups:
Governmental fund types: Governmental funds use the current financial resources
measurement focus. Only current assets and current liabilities are generally included on
their balance sheets. Their operating statements present sources and uses of available
resources during a given period.
Account groups: The account groups are used to account for fixed assets and long-
term liabilities which are not reported in the respective governmental funds.
D. Basis of Accounting:
All Governmental Funds are accounted for using the modified accrual basis of
accounting. Their revenues are recognized when earned and expenditures are
recognized when incurred except that property taxes are not recorded until collected as
they are not practicably measurable and interest on general obligation bonds is not
recorded until coupons mature.
The Airport does not apply encumbrance accounting in any of its funds.
E. Budgetary Basis:
The Airport's legally adopted budget is not in conformity with generally accepted
accounting principles. The budget is prepared and adopted using the cash basis of
accounting whereby revenues budgeted are expected to be received rather than earned
and expenditures budgeted are expected to be disbursed rather than incurred. There
are no significant differences between the budgeted basis of accounting and the
generally accepted basis. The Airport Board sets the property tax levy needed to
support the coming years budget in August of each year and submits its budget as
required by State Statute.
F. Budgetary Control:
Each funds appropriated budget is prepared on a detailed line item basis. Revenues
are budgeted by source. Expenditures are budgeted by department. This constitutes
the legal level of control. Expenditures may not exceed appropriations at this level. All
budget revisions at this level are subject to final review by the Airport Board. No
revisions to the budget were made for the year ended September 30, 2003.
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BLAIR AIRPORT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
G. Cash and Cash Equivalents:
For the purposes of the Statement of Cash Flows the Airport considers all short-term
debt instruments purchased with a maturity of three months or less to be cash
equivalents.
H. Fixed Assets:
All fixed assets are recorded at cost or estimated cost if actual cost not available.
Assets in general fixed asset funds are recorded as expenditures at the time of
purchase with the accumulated cost being presented in the general fixed asset group of
accounts for measurement purposes only. Certain improvements such as roads,
bridges, curbs and gutters, streets and sidewalks, drainage systems, and lighting
systems are not capitalized. No depreciation is provided for assets in the general fixed
asset group of accounts.
I. Deposits and Investments:
The statutes of the State of Nebraska require that local governmental units follow the
"prudent man" rule with deposits. The Airport requires that it have deposits one hundred
and ten percent secured by collateral valued at market or par whichever is lower less
that amount of the Federal Deposit Insurance Corporation Insurance. Total deposits at
September 30, 2003, were $14,234.
Deposits consist of savings accounts and certificates of deposit with current maturities.
The deposits are entirely Category 1 which means that the investments are insured or
collateralized with securities held by the entity's agent.
J. Compensated Absences:
The Airport Authority does not accrue compensated absences because the Airport
Authority has no employees.
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BLAIR AIRPORT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
2. PROPERTY TAX CALENDAR
The Airport's December 31, 2002 valuation was $348,875,016: The levy for the Airport for
the year ending September 30, 2003 was .013 per $100 of value. The total tax levy was
$44,100. Property taxes are due December 31 of each year and delinquent in halves at May
1 and September 1 of the following year.
3. CONCENTRATION OF CREDIT RISK
All of the receivables of the Blair Airport Authority are from the local Blair area therefore
creating a concentration of credit risk. If the Blair area economy was depressed this could
have an adverse effect on the collection of the outstanding accounts receivable.
4. RISK MANAGEMENT
The Airport is exposed to various risks of loss related to torts; theft, damage to and
destruction to assets; errors and omissions; injuries to employees; and natural disasters.
These risks are covered by the purchase of commercial insurance. The Airport assumes
liability for any deductibles and claims in excess of coverage limitations. Settled claims from
these risks have not exceeded commercial insurance coverage in any of the post three fiscal
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5. REGISTERED WARRANTS
The Airport has $66,200 of outstanding registered warrants at September 30, 2003. The
warrants are due currently and bear an average interest rate of 4.25%. The accrued interest
at September 30, 2003, was $3,680.
6. SALE OF PROPERTY— CONTINGENCY
The Airport Authority entered into a contract to sell certain real estate on March 27, 2002.
The sale in the amount of $236,000 was contingent on the entire property remaining a golf
course. This restriction can only be lifted with approval of the City of Blair.
7. DEFICIT FUND BALANCE
The Blair Airport Authority General fund had a deficit fund balance of $66,179 as of
September 30, 2003. The deficit is the result of registered warrants issued in excess of
general fund unreserved assets. The General Fund had excess expenses over revenues for
September 30, 2003.
The Blair Airport Authority has been approved for two grants through the Federal Aviation
Administration for land acquisition in the amount of $1,192.137 and $5,422,712 as of
September 30, 2003. Pending applications for costs incurred through September 30, 2003
have been applied for in the amount of $350,560.
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EDWARD W. SCHROEDER
i'
CERTIFIED PUBLIC ACCOUNTANT
1904 SOUTH STREET OFFICE:
BOX 486
(402)426-4080
9 BLAIR, NEBRASKA 68008 FAX:
(402)426-9340
December 5, 2003
3
Honorable Chairman and Members
of the Airport Authority Board
Blair, Nebraska
"Compliance and Internal Control over financial reporting"
Dear Gentlemen:
I have audited the financial statements of the Blair Airport Authority as of and for the year ended
September 30, 2003, and have issued my report thereon dated December 5, 2003. 1 conducted my
1 audit in accordance with generally accepted auditing standards in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by
the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Blair Airport Authority's financial
statements are free of material misstatement, I performed tests of its compliance with certain
provisions of laws, regulations, contracts and grants, 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 my audit and, accordingly, I do
not express such an opinion. The results of my tests disclosed no instances of noncompliance that
are required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing my audit, I considered Blair Airport Authority's internal control over
financial reporting in order to determine my auditing procedures for the purpose of expressing my
opinion on the financial statements and not to provide assurance on the internal control over
financial reporting. However, I noted certain matters involving the internal control over financial
reporting and its operation that I consider to be reportable conditions. Reportable conditions involve
matters coming to my attention relating to significant deficiencies in the design or operation of the
internal control over financial reporting that, in my judgment, could adversely affect the Blair Airport
Authority's ability to record, process, summarize and report financial data consistent with the
assertions of management in the financial statements. Reportable conditions are described in the
accompanying schedule of findings and questioned costs as the lack of separation of duties.
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Honorable Chairman and Members
of the Airport Authority Board
Page 2
A material weakness is a condition in which the design or cooperation of one or more of the internal
control components does not reduce to a relatively low level the risk that misstatements 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 over financial reporting would not
necessarily disclose all matters in the internal control that might be reportable conditions and,
accordingly, would not necessarily disclose all reportable conditions that are also considered to be
material weaknesses.
However, the reportable conditions described above I consider to be material weaknesses. The
condition, criteria, effect and cause is the lack of separation of duties due to the small size of the
entity.
This report is intended solely for the information and the use of the audit committee, management,
others within the organization, board members, and federal awarding agencies and pass-through
entities and is not intended to be and should not be used by anyone other than these specified
parties.
Edward W. Schroeder
Certified Public Accountant
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Blair Airport Authority
Schedule of Findings
Year ended September 30, 2003
INSTANCES OF NON-COMPLIANCE:
No matters were noted.
REPORTABLE CONDITIONS:
Segregation of Duties — One important aspect of :internal control is the segregation of
duties among employees to prevent an individual employee from handling duties which
are incompatible. The depositing, investing and the preparation of reports are all done
by the same person.
Recommendation - We realize that with a limited number of office employees,
segregation of duties is difficult. However, the Airport should review its control
procedures to obtain the maximum internal control possible under the circumstances.
Response — We will consider this.
Conclusion — Response acknowledged. The Airport could segregate duties to the
extent possible with existing personnel and utilize the board to provide additional control
through review of financial transactions and reports.
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