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FY1996 Audit Report CityCITY OF BLAIR, NEBRASKA SEPTEMBER 30, 1996 CITY OF BLAIR, NEBRASKA TABLE OF CONTENTS Page INDEPENDENT AUDITORS' OPINION 1-2 COMBINED STATEMENTS: Combined Balance Sheet - All Fund Types and Account Groups 3-4 Combined Statement of Revenue, Expenditures and Changes in Fund Balance - All Government Fund Types 5-6 Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - General Fund 7 Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - Debt Service Fund 8 Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - Special Revenue Fund 9 Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - Capital Improvement Fund 10 Combined Statement of Revenues, Expenses and Changes in Retained Earnings/Fund Balance - Budget (Cash Basis) and Actual - All Proprietary Fund Types and Similar Trust Funds 11 General Fixed Assets Account Group: Statement of General Fixed Assets 12 Statement of Changes in General Fixed Assets 13 General Long -Term Debt Account Group: Statement of General Obligation Bonds Principal and Interest Requirements by Year of Maturity 14 Statement of Changes in General Long -Term Debt 15 Combined Statement of Cash Flow - All Proprietary Fund Types and Similar Trust Funds 16 Comparative Combined Balance Sheets - General and Special Revenue Funds 17 Comparative Combined Balance Sheets - Debt Service and Capital Improvement Funds 18 Comparative Combined Balance Sheets - Enterprise and General Insurance Funds 19 Comparative Combined Balance Sheets - General Fixed Assets and General Long -Term Debt 20 Comparative Combined Statement of Revenues, Expenditures And Changes in Fund Balances - General and Special Revenue Funds 21 Comparative Combined Statement of Revenues, Expenditures And Changes in Fund Balances - Debt Services and Capital Improvements Funds 22 Comparative Combined Statement of Revenues, Expenditures And Changes in Retained Earnings/Fund Balances - Enterprise and Insurance Funds 23 NOTES TO FINANCIAL STATEMENTS 24-31 CITY OF BLAIR, NEBRASKA TABLE OF CONTENTS STATEMENTS OF INDIVIDUAL FUNDS: Page SPECIAL REVENUE FUNDS: Combining Balance Sheet 32 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Special Revenue Funds 33 Individual Statement of Gross Proceeds Distribution and Changes in Fund Balance - Budget (Cash Basis) and Actual - Special Revenue Funds - Keno Fund 34 Individual Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - Street Fund 35 Individual Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - M.I.R.F Fund 36 Individual Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - Revolving Loan Fund 37 Individual Statement of Revenues, Expenditures and Changes in Fund Balance - Budget (Cash Basis) and Actual - Development Fund 38 ENTERPRISE FUNDS: Combining Balance Sheet 39-40 Combining Statement of Revenues, Expenses, and Changes in Retained Earnings 41 Combining Statement of Cash Flow 42 Individual Statement of Revenues and Expenses - Budget (Cash Basis) and Actual - Water 43-44 Individual Statement of Revenues and Expenses - Budget (Cash Basis) and Actual - Sewer 45 SUPPORTING SCHEDULES: Schedule of General Fund Revenues - Budget (Cash Basis) and Actual 46 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Administration Department 47 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Contingency Allowance 48 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Police Department 49 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Cemetery 50 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Fire Department 51 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Park Department 52 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Library 53 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Supervised Recreation 54 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Swimming Pool 55 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Landfill 56 CITY OF BLAIR, NEBRASKA TABLE OF CONTENTS Paste Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Animal Control 57 Schedule of General Fund Expenditures - Budget (Cash Basis) and Actual - Donated Funds 58 Report on Schedule of Federal Financial Assistance 59 Schedule of Federal Financial Assistance 60-61 Compliance Report - General Purpose 62 Internal Control Report - General Purpose 63-65 Compliance Report - Non -major Specific 66 Compliance Report - Major Specific 67 Compliance Report - General Requirements 68 Internal Control Report - Federal Financial Assistance 69-71 EDWARD. SCHE CERTIFIED PUBLIC ACCOUNTANT 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 Honorable Mayor and Members of the City Council City of Blair, Nebraska Gentlemen: December 4, 1996 RESIDENCE: (402) 468-5253 OFFICE: (402) 426-4080 "Independent Auditor's Report" I have audited the general purpose financial statements of the City of Blair, Nebraska, and the combining, individual fund, and account group financial statements of the City as of and for the year ended July 31, 1995, and the fourteen months ended September 30, 1996, as lasted in the table of contents. These financial statements are the responsibility of the entity. 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 issued by the comptroller General of the United States, and the provisions of the Office of Management and Budget Circular A-128, "Audits and State of Local Governments." 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. As described more fully in Note 1, the budgetary comparisons included in the combined statements of revenues and expenditures are on the basis of cash receipts and expenditures which is different from the accrual basis on which the actual amounts are reported. The budgetary information included for the fourteen months ended September 30, 1996, has not been compiled or audited by me and, accordingly, I do not express an opinion or any other form of assurance on it. Management has elected to omit the summaries of significant assumptions and accounting policies required under established guidelines for presentation of prospective financial statements. If the omitted summaries were included in the budgeted information, they might influence the user's conclusions about the city's budgeted information. Accordingly, this budgeted information is not designed for those who are not informed about such matters. Mayor and Members of the City Council December 4, 1996 Page 2 In my opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Blair, Nebraska, at July 31, 1995 and September 30, 1996, and the results of its operations and the changes in cash flow for its propriety fund types for the periods then ended, in conformity with generally accepted accounting principles. Also, in my opinion, the combining, individual fund, and account group financial statements referred to above present fairly, in all material respects, the financial position of each of the individual funds and account groups of the City of Blair, Nebraska, at July 31, 1995, and September 30, 1996, and the results of operations of such funds and the changes in cash flow of the individual proprietary funds for the periods then ended, in conformity with generally accepted accounting principles. My examination was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole and on the combining, individual fund, and individual account group financial statements. The accompanying financial information listed as supporting schedules in the table of contents is presented for purposes of additional analysis and is not a required part of the financial statements of the City of Blair, Nebraska. Such information has been subjected to the auditing procedures applied in the examination of the general purpose combining, individual fund, and individual account group financial statements and, in my opinion, is fairly stated 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 CITY OF BLAIR, NEBRASKA COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30, 1996 ASSETS Amount available in Debt Service for general long-term debt retirement - Amount to be provided for retirement of general long-term debt - Contract receivable - OPPD - TOTAL ASSETS 5549.�3A Account Groups General General General Fixed Long-term Insurance Assets Debt 23,655 - - - 4,218,591 - - $ 778,296 $1,777,352 $4,449,300 $12,680,126 $ 23,655 See Notes to Financial Statements. -3- 4,539,320 - 963,831 348,840 $4,539,320 $1,312,671 Proprietary Fund Governmental Fund Types Types Special Debt Capital General Revenue Service Improvement Enterprise Cash $ 8,614 $ - $ 48,510 $ 10,872 $ 154,424 $ Receivables: Billed user fees - - - - 376,205 Special assessments - - 1,263,504 - - Accrued interest 1,124 11,294 - 189,837 13,783 Other - 186,944 - - 378 Investments -at cost (unrestricted) 499,000 - 463,000 30,000 901,597 Due from County Treasurer 40,500 - 2,338 - - Inventory - - - - 29,351 Prepaid expenses - - - - 1,619 Restricted assets - cash and investments - at cost - 580,058 - - 822,091 Property - net of accumulated depreciation, where applicable - - - - 10,380,678 Amount available in Debt Service for general long-term debt retirement - Amount to be provided for retirement of general long-term debt - Contract receivable - OPPD - TOTAL ASSETS 5549.�3A Account Groups General General General Fixed Long-term Insurance Assets Debt 23,655 - - - 4,218,591 - - $ 778,296 $1,777,352 $4,449,300 $12,680,126 $ 23,655 See Notes to Financial Statements. -3- 4,539,320 - 963,831 348,840 $4,539,320 $1,312,671 CITY OF BLAIR, NEBRASKA COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30, 1996 LIABILITIES Accounts payable Accrued interest Accrued expenses Deposits payable Registered warrants Bonds payable Revenue bonds payable Total liabilities Governmental Fund Types Special Debt General Revenue Service $ 82,768 $110,968 $ - - - 33,600 17,400 - - - - 779,921 - 205,000 - 100,168 _315,968 813,521 FUND BALANCES Contributed capital - Investment in general fixed assets - Retained earnings - appropriated - Retained earnings - unappropriated Fund balance - reserved Fund balance - unreserved Total fund balances TOTAL LIABILITIES AND FUND BALANCES - 462,328 - 449,070 - 963,831 449,070 462,328 _963,831 Proprietary Fund Types Capital Improvement Enterprise $ - $ 106,173 - 131,135 - 14,859 - 1,750 _ - 6,000,000 6,253,917 4,825,934 822,091 778,184 4,449,300 - 4,449,300 6,426,209 General Insurance 23,655 23,655 Account Groups General General Fixed Long-term Assets Debt 1,312,671 4,539,320 _4,539,320 1,312,671 $549,238 $778,296 $1,777,352 $4,449,300 $12,680,126 $ 23,655 $4,539,320 $1,312,671 See Notes to Financial Statements. -4- CITY OF BLAIR, NEBRASKA COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ALL GOVERNMENT FUND TYPES FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Debt Special Capital General Service Revenue Improvement Fund Fund Fund Fund REVENUES: Taxes Street revenues Keno proceeds Licenses and permits Charges for services Interest income Bond proceeds Grants Other revenues Total revenues EXPENDITURES: $1,345,704 $ 630,746 111,973 - 96,120 - 19,204 19,613 - 780,000 140,870 - 1,713,871 1,430,359 Administration 445,302 623 Contingency allowance 26,549 - Police Department 762,887 - Cemetery 92,994 - Fire Department 48,685 - Parks Department 94,028 - Library 173,670 - Supervised recreation 35,408 - Swimming pool 25,257 - Landfill 12,161 - Animal control 49,149 - Donated funds 4,658 - Keno expense - - M.I.R.F. fund expenses - - Development expense - - Street expense - - Park tractor - - Debt service: Bonding costs - 13,133 District construction - 748,063 Redemption of bonds - 72,513 Bond interest - 104,022 Total expenditures 1,770,748 938,354 REVENUES OVER (UNDER) EXPENDITURES $ (56,877) $ 492,005 $ 282,791 $ - 516,417 - 51,972 - 30,841 448,981 185,454 - 1,067,475 448,981 15,785 - 315,800 - 641,658 - - 4,000 973,243 4,000 $ 94,232 $ 444,981 See Notes to Financial Statements -5- REVENUES AND OTHER CITY OF BLAIR, NEBRASKA FINANCING SOURCES COMBINED STATEMENT OF REVENUES, EXPENDITURES, OVER (UNDER) AND CHANGES IN FUND BALANCE EXPENDITURES AND ALL GOVERNMENT FUND TYPES FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 199.6 (33,333) FUND BALANCE Debt Special Capital 357,128 General Service Revenue Improvement Fund Fund Fund Fund REVENUES OVER (UNDER) $ 963,831 $ 462,328 $4,449,300 EXPENDITURES $ (56,877) $492,005 $ 94,232 $ 444,981 OTHER FINANCING SOURCES (USES): Operating transfers - in 212,319 20,247 210,000 3,500 Operating transfers - out (63,500) - (33,737) (481,814) REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES 91,942 512,252 270,495 (33,333) FUND BALANCE JULY 31, 1995 357,128 451,579 191,833 4,482,633 FUND BALANCE SEPTEMBER 30, 1996 $ 449,070 $ 963,831 $ 462,328 $4,449,300 See Notes to Financial Statements. -6- CITY OF BLAIR, NEBRASKA COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL GENERAL FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 REVENUES: Taxes Licenses and permits Charges for services Interest income Other revenues Total revenues EXPENDITURES: Administration Contingency allowance Police Department Cemetery Fire Department Parks Department Library Supervised recreation Swimming pool Landfill Animal control Donated funds Total expenditures REVENUES OVER (UNDER) EXPENDITURES General Fund Variance Favorable Budget Actual (Unfavorable) $1,323,400 69,820 101,622 11,800 110,340 1,616,982 473,209 32,000 763,164 109,154 61,700 136,458 188,107 56,190 57,167 91,440 53,434 12,381 2,034,404 (417,422) $1,345,704 111,973 96,120 19,204 140,870 1,713,871 445,302 26,549 762,887 92,994 48,685 94,028 173,670 35,408 25,257 12,161 49,149 4,658 1,770,748 (56,877) $ 22,304 42,153 (5,502) 7,404 30,53-0- 27,907 0,530 27,907 5,451 277 16,160 13,015 42,430 14,437 20,782 31,910 79,279 4,285 7,723 263,656 360,544 OTHER FINANCING SOURCES (USES): Operating transfers - in 216,483 212,319 (4,164) Operating transfers - out (96,500) (63,500) 33,000 REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES (297,439) 94,942 FUND BALANCE - JULY 31, 1995 357,128 357,128 FUND BALANCE - SEPT 30, 1996 $ 59,689 $ 449,070 See Notes to Financial Statements. -7- $389,380 CITY OF BLAIR, NEBRASKA COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL DEBT SERVICE FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Debt Service Fund Variance Favorable Budget Actual (Unfavorable) REVENUES: Taxes and special assessments $ 292,923 Interest income 7,500 Bond proceeds 940,000 Other revenues 5,000 Total revenues 1,245,423 938,354 EXPENDITURES: Administration 935 Bonding costs 2,000 District construction 1,238,000 Redemption of bonds 90,892 Bond interest 63,006 Total expenditures 1,394,833 REVENUES OVER (UNDER) EXPENDITURES (149,410) OTHER FINANCING SOURCES (USES): Operating transfers - in 40,494 Operating transfers - out - REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES (108,916) FUND BALANCE - JULY 31, 1995 451,579 FUND BALANCE - SEPT 30, 1996 $ 342,663 $ 630,746 $337,823 19,613 12,113 780,000 (160,000) - (5,000) 1,430,359 184,936 623 312 13,133 (11,133) 748,063 489,937 72,513 18,379 104,022 (41,016) 938,354 456,479 492,005 641,415 20,247 (20,247) 512,252 451,579 $ 963,831 h See Notes to Financial Statements. -8- $621,168 CITY OF BLAIR, NEBRASKA COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL SPECIAL REVENUE FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Special Revenue Fund Variance Favorable Budget Actual (Unfavorable) REVENUES: Sales Tax and M.I.R.F. Keno net proceeds Street revenues Grants Interest income Total revenues EXPENDITURES: Keno expense Development expenses Street expenses Grant expenses Total expenditures REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers - in Operating transfers - out REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES FUND BALANCE - JULY 31, 1995 FUND BALANCE - SEPT 30, 1996 $ 310,500 30,800 952,079 221,000 17,800 1,532,179 70,000 78,850 1,227,079 3,000 1,378,929 153,250 210,000 (47,654) 315,596 191,833 $ 507,429 $ 282,791 51,972 516,417 185,454 30,841 1,067,475 15,785 315,800 641,658 973,243 94,232 210,000 (33,737) 270,495 191,833 $ 462,328 See Notes to Financial Statements. ME $(27,709) 21,172 (435,662) (35,546) 13,041 (464,704) 54,215 (236,950) 585,421 3,000 405,686 (59,018) 13,927 $(45,091) CITY OF BLAIR, NEBRASKA COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL CAPITAL IMPROVEMENT FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Capital Improvement Fund Variance Favorable Budget Actual (Unfavorable) REVENUES: Interest income $ 482,214 EXPENDITURES: Park tractor 4,000 Cemetery mower 4,200 Cemetery paving 4,000 Park equipment 3,000 Park truck 6,000 Heavy equipment 60,000 Pool painting 3,500 Total expenditures 84,700 REVENUES OVER (UNDER) EXPENDITURES 397,514 OTHER FINANCING SOURCES (USES): Operating transfers - in 44,000 Operating transfers - out (481,814) REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES (40,300) FUND BALANCE - JULY 31, 1995 4,482,633 FUND BALANCE - SEPT 30, 1996 $ 4,442,333 $ 448,981 $(33,233) 4,000 4,000 444,981 3,500 (481,814) (33,333) 4,482,633 $4,449,300 See Notes to Financial Statements. -10- 4,200 4,000 3,000 6,000 60,000 3,500 80,700 47,467 (40,500) $ 6,967 CITY OF BLAIR, NEBRASKA COMBINED STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN RETAINED EARNINGS/FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Enterprise Funds Variance Favorable Budget Actual (Unfavorable) OPERATING REVENUES: User fees Sale of merchandise Insurance contributions Other Total EXPENSES: Personal services Operating expenses Materials and supplies Rental expense Depreciation Payments of insurance benefits Total OPERATING INCOME (LOSS) OTHER REVENUE (EXPENSE): Loss on assets Interest income Interest expense Bond and grant fees Operating transfers - in Operating transfers - out NET INCOME (LOSS) RETAINED EARNINGS/FUND BALANCE - July 31, 1995 RETAINED EARNINGS/FUND BALANCE - Sept 30, 1996 $2,163,015 23,000 13,128 2,199,143 $2,409,625 34,453 23,439 2,467,517 $ 246,610 11,453 10,311 268,374 Insurance Fund Variance Favorable Budget Actual (Unfavorable) 319,597 338,904 19,307 612,151 624,044 (11,893) - - - 437,500 493,709 (56,209) - - - 376,128 353,330 22,798 - - - 1,900 1,930 (30) - - - - 376,917 (376,917) - - - 356,905 358,193 1,288 1,427,679 1,849,930 i(422,251) 356,905 358,193 1,288 771,464 617,587 (153,877) (37,308) (19,289) 18,019 - (18,745) (18,745) - - 705 55,400 93,266 37,866 600 1,305 (63,006) (334,923) (271,917) - - - - (59,735) (59,735) - - - 212,985 481,531 268,546 - - - (80,000) (80,000) - - - - 896,843 698,981 $ (197,862) (36,708) (17,984) $ 18,724 901,294 901,294 $1,798,137 $1,600,275 See Notes to Financial Statements. -11- 41,639 41,639 $ 4,931 $ 23,655 CITY OF BLAIR, NEBRASKA STATEMENT OF GENERAL FIXED ASSETS SEPTEMBER 30, 1996 See Notes to Financial Statements. -12- Land Buildings Vehicles Equipment Total GENERAL FUND: Administration $ 50,000 $ 936,683 $ 13,730 $ 125,874 $1,126,287 Police - - 94,858 58,821 153,679 Cemetery 115,000 30,378 14,553 14,911 174,842 Fire - - 557,012 56,368 613,380 Park 97,952 355,282 14,035 252,537 719,806 Library 22,500 116,600 - 32,491 171,591 Supervised recreation - 11,343 - 14,680 26,023 Swimming pool 100,000 237,581 - 164,538 502,119 Landfill 15,000 - - - 15,000 Animal control - 5,686 13,450 2,566 21,702 SPECIAL REVENUE FUNDS - Street 10,000 213,878 250,459 337,150 811,487 CAPITALIZED LEASE - Library - 203,404 - - 203,404 TOTALS $410,452 $2,110,835 $958,097 $1,059,936 $4,539,320 See Notes to Financial Statements. -12- CITY OF BLAIR, NEBRASKA STATEMENT OF CHANGES IN GENERAL FIXED ASSETS FOR THE YEAR ENDED SEPTEMBER 30, 1996 GENERAL FUND: Administration Police Cemetery Fire Park Library Supervised recreation Swimming pool Landfill Animal control SPECIAL REVENUE FUNDS - Street CAPITALIZED LEASE - Library TOTALS Balance Balance July 31 September 30 1995 Additions Dispositions 1996 $1,149,600 $ 16,283 $ 39,596 $1,126,287 150,132 42,083 38,536 153,679 180,046 - 5,204 174,842 591,583 23,648 1,851 613,380 727,328 34,361 41,883 719,806 169,797 1,794 - 171,591 38,719 4,935 17,631 26,023 503,042 - 923 502,119 21,700 - 6,700 15,000 21,702 - - 21,702 893,398 47,061 128,972 811,487 203,404 - - 203,404 $4,650,451 $170,165 $281,296 $4,539,320 See Notes to Financial Statements. -13- ,- CITY OF BLAIR, NEBRASKA f STATEMENT OF GENERAL OBLIGATION BONDS PRINCIPAL AND INTEREST REQUIREMENTS BY YEAR OF MATURITY SEPTEMBER 30, 1996 Year Ending Principal Interest September 30, Requirements Requirements Total 1997 $ 138,380 $ 77,475 $ 215,855 ° 1998 149,291 53,974 203,265 1999 140,000 46,941 186,941 2000 140,000 40,322 180,322 2001 120,000 34,244 154,244 2002 130,000 28,598 158,598 2003 135,000 22,305 157,305 2004 140,000 15,772 155,772 2005 125,000 8,757 133,757 2006 95,000 2,280 97,280 $1,312,671 $330,668 $1,643,339 See Notes to Financial Statements. -14- CITY OF BLAIR, NEBRASKA STATEMENT OF CHANGES IN GENERAL LONG-TERM DEBT FOR THE YEAR ENDED SEPTEMBER 30, 1996_ Balance Balance Interest July 31 Sept 30 Dated Description Rate 1995 Additions Deductions 1996 10/15/91 Fire Department bonds 5.00-6.20% $115,000 $ - $ 20,000 $ 95,000 2/15/94 Various purpose 3.00-4.70% 175,000 - 15,000 160,000 11/15/94 Street sweeper Loan 5.00% 55,184 - 17,513 37,671 3/01/95 Various purpose 5.10-5.95% 260,000 - 20,000 240,000 1/15/96 Various purpose 5.90-4.80% -0- 780,000 -0- 780,000 TOTAL $605,184 $780,000 $ 72,513 $1,312,671 See Notes to Financial Statements. -15- CITY OF BLAIR, NEBRASKA COMBINED STATEMENT OF CASH FLOW ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996. General Enterprise Insurance Funds Funds CASH FLOW FROM OPERATIONS: Net operating income (loss) $ 617,587 $(19,289) Adjustment to reconcile net income to net cash from operations: Depreciation 376,917 - Decrease (increase) in accounts receivable -user fees (5,781) - Decrease (increase) in accounts receivable -other 1,884 - Decrease (increase) in inventory 949 - Decrease (increase) in prepaid expenses 3,982 - Increase (decrease) in accounts payable (94,565) Decrease in accrued expenses 9,963 - Increase (decrease) in deposits payable (570) - Net cash provided (used) by operations 910,366 (19,289) CASH FLOW FROM INVESTING: Purchase of property (1,613,079) - Interest income 93,266 1,305 Transfers - net 401,531 - Decrease (increase) in accrued interest receivable (2,992) - Cash from (used by) investing (1,121,274) 1,305 CASH FLOW FROM FINANCING: Increase in contributed capital 28,829 - Increase in long-term debt 1,240,000 - Decrease (increase) in restricted assets (436,341) - Interest expense (334,923) - Bonding costs & grant fees (59,735) - Increase (decrease) in accrued interest payable (10,877) - Cash from (used in) financing 426,953 - NET INCREASE (DECREASE) IN CASH 216,045 (17,984) CASH AND CASH EQUIVALENTS - Beginning of the period 839,976 41,639 CASH AND CASH EQUIVALENTS - End of the period $1,056,021 $ 23,655 See Notes to Financial Statements. -16- CITY OF BLAIR, NEBRASKA COMPARATIVE COMBINED BALANCE SHEETS GENERAL AND SPECIAL REVENUE FUNDS AS OF JULY 31, 1995 AND SEPTEMBER 30, 1996 ASSETS Cash Receivables: Billed user fees Accrued interest Other Investments - at cost (unrestricted) Due from County Treasurer Restricted assets - cash and investments - at cost TOTAL ASSETS LIABILITIES Accounts payable Accrued expenses Deposits payable Revenue bonds payable Total Liabilities FUND BALANCES Fund balance - reserved Fund balance - unreserved Total Fund Balances TOTAL LIABILITIES AND FUND BALANCES GENERAL FUNDS 1995 1996 $120,271 480 277,500 26,062 $424.313 $ 53,785 13,400 67,185 357,128 357,128 8424.313 $ 8,614 1,124 499,000 40,500 $549,238 $ 82,768 17,400 100,168 449,070 449,070 $549.238 SPECIAL REVENUE FUNDS 1995 1996 868 63,059 569,945 $633.872 $ 37,039 405,000 442,039 11,294 186,944 580,058 $778,296 $110,968 205,000 315,968 191,833 462,328 191,833 462,328 $633,872 $778,296 See Notes to Financial Statements. -17- CITY OF BLAIR, NEBRASKA COMPARATIVE COMBINED BALANCE SHEETS DEBT SERVICE AND CAPITAL IMPROVEMENT FUNDS AS OF JULY 31, 1995 AND SEPTEMBER 30, 1996 ASSETS Cash Receivables: Special assessments Accrued interest Investments - at cost (unrestricted) Due from County Treasurer Contract receivable - OPPD TOTAL ASSETS DEBT SERVICE FUNDS 1995 1996 $ 157,941 $ 48,510 1,057,139 1,263,504 300,000 463,000 1,573 2,338 $1,516,653 $1,777,352 LIABILITIES Accounts payable $ - $ - Accrued interest 18,534 33,600 Registered warrants 1,046,540 779,921 Total Liabilities 1,065,074 813,521 FUND BALANCES Fund balance - unreserved 451,579 963,831 TOTAL LIABILITIES AND FUND BALANCES $1,516,653 $1,777,352 CAPITAL IMPROVEMENT FUNDS 1995 1996 $ 40,965 129,369 4,312,299 $4,482,633 $ 10,872 189,837 30,000 4,218,591 $4,449,300 4,482,633 4,449,300 $4,482,633 $4,449,300 See Notes to Financial Statements. -18- CITY OF BLAIR, NEBRASKA COMPARATIVE COMBINED BALANCE SHEETS ENTERPRISE AND GENERAL INSURANCE FUNDS AS OF JULY 31, 1995 AND SEPTEMBER 30, 1996 See Notes to Financial Statements. -19- GENERAL ENTERPRISE INSURANCE FUNDS FUNDS 1995 1996 1995 1996 ASSETS Cash $ 205,776 $ 154,424 $ - $ - Receivables: Billed user fees 370,424 376,205 - - Accrued interest 10,791 13,783 - - Other 2,262 378 - - Investments - at cost (unrestricted) 634,200 901,597 - - Inventory 30,300 29,351 - - Prepaid expenses 5,601 1,619 - - Restricted assets - cash and investments - at cost 385,750 822,091 41,639 23,655 Property - net of accumulated depreciation, where applicable 9,163,261 10,380,678 - - TOTAL ASSETS $10,808,365 $12,680,126 $ 41,639 $ 23,655 LIABILITIES Accounts payable $ 200,738 $ 106,173 $ - $ - Accrued interest 142,012 131,135 - - Accrued expenses 4,896 14,859 - - Deposits payable 2,320 1,750 - - Revenue bonds payable 4,760,000 6,000,000 - - Total Liabilities 5,109,966 6,253,917 - - FUND BALANCES Contributed capital 4,797,105 4,825,934 - - Retai.ned earnings - appropriated 385,750 822,091 - - Retained earnings - unappropriated 515,544 778,184 - - Fund balance - reserved - - 41,639 23,655 Total Fund Balances 5,698,399 6,426,209 41,639 23,655 TOTAL LIABILITIES AND FUND BALANCES $10,808,365 $12,680,126 $ 41,639 $ 23,655 See Notes to Financial Statements. -19- CITY OF BLAIR, NEBRASKA COMPARATIVE COMBINED BALANCE SHEETS GENERAL FIXED ASSETS AND GENERAL LONG-TERM DEBT AS OF JULY 31, 1995 AND SEPTEMBER 30, 1996 ASSETS Property - net of accumulated depreciation, where applicable Amount available in Debt Service for general long-term debt retirement Amount to be provided for retirement of general long-term debt TOTAL ASSETS LIABILITIES Bonds payable Total Liabilities FUND BALANCES Investment in general fixed assets TOTAL LIABILITIES AND FUND BALANCES GENERAL FIXED ASSETS GENERAL LONG-TERM DEBT 1995 1996 1995 1996 $4,650,451 $4,539,320 $ 451,579 963,831 - 153,605 348,840 $4,650,451 $4,539,320 $605,184 $1,312,671 $605,184 $1,312,671 605,184 1,312,671 4,650,451 4,539,320 - $4,650,451 $4,539,320 $605,184 $1,312,671 See Notes to Financial Statements. -20- CITY OF BLAIR, NEBRASKA COMPARATIVE COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GENERAL AND SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JULY 31, 1995 AND THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 REVENUES Taxes Keno net proceeds Street revenues Licenses and permits Charges for services Interest income Grant proceeds Other revenues Total revenues GENERAL FUNDS 1995 1996 $1,050,002 $1,345,704 59,007 111,973 119,226 96,120 9,466 19,204 345,110 140,870 1,582,811 1,713,871 SPECIAL REVENUE FUNDS 1995 1996 $ 389,040 $ 282,791 53,917 51,972 431,139 516,417 16,836 30,841 - 185,454 890,932 1,067,475 EXPENDITURES Administration 411,130 445,302 - - Contingency allowance 6,677 26,549 - - Police Department 603,507 762,887 - - Cemetery 85,820 92,994 - - Fire Department 45,414 48,685 - - Parks Department 94,549 94,028 - - Library 141,034 173,670 - - Supervised recreation 39,858 35,408 - - Swimming pool 44,192 25,257 - - Landfill 7,583 12,161 - - Animal control 40,172 49,149 - - Donated funds - 4,658 - - Keno expenses - - 12,182 15,785 M.I.R.F. fund - - - - Development - - 105,470 315,800 Street - - 596,499 641,658 Total expenditures 1,519,936 1,770,748 714,151 973,243 REVENUES OVER (UNDER) EXPENDITURES 62,875 (56,877) 176,781 94,232 OTHER FINANCING SOURCES (USES): Operating transfers - in 140,036 212,319 180,000 210,000 Operating transfers - out (173,653) (63,500) (46,000) (33,737) REVENUES AND OTHER FINANCIAL SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES FUND BALANCE - BEGINNING FUND BALANCE - ENDING 29,258 91,942 310,781 270,495 327,870 357,128 (118,948) 191,833 $ 357,128 $ 449,070 $ 191,833 $ 462,328 See Notes to Financial Statements -21- CITY OF BLAIR, NEBRASKA COMPARATIVE COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES DEBT SERVICES AND CAPITAL IMPROVEMENTS FUNDS FOR THE YEAR ENDED JULY 30, 1995 AND THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 REVENUES Taxes and special assessments Interest income Bond proceeds Other revenues Total revenues EXPENDITURES Administration Capital outlay Debt service: Bonding costs District construction Redemption of bonds Bond interest Total expenditures REVENUES OVER (UNDER) EXPENDITURES DEBT CAPITAL SERVICE IMPROVEMENT FUNDS FUNDS 1995 1996 1995 1996 $1,116,789 $ 630,746 $ - $ - 12,204 19,613 393,724 448,981 260,000 780,000 - - 64,087 - - 1,453,080 1,430,359 393,724 448,981 1,438 623 - - - - 9,500 4,000 6,500 13,133 1,113,670 748,063 - 161,233 72,513 - 48,642 104,022 - 1,331,483 938,354 91500 OTHER FINANCING SOURCES (USES): Operating transfers - in Operating transfers - out REVENUES AND OTHER FINANCIAL SOURCES OVER (UNDER) EXPENDITURES AND OTHER USES FUND BALANCE - BEGINNING FUND BALANCE - ENDING 121,597 492,005 114,290 20,247 1,274) - 384,224 4.000 34,000 3,500 (481,815) (481,814) 234,613 512,252 ( 63,591) (33,333) 216,966 451,579 4,546,224 4,482,633 $ 451,579 $ 963,831 $4,482,633 $4,449,300 See Notes to Financial Statements SPxz CITY OF BLAIR, NEBRASKA COMPARATIVE COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN RETAINED EARNINGS/FUND BALANCES ENTERPRISE AND INSURANCE FUNDS FOR THE YEAR ENDED JULY 31, 1995 AND FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 OPERATING REVENUES: User fees Sale of merchandise Insurance contributions Other Total EXPENSES: Personal services Operating expenses Materials and supplies Rental expense Depreciation Payments of insurance benefits Total OPERATING INCOME (LOSS) OTHER REVENUE (EXPENSE): Loss on assets Interest income Interest expense Bonding costs Operating transfers - in Operating transfers - out NET INCOME (LOSS) ENTERPRISE FUNDS INSURANCE FUNDS 1995 1996 1995 1996 $1,283,363 25,919 13,522 1,322,804 500,701 303,937 253,727 1,475 331,880 1,391,720 ( 68,916) 89,812 (246,537) ( 33,860) 324,604 ( 90,189) (25,086) RETAINED EARNINGS/FUND BALANCE Beginning 926,380 RETAINED EARNINGS/FUND BALANCE Ending $ 901,294 $2,409,625 $ - $ - 34,453 - - - 268,918 338,904 23,439 - - 2,467,517 268,918 338,904 624,044 - - 493,709 - - 353,330 - - 1,930 - - 376,917 - - - 256,353 358,193 1,849,930 256,353 358,193 617,587 12,565 (19,289) (18,745) - - 93,266 706 1,305 (334,923) - - (59,735) - - 481,531 - - (80,000) - - 698,981 13,271 (17,984) 901,294 28,368 41,639 $1,600,275 $ 41,639 $ 23,655 See Notes to Financial Statements -23- CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Blair accounts for its financial position and results of operations in accordance with generally accepted accounting principles applicable to governmental units. Accordingly, the City uses several funds and account groups which are described below. r A. Fund Types and Account Groups: A fund or account group is an accounting entity with a self -balancing set of accounts established to record the financial position and results of operations of a specific governmental activity. The City maintains the following fund types and account groups: Governmental fund types, that include the General Fund, Special Revenue Funds, and the Debt Service Fund, are used to record the general operations of the City; Proprietary fund types, that are used to account for activities conducted on a fee for service basis in a manner similar to commercial enterprises, provide services to the public (enterprise funds); Fiduciary fund types (trust and insurance funds), that are used to account for assets held by the City as an agent for private individuals or organizations or in trust; General fixed assets and general long-term obligation account groups, that are used to account for property and equipment and long-term obligations of governmental funds. General long-term bonded debt was repaid through the Debt Service Fund. B. Reporting Entity: All significant activities and organizations on which the City exercises oversight responsibility have been included in the City's general purpose financial statements, for the year ended July 31, 1995 and fourteen months ended September 30, 1996. The following criteria regarding manifestation of oversight were considered by the City in its evaluation of the City organizations and activities: Financial interdependency -The City is responsible for its debts and is entitled to surpluses. No separate agency receives a financial benefit nor imposes a financial burden on the City. Election of the government authority -The locally elected City Council is exclusively responsible for all public decisions and accountable for the decisions it makes. -24- CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS, Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Designation of management -The City Council appoints the City Administrator. The City Administrator hires other members of City management. The activities under the purview of management are within the scope of the reporting entity and management is accountable to the City Council for the activities being managed. Ability to significantly influence operations -The City Council has the statutory authority under the provisions of the Revised Statutes to significantly influence operations. This authority includes, but is not limited to, adoption of the budget, control over all assets, including facilities and properties, short term borrowing, signing contracts, and developing the programs to be provided. Accountability of fiscal matters -The responsibility and accountability over all funds is vested in the City management. C. Basis of Accounting: The State of Nebraska required all municipalities to change their year ends from July to September as of September 30, 1996. That is why the statements ended September 30, 1996 are for a fourteen month period. 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 proprietary fund types and similar trust funds are accounted for using the accrual basis whereby revenues are recognized when earned and expenses are recognized when incurred. The City does not apply encumbrance accounting on any of its funds. D. Debt Service Fund: The Debt Service Fund is used to account for the payment of principal and interest on general long-term debt. The primary sources of revenue are property taxes and special assessments. E. Inventory• Inventory is stated at the lower of cost (first -in, first -out) or market value. The consumption method is used in regard to inventory expenditure recognition. -25- CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS, Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) F. Property: All fixed assets are recorded at cost or estimated cost if actual cost is not available. The proprietary and fiduciary fund assets are presented on the respective balance sheets except for the cost of any underground utility lines which are not included in the assets. Depreciation of the assets is computed on a straight-line method over the estimated useful lives of the assets. The range of estimated lives is from five to fifty years. Assets in other than proprietary and fiduciary funds are recorded as expenditures at the time of purchase with the accumulated cost being presented in the general fixed asset group of accounts. 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. G. Budgetary Basis: The City's legally adopted budget is based on requirements of the State of Nebraska. The budget is prepared and adopted using the cash basis of accounting whereby revenues are budgeted when expected to be received rather than earned and expenditures are budgeted when expected to be disbursed rather than incurred. The nature and amount of the differences are not material to the financial statements. H. Compensated Absences: The City of Blair does not record accrued compensated absences as they are unmeasurable as of July 31, 1995, and September 30, 1996. I. Investments: The Investments are bank Certificates of Deposit or U.S. Government Securities with no unusual restrictions other than penalty for early withdrawal. All unrestricted investments are short-term. Investments are stated at cost, which approximates market value. All investments are entirely insured or collateralized with U.S. Government Securities and are considered cash equivalents. -26- CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS, Continued 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) The City's investments are categorized to give an indication of the level of risk assumed by the City at year end. The City's investments are all category 1, which means that the investments are insured or registered. The securities are held by the City or its agent in the City's name. 2. RESTRICTED ASSETS Restricted assets consist of cash, certificates of deposit, and government securities. The assets are restricted as follows: Keno funds Street funds M.I.R.F funds Development funds Revolving loan fund Bond and Interest sinking fund Reserve for insurance claims Total restricted assets Keno funds Street funds M.I.R.F funds Development funds Bond and Interest sinking fund Reserve for insurance claims Total restricted assets 1996 Special Enterprise Insurance Revenue Fund Funds Funds $ 77,949 $ - $ - 190,984 8,654 - - 297,175 - - 5,296 822,091 - - - 23,655 $580,058 $ 822,091 $ 23,655 1995 Special Enterprise Insurance Revenue Fund Funds Funds $ 37,828 $ - $ - 75,967 4,850 - - 451,300 - 385,750 - - - 41,639 $569,945 $ 385,750 $ 41,639 -27- CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS, continued 3. LONG-TERM DEBT Water Debt: Rate Total Refunding Bonds 3.2 - 6.30 $1,970,000 Water Revenue Bonds 4.05- 5.40 $3,050,000 Annual Principal Requirements For Water Bonds Year Ending September 30, 1997 $ 340,000 1998 350,000 1999 350,000 2000 360,000 2001 380,000 2002-2014 3,240,000 TOTAL $5,020,000 The City of Blair secured the November 1, 1992 refunding bonds by pledging $20,000 of annual M.I.R.F. receipts to the payment of the bonds through September 30, 1999. The issuance of the November 1, 1992 bonds provided funds for the defeasance of an June 15, 1988 issue callable May 1, 1995. The amount defessed was $2,310,000. The economic gain of the refinance was $430,648. The funds necessary for defeasement have been placed in non -accessible trust accounts. There was no interest capitalized during 1995 or 1996. Sales Tax Revenue Bonds: Rate Total November 15, 1993 2.7-3.50 $205,000 Annual Principal Year Ending September 30 1997 $205,000 TOTAL $205,000 The payment of the Sales Tax Revenue Bonds is collateralized by the pledging of future sales tax receipts. Sewer Bond Anticipation Notes: Rate DUE AMOUNT October 13, 1995 4.25% October 15, 1998 $980,000 9-* CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS, continued 4. PENSION PLANS The city has two pension plans covering substantially all of its employees. Employees other than policemen are covered by a defined contribution plan. All contributions up to 50 of gross wage in employee contributions and 50 of gross wage in contributions from the City are invested with an investment manager. The employees must have accumulated six months of service, be at least age 21, and work 40 hours per week to participate in the plan. Employees are 100% vested in employer contributions after seven years of service. The plan is a single employer plan with the City maintaining fiduciary responsibility for it. Contributions for the periods ended July 31, 1995 and September 30, 1996, were $67,986 and $84,714 respectively. Contributions are expected to remain relatively level from year to year. The 1996 covered payroll and total payroll were $847,140 and $1,011,306 respectfully. The policemen are covered under a defined benefit plan established by the statutes of the State of Nebraska. Policemen terminating before retirement age receive payment for their contributions to date of termination plus interest accrued and the vested portion of the City's contributions based on the statutes of the State of Nebraska. The City has fiduciary responsibility for the plan and it is a single employer plan only. Contributions of $42,427 for 1995 and $59,313 for 1996, were 120 of gross wages which compiles with statutory requirements. The City contributed 6 percent of gross wages and the policemen contributed 6 percent. The City has no material pension benefit obligations as of January 1, 1990, per Actuarial Report dated November 7, 1990. The City does expect E; contributions to remain relatively level from year to year. The contributions are not actuarially determined. All qualifying police payroll was covered in 1995 and 1996. During the year ended July 31, 1984, the City transferred police pension funds to an independent trustee for investment. The trustee will maintain the fund according to state law. This change in pension fund maintenance eliminated the need for the police pension fund. Contributions to the trustee were reported as an expenditure. 5. OTHER ASSET - ELECTRIC PLANT CONTRACT In April 1984, the City of Blair contracted to sell its electrical transmission and distribution generating facilities to the Omaha Public Power District. The terms of the agreement were as follows: Omaha Public Power District agreed to buy the City of Blair facilities for the sum of $5,950,000. The terms of payment shall be $1,000,000 payable at the date of the contract and the balance of $4,950,000 amortized over thirty years at nine percent interest per annum, with annual payments of $481,815 commencing in April 1985. This contract is unsecured. -29- CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS, Continued 5. OTHER ASSET - ELECTRIC PLANT CONTRACT (Continued) This contract also provided for the Omaha Public Power District to supply electrical service directly to the City and its residents. The transfer of electrical services was completed on September 30, 1984. 6. LANDFILL CLOSURE The City of Blair has closed its landfill operations. All material closing and monitoring costs were accrued over the remaining life of the landfill. The Landfill closed October 31, 1993 and any remaining monitoring costs will be paid from City funds but are not anticipated to be material to the financial statements. 7. ACCOUNTS RECEIVABLE - SPECIAL ASSESSMENTS The City of Blair's special assessments outstanding as of July 31, 1995 and September 30, 1996, are composed of the following 1995 1996 Special assessment principle $ 355,972 $1,054,699 Special assessments available not levied 701,167 208,805 Total Special Assessments Receivable$1,057,139 $1,263,504 8. INSURANCE FUND The City of Blair self -insures certain dental and eye benefits for its employees. Effective July 1, 1991, the City no longer has self-insured medical benefits. Funds were contributed from various funds into the insurance fund for proper allocation. The contributions into the fund for July 31, 1995 and September 30, 1996, were $268,918 and $304,198 respectively. Dental and vision benefits are limited and do not create significant risk for the City. 9. CONCENTRATION OF CREDIT RISK All of the receivables of the City of Blair proprietary funds 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. -30- b CITY OF BLAIR, NEBRASKA NOTES TO FINANCIAL STATEMENTS, Continued 10. DEFICIT FUND BALANCE (Continued) The City of Blair sewer fund had a deficit fund balance of $1,062,275 as of September 30, 1996. 11. PROPERTY TAX CALENDAR The City of Blair levy date is December 31 with tax due dates by halves on May and September of the following year. Fiscal year-end September 30, 1997 levy amounts were set at 32.8682 cents per 100 General fund, 12.4705 cents per 100 Street fund and 1.9 cents per 100 Debt service fund. -31- CITY OF BLAIR, NEBRASKA COMBINING BALANCE SHEET - SPECIAL REVENUE FUNDS SEPTEMBER 30, 1996_ ASSETS Keno Street M.I.R.F. Development Revolving Fund Fund Fund Fund Loan Fund Total CASH SAVINGS $77,949 $ 50,984 $ 8,654 $ 38,175 $ 5,296 $181,058 INVESTMENTS - 140,000 - 259,000 - 399,000 REVOLVING LOAN\ KENO RECEIVABLE 4,712 - - - 182,232 186,944 ACCRUED INTEREST RECEIVABLE - - - 11,294 - 11,294 TOTAL $82,661 $190,984 $ 8,654 $308,469 $187,528 $778,296 LIABILITIES AND FUND BALANCES STATE TAX PAYABLE$ 2,900 $ - $ - $ - $ - $ 2,900 ACCOUNTS PAYABLE - 81,005 - 27,063 - 108,068 REVENUE BONDS PAYABLE - - - 2051000 - 205,000 FUND BALANCE 79,761 109,979 8,654 76,406 187,528 462,328 TOTAL $82,661 $190,984 $ 8,654 $308,469 $187,528 $778,296 -32- REVENUES: Net Keno proceeds Street revenues M.I.R.F. revenues Interest on investments Sales and use tax Grants Total revenues CITY OF BLAIR, NEBRASKA COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES SPECIAL REVENUE FUNDS FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Keno Street M.I.R.F. Development Revolving Fund Fund Fund Fund Loan Fund $51,972 $ - $ - $ - $ - 516,417 - - - 17,294 - 1,536 5,410 - 21,821 - - - 265,497 53,508 521,827 17,294 287,318 2,074 185,454 187,528 Total $ 51,972 516,417 17,294 30,841 265,497 185,454 1,067,475 EXPENDITURES: Salaries - 204,048 - - - 204,048 FICA - 15,000 - - - 15,000 Retirement - 9,204 - - - 9,204 Employee insurance - 43,044 - - - 43,044 Legal - 30 - - - 30 Engineering 4,970 - - 4,970 Auditing - , 1840 - - - 1,840 Office expenses 31 - - - 31 Dues - 307 - - - 307 Utilities - 4,405 - - - 4,405 Telephone - 1,098 - - - 1,098 Insurance - 9,521 - - - 9,521 Maintenance - 24,481 - - - 24,481 Street lighting - 117,014 - - - 117,014 Contingency reserve - - - - - - Car expense - 15,785 997 - - - - 997 - 15,785 Keno expense Collection fees - - - 9,336 - 9,336 Development expenses - - - 306,464 - 306,464 Sand, gravel and rock - 7,910 - - - 7,910 Gas, diesel and oil - 10,493 - - - 10,493 Materials and supplies - 4,915 - - - 4,915 Rental - 275 - - - 275 Capital outlay: - Motorized equipment - 47,061 - - - 47,061 Street improvements - 135,014 - - - 135,014 Total expenditures 15,785 641,658 - 315,800 - 973,243 REVENUES OVER (UNDER) EXPENDITURES 37,723 (119,831) 17,294 (28,482) 187,528 94,232 OTHER FINANCING SOURCES (USES): Operating transfers - in - 210,000 - - - 210,000 Operating transfers - out - (20,247) (13,490) - - (33,737) REVENUES OVER (UNDER) EXPENDITURES 37,723 69,922 3,804 (28,482) 187,528 270,495 FUND BALANCE - July 31, 1995 42,038 40,057 4,850 104,888 - 191,833 FUND BALANCE - Sept 30, 1996 $79,761 $109,979 $ 8,654 $ 76,406 $ 187,528 $ 462,328 -33- CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF GROSS PROCEEDS DISTRIBUTION AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL, SPECIAL REVENUE FUNDS - KENO FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Budget Actual Variance GROSS PROCEEDS - $748,648 - PRIZES: Declared Prizes - 558,056 - Unclaimed Wins - (2,066) Net Prizes Paid - 555,990 - NET HOLD - 192,658 - ALLOWABLE EXPENSES PAID: Lottery Operator's Commission - (104,810) - NET KENO PROCEEDS $ 91,000 87,848 $ (3,152) EXPENSES PAID BY CITY: State Taxes 18,000 14,973 3,027 Other Expenses 7,200 2,500 4,700 TOTAL EXPENSES PAID 25,200 17,473 7,727 PROCEEDS AVAILABLE FOR DISTRIBUTION 65,800 70,375 4,575 TRANSFER TO PRIZE RESERVES (35,000) (18,403) 16,597 COMMUNITY BETTERMENT (70,000) (15,785) 54,215 NET AFTER TRANSFERS (39,200) 36,187 75,387 Beginning Keno Account Fund Balance 42,038 42,038 - Interest 2,000 1,536 (464) KENO ACCOUNT FUND BALANCE $ 4,838 $ 79,761 $ 74,923 PRIZE RESERVE FUND RECONCILIATION FOR THE REPORTING PERIOD Beginning fund Balance Increase to Fund Withdrawals from Fund Ending Fund Balance -34- $ 697 18,403 $19,100 CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL SPECIAL REVENUE FUNDS - STREET FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) REVENUES: Highway allocation Motor vehicle pro -rata Incentive payment State maintenance agreement Bond proceeds Sale of rock Equipment rental Interest on investments Reimbursed expenses Sale of assets Total revenues EXPENDITURES: Salaries FICA Retirement Employee insurance Legal Engineering Auditing Office expense Dues Utilities Telephone Travel Training Insurance Maintenance Street lighting Contingency reserve Car expense Sand, gravel, and rock Gas, diesel, and oil Materials and supplies Rental Capital outlay: Buildings Equipment Street improvements Total expenditures REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -in Operating transfers -out REVENUES OVER (UNDER) EXPENDITURES FUND BALANCE - July 31, 1995 FUND BALANCE - Sept 30, 1996 $ 396,779 $446,606 $ 49,827 1,050 - (1,050) 3,000 3,000 - 13,800 18,273 4,473 537,000 - (537,000) 450 1,464 1,014 - 1,043 1,043 1,500 5,410 3,910 - 3,531 3,531 - 42,500 42,500 953,579 521,827 (431,752) 215,844 204,048 11,796 16,520 15,000 1,520 9,569 9,204 365 43,266 43,044 222 300 30 270 4,000 4,970 (970) 2,000 1,840 160 350 31 319 320 307 13 8,100 4,405 3,695 1,500 1,098 402 200 - 200 200 - 200 13,000 9,521 3,479 26,350 24,481 1,869 106,760 117,014 (10,254) 3,000 - 3,000 900 997 (97) 13,000 7,910 5,090 12,000 10,493 1,507 3,800 4,915 8,885 2,500 275 2,225 2,000 - 2,000 88,800 47,061 41,739 652,800 135,014 517,786 1,227,079 641,658 _585,421 (273,500) (119,831) 153,669 210,000 210,000 - (30,000) (20,247) 9,753 (93,500) 69,922 $163,422 40,057 40,057 $ (53,443) $109,979 -35- CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL SPECIAL REVENUE FUNDS - M.I.R.F. FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) REVENUES: M.I.R.F. revenues Interest income Total revenue EXPENDITURES: None REVENUES OVER (UNDER) EXPENDITURES BEFORE TRANSFERS TRANSFER OUT REVENUES OVER (UNDER) EXPENDITURES FUND BALANCE - July 31, 1995 FUND BALANCE - Sept 30, 1996 -36- $ 15,500 300 15,800 $ 17,294 17,294 15,800 17,294 (17,654) (13,490) (1,854) 3,804 4,850 4,850 $ 2,996 $ 8,654 $ 1,794 (300) 1.494 1,494 4,164 $ 5,658 CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL SPECIAL REVENUE FUNDS - REVOLVING LOAN FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) REVENUES: Grants Interest Income Total revenue EXPENDITURES: Grant administration Total expenditures REVENUES OVER (UNDER) EXPENDITURES FUND BALANCE - July 31, 1995 FUND BALANCE - Sept 30, 1996 $ 221,000 $ 185,454 - 2,074 221,000 187,528 3,000 - 3,000 - 218,000 187,528 $ 218,000 $ 187,528 -37- $ (35,546) 2,074 (33,472) 3,000 3,000 $ (30,472) CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET (CASH BASIS) AND ACTUAL SPECIAL REVENUE FUNDS - DEVELOPMENT FUND FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) REVENUES: Sales tax Use tax Interest income Total revenue EXPENDITURES: State collection fees Refunds Water plant expansion Gateway fees Bond interest Total expenditures REVENUES OVER (UNDER) EXPENDITURES FUND BALANCE - July 31, 1995 FUND BALANCE - Sept 30, 1996 -38- $ 285,000 $ 258,452 $ (26,548) 10,000 7,045 (2,955) 14,000 21,821 7,821 309,000 287,318 (21,682) 10,000 9,336 664 3,000 12,494 (9,494) - 268,545 (268,545) 45,000 15,000 30,000 20,850 10,425 10,425 78,850 315,800 (236,950) 230,150 (28,482) $(258,632) 104,888 104,888 $ 335,038 $ 76,406 CITY OF BLAIR, NEBRASKA COMBINING BALANCE SHEET - ENTERPRISE FUNDS SEPTEMBER 30, 1996 ASSETS Water CURRENT ASSETS: Cash $ 139,754 Accounts receivable - user fees 318,073 Accounts receivable - other 378 Accrued interest receivable 12,459 Investments 546,212 Inventory 29,351 Prepaid expenses 882 Total current assets 1,047,109 RESTRICTED ASSETS: Bond and interest sinking fund cash and investments 822,091 PROPERTY: Plant in service 11,256,123 Accumulated depreciation (3,212,237) Property - net 8,043,886 Sewer $ 14,670 $ 154,424 58,132 376,205 378 1,324 13,783 355,385 901,597 - 29,351 737 1,619 430,248 1,477,357 4,404,449 (2,067,657) 2,336,792 TOTAL ASSETS $ 9,913,086 $2,767,040 -39- 822,091 15,660,572 (5,279,894) 10,380,678 $12,680,126 CITY OF BLAIR, NEBRASKA COMBINING BALANCE SHEET - ENTERPRISE FUNDS SEPTEMBER 30, 1996 LIABILITIES AND FUND BALANCE Water Sewer CURRENT LIABILITIES: Current portion of long-term debt $ 340,000 Accounts payable 70,739 Accrued interest 91,220 Accrued expenses 11,727 Total current liabilities 513,686 DEPOSITS PAYABLE 1,750 LONG-TERM DEBT: Revenue bonds payable- unmatured 5,020,000 Less current portion above (340,000) Long-term debt -net 4,680,000 Total liabilities 5,195,436 FUND BALANCE: Contributed capital 2,055,100 Retained earnings: Reserved 822,091 Unreserved 1,840,459 Total fund balance 4,717,650 TOTAL LIABILITIES AND FUND BALANCE $9,913,086 -40- 35,434 39,915 3,132 78,481 980,000 980,000 1,058,481 2,770,834 (1,062,275) 1,708,559 $2,767,040 Total $ 340,000 106,173 131,135 14,859 592,167 1,750 6,000,000 (340,000) 5,660,000 6,253,917 4,825,934 822,091 778,184 6,426,209 $12,680,126 CITY OF BLAIR, NEBRASKA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS ENTERPRISE FUNDS FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 OPERATING REVENUES: User fees Sale of merchandise Other Total EXPENSES: Personal services Operating expenses Materials and supplies Rental expense Depreciation Total OPERATING INCOME (LOSS) OTHER REVENUE (EXPENSE): Loss on assets Interest income Interest expense Bonding and grant fees Operating transfers -in Operating transfers -out NET INCOME (LOSS) RETAINED EARNINGS (DEFICIT) July 31, 1995 RETAINED EARNINGS (DEFICIT) Sept 30, 1996 Water $2,015,491 26,849 23,439 2,065,779 426,928 363,786 306,359 1,076 296,966 1,395,115 670,664 (18,745) 61,549 (295,008) (49,445) 481,531 (80,000) 770,546 Sewer $ 394,134 7,604 401,738 197,116 129,923 46,971 854 79,951 454,815 (53,077) 31,717 (39,915) (10,290) (71,565) Total $2,409,625 34,453 23,439 2,467,517 624,044 493,709 353,330 1,930 376,917 1,849,930 617,587 (18,745) 93,266 (334,923) (59,735) 481,531 (80,000) •: 1,892,004 (990,710) 901,294 $2,662,550 $(1,062,275) $1,600,275 -41- CITY OF BLAIR, NEBRASKA COMBINING STATEMENT OF CASH FLOW ENTERPRISE FUNDS FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Water Sewer Total CASH FLOW FROM OPERATIONS: Net operating income (loss) Adjustment to reconcile net income to net cash from operations: Depreciation Decrease (increase) in accounts receivable - user fees Decrease (increase) in accounts receivable - other Decrease (increase) in inventory Decrease (increase) in prepaid expenses Increase (decrease) in accounts payable Increase (decrease) in accrued expenses Increase (decrease) in deposits payable Net cash provided (used) by operations CASH FLOW FROM INVESTING: Purchase of property Interest income Transfers - net Decrease (increase) in accrued interest receivable Cash flow from (used in) investing CASH FLOW FROM FINANCING: Increase in contributed capital Increase in long-term debt Decrease (increase) in restricted assets Interest expense Bonding and grant fees Increase (decrease) in accrued interest payable Cash flow from (used in) financing NET INCREASE (DECREASE) IN CASH CASH AND CASH EQUIVALENTS - Beginning of the period CASH AND CASH EQUIVALENTS - End of the period -42- $ 670,664 $ (53,077) $ 617,587 296,966 79,951 367,917 (7,000) 1,219 (5,781) 94 1,790 1,884 949 - 949 2,173 1,809 3,982 (101,971) 7,406 (94,565) 6,831 3,132 9,963 (570) - (570) 868,136 42,230 910,366 (821,432) (791,647) (1,613,079) 61,549 31,717 93,266 401,531 - 401,531 (1,668) (1,324) (2,992) (360,020) (761,254) (1,121,274) 28,829 - 28,829 260,000 980,000 1,240,000 (436,341) - (436,341) (295,008) (39,915) (334,923) (49,445) (10,290) (59,735) (50,792) 39,915 (10,877) (542,757) 969,710 426,953 (34,641) 250,686 216,045 720,607 119,369 839,976 $ 685,966 $ 370,055 $1,056,021 CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF REVENUES AND EXPENSES BUDGET (CASH BASIS) AND ACTUAL ENTERPRISE FUND - WATER FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 OPERATING REVENUES: User fees Sale of merchandise Forfeited discounts Other Total revenues EXPENSES: Personal services: Salaries FICA Workman's compensation HAL insurance Retirement (city share) Unemployment and disability Total Operating expenses: Legal fees Auditing Consultants/Lab fee Employee appreciation Postage Printing and publications Computer programming Schools, travel, and training Dues Utilities Telephone Vehicle insurance Liability insurance Buildings and contents insurance Employee bonds Radio maintenance Office equipment maintenance Motorized equipment maintenance Building maintenance Major maintenance Contingent reserve Maintenance agreements Car expense Bad accounts Total - continued - Budget $1,768,740 18,000 8,000 5,128 -43- 1,799,868 316,743 24,230 6,000 50,371 11,750 2,920 412,014 400 1,800 12,000 500 7,500 600 1,000 2,000 3,500 210,000 3,000 600 2,000 4,000 300 800 1,000 2,200 12,000 24,000 6,000 3,500 400 400 299,500 Actual $2,015,491 26,849 14,642 8,797 2,065,779 326,004 23,823 7,084 50,574 17,416 2,027 426,928 19 1,805 5,765 94 6,180 143 1,537 540 1,058 269,535 2,272 584 1,781 4,377 72 809 529 2,277 19,544 39,961 Variance Favorable (Unfavorable) 1,090 397 3,417 363,786 $246,751 8,849 6,642 3,669 265,911 (9,261) 407 (1,084) (203) (5,666) 893 (14,914) 381 (5) 6,235 406 1,320 457 (537) 1,460 2,442 (59,535) 728 16 219 (377) 228 (9) 471 (77) (7,544) (15,961) 6,000 2,410 3 (3,017) (64,286) r a CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF REVENUES AND EXPENSES BUDGET (CASH BASIS) AND ACTUAL ENTERPRISE FUND - WATER FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable continued - Budget Actual (Unfavorable) EXPENSES: Materials and supplies: Office supplies Janitorial supplies Shop and supplies Chemicals Meters Supplies for inventory Gas, oil and diesel Uniforms Small tools Payment to OPPD Other materials and supplies Total Rental expense - Office equipment Total expenses OPERATING INCOME (LOSS) BEFORE DEPRECIATION DEPRECIATION OPERATING INCOME (LOSS) OTHER REVENUES (EXPENSES): Loss on assets Interest income Interest expense Bonding and grant fees Operating transfers - in Operating transfers - out NET INCOME (LOSS) $ 1,700 $ 3,838 $ (2,138) 600 605 (5) 2,500 2,383 117 280,000 257,239 22,761 15,000 15,046 (46) 7,500 7,889 (389) 3,000 3,047 (47) 1,200 927 273 1,500 1,747 (247) 3,128 5,865 (2,737) 4,550 7,773 (3,223) 320,678 306,359 14,319 11100 1,076 24 1,033,292 1,098,149 (64,857) 766,576 967,630 201,054 - (296,966) (296,966) 766,576 670,664 (95,912) (18,745) (18,745) 52,100 61,549 9,449 (63,006) (295,008) (232,002) - (49,445) (49,445) 212,985 481,531 268,546 (80,000) (80,000) - $ 888,655 $ 770,546 $(118,109) -44- CITY OF BLAIR, NEBRASKA INDIVIDUAL STATEMENT OF REVENUES AND EXPENSES BUDGET (CASH BASIS) AND ACTUAL ENTERPRISE FUND - SEWER FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) OPERATING REVENUES: User fees $394,275 $394,134 $ (141) Sale of merchandise 5,000 7,604 2,604 Total revenues 399,275 401,738 2,463 EXPENSES: Personal services: Salaries 151,446 148,362 3,084 FICA 11,586 10,891 695 Workman's compensation 3,800 4,769 (969) H.A.L. insurance 24,334 24,124 210 Retirement (city share) 7,401 7,930 (529) Unemployment and disability 1,570 1,040 530 Total 200,137 197,116 3,021 Operating expense: Legal 200 11 189 Auditing 800 2,416 (1,616) Consulting/engineering 11,000 9,109 1,891 Employee appreciation 300 54 246 Postage 3,000 4,082 (1,082) Printing and publication 300 - 300 Computer programming 600 764 (164) School, travel and training 1,500 798 702 Dues 1,600 570 1,030 Utilities 54,000 53,737 263 Telephone 1,000 13 987 Insurance 6,600 6,602 (2) Maintenance 49,200 51,562 (2,362) Car expense 3,900 205 3,695 Contingent reserve 4,000 - 4,000 Total 138,000 129,923 8,077 Materials and supplies 55,450 46,971 8,479 Rental expense 800 854 (54) Total expenses 394,387 374,864 19,523 OPERATING INCOME (LOSS) BEFORE DEPRECIATION 4,888 26,874 21,986 DEPRECIATION - (79,951) (79,951) OPERATING INCOME (LOSS) 4,888 (53,077) (57,965) OTHER REVENUE (EXPENSE): Interest income 3,300 31,717 28,417 Interest expense - (39,915) (39,915) Underwriting costs - (10,290) (10,290) NET INCOME (LOSS) $ 8,188 $(71,565) $(79,753) -45- CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND REVENUES BUDGET (CASH BASIS) AND ACTUAL FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 REVENUES: Taxes: Property taxes Interest on taxes Insurance tax Receipts in lieu of taxes State aid Personal property tax Homestead relief Franchise tax Total Charges for services: Business Licenses and Library Landfill collections Cemetery lots Grave openings Swimming pool fees Other fees and charges Sales of fireworks RV Park Total INTEREST INCOME Budget $ 996,700 4,000 34,100 65,400 104,000 100 35,100 84,000 1,323,400 Permits 69,820 11,846 600 11,670 21,006 25,100 15,500 13,500 2,400 171,442 OTHER REVENUES: State aid -Library Federal grant - library Federal grant - police Federal grant - park Gifts Rural fire reimbursement Sale of assets County inspector payments Other miscellaneous revenue Total TOTAL REVENUES Actual $1,046,059 2,889 35,182 48,240 99,975 35,545 77,814 1,345,704 111,973 13,628 3,356 23,640 19,750 3,497 14,299 14,260 3,690 208,093 11,800 19,204 1,440 57,500 3,500 1,000 2,000 41,400 3,500 110,340 $1,616,982 -46- 1,440 3,000 63,129 1,091 5,089 233 3,588 30,304 32,996 140,870 $1,713,871 Variance Favorable (Unfavorable) $ 49,359 (1,111) 1,082 (17,160) (4,025) (100) 445 (6,186) 22,304 42,153 1,782 2,756 11,970 (1,256) (21,603) (1,201) 760 1,290 36,651 7,404 3,000 5,629 1,091 1,589 (767) 1,588 (11,096) 29,496 30,530 CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL ADMINISTRATION DEPARTMENT FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries $149,738 $126,186 $ 23,552 Social security 11,455 9,257 2,198 Employee's insurance 87,806 79,664 8,142 Retirement 7,432 5,581 1,851 OPERATING EXPENSES: 8,000 10,761 (2,761) Legal 38,900 39,876 (976) Building inspection 4,670 1,997 2,673 Auditing 1,350 1,203 147 Civil defense 2,700 1,800 900 Consulting 36,000 33,840 2,160 Custodial services 4,320 4,340 (20) Employee appreciation 750 1,091 (341) Postage 3,400 3,906 (506) Printing and publications 7,800 11,175 (3,375) Training 6,000 4,745 1,255 Dues 5,800 12,640 (6,840) Election expense 2,000 3,071 (1,071) Programming 500 2,716 (2,216) City utilities 4,670 6,111 (1,441) Telephone 4,250 6,296 (2,046) Travel expense 2,000 1,251 749 Insurance and bonds 6,100 4,291 1,809 Maintenance 14,800 17,263 (2,463) Tree stump removal 13,500 11,488 2,012 Tobacco licenses 600 - 600 Chamber of Commerce 1,500 1,500 - Gas and oil 1,000 2,033 (1,033) County Treasurer's collection fees 15,868 10,656 5,212 In -lieu of tax distribution - 12,192 (12,192) Miscellaneous 400 758 (358) SUPPLIES 6,700 11,329 (4,629) RENTAL EXPENSES Office equipment 1,200 763 437 CAPITAL OUTLAY Motorized equipmen 15,000 - 15,000 Office equipment 7,000 5,522 1,478 Building remodel 8,000 10,761 (2,761) TOTALS $473,209 $445,302 $ 27,907 IrIva CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL CONTINGENCY ALLOWANCE FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) CONTINGENT RESERVE $32,000 $ $ Corridor and main street study Fire chief vehicle TOTAL 5,500 - - 21,049 - $32,000 $26,549 $ 5,451 ELM CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL POLICE DEPARTMENT FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996_____ Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries $458,376 $466,023 $(7,647) Social security 35,066 34,273 793 Employees' insurance 87,862 86,818 1,044 Retirement 35,665 29,656 6,009 OPERATING EXPENSES: Legal 15,170 13,406 1,764 Auditing 975 849 126 Postage 1,000 534 466 Printing and publications 1,000 2,121 (1,121) Training 2,450 1,966 484 Telephone 5,000 3,758 1,242 Travel 900 444 456 Dues 400 250 150 Insurance 8,700 6,439 2,261 Maintenance 14,300 13,639 661 Medical exams 750 271 479 Car Expense 1,400 1,400 - Great\Dare Wellness 2,850 5,365 (2,515) Miscellaneous 2,200 728 1,472 SUPPLIES: Supplies 7,100 10,364 (3,264) Gas and oil 10,500 10,367 133 Uniforms 9,000 10,063 (1,063) Ammunition and range 1,050 1,129 (79) Safety Equipment/Training 3,150 2,647 503 RENTAL EXPENSE 14,200 18,293 (4,093) CAPITAL OUTLAY: Office equipment - Great 1,200 2,651 (1,451) Motor vehicles 35,000 35,283 (283) Radio/Camera/Video 7,900 4,150 3,750 TOTALS $763,164 $762,.887 $ 277 -49- r CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL CEMETERY FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries Social security Employees' insurance Retirement OPERATING EXPENSES: Legal Auditing Printing and publications Training Travel Dues Utilities Telephone Insurance Maintenance Miscellaneous SUPPLIES: Operating supplies Gas, Oil, Diesel Uniforms Small tools Sand, Gravel, Rock RENTAL EXPENSE CAPITAL OUTLAY: Office equipment Motorized equipment Paving TOTALS $ 55,596 $51,599 $ 3,997 4,250 3,657 593 8,213 6,594 1,619 1,460 1,552 (92) 75 - 75 70 71 (1) 110 163 (53) 340 145 195 30 14 16 75 25 50 2,700 2,356 344 510 719 (209) 1,520 1,081 439 5,640 5,714 (74) 400 - 400 1,475 1,143 332 2,200 1,981 219 160 258 (98) 150 745 (595) 600 627 (27) 16,300 14,550 1,750 700 - 700 6,580 - 6,580 $109,154$92,994 $16,160 -50- CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL FIRE DEPARTMENT FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES $ 4,500 $ 3,894 $ 606 OPERATING EXPENSES: Utilities and telephone 15,400 10,513 4,887 Insurance 7,800 6,224 1,576 Maintenance 9,800 11,593 (1,793) Travel 100 - 100 Training 3,800 3,014 786 Miscellaneous 500 215 285 SUPPLIES: Gas and oil 2,000 1,995 5 Safety equipment 9,000 6,788 2,212 Miscellaneous 2,300 1,851 449 CAPITAL OUTLAY: Specialized equipment 6,500 2,598 3,902 TOTALS $61,700 $48,685 $13,015 -51- CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL PARK DEPARTMENT FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996.. Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries Social security Employees' insurance Retirement OPERATING EXPENSES: Travel Utilities and telephone Insurance Maintenance Miscellaneous SUPPLIES: Gas and oil Small tools Miscellaneous CAPITAL OUTLAY: Other improvements Motorized equipment Playground equipment TOTALS $ 55,129 $ 47,074 $ 8,055 4,220 3,301 919 7,509 6,026 1,483 1,460 314 1,146 100 - 100 5,050 5,231 (181) 1,740 1,254 486 12,600 11,111 1,489 960 459 501 2,000 2,298 (298) 200 882 (682) 1,790 1,502 288 35,000 8,910 26,090 5,700 2,151 3,549 3,000 3,515 (515) ,$136,458 $ 94,028 $ 42,430 -52- CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL LIBRARY FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries Social security Employees' insurance Retirement OPERATING EXPENSES: Auditing Postage Dues Printing and publications Utilities Telephone Travel Training Insurance Maintenance Custodial services SUPPLIES: Supplies Library materials CAPITAL OUTLAY: Office equipment TOTALS $ 89,865 6,880 12,642 4,400 $ 91,160 6,722 12,150 4,215 $(1,295) 158 492 185 325 283 42 500 493 7 325 300 25 250 238 12 10,800 10,409 391 800 765 35 200 10 190 700 642 58 1,350 994 356 15,600 5,370 10,230 2,570 21264 306 3,000 2,556 444 33,400 33,305 95 4,500 1,794 2,706 $188,107 X173,670 $14,437 -53- CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL SUPERVISED RECREATION FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries Social security Employees' insurance OPERATING EXPENSES: Auditing Professional fees Printing and publications Utilities Telephone Insurance Maintenance Little League and BYSA Golf SUPPLIES: Gas and oil Recreation supplies CAPITAL OUTLAY: Motorized equipment Bleachers/fields Asphalt TOTALS $ 9,195 $ 7,673 700 587 615 475 $ 1,522 113 140 80 71 9 500 - 500 200 225 (25) 4,200 4,842 (642) 200 - 200 1,575 1,209 366 4,400 7,711 (3,311) 6,000 6,000 - 3,050 1,117 1,933 300 248 52 1,075 315 760 6,600 4,935 1,665 2,500 - 2,500 15,000 - 15,000 $56,190 $3S,408 $20,782 -54- CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL SWIMMING POOL FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries Social security Employees' insurance OPERATING EXPENSES: Auditing Printing and publications Utilities and telephone Insurance Maintenance State sales tax Miscellaneous SUPPLIES: Chemicals Miscellaneous TOTALS $33,523 $ 4,101 $29,422 2,564 314 2,250 700 634 66 240 212 28 600 295 305 4,900 5,082 (182) 880 701 179 4,800 5,407 (607) 1,200 409 791 20 - 20 4,500 3,240 $57,167 -55- 3,930 4,172 $25,257 570 932) $31,910 CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL LANDFILL FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries Social security Employees' insurance Retirement OPERATING EXPENSES: Auditing Printing and publication Professional consultants SUPPLIES: Sand and gravel Capital outlay Contract Hauling TOTALS $ 1,500 $ 1,625 $ (125) 115 177 (62) 100 - 100 150 - 150 75 - 75 1,500 - 1,500 - 282 (282) 82,000 - 82,000 6,000 10,077 (4,077) $ 91,440 $ 12,161 $ 79,279 -56- CITY OF BLAIR, NEBRASKA SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL ANIMAL CONTROL FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) PERSONAL SERVICES: Salaries Social security Employees' insurance Retirement OPERATING EXPENSES: Legal Auditing Printing and publications Travel Training Veterinary expense Utilities and telephone Insurance Maintenance Miscellaneous SUPPLIES: Gas and oil Dog license & supplies Uniforms Miscellaneous CAPITAL OUTLAY - equipment TOTALS -57- $27,305 2,890 6,824 1,270 $25,226 1,796 6,725 1,265 $ 2,079 1,094 99 5 575 560 15 65 71 (6) 520 200 320 200 142 58 295 425 (130) 1,650 1,925 (275) 3,930 3,688 242 460 316 144 2,475 2,603 (128) 100 - 100 1,100 908 192 2,200 1,351 849 525 502 23 475 1,446 (971) 575 - 575 $53,434 $49,149 $ 4,285 CITY OF BLAIR, NEBRASKA j SCHEDULE OF GENERAL FUND EXPENDITURES BUDGET (CASH BASIS) AND ACTUAL DONATED FUNDS FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 Variance Favorable Budget Actual (Unfavorable) Police - DARE $ 2,293 $ 2,280 $ 13 Police - GREAT 690 651 39 Police - Other - 1,108 (1,108) M.O.C.I.C. 2,000 - 2,000 Animal control 815 20 795 Library 533 - 533 Cemetery 5,500 403 5,097 Park 550 196 354 TOTALS $ 12,381 $ 4,658 $ 7,723 e t I_ 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 EDWARD W. SCHROEDER CERTIFIED PUBLIC ACCOUNTANT Honorable Mayor and Members of the City Council City of Blair, Nebraska Dear Gentlemen: December 4, 1996 RESIDENCE: (402.) 468-5253 OFFICE: (402) 426-4080 I have audited the general purpose financial statements of the City of Blair, Nebraska, as of and for the year ended July 31, 1995 and the fourteen months ended September 30, 1996, and have issued my report thereon dated December 4, 1996. These general purpose financial statements are the responsibility of the City of Blair, Nebraska, 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 and GOVERNMENT AUDITING STANDARDS issued by the l Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A-128, "Audits of State and Local Governments." Those standards and OMB Circular A-128 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 financial statement presentation. I believe that my audit provides a reasonable basis for my opinion. My audit was conducted for the purpose of forming an opinion on the general purpose financial statements of the City of Blair, Nebraska taken as a whole. The accompanying schedule of federal financial assistance is presented for purposes of additional analysis and is not a required part of the general purpose financial statements. The information in that schedule has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in my opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. 2, 1 Z) Edward W. Schroeder Certified Public Accountant -59- SCHEDULE OF FOR THE FOURTEEN FEDERAL FINANCIAL ASSISTANCE CITY OF BLAIR MONTHS ENDED SEPTEMBER 30, 1996 PROGRAM TITLE CFDA NUMBER GRANT BALANCE REVENUE EXPENSE BALANCE GRANTORS NUMBER AMOUNT 7-31-95 RECOGNIZED INCURRED 9-30-96 Community Dev. Block Grant CFDA #14.228 #93 -ED -014 $505,000 $ - $ 28,829 $202,055 $ - Community Dev. Block Grant CFDA #14.228 #94 -ED -023 221,000 - 185,454 185,454 - Community Dev. Block Grant CFDA #14.228 #95 -ED -021 505,000 - - - - Bureau of Alcohol Tobacco and Firearms G.R.E.A.T. Program #95-6T-11 13,258 - 10,377 10,377 - #96-6T-02 8,883 - 4,780 4,780 - U.S. Dept of Transportation CFDA #20.600 #95-1005 5,010 - 2,198 2,198 - #96-1005 835 835 835 Bureau of Justice Assistance -Cops, Kids, and Crime CFDA #16.579 #93 -DA -327 13,000 - 3,423 3,423 - #95 -DA -317 14,352 14,352 14,352 U.S. Dept of Justice Cops Fast CFDA #16.726 #95-CF-WX-5135 67,425 - 26,488 26,488 - (continued) m -61- SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE CITY OF BLAIR FOR THE FOURTEEN MONTHS ENDED SEPTEMBER 30, 1996 (Continued) PROGRAM TITLE CFDA NUMBER GRANT BALANCE REVENUE EXPENSE BALANCE GRANTORS NUMBER AMOUNT 7-31-95 RECOGNIZED INCURRED 9-30-96 Community Dev. Block Grant CFDA #14.228 ##96 -ED -001 $ 505,000 SBA National Tree Planting 1994 1,091 - 1,091 1,091 - U.S. Dept of Education CFDA ##84-034 #96-3 3,000 - 3,000 3,000 - U.S. Dept of Justice Troops to COPS CFDA ##16.711 ##95-TC-WX-1151 11000 - 675 675 - Totals $1,863,854 $ $281,502 $454,728 $ - -61- EDWARD W. SCHROEDER CERTIFIED PUBLIC ACCOUNTANT 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 December 4, 1996 Honorable Mayor and Members the City Council City of Blair, Nebraska Gentlemen: RESIDENCE: (402.) 468-5253 OFFICE: (402) 426-4080 I have audited the general purpose financial statements of the City of Blair, Nebraska, as of and for the year ended July 31, 1995 and fourteen months ended September 30, 1996, and have issued my report thereon dated December 4, 1996. I conducted my audit in accordance with generally accepted auditing standards, GOVERNMENT AUDITING STANDARDS, issued by Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A-128. "Audits of State and Local Governments." those standards and OMB Circular A-128 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 City of Blair is the responsibility of the City of Blair's management. As part of obtaining reasonable assurance about whether the financial statements are free of material_ misstatement, I performed tests of the City's 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 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 City of Blair had not complied, in all material respects, with those provisions. This report is intended for the information of management and the Blair City Council. However, this report is a matter of public record and its distribution is not limited. Edward W. Certified -62- Schroeder Public Accountant EDWARD W. SCHROEDER CERTIFIED PUBLIC ACCOUNTANT r 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 December 4, 1996 Honorable Mayor and Members of the City Council City of Blair, Nebraska Gentlemen: RESIDENCE: (402) 468-5253 OFFICE: (402) 426-4080 I have audited the general purpose financial statements of the City of Blair, Nebraska, as of and for the year ended July 31, 1995 and the fourteen months ended September 30, 1996, and have issued my report thereon dated December 4, 1996. I conducted my audit in accordance with generally accepted auditing standards, GOVERNMENT AUDITING STANDARDS, issued by the Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A-128, "Audits of State and Local Governments." Those standards and OMB Circular A-128 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 City of Blair for the periods ended July 31, 1995 and 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 City of Blair is responsible 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 F that assets are safeguarded against loss from unauthorized use of 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. -63- f 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 Cycles of the Entities Activity Treasury or financing Revenue/receipts Purchases/disbursements External financial reporting Financial Statement Captions Cash and Cash equivalents Receivables Inventory Property and equipment Payable and accrued liabilities Debt Fund balance Accounting Applications Billings Receivables Cash receipts Purchasing and receiving Accounts payable Cash disbursements Payroll Administrative Controls General Requirements Political activity Davis -Bacon Act Civil Rights Cash management Federal financial reports Specific Requirements Types or services Eligibility Matching level of effort Reporting Cost allocation Special requirements, if any For all of the control categories listed above, I obtained an understanding of the design of relevant polices and procedures and whether they have been place 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 City of Blair does not have adequate separation of duties. -64- Page 3 t 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 f 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 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 Blair City Council. However, this report is a matter of public record and its distribution is not limited. Edwa d W. Schroeder Certified Public Accountant -65- EDWARD W.C CERTIFIED PUBLIC ACCOUNTANT 1904 SOUTH STREET BOX 486 BLAIR, NEBRASKA 68008 Honorable Mayor and Members of the City Council City of Blair, Nebraska Gentlemen: December 4, 1996 I have audited the financial statements of Nebraska, as of and for the year ended July 31, months ended September 30, 1996, and have issued dated December 4, 1996. RESIDENCE: (402) 4685253 OFFICE: (402) 42.6-4080 the City of Blair, 1995 and fourteen my report thereon In connection with my audit of the 1995 and 1996 general purpose financial statements of the City of Blair and with my consideration of the City of Blair control structure used to administer federal financial assistance programs, as required by Office of Management and Budge Circular A-128, "Audits of State and Local Government," I selected certain transactions applicable to certain non major federal financial assistance programs for the periods ended July 31, 1995 and September 30, 1996. As required by OMB Circular A-128, I have performed auditing procedures to test compliance with the requirements governing types of services allowed or unallowable, eligibility, and other specific requirements that are applicable to those transactions. My procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the City of Blair's compliance with these requirements. Accordingly, I do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the preceding paragraph. With respect to items not tested, nothing came to my attention that caused me to believe that the City of Blair had not complied, in all material respects, with those requirements. This report is intended for the information of management and the Blair City Council. However, this report is a matter of public record and its distribution is not limited. J n r"'Edwardl Schroeder Certified Public Accountant Page 2 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, 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, and that federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance 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. For the purpose of this report. I have classified the significant internal control structure policies and procedures used in administering federal financial assistance programs in the following categories: Accounting Controls Cycles of the Entities Activity Treasury or financing Revenue/receipts Purchases/disbursements External financial reporting Financial Statement Captions Cash and Cash equivalents Receivables Inventory Property and equipment Payable and accrued liabilities Debt Fund balance ` Accounting Applications Billings Receivables Cash receipts Purchasing and receiving Accounts payable Cash disbursements Payroll Administrative Controls General Requirements Political activity Davis -Bacon Act Civil Rights Cash management Federal financial reports Specific Requirements Types or services Eligibility Matching level of effort Reporting Claims for advances Cost allocation Other special requirements, if any For all of the internal control structure categories listed above, I obtained an understanding of the design of relevant polices and procedures and whether they have been place in operation, and I assessed control risk. -70- Page 3 During the year ended September 30, 1996, the City of Blair expended 440 of its total federal financial assistance under major federal financial assistance programs. I performed tests of controls, as required by OMB Circular A-128, to evaluate the effectiveness of the design and operation on internal control structure policies and procedures that I considered relevant to preventing or detecting material noncompliance with specific requirements, general requirements, and requirements governing claims for advances and reimbursements and amounts claimed or used for matching that are applicable to each of City of Blair, Nebraska's major federal financial assistance programs, which are identified in the accompanying Schedule of Federal Financial Assistance. My procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, I do not express such an opinion. 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 City of Blair's ability to administer federal financial assistance programs in accordance with applicable laws and regulations. The City of Blair does not have adequate separation of duties. 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 noncompliance with laws and regulations that would be material to a federal financial assistance program 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 policies and procedures used in administering federal financial assistance 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 Blair City Council. However, this report is a matter of public record and its distribution is not limited. Edward W. Schroeder Certified Public Accountant -71-