PEACHTREE CITY CONVENTION & VISITORS BUREAU

Transcription

1 PEACHTREE CITY CONVENTION & VISITORS BUREAU (A COMPONENT UNIT OF PEACHTREE CITY, GEORGIA) FINANCIAL REPORT SEPTEMBER 30, 2011

2 PEACHTREE CITY CONVENTION & VISITORS BUREAU FINANCIAL REPORT SEPTEMBER 30, 2011 TABLE OF CONTENTS Page INDEPENDENT AUDITOR S REPORT... 1 and 2 FINANCIAL STATEMENTS Statement of Net Assets... 3 Statement of Revenues, Expenses and Changes in Net Assets... 4 Statement of Cash Flows... 5 Notes to Financial Statements REPORT ON COMPLIANCE AND ON INTERNAL CONTROL Independent Auditor s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards and 11

3 INDEPENDENT AUDITOR S REPORT To the Board of Directors Peachtree City Convention & Visitors Bureau Peachtree City, Georgia We have audited the accompanying basic financial statements of the Peachtree City Convention & Visitors Bureau (the "CVB"), a component unit of the City of Peachtree City, Georgia, as of and for the year ended September 30, These financial statements are the responsibility of the CVB's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we 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. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Peachtree City Convention & Visitors Bureau, a component unit of the City of Peachtree City, Georgia, as of September 30, 2011, and the changes in financial position and cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. In accordance with Government Auditing Standards, we have also issued our report dated February 28, 2012, on our consideration of the CVB s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. 300 MULBERRY STREET, SUITE 300 POST OFFICE BOX 1877 MACON, GEORGIA FAX MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

4 Management has not presented the management s discussion and analysis that governmental accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of the financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information. Macon, Georgia February 28,

5 PEACHTREE CITY CONVENTION & VISITORS BUREAU STATEMENT OF NET ASSETS SEPTEMBER 30, 2011 ASSETS CURRENT ASSETS Cash $ 79,096 Due from City of Peachtree City 42,130 Inventory 6,474 Prepaid expenses 14,687 Total assets 142,387 LIABILITIES CURRENT LIABILITIES Accounts payable 1,879 Due to City of Peachtree City Airport Authority 9,380 Accrued expenses 563 Total liabilities 11,822 NET ASSETS NET ASSETS Unrestricted 130,565 Total net assets $ 130,565 See Notes to Financial Statements. 3

6 PEACHTREE CITY CONVENTION & VISITORS BUREAU STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET ASSETS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2011 Operating revenues: Merchandise sales $ 14,821 Miscellaneous 1,908 Total operating revenues 16,729 Operating expenses: Salaries, wages and employee benefits 19,152 Marketing 61,441 Rental 15,502 Professional services 123,155 Tourism events 129,819 Supplies 15,014 Other 55,835 Total operating expenses 419,918 Operating loss (403,189) Non-operating revenues (expenses): Hotel/motel taxes 569,200 Payments to Peachtree City Airport Authority (113,840) Interest income 12 Total non-operating revenues, net 455,372 Change in net assets 52,183 Net assets, beginning of year 78,382 Net assets, end of year $ 130,565 See Notes to Financial Statements. 4

7 PEACHTREE CITY CONVENTION & VISITORS BUREAU STATEMENT OF CASH FLOWS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2011 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers and users $ 16,729 Payments to suppliers (417,537) Payments to employees (18,651) Net cash used in operating activities (419,459) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Taxes received 544,672 Payments to Peachtree City Airport Authority (115,455) Net cash provided by noncapital financing activities 429,217 CASH FLOWS FROM INVESTING ACTIVITIES Interest received 12 Net cash provided by investing activities 12 Net increase in cash 9,770 Cash, beginning of year 69,326 Cash, end of year $ 79,096 RECONCILIATION OF OPERATING LOSS TO NET CASH USED IN OPERATING ACTIVITIES Operating loss $ (403,189) Adjustments to reconcile operating loss to net cash used in operating activities: Changes in assets and liabilities: Increase in inventory (2,551) Increase in prepaid expenses (13,447) Decrease in accounts payable (773) Increase in accrued expenses 501 Net cash used in operating activities $ (419,459) See Notes to Financial Statements. 5

8 PEACHTREE CITY CONVENTION & VISITORS BUREAU NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2011 NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES Nature of Business: The Peachtree City Tourism Association, Inc., currently known as the Peachtree City Convention & Visitors Bureau (the "CVB"), was established by authorization of the City Council of Peachtree City, Georgia on November 6, 2003, pursuant to the State of Georgia Hotel/Motel Tax Laws, Official Code of Georgia Annotated On November 10, 2003, the Peachtree City Tourism Association was incorporated as a State of Georgia non-profit organization and was subsequently authorized to operate as a 501(c)(6) organization by the Internal Revenue Service, retroactive to the date of incorporation. On July 23, 2010, the Articles of Incorporation were amended for the Peachtree City Tourism Association, Inc., changing the corporate name to the Peachtree City Convention & Visitors Bureau. The CVB operates under a seven-person Board of Directors appointed by the City Council of Peachtree City. The CVB is a component unit of Peachtree City, Georgia as defined by Governmental Accounting Standards Board (GASB) Statement No. 14, as amended by GASB Statement No. 39. The accounting policies of the CVB conform to accounting principles generally accepted in the United States of America as applicable to governmental units. The following is a summary of the more significant accounting policies. Significant Accounting Policies: Basis of Presentation: In accounting and reporting for its proprietary fund-type operations, the CVB applies all Governmental Accounting Standards Board pronouncements, and all Financial Accounting Standards Board (FASB) pronouncements and interpretations issued on or before November 30, Such FASB statements are applied unless they conflict or contradict GASB pronouncements. The accrual basis of accounting is utilized by the CVB. Under this method, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services in connection with the proprietary fund s principal ongoing operations. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the CVB s policy to use restricted resources first, then unrestricted resources as they are needed. 6

9 NOTES TO FINANCIAL STATEMENTS NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Significant Accounting Policies: (Continued) Basis of Presentation: (Continued) The CVB s financial statements include provisions of GASB Statement No. 34, Basic Financial Statements and Management s Discussion and Analysis For State and Local Governments; Statement No. 37, Basic Financial Statements and Management s Discussion and Analysis for State and Local Governments: Omnibus; and Interpretation No. 6, Recognition and Measurement of Certain Liabilities and Expenditures in Governmental Fund Financial Statements. Management Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. Cash: State statutes require all deposits and investments (other than federal or state government instruments) to be collateralized by depository insurance, obligations of the U.S. government, or bonds of public authorities, counties, or municipalities. The collateral pledged by the banks trust departments in the CVB s name is composed of various obligations of the U.S. Government. Prepaid Expenses: Payments made to vendors for services that will benefit periods beyond September 30, 2011, are recorded as prepaid expenses. 7

10 NOTES TO FINANCIAL STATEMENTS NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Significant Accounting Policies: (Continued) Capital Assets: Capital assets are defined by the CVB as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of two years. Such assets are carried at cost. Donated capital assets are recorded at the estimated fair value at the date of donation. Capital assets of the CVB are depreciated using the straight line method over the following useful lives: Machinery & equipment Land improvements Buildings 5 years 10 years 10 years The CVB utilizes a facility owned by the City of Peachtree City for which no historical costs are recorded or recognized by the CVB due to the fact that the CVB has made no investment in the original facilities; consequently, no depreciation expense is recorded by the CVB for this facility. Additionally, no rents are charged by the City of Peachtree City for the use of the respective facilities. Therefore, no occupancy expense associated with the CVB s use of the facilities is reflected in the statement of revenues, expenses, and changes in net assets for the period ended September 30, Maintenance and repairs of capital assets are charged to operations and major improvements are capitalized. Upon retirement, sale or other disposition of capital assets, the cost and accumulated depreciation is eliminated from the accounts and a gain or loss is recognized. NOTE 2. CASH Custodial credit risk deposits. Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover deposits or will not be able to recover collateral securities that are in the possession of an outside party. State statutes require all deposits and investments (other than federal or state government instruments) to be collateralized by depository insurance, obligations of the U.S. government, or bonds of public authorities, counties, or municipalities. As of September 30, 2011, the CVB s bank balance was fully collateralized as defined by GASB pronouncements. 8

11 NOTES TO FINANCIAL STATEMENTS NOTE 3. CONTINGENT LIABILITIES The CVB is subject to legal actions in the ordinary course of business. In the opinion of management and legal counsel, the CVB has adequate legal defenses and insurance coverage with respect to such actions and the liability, if any, which might result from these proceedings, would not have a material adverse effect on the financial position of the CVB. NOTE 4. RISK MANAGEMENT The CVB is exposed to various risks of loss related to torts, theft of assets, damage to and destruction of assets, errors and omissions, and natural disasters. The CVB carries commercial insurance to cover these risks of loss. There have been no significant reductions in insurance coverage. Settlement amounts have not exceeded insurance coverage in the last three fiscal years. 9

12 INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Board of Directors Peachtree City Convention & Visitors Bureau Peachtree City, Georgia We have audited the basic financial statements of the Peachtree City Convention & Visitors Bureau (the CVB ), a component unit of the City of Peachtree City, Georgia, as of and for the year ended September 30, 2011, and have issued our report thereon dated February 28, We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting Management of the CVB is responsible for establishing and maintaining effective internal control over financial reporting. In planning and performing our audit, we considered the CVB s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the CVB's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the CVB's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity s financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 300 MULBERRY STREET, SUITE 300 POST OFFICE BOX 1877 MACON, GEORGIA FAX MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

13 Compliance and Other Matters As part of obtaining reasonable assurance about whether the CVB s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, non-compliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. This report is intended solely for the information and use of management and the Board of Directors of the Peachtree City Convention & Visitors Bureau, the City of Peachtree City, and the State of Georgia and is not intended to be and should not be used by anyone other than these specified parties. Macon, Georgia February 28,