SU LPH U R PA R KS A N D R EC R EATIO N SULPHUR.LO U ISIANA. ANNUAL FINANC IAL REPO RT A ND INDEPENDEN'rAUDITO RS'REPO RT. YearEnded Decem ber31.

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1 /</C<~<) SU LPH U R PA R KS A N D R EC R EATIO N SULPHUR.LO U ISIANA ANNUAL FINANC IAL REPO RT A ND INDEPENDEN'rAUDITO RS'REPO RT YearEnded Decem ber G RAGSON~C ASII)AY ~:G UILLORYrL.L.F. C ERT IFIED PU BLIC A C C O U N TA N TS

2 CO NTENTS PA G E N DEPENDENT AU DITO RS'REPO RT 3 G ENERAL PU RPO SE FINANC IAL STATEM ENTS CO M BINED BA LANC E SH EET -ALL FUND "[YPES AND ACCO UNT G RO UPS 4-7 CO M BIN ED STATEM ENT O F R EVENUES,EXPEND ITU RES,A ND C HANG ES IN FUND BALANC ES -ALL G O VERNM ENTAL FUND TYPES 8-9 STATEM ENT O F R EVENUES,EXPENDITURES,AND CHANG ES IN FUN D BALAN CES -BUDG ET AND ACTUAL -G ENERAL FUND N O TES TO FINA N C IAL STATEM ENTS SUPPLEM ENTAL INFO RM ATIO N STATEM ENT O F EXPEN DITURES -BUDG ET AND ACTUAL -G ENERAL FU N D N D EPEN D ENT A U D ITO R S'R EPO RT O N C O M PLIAN C E A N D INTER NA L CO NTRO L O V ER FINANC IAL REPO RTING BASED O N AN AUDIT O F G ENERAL PURPO SE FINANC IAL STATEM ENTS PERFO RM ED IN A CCO R DAN CE W ITH G O V ERNM ENT AU DITING STANDARDS SU M M A RY SC H ED U LE O F FIN D ING S G RAGSONrC ASIDAY ~ G UII.LORY,L L.~. C ERTIFIED PU BLIC AC CO U NTA NTS

3 G R A G S O N,C A S ID A Y & G U IL I,O R Y,L.L.P. C ERTIFIED PU B LIC A C C O U NTA N 'rb W GEORGE GRAGSON C P A RICHARD W.CASIDAY,C P.A RAYMOND GUILLORY,JR,C P.A G RAHAM A PORIUS,E A C OY 1 VINCEN'f.C.P.A JULIA W.PO RTUS,C.P.A M ICH EI-LE BOURNE,C.P.A PAIGE r.19row NE,C P.A DAW N REDD.C P A N D EPEN D ENT A U D ITO RS'R EPO RT April8,2002 Board ofcom m issioners SulphurParks and Recreation W e have audited the accom panying generalpurpose financialstatem ents ofsulphur Parks and Recreation,a com ponentunitofthe Calcasieu Parish Police Jury,as ofand forthe yearended Decem ber31,2001,as listed in the table ofcontents. These generalpurpose financialstatem ents are the responsibility ofsulphurparks and Recreation m anagem ent. O ur responsibility is to express an opinion on these generalpurpose financialstatem ents based on ouraudit. W e conducted ourauditin accordance w ith auditing standards genera ly accepted in the United States ofa m erica and the standards applicable to financialaudits contained in G overnm entauditing Stan _ d _ ar d s,issued by the Com ptro lerg eneralofthe United States. Those standards require thatwe plan and perform the auditto obtain reasonable assurance aboutw hetherthe generalpurpose financialstatem ents are free ofm aterialm isstatem ent. An auditincludes exam ining,on a testbasis,evidence supporting the am ounts and disclosures in the generalpurpose financialstatem ents. An auditalso includes assessing the accounting principles used and significantestim ates m ade by m anagem ent,as w e las evaluating the overa lgeneralpurpose financialstatem entpresentation. W e believe thatourauditprovides a reasonable basis forouropinion. In ouropinion,the generalpurpose financialstatem ents referred to above presentfairly, in a lm aterialrespects,the financialposition ofsulphurparks and Recreation as ofdecem ber 31,2001,and the results ofits operations forthe yearthen ended in conform ity w ith accounting principles genera ly accepted in the U nited States ofa m erica. O urauditw as m ade forthe purpose ofform ing an opinion on the generalpurpose financialstatem ents taken as a w hole. The supplem entalinform ation listed in the table of contents is presented forpurposes ofadditionalanalysis and is nota required partofthe generalpurpose financialstatem ents ofsulphurparks and Recreation. Such inform ation has been subjected to the auditing proceduresapplied in the auditofthe generalpurpose financial statem ents and,in ouropinion,is fairly presented in a lm aterialrespects in relation to the generalpurpose financialstatem ents taken as a w hole. In accordance w ith G overnm entauditinq Standa _ rds,w e have also issued ourreport dated A pril8,2002 on ourconsideration ofsulphurparks and Recreation's internalcontrolover financialreporting and ourtests ofits com pliance w ith certain provisions oflaw s,regulations and contracts. This reportis an integralpartofan auditperform ed in accordance w ith G overnrnenta _ u _ditln~.standards and should be read in conjunction with this report in considering the results ofouraudit. TELEPHONIE(37)4~t~1906' /ZJ ~ FACSIMILE(37~ ~ / '~ lif/'-telepho~[(37)625t1~86,facsimile(37)

4 SULPHUR PA RKS AND R EC REATIO N Com bined Balance Sheet- A lfund Types and AccountG roups Decem ber ASSETS C ash and cash equivalents R eceivables: Ad valorem tax,net State revenue sharing A ccrued interest O ther Inventory,atcost Prepaid expense Fixed assets Am ountavailable in DebtService Fund A m ountto be provided forretirem entof G enerallong-term Debt TO TA L A SSETS.G gv.ẹ[p nle ntaḷ_ F u p _ d _._Typ_.e s G enera~ _Peb.t S _e_r~!~e $ 2,588,141 $ 63,931 2,861, ,717 25,840 1,617 1,004,936 $ 5,542,893 $ 1,068,867 The accom panying notes are an integralpartofthe financialstatem ents

5 A ccountg roups G enera Fixed A ssets G eneral Long-Term Debt Totals (Memorandum Only) $ 2,652,072 $ 2,299,024 23,727,664 1,068,867 3,866, ,717 25,840 1,617 23,727, ,092,569 78,453 15, ,472, (23,867) (~ 867) ,727,664 $ 1,045,000 $ 31,384,424 $ 31,013,599 Continued G RAGSON,CASII)AY ~ G UILI.ORY,L.L.I: C ERTIFIED PU BLIC AC C O U NTA NTS

6 SULPHUR PARKS AND RECREATIO N Com bined Balance Sheet- A lfund Typesand AccountGroups (Continued) Decem ber LIABILITIES AND FUND EQ UITY LIA BILITIES Accounts payable Accrued liabilities Deferred revenue G eneralobligation bonds payable Totalliabilities FUN D EQ U ITY Investm entin G eneralfixed Assets Fund balances: Reserved forinventory Reserved fordebtserv ice Unreserv ed -undesignated TotalFund Equity TO TAL LIABILITIES AND FUN D EQ U ITY G o~_e rn_m _e nla! E yn _d.!yn._e.~ _ G epera~ _DebLSer~i~ e 136~559 25, ~ 380, ~ 1, 1068~ 86Z $ 5,542,893 $ 1,068,867 The accom panying notes are an integralpartofthe financialstatem ents

7 AccountG roues G enera Fixed Assets G eneral Long-Term Debt Totals (MemgraQdu_m_ On!y) ,04~ 00Q $ 21, ,311 8,615 ~ 04~ 9_oo_ 1j3_8_L _559 $ 23, , ,7~ ,840 1,068,867 30,987 1,147,016 5~200,798 28~ 851,20Z $:23,727,664 $!,045,000 $ 31,384,424 $ 31,013,599 G RAGSON,CASIDAY ~ G UII.I.OR% L.L.I: C ERTIFIED PU B LIC A C C O U N TA N TS 7

8 SULPHUR PARKS AND REC REATIO N Com bined Statem entofrevenues,expenditures,and C hanges in Fund Balances -A lg overnm entalfund Types YearEnded Decem ber R EVEN UES Ad valorem tax State revenue sharing Recreation centerconcessions G olfcourse G ril Tennis Interest M isce laneous TotalRevenues _ - Gg. yernm entalfundt yp es D ebt G eneral Service 3,998,583 $ 981,405 30,616 ~._J,0:12,02J EXPEN DITU RES C urrentoperating: Recreation G olfcourse G rill Sw im m ing pools Tennis G eneraland adm inistration D ebtservice: Interest Principalretirem ent TotalExpenditures 2,505, ,251 52,437 54,805 36, _ 110, ,000 j,q~ojy o Excess (deficiency)ofrevenues overexpenditures 174,549 (78,149) Fund Balance -Beginning Fund Balance -Ending _ 5,2~ 8_ $ 5,406,334 $ 1,068,867 The accom panying notes are an integralpartofthe financialstatem ents

9 Totals (Memorandum Only) $ 3,726,039 78, , ,100 49,130 17, ~ 517 ~,9JQ,604 $ 4,080,914 78, , ,980 49,441 23, , ,505, ,251 52,437 54,805 36, ,170 98~ ooo ~ 9!~ 204 2,013, ,244 49,861 58,701 41, ,470 92~p00 " 4~4673~00 96, , ,475 $.6,475,201 $ 6,378,601 G RAGSONtCASIDAY ~zg UII.I.ORY,L.L.P. C ERTIFIED PU BLIC AC C O U NTANTS,

10 SULPH UR PARKS A ND RECREATIO N Statem entofrevenues,expenditures,and Changes in Fund Balances -Budgetand Actual-G eneralfund YearEnded D ecem ber31,2001 W ith Com parative ActualAm ounts foryearended Decem ber31,2000 R EV EN U ES A d valorem tax State revenue sharing Recreation center concessions G olfcourse G ril Tennis Interest M isce laneous TotalR evenues Budget $ 2,450, , ,OO0 47,0O0 21, ,000 23,00g Actual $ 2,744, , ,100 49,130 17, ,953 _ ~2, Variance- Favorable (Unfavorable) $ 294, A ctual $ 3,019, , ,980 49,441 23, ,525 EXPEND ITUR ES C urrentoperating: Recreation G olfcourse G ril Swim m ing pools Tennis G eneraland adm inistration TotalExpenditures 2,757, ,900 52,400 82,000 53, ,505, ,251 52,437 54,805 36, ,034 3~824~Q , ,649 (37) 27,195 16, ,013, ,244 49,861 58,701 41, ,583 3,388~8 3Q Excess(deficiency)ofrevenuesover expenditures (790,100) 174, , ,862 FUN D BALANC E-Beginning 5123 _ 1 It78 _ _4,335,823 FUND BALANCE-Ending $,4,44!,685 ~ 5,406,334 $ 964,649 $ 5,231,785 The accom panying notes are an integralpartofthe financialstatem ents G RAGSON,CASIDAY & G UILLORY~L.L.E C ERTIFIED PU BLIC ACC O U NTANTS 10

11 SULPHUR PA RKS AND REC REATIO N Notes to FinancialStatem ents Decem ber NO TE A -SUM M ARY O F SIG N IFICANT ACCO UNTING PO LIC IES SulphurParks and Recreation was created by the Calcasieu Parish Police Jury as authorized by Act82 of1948. The districtis governed by a board offive com m issioners w ho are appointed by the Calcasieu Parish Police Jury. The districtestablishes regulations governing the parks,playgrounds and com m unity centers and provides adm inistration,m anagem ent,m aintenance and operations ofthe facilities. The financialstatem ents ofthe Districthave been prepared in conform ity w ith genera ly accepted accounting principles (GAAP)as applied to governmentunits.the GovernmentalAccounting Standards Board (GASB)is the accepted standard-setting body forestablishing governm entalaccounting and financialreporting principles. The m ore significantofthe governm ent's accounting policies are described below. 1. Reporting Entity G ASB Statem entno.14 established criteria fordeterm ining the governm entalreporting entity and com ponentunits thatshould be included w ithin the reporting entity. For financialreporting purposes,in conform ance w ith G ASB Statem entn o.14,the Sulphur Parks and Recreation includes a lfunds,accountgroups,etcetera,thatare w ithin the oversightresponsibility ofthe SulphurParks and Recreation. As the governing authority,forreporting purposes,the Calcasieu Parish Police Jury is the financialreporting entity.the financialreporting entity consistsof(a)the primary government,(b)organizations forwhich the primary governmentis financialy accountable,and (c)otherorganizations forwhich the nature and significance oftheir relationship w ith the prim ary governm entare such thatexclusion would cause the reporting entity's financialstatem ents to be m isleading orincom plete. G overnm entalaccounting Standards Board Statem entno.14 established criteria for determ ining which com ponentunits should be considered partofthe Calcasieu Parish Police Jury forfinancialreporting purposes. The basic criterion forincluding a potentia com ponentunitw ithin the reporting entity is financialaccountability.the G A SB has set forth criteria to be considered in determ ining financialaccountability. This criteria includes: G RACSON,C ASII)AY & G UILLORY,L.L.I~. C ERTIFIED PU BLIC AC CO U NTA NTS Continued

12 SULPHUR PA RKS AND REC REATIO N Notes to FinancialStatem ents Decem ber31,2001 NOTE A -SUM M ARY O F SIG NIFICANT ACCO UNTING PO LICIES -CO NTINUED 1. Appointing a voting majority ofan organization's governing body and a. The ability ofthe Calcasieu Parish Police Jury to im pose its w il on thatorganization and/or b. The potentialforthe organization to provide specific financial benefits to orim pose specific financialburdens on the Calcasieu Parish Police Jury. 2. O rganizations forw hich the C alcasieu Parish Police Jury does not appointa voting majority butare fiscaly dependenton the Calcasieu Parish Police Jury. 3. O rganizations forw hich the reporting entity financialstatem ents could be m isleading ifdata ofthe organization is notincluded because ofthe nature orsignificance ofthe relationship. Based upon the appficafion ofthese crileria,sulphurparks and Recreation is a com ponentunitofthe Calcasieu Parish Police Jury 's reporting entity. 2. Fund Accounting The SulphurParks and R ecreation uses funds and accountgroups to reporton its financialposition and the results ofits operations. Fund accounting is designed to dem onstrate legalcom pliance and to aid financialm anagem entby segregating lransacljons re~atjng to certain governm entfunctions oractivities. A fund is a separate accounting entity w ith a self-balancing setofaccounts. O n the other hand,an accountgroup is a financialreporting device designed to provide accountability forcertain assets and liabilities thatare notrecorded in the funds because they do not directly affectnetexpendable financialresources. The fo low ing funds and group ofaccounts are used by the District: G RAGSON,CASIDAY & G UILLORYrL.L.I~. C ERTIFIED PU BLIC ACC O U NTANTS Continued

13 SULPHUR PARKS AND RECREATIO N Notes to FinancialStatem ents Decem ber NO TE A -SUM M ARY O F SIG NIFICANT ACCO UNTING PO LICIES -CO NTINUED G overnm entalfunds: Funds ofthe districtare classified as gow.~rnm entalfunds. G overnm entalfunds account forthe district's generalactivities,including the co lection and disbursem entofspecific or legally restricted m onies,the acquisition orconstruction ofgeneralfixed assets,and the servicing ofgenerallong-term debt. G ow.~rnm entalfunds ofthe districtinclude: 1. G eneralfund -the generaloperating fund ofthe districtand accounts fora l financialresources,exceptthose required to be accounted forin otherfunds. 2. DebtService Fund -accounts fortransactions relating to resources retained and used forthe paym entofprincipaland intereston those long-term obligations recorded in the generallong-term obligations accountgroup. AccountG roups: G eneralfixed Assets AccountG roup: Fixed assets ofgovernm entalfunds are recorded as expenditures atthe tim e they are purchased orconstructed,and the related assets are capitalized (reported)in the general fixed assets accountgroup. Public dom ain orinfrastructures are notcapitalized. No depreciation has been provided on generalfixed assets. A lfixed assets are valued at historicalcostorestim ated costifhistoricalcostis notavailable. Substantia ly a lofthe furniture and equipm entare reported atestim ated costs. G enerallong-term DebtA ccountg roup: Long-term obligations expected to be financed from governm entalfunds are reported in the generallong-term obligations accountgroup. Expenditures forprincipaland interest paym ents forlong-term obligations are recognized in the governm entalfunds w hen due 3. Basis ofaccounting The accounting and financialreporting treatm entapplied to a fund is determ ined by its m easurem entfocus. A lgovernm entalfund types are accounted forusing a current financialresources m easurem entfocus. W ith this m easurem entfocus,only current assets and currentliabilities genera ly are included on the balance sheet. O perating statements ofthese funds presentincrea.~es(i.e.,revenues and otherfinancing sources) and decreases(i.e.,expendituresand otherfinancing uses)in netcurrentassets. Continued G RAGSON,CASIDAY & G UILLORY,L.I,.P. C ERTIFIED PU E3LIC AC C O U NTA NTS 3

14 SULPHUR PARKS AND RECREATIO N Notes to FinarlcialStatem ents Decem ber NO TE A -SUM M ARY O F SIG N IFICANT ACCC)UNTING PO LIC IES -CO NTINUED 3. Basis ofaccounting -C ontinued The m odified accrualbasis ofacco unting is used by a lgovernm entalfund types. U nder the m odified accrualbasis ofaccounting,revenues are recognized when susceptible to accrual(i.e.,when they become both measurable and available)."measurable"means the am ountofthe transaction can be determ ined and "available"m eans co lectible w ithin the currentperiod orsoon enough thereafterto be used to pay liabilities ofthe current period. A one yearavailability period is used forrevenue recognition fora lgovernm ental fund type revenues. Expenditures are recorded w hen the related fund liability is incurred. Principaland intereston generallong-term debtare recorded as fund liabilities w hen due orw hen am ounts have been accum ulated in the debtservice fund forpaym ents to be m ade early in the fo low ing year. Those revenues susceptible to accrualare properly taxes,stale revenue sharing and interest. Sw im m ing pool,concessions and golfcourse revenues are notsusceptible to accrualbecause genera ly they are notm easura ble untilreceived in cash. Transfers between funds thatare notexpected to be repaid (and any other financing source/use)are accounted foras otherfinancing sources(uses). 4. Cash Cash includes am ounts in dem and deposits and tim e deposits with originalm aturities of 90 days orless. Understate law,the D istrictm ay depositfunds in dem and deposits, interest-bearing dem and deposits,m oney m arketaccounts,ortim e deposits w ith state banks organized underlouisiana law and nationalbanks having theirprincipaloffices in Louisiana. C ontinued G RAGSON,C ASIDAY & G UILLORY,L.L.P. C ERTIFIED PU BLIC AC C O U NTA N'rS

15 SULPHUR PARKS AND REC REATIO N Notes to FinancialStatem ents Decem ber NO TE A -SUM M ARY O F SIG N IFICANT ACCO UNTING PO LIC IES -CO NTINUED These deposits are stated atcost,w hich approxim ates m arket. Understate law,these deposits(orthe resulting bank balances)mustbe secured by federaldepositinsurance or the pledge ofsecurities ow ned by the fiscalagentbank. The m arketvalue ofthe pledged securities plus the federaldepositinsurance m ustata ltim es equalthe am ounton depositw ith the fiscalagent. These securities are held in the nam e ofthe pledging fiscal agentbank in a holding orcustodialbank thatis m utua ly acceptable to both parties. At December31,2001,the Districthas $2,716,211in deposits (colected bank balances). These deposits are secured from risk by $200,000 offederaldepositinsurance and $2,516,211 ofpledged securities held by the custodialbank in the nam e ofthe fiscal agentbank. 5. Budgets A budgetis adopted on a basis consistentw ith genera ly accepted accounting principles forthe generalfund. A lannualappropriations lapse atfiscalyearend. O n orbefore the lastm eeting ofeach year,the budgetis prepared by fund,function and activity,and includes inform ation on the pastyear,currentyearestim ates and requested appropriations forthe nextfiscalyear. The proposed budgetis presented to the governm ent's Board ofcom m issioners for review. The board holds a public hearing and m ay add to,subtractfrom orchange appropriations,butm ay notchange the form ofthe budget. Any changes in the budget m ustbe w ithin the revenues and reserves estim ated. The budgetw as am ended once during the year. 6. Inventory Inventory is valued atcost,w hich approxim ates m arket,and is determ ined using the FIFO m ethod. Inventory consists ofgolfequipm entand concessions held forresale Inventory atyearend is equa ly offsetby fund balance reserve. G RAGSON,C ASIDAY ~ G UILI.OI~Y,L.L.P. C ERT IFIED PU B LIC A C C O U N TA N TS 15 C ontinued

16 SULPHUR PARKS AND REC REATIO N Notes to FinancialStatem ents Decem ber31.200t NO TE A -SUM M ARY O F SIG N IFICANT ACCO UNTING PO LIC IES -CO NTINUED 7. Com pensated Absences Vacation tim e is earned atvarious rates depending on years ofservice. Earned vacation tim e is genera ly required to be used w ithin one yearofaccrualand is notcum ulative. Sick leave is earned atvarious rates depending on years ofserv ice. Em ployees can accum ulate up to fifteen w eeks ofunused sick leave. Upon retirem entorterm ination em ployees are notpaid forany accum ulated sick leave. 8. TotalColum ns on Com bined Statem ents -O verv iew TotalC olum ns on the com bined financialstatem ents are captioned "M em orandum O nly" to indicate thatthey are presented only to facilitate financialanalysis. Data in these colum ns do notpresentfinancialposition orresults ofoperations in conform ity w ith genera ly accepted accounting principles. Neitheris such data com parable to a consolidation. Interfund elim inations have notbeen m ade in the aggregation ofthis data 9. Com parative Data C om parative totals forthe prioryearhave been presented in the accom panying financial statem ents in orderto provide an understanding ofchanges in the District's financial position and operations. How ever,presentation ofprioryeartotals by fund type have not been presented in each ofthe statem ents since theirinclusion w ould m ake the statem ents unduly com plex and dificultto read. N O TE B -A D VA LO R EM TA XES Forthe yearended Decem ber31,2001,taxes w ere levied on property w ith taxable assessed valuations as fo low s: G eneralcorporate purposes Debtservice Approxim ate Valuations Taxes $ 288,175, m ils 288,175, m ils 13,85 m ils Continued G RAGSONtCASIDAY q~zg UILLORY~L.L.P. C ERT IFIED PU B LIC A C C O U N TA N TS

17 SULPHUR PA RKS AND REC REATIO N Notes to FinancialStatem ents Decem ber NO TE B -AD VALO REM TAXES -CO NTINUED Property tax m ilage rates are adopted in July forthe calendaryearin w hich the taxes are levied and recorded. A ltaxes are due and co lectible w hen the assessm entro ls are filed on orbefore Novem ber15th ofthe currentyear,and becom e delinquentafterd ecem ber 31.Property taxes notpaid by the end offebruary are subjectto lien. NO TE C -C HANG ES IN G EN ERAL FIXED ASSETS A sum m ary ofchanges in generalfixed assets forthe yearended Decem ber31,2001 follow s: Balance Balance Decem ber31 Decem ber Net Additions.(Deletion sj Recreationalfacilities Furniture and equipm ent C onstruction in progress $ 20,356,015 1,909, $ 1,144, ,336 (16~ 13J ) $ 21,500,068 2,036, ,062 _ Totalgeneralfixed assets $ 22,472,406 $ 1,255,258 $ 23,727,664 The construction in progress consists ofthe addition to North Frasch parking lotat $166,028,the sidewalk projectat$20,702,the Dick Ackle drainage improvements at $4,332.Estimated remaining costs to complete the projects are $0,$54,000 and $245,000,respectively. NOTE D -RETIREM ENT CO M M ITM ENTS Fu l-tim e em ployees ofthe districtare m em bers ofthe ParochialEm ployees'r etirem ent System oflouisiana,a multi-employer(cost-sharing),public employee retirementsystem (PERS),controled and administered by a separate board oftrustees.the System is com posed oftw o distinctplans,plan A and Plan B,w ith separate assets and benefit provisions. Eligible em ployees ofthe districtw ere m em bers ofplan A during U nderplan A,m em bers w ith 10 years ofcreditable service m ay retire atage sixty; m em bers w ith 25 years ofserv ice m ay retire atage fifty-five;m em bers w ith 30 years of service m ay retire regardless ofage. The retirem enta low ance is equalto three percent G F,AGSON,CASII)AY & G UILLOP,YtL.L.r C ERTIFIED PU BLIC AC C O U NTA NTS C ontinued

18 SULPHUR PARKS AND REC REATIO N Notes to FinancialStatem ents Decem ber NO TE D -R ETIREM ENT CO M M ITM ENTS -CO NTIN UED ofthe member's finalaverage compensation (defined as the average ofthe highest consecutive 36 months)multiplied by hisyears ofcreditable service.however,any em ployee w ho w as a m em berofthe supplem entalplan only priorto the revision date has the benefitearned forserv ice credited priorto the revision date on the basis ofone percentoffinalcom pensation plus two do lars perm onth foreach yearcredited priorto the revision date,and three percentoffinalcom pensation foreach yearofservice credited afterthe revision date. The retirem enta lowance m ay notexceed the greaterof one hundred percentofa m em ber's finalsalary orthe finalcom pensation. Contributions to the System include 1/4 of1% ofthe taxes show n to be co lectible by the tax ro ls ofeach parish,excepto rleans and EastBaton Rouge Parishes. These tax do lars are divided betw een Plan A and Plan B based proportionately on the salaries of the active m em bers ofeach plan. State statute requires covered em ployees to contribute a percentage oftheirsalaries,2% underplan B and 9.5% underplan A,to the System. A s provided by Louisiana Revised Statute 11:103,the em ployercontributions are determ ined by an actuarialvaluation and are subjectto change each yearbased on the results ofthe valuation forthe priorfiscalyear.the em ployercontributions for2001w ere 7.75% ofcovered em ployees'salaries underplan A. The payro lforthe Districtem ployees covered by the system forthe yearended Decem ber31,2001was $692,637;the District's totalpayrolwas $1,096,092.The Districtcontributed $53,679 to the system during the year. NOTE E -LO NG -TERM DEBT The fo low ing is a sum m ary ofbond transactions ofthe Districtforthe yearended D ecem ber31,2001: Balance Beginning _ Additions Reductions Balance endiqg GeneralObligation Bond $2,025,000 $ - $:980,000 $ 1,045,000 G RAGSON,CASn)AY & G UILLORY,L.L.E C ERTIFIED PU BI.JC ACC O U NTANTS 18 Continued

19 SULPHUR PARKS AND REC REATIO N Notes to FinancialStatem ents Decem ber NOTE E -LO NG-TERM DEBT -CO NTINUED G eneralobligation bond payable atdecem ber31,2001 is com prised ofthe fo lowing issue: $8,000,000 bonds due in annualprincipal insta lm ents ranging from $980,000 to $1,045,000 through Septem ber1,2002,interestrate is5.38% $ 1,045,000 A nnualrequirem ents to am ortize a ldebtoutstanding atdecem ber31,2001,including interestof$56,953 are as fo lows: Yearending D ecem ber _,~_Q1+,953 In accordance with the 1992 $8,000,000 bond issue,the Districtm ustspend property tax revenues w ithin thirteen m onths ofreceipt,m ustspend interestearnings w ithin one year ofreceiptand m ustdeplete funds once a yearw ith a carryovera low ed atthe greaterof one year's interestearnings orone-twelfth (1/12)ofanhualdebtservice.The Districtwas in com pliance w ith a lbond issue covenants for2001. NO TE F -R ISK M ANAG EM ENT The D istrictis exposed to various risks ofloss related to torls;theftof,dam age to and destruction ofassets;errors and omissions;injuriesto employees;and naturaldisasters The Districtm aintains com m ercialinsurance coverage covering each ofthose risks of loss. M anagem entbelieves such coverage is sufficientto preclude any significant uninsured losses to the D istrict. Settled claim s have notexceeded this com m ercial coverage in any ofthe pastthree fiscalyears. G RAGSON,C ASIDAY & G U)LLORYrL.L.I~. C ERTIFIED PU BLIC AC CO U NTANTS

20 SULPHUR PARKS AND REC REATIO N Notes to FinancialStatem ents Decem ber31,2001 NOTE G -DEFERRED CO M PENSATIO N PLAN The Districtoffers its em ployees a deferred com pensation plan created in accordance w ith InternalRevenue Code Section 457. The plan,available to a lfu ltim e em ployees w hich have been em ployed by the Districtfor12 consecutive m onths,perm its them to defera portion oftheirsalaries untilfuture years. The Districtw ilm atch fifty percent (50% )ofthe employee's contribution to a maximum ofsix percent(6% )ofthe employee's salary,notto include com pensatory tim e orexpense reim bursem ent. The deferred com pensation is notavailable to em ployees untilterm ination,retirem ent,or unforeseeable em ergency. Deferred com pensation is available to em ployees' beneficiaries in case ofdeath. A lam ounts ofcom pensation deferred underthe plan,a lproperty and rights purchased w ith those am ounts,and a lincom e attributable to those am ounts,property orrights are (untilpaid ormade available to the employee orotherbeneficiary)solely the property and rights ofthe District(withoutbeing restricted to the provisions ofbenefits underthe plan), subjectonly to the claim softhe District's generalcreditors. Participants'rights underthe plan are equalto those ofgeneralcreditors ofthe D istrictin an am ountequalto the fair m arketvalue ofthe deferred accountforeach participant. In m anagem ent's opinion,the City has na liability forlosses underthe plan. How ever,the D istrictdoes have the duty ofdue care thatw ould be required ofan ordinary prudent investor. The Districtbelieves itis unlikely thatitw iluse the assets to satisfy the claim s ofgeneralcreditors in the future. NO TE H -CO M M ITM ENTS D uring 2001,the Board approved the fo low ing transactions w hich w iloccursubsequent to Decem ber31,2001: ~ The fencing ofnorth Frasch parking lotforan approxim ate costof$18,000 ~ The purchase ofone frontdeck rotary m owerfora totalcostof$14,190. ~ The purchase ofone utility truck w ith dum p bed foran approxim ate costof $15,000. ~ The purchase ofone five reelhydraulic m ow erforan approxim ate costof $29,000. ~ The purchase of25 acres ofland forapproxim ately $100,000. G RAGSON,CASIDAY &~G UILLORY,L.L.E C ERTIFIED PU BLIC AC C O U NTA NTS

21 SULPHUR PARKS AND RECREATIO N Statem entofexpenditures -Budgetand Actual- G eneralfund YearEnded Decem ber31,2001 W ith Com parative ActualAm ounts foryearended Decem ber31,2000 REC REATIO N C hem icaland fertilizer Concession purchases C ontractlabor G round im provem ents R ecreation program R epairs and m aintenance Salaries Telephone Training Utilities Acquisitions Budget_ $ 35,000 69, ,000 35, , , ,500 25,000 1,000 _ 148,000 L1~15 0,~0Q 2,757, Actua $ 20,992 54, ,694 41,355 71, , ,836 21,625 20, ,954 1,274,590 ~2,505,622 Variance- Favorable (UnfavorableJ $ 14,008 14,714 12,306 (6,355) 33,116 8,123 33,664 3,375 (19,229) 18, ,410 $ 252, A ctua $ 25,006 65,7t6 115,720 33,362 67, , , , ,726 $ 2,013,426 G O LF C O U R SE C hem icals and fertilizer Driving range purchases G round im provem ents Pro shop purchases for resale Repairs and m aintenance Salaries Telephone U tilities Acquisitions $ 45,000 $ 34,096 $ 10,904 $ 32,533 17,100 9,548 7,552 9, ,150 82, ,604 6,806 38, ,650 7,202 88,396 1,194 2, ,757 87, ,721 5,720 33, $ 653,251 $ $ 698,244 Continued G RAGSON,CASIDAY & G UILLORY,L.L.I: C ERTIFIEO PU B LIC A C C O U N TA N TS 2]

22 SULPHUR PARKS AND R EC REATIO N Statem entofexpenditures -Budgetand Actua G eneralfund -Continued YearEnded Decem ber31,2001 W ith Com parative ActualAm ounts foryearended Decem ber31,2000 G R ILL Purchases forresale Shortages Salaries Supplies Spo~t,age Budget. $ 26, , ,52,4QQ 2001 Actua $ 26, ,027 1, ~ 52,43z Variance- Favorable (Unfavorab~) $ (1,329) 41 $ (37) Actual $ 27,444 (5) ,861 SW IM M ING PO O LS C hem icals Utilities M aintenance JointService Agreem ent TEN N IS Co~cess~ons Supplies Utilities Salaries InstrJtraining $ 8,500 7,000 12,000 55,000 $ 6,500 2,500 16,000 26,000 $~ 53,00Q $ ,388 4,046 3Q,o5o ~ 54,805 4, , ~ ~36,885 $ 1,688 1,612 7,954 15,941 $ 2Z,!95 $ 2,476 2,406 1,811 7,422 _ 20 ~ $!6J!5 $ 5,247 5,595 7,036 40~23 ~ 58,791 $ 7,099 13,838 20,078 41,015 G ENERAL AND ADM INISTRATIVE Bank service charges $ 4,000 Com puterexpense 26,000 Cor~tractlabor Insurance Janitorialsupplies Legal& professionalfees M isce laneous O ffice expense Payro ltaxes Professionaldevelopm ent Retirem entcontributions Safety program expenses Salaries Acquisitions 315,400 19,000 6, ,000 59,000 6,000 78,0O0 7, , $ 5, , ,339 15,008 6,500 2,280 11, ,282 69,485 7, ,905 ~ o65 $ (1,628) 13,863 (5,718) 110,061 3, ,720 5,019 13,166 2,718 8,515 (872) 19,095 6,935 3, ,373 16,943 6,000 6,556 13,096 49,418 3,761 59,253 5, ,488 1.~74 ~.702,9qQ ~.5~1,034 $ 180,966 ~ 527,583 G RAGSON~CASID,&Y & G UII,I,OR~~L.L.P C ERTIFIED PU BI,-IC AC CO U NTANTS

23 G R A G S O N,C A S ID A Y & G U IL L O R Y,L.L.P. C ERTIFIED PU B LIC A C C O U NTA N TS w GEORG E G RAGSON.C P A RfCHARD W.CASlDAY,C P A RAYMOND GUILLORY,JR,C P.A GRAHAM A PORTUS,IrA COY T VINCENI.C P A JULIA W PORTUS,C,P,A M ICHELLE, BOURNE,C P A PAIG E, F,BROW NE- C p A DAW N REDD C P A IN DEPEN DENT AUD ITO RS'R EPO RT O N CO M PLIANCE AND O N INTERNAL CO NTRO L O VER FINANC IAL REPO RTING BASED O N AN AUD IT O F G EN ERAL PUR PO SE FINANC IAL STATEM [-NTS PER FO RM ED IN ACCO RDANC E W ITH G O VERNM ENT AUD ITING STANDARDS Board ofcom m issioners SulphurParks and Recreation April8,2002 W e have audited the generalpurpose financialstatem ents ofthe SulphurParks and Recreation,a com ponentunitofthe Calcasieu Parish Police Jury,as ofand forthe yearended D ecem ber31,2001,and have issued ourreportthereon dated A pril8,2002.w e conducted our auditin accordance w ith auditing standards genera ly accepted in the United States ofam erica and the standards applicable to financialaudits contained in G overnm enta uditing Standards, issued by the C om ptro lerg eneralofthe U nited States. C~ [qp!a rice As partofobtaining reasonable assurance aboutw hethersulphurparks and Recreation's financialstatem ents are free ofm aterialm isstatem ent,w e perform ed tests ofits com pliance w ith certain provisions oflaw s,regulations,contracts and grants,noncom pliance w ith w hich could have a directand m aterialeffecton the determ ination offinancialstatem entam ounts. However,providing an opinion on compliance with those provisionswas notan objective ofour auditand,accordingly,w e do notexpress such an opinion. The results ofourtests disclosed no instances ofnoncom pliance thatare required to be reported underg overnm entauditing Standards. nterna{c ontrolo verfinancialre In planning and perform ing ouraudit,w e considered SulphurParks and Recreation's internalcontroloverfinancialreporting in orderto determ ine ourauditing procedures forthe purpose ofexpressing ouropinion on the financialstatem ents and notto provide assurance on the internalcontroloverfinancialreporting. O urconsideration ofthe internalcontrolover financialreporting w ould notnecessarily disclose a lm atters in the internalcontroloverfinancia reporting thatm ightbe m aterialw eaknesses. A m aterialw eakness is a condition in w hich the design oroperation ofone orm ore ofthe internalcontrolcom ponents does notreduce to a relatively low levelthe risk thatm isstatem ents in am ounts thatw ould be m aterialin relation to the financialstatem ents being audited m ay occurand notbe detected w ithin a tim ely period by ONE LAKESIDE plaza,suite 700,P,O,DRAWER 1047 LAKE CHARLES,LOUISIANA "/0602,1847 TELEPHONE (3:~?)4~9 tgs6,facsim ILE (337)4~ PO ST O AK ROAD,SUI'FE 6 SULPHUR,LOUISIANA TELEPHONE (337) ,FACSIMILE- (337)625.56~

24 Board ofcom m issioners SulphurParks and Recreation April8,2002 Page Tw o em ployees in the norm alcourse ofperform ing theirassigned functions. W e noted no m atters involving the internalcontroloverfinancialreporting and its operation thatw e considerto be m aterialw eaknesses. This reportis intended solely forthe inform ation and use ofthe m anagem entand the Board ofcom m issioners and is notintended to be and should notbe used by anyone other than these specified parties. G RAGSON,CASIDAY ~ G UILLORY,L.L.I~ C ERTIFIED PU BLIC ACC O U NTANTS

25 SULPHUR PARKS AND RECREATIO N SUM M ARY SC HEDULE O F FINDING S YearEnded Decem ber Sum m ary ofauditors'results Type ofauditors'reportissued: unqualified Internalcontroloverfinancialreporting: Materialweakness(es)identified? Reportable condition(s)identified thatare notconsidered to be materialweakness(es)? Noncom pliance m aterialto financial statem ents noted? FINANC IAL STATEM ENT FINDING S None _ yes _ yes _ yes X no X none reported X no FEDERAL AW ARD FIND ING S AND Q UESTIO NED CO STS N/A G RAGSON,CASn)AY & G UILLORY~L.L,I; C ERTIFIED PU BLIC AC C O U NTA NTS