REPORT ST. BERNARD PARISH HOME MORTGAGE AUTHORITY MARCH 31,2007

Transcription

1 REPORT ST. BERNARD PARISH HOME MORTGAGE AUTHORITY MARCH 31,2007 Under provisions of state law, this report is a public document. A copy of the report has been submitted to the entity and other appropriate public officials. The report is available for public inspection at the Baton Rouge office of the Legislative Auditor and, where appropriate, at the office of the parish clerk of court. Release Date

2 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY TABLE OF CONTENTS MARCH 31,2007 ACCOUNTANT'S COMPILATION REPORT 1 PAGE MANAGEMENT'S DISCUSSION AND ANALYSIS 2-5 FINANCIAL STATEMENTS: Statement of Net Assets 6 Statement of Revenues, Expenses and Changes in Fund Net Assets 7 Statement of Cash Flows 8 Notes to Financial Statements 9-11 SUPPLEMENTARY INFORMATION: Statement of Activities 12

3 DUPLANTIER, HRAPMANN, HOGAN & MAHER, L.L.P. MICHAEL J. O'ROURKE, C.P.A. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ A j_ DUPLANTIER JR, C.P.A. WILLIAM G. STAMM, C.P.A. ^^^_ M ^m^m ( ) CLIFFORD J.GIFFIN,JR,C.P.A. ^^V VVV CERTIFIED PUBLIC ACCOUNTANTS FELIX j. HRAPMANN, JR,C.P.A. D AVID A. BURGARD, C.P.A. III ( ) LINDSAY J. CALUB, C.P.A., L.L.C. ^ WILLIAM R. HOGAN, JR. C.TJL Poydras St., Suite 2000 New Orleans, LA JAMES,. C.P.V. DENNIS W. DILLON, C.P.A. (504) MMI-mm ANNM.HEBERT.C.PA. FAX (504) MEMBERS v ROBIN A. STROHMEYER, C.P.A. ' AMERICAN INSTITUTE OF GRADY c. LLOYD, in, c.p.a, CERTIFIED PUBLIC ACCOUNTANTS HENRY L. SILVIA, C 3 A. SOCIETY OF LA C.P.A.'S KENNETH J. BROOKS, C.PA, ASSOCIATE ACCOUNTANT'S COMPILATION REPORT Board of Trustees St. Bernard Parish Home Mortgage Authority Chalmette, Louisiana July 24,2007 We have compiled the accompanying statement of net assets of St. Bernard Parish Home Mortgage Authority, a component unit of the Parish of St. Bernard, as of March 31, 2007, and the related statements of revenues, expenses and changes in fund net assets and cash flows for the year then ended, and the accompanying supplementary information contained on page 12, which is presented only for supplementary analysis purposes, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. A compilation is limited to presenting in the form of financial statements information that is the representation of management. We have not audited or reviewed the accompanying financial statements and supplementary schedule and, accordingly, do not express an opinion or any other form of assurance on them., Sixapmann, Sicgan. <C Make*, 3*

4 PAGE 2 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS AS OF AND FOR THE YEAR ENDED MARCH 31, 2007 The Management's Discussion and Analysis of the St. Bernard Parish Home Mortgage Authority's financial performance presents a narrative overview and analysis of St. Bernard Parish Home Mortgage Authority's financial activities for the year ended March 31, This document focuses on the current year's activities, resulting changes, and currently known facts in comparison with the prior year's information. Please read this document in conjunction with the information contained in the St. Bernard Parish Home Mortgage Authority's financial statements, which begin on page 6. FINANCIAL HIGHLIGHTS * The St. Bernard Parish Home Mortgage Authority's assets exceeded its liabilities at the close of fiscal years 2007 and 2006 by $470,468 and $468,698, respectively. This represents a increase from 2007 to The net assets increased by S1,770 (or.38%;. * The St. Bernard Parish Home Mortgage Authority's operating loss decreased by $24,865 (or 93%). OVERVIEW OF THE FINANCIAL STATEMENTS The following graphic illustrates the minimum requirements, if applicable, for Special Purpose Governments Engaged in Business-Type Activities established by Governmental Accounting Standards Board Statement 34, Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments. Management's Discussion and Analysis I Basic Financial Statements Required supplementary information (otter than MD&A)

5 PAGE 3 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS AS OF AND FOR THE YEAR ENDED MARCH BASIC FINANCIAL STATEMENTS The basic financial statements present information for the St. Bernard Parish Home Mortgage Authority as a whole, in a format designed to make the statements easier for the reader to understand. The statements in this section include the Statement of Net Assets; the Statement of Revenues, Expenses, and Changes in Fund Net Assets; and the Statement of Cash Flows. The Statement of Net Assets (page 6) presents the current and long-term portions of assets and liabilities separately. The difference between total assets and total liabilities is net assets and may provide a useful indicator of whether the financial position of the St. Bernard Parish Home Mortgage Authority is improving or deteriorating. The Statement of Revenues, Expenses, and Changes in Fund Net Assets (page 7) presents information showing how St. Bernard Parish Home Mortgage Authority's assets changed as a result of current year operations. Regardless of when cash is affected, all changes in net assets are reported when the underlying transactions occur. As a result, there are transactions included that will not affect cash until future fiscal periods. The Cash Flow Statement (page 8) presents information showing how St. Bernard Parish Home Mortgage Authority's cash changed as a result of current year operations. The cash flow statement is prepared using the direct method and includes the reconciliation of operating income to net cash provided by operating activities (indirect method) as required by GASB 34. FINANCIAL ANALYSIS OF THE ENTITY Statement of Net Assets as of March 31, 2007 and 2006 (in thousands) Current and other assets Noncurrent assets $ 472 $ 469 Total assets Other liabilities Long-term debt outstanding..._ Total liabilities Net assets: 2 ~ Unrestricted Total net assets $ 470 $ 459

6 PAGE 4 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS AS OF AND FOR THE YEAR ENDED MARCH 31, 2Q07 Restricted net assets represent those assets that are not available for spending as a result of legislative requirements, loan agreements or other requirements. Conversely, unrestricted net assets are those that do not have any limitations on what these amounts may be used for. Net assets of St. Bernard Parish Home Mortgage Authority increased by $1,770 (or.38%a from March 31, 2006 to March 31, The main cause of the increase is a decrease in operating expenses of the Authority for the year ended March 31, Statement of Revenues, Expenses, and Changes in Fund Net Assets for the years ended March 31, 2007 and 2006 (in thousands) Operating revenues $ $ Operating expenses (2) (27) Operating loss (2) (27) Non-operating revenues (expenses) 4_ 4_ Extraordinary item - - Transfer out Change in net assets $ 2 $ (23) The St. Bernard Parish Home Mortgage Authority had no operating revenues for fiscal years 2007 and 2006 since all of its programs were terminated in fiscal year 2004.

7 PAGES ST. BERNARD PARISH HOME MORTGAGE AUTHORITY MANAGEMENT'S DISCUSSION AND ANALYSIS AS OF AND FOR THE YEAR ENDED MARCH 31, 2007 CAPITAL ASSET AND DEBT ADMINISTRATION Capital Assets The St. Bernard Parish Home Mortgage Authority has no capital assets. Debt The St. Bernard Parish Home Mortgage Authority had no debt outstanding at March 31, All bonds were called, defeased or paid off in full during the year ended March 31, NEXT YEAR'S BUDGETS The St. Bernard Parish Home Mortgage Authority's appointed officials considered the following factors when setting next year's budget. These factors include: * The termination of the Authority's mortgage programs during the year ended March 31, * All bonds of the Authority were called, defeased or paid off in full during the year ended March 31,2004. * The Authority's officials are working to establish new programs for the Authority in the future. CONTACTING THE ST. BERNARD PARISH HOME MORTGAGE AUTHORITY MANAGEMENT This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the St. Bernard Parish Home Mortgage Authority's finances and to show the St. Bernard Parish Home Mortgage Authority's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Jack A. Stephens, Chairman, P. O. Box 168, Chalmette, Louisiana

8 PAGE 6 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY STATEMENT OF NET ASSETS MARCH (Unaudited) ASSETS CURRENT ASSETS: Cash (Note 2) TOTAL ASSETS $ 472,468 $ 472,468 LIABILITIES AND NET ASSETS CURRENT LIABILITIES: Accounts payable Total current liabilities NET ASSETS: Unrestricted TOTAL LIABILITIES AND NET ASSETS 2,000 2, , ,468 See accountant's compilation report and accompanying notes.

9 PAGE? ST. BERNARD PARISH HOME MORTGAGE AUTHORITY STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS FOR THE YEAR ENDED MARCH (Unaudited) OPERATING REVENUE OPERATING EXPENSES: Professional services Total operating expenses OPERATING LOSS NONOPERATING REVENUES (EXPENSES): Interest earned Total nonoperating revenues (expenses) CHANGE IN NET ASSETS Net assets, beginning of year NET ASSETS, END OF YEAR 2,000 2,000 (2,000) 3,770 3,770 1, ,698 $ 470,468 See accountant's compilation report and accompanying notes.

10 PAGE 8 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY STATEMENT OF CASH FLOWS FOR THE YEAR ENDED MARCH (Unaudited) CASH FLOWS FROM INVESTING ACTIVITIES: Interest received on cash and cash equivalents $ 3,770 Net cash provided by investing activities 3,770 INCREASE IN CASH AND CASH EQUIVALENTS 3,770 Cash and cash equivalents - beginning of year 468,698 CASH AND CASH EQUIVALENTS - END OF YEAR $ 472,468 RECONCILIATION OF OPERATING LOSS TO NET CASH USED BY OPERATING ACTIVITIES: Operating loss $ (2,000) Adjustments to reconcile operating loss to net cash used by operating activities: Change in accounts payable 2,000 Net cash used by operating activities $ See accountant's compilation report and accompanying notes.

11 PAGE 9 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY NOTES TO FINANCIAL STATEMENTS MARCH NATURE OF OPERATIONS The St. Bernard Parish Home Mortgage Authority (the "Authority") was created through a Trust Indenture dated May 9, 1979 pursuant to provisions of Chapter 2-A of Title 9 of the Louisiana Revised Statutes of 1950, as amended. The initial legislation and subsequent amendments grant the Authority the power to obtain funds and to use the proceeds to promote the financing and development of any essential program conducted in the public interest within the boundaries of St. Bernard Parish, Louisiana. The Authority's operations consisted of two single family mortgage revenue bond programs and two single family mortgage refunding bond programs whereby the Authority promoted residential home ownership through the acquisition of mortgage loans secured by first mortgage liens on single family residential housing. The funds for these programs were obtained through the issuance of bonds, which were general obligations of the Authority. As of March 31, 2004, all bonds of the Authority were defeased or paid off in full and the mortgage programs were terminated. The Authority's Board is currently working to establish new programs for the Authority in the future. The Authority has a Board of Trustees which contracts with outside parties to conduct the day-to-day operations of the programs it initiates. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Basis of Presentation The accompanying financial statements have been prepared on the full accrual basis in accordance with accounting principles generally accepted in the United States of America. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting principles and reporting standards. The Authority applies all GASB pronouncements as well as Financial Accounting Standards Board (FASB) statements and interpretations issued on or before November 30,1989, unless those pronouncements conflict with or contradict GASB pronouncements. These financial statements were prepared in accordance with GASB Statement 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities that Use Proprietary Fund Accounting. All activities of the Authority are accounted for within a single proprietary (enterprise) fund. This fund type is used to report any activity for which a fee is charged to external users for good and services. Nonoperating revenues result from nonexchange or ancillary activities. In addition, these financial statements include the provisions of GASB Statement Number 34, Basic Financial Statement - and Management's Discussion and Analysis - for State and Local Governments and related standards.

12 PAGE 10 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY NOTES TO FINANCIAL STATEMENTS MARCH 31, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued) Reporting Entity Government Accounting Standards Board (GASB) Statement No. 14 has established criteria for determining the governmental reporting entity and component units that should be included within the reporting entity. The basic criterion for including a potential component unit within the reporting entity is financial accountability. The GASB has set forth criteria to be considered in determining financial accountability. The criteria include: 1. Appointment of a voting maj ority of the governing board a. The ability of the parish government to impose its will on the organization b. The potential of the organization to provide specific financial benefits to or impose specific financial burdens on the reporting entity 2. Organizations which are fiscally dependent 3. Organizations for which the reporting entity's financial statements would be misleading if data of the organization is not included because of the nature or significance of the relationship Because the parish government appoints the governing board, the Authority was determined to be a component unit of the St. Bernard Parish Government, the governing body of the parish and the governmental body with oversight responsibility. The accompanying financial statements present information only on the funds maintained by the Authority and do not present information on the parish government, the general government services provided by that governmental unit, or the other governmental units that comprise the governmental reporting entity. Annually, the St. Bernard Parish Government issues audited financial statements, which include the activity contained in the accompanying financial statements. Basis of Accounting The Authority follows the accrual basis of accounting whereby revenues are recognized when earned and expenses are recognized when the related liability is incurred. Statements of Cash Flows For purposes of the statements of cash flows, the Authority considers all short-term, highly liquid investments with a maturity of three months or less to be cash equivalents.

13 PAGE 11 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY NOTES TO FINANCIAL STATEMENTS MARCH DEPOSITS: Custodial credit risk is the risk that, in the event of a bank failure, the Authority's deposits might not be recovered. The Authority's deposit policy for custodial credit risk conforms to state law. At March 31, 2007, deposits in the amount of $472,468 (bank balance) were entirely covered by federal depository insurance and pledged securities held by the Federal Reserve Bank in the Authority's name. 3. BONDS PAYABLE: On June 1, 1992, the Authority advance refunded $16,470,000 of its 1979 Series bonds with interest rates of 5.87% to 7.5%. Government securities were purchased and were deposited into an irrevocable trust with an escrow agent to provide for all future debt service payments on the 1979 Series Bonds. Since these bonds were defeased, the liability for these bonds was removed from the financial statements. At March 31,2007, $12,825,000 of the defeased bonds was still outstanding. On June 10, 2003, the Authority defeased its 1992 Series B-2 Single Family Mortgage Refunding Bonds. Government securities were purchased and deposited into an irrevocable trust with an escrow agent to provide for all future debt service payments on the 1992 Series B-2 Bonds. Since these bonds were defeased, the liability for these bonds has been removed from the financial statements. At March 31,2007, $200,000 of the defeased bonds was still outstanding. 4. BOARD OF TRUSTEES EXPENSES: The members of the Authority's Board of Trustees receive no compensation for their services rendered but are reimbursed for their actual travel costs incurred in connection with their duties as trustees of the Authority. 5. 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 certain reported amounts and disclosures. Actual results could differ from those estimates.

14 PAGE 12 ST. BERNARD PARISH HOME MORTGAGE AUTHORITY SUPPLEMENTARY INFORMATION STATEMENT OF ACTIVITIES FOR THE YEAR ENDED MARCH 31, 2007 (Unaudited) Net (Expense) Revenue and Program Revenue Changes in Net Assets Operating Capital Business Charges Grants and Grants and Type Functions/Programs Expenses for Services Contributions Contributions Activities Business-type activities: Mortgage programs $ 2,000 $ -_ $ -_ $ ~_ $ (2,000) TOTAL $ 2,000 $ - $ - $ - (2,000) General revenues: Investment earnings 3,770 Total general revenues 3,770 Change in net assets 1,770 Net assets, beginning of year 468,698 NET ASSETS, END OF YEAR $ 470,468 See accountant's compilation report.