CARROLL COUNTY, ILLINOIS

Transcription

1 MOUNT CARROLL, ILLINOIS ANNUAL FINANCIAL REPORT November 30, 2008

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3 CONTENTS Page Number INDEPENDENT AUDITOR S REPORT 1-2 Management Discussion and Analysis (Unaudited) 3-12 Basic Financial Statements: Government -Wide Financial Statements: Statement of Net Assets 13 Statement of Activities 14 Fund Financial Statements: Governmental Funds: Balance Sheet 15 Reconciliation of the Balance Sheet the Statement of Net Assets 16 Statement of Revenues, Expenditures and Changes in Fund Balances 17 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances the Statement of Activities 18 Fiduciary Funds- Statement of Fiduciary Net Assets 19 Notes Financial Statements Required Supplementary Information (Unaudited): Budgetary Comparison Schedules for: General Fund County Highway Fund Community Bridge Fund 49 Maintenance and Child Support Fund 50 Matching Fund 51 Schedule of IMRF Funding Progress 52 Notes Required Supplementary Information 53 Other Supplementary Information: Nonmajor Governmental Funds: Combining Balance Sheet Combining Statement of Revenues and Expenditures And Changes in Fund Balances 58-61

4 Page Number Other Supplementary Information (continued): Schedule of Expenditures from Taxes Extended for Tort Immunity Purposes 62 Regional Superintendent of Schools Trust Fund - Balance Sheet and Statement of Receipts and Disbursements 63

5 0 -D C, LGV (1) INDEPENDENT AUDITOR S REPORT 0) 0 To the County Board Carroll County, Illinois Mt. Carroll, Illinois We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Carroll County, Illinois, as of and for the year ended November 30, 2008, which collectively comprise the County s basic financial statements as listed in the table of contents. These financial statements are the responsibility of the County s management. Our responsibility is 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. Those standards require that we plan and perform the audit 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 above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of Carroll County, Illinois, as of November 30, 2008, and the respective changes in financial position, thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. The Management s Discussion and Analysis and Required Supplementary Information on pages 3 through 12 and 37 through 52 are not a required part of the basic financial statements but are supplementary information required by the accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the supplementary information. However, we did not audit the information and express no opinion on it. Lindgren, Callihan, Van Osdol & Co., Ltd. 403 East Third Street ph Dixon, Illinois Certified Public Accountants & Consultants P.O. Box 898 fax Freeport, Illinois Sterling, Illinois Mendota, Illinois Rockford, Illinois

6 Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the Carroll County, Illinois basic financial statements. The combining nonmajor and other schedules are presented for purposes of additional analysis and are not The combining nonmajor and other schedules have been subjected audit of the basic financial statements and, in our opinion, the basic financial statements taken as a whole. is a required part of the basic financial statements. the auditing procedures applied fairly stated in all material respects in in relation the / Sterling, Illinois January 20,

7 MANAGEMENT DISCUSSION AND ANALYSIS (Unandited)

8 MANAGEMENT DISCUSSION AND ANALYSIS For the years ended November 30, 2008 and 2007 Carroll County, Illinois (the County ) management discussion and analysis (MD&A) assist the reader in focusing on significant financial issues, activities, and conditions), budget), and (1) (3) The MD&A at November (2) identify changes in the County s financial position (5) replacement for (4) is generally intended provide an overview of the County s financial (its ability meet future financial demands identify any material deviations from the governmental unit s financial plan (approved identify individual fund issues or concerns. provided at the beginning of the report is 30, the 2008 and the results of operations for the financial position This summary should not be taken provide an overview of the year. County s audit report, which consists of the basic financial statements, notes statements, required and other supplementary information. as a the financial FINANCIAL HIGHLIGHTS FOR FY2008 a The County s assets exceeded this amount liabilities its at (net $1.7 million (unrestricted net assets) may be used meet the County s ongoing obligations. $.5 million during fiscal year 2008 as in The County s tal net assets decreased by activities. The County s major revenue consisted of the close of the fiscal year by $10.0 million reported $2.2 million in property tax distributions, $1.5 million in and $1.0 million in assets). Of the statement of operating grants and contributions, charges for services. At of the close of fiscal year 2008, the County s governmental funds reported combined ending fund the prior year. At the end of fiscal year 2008, the unreserved fund balance in the General Fund was balances of $5.4 million, a decrease of $.3 million 48.8% of tal general fund expenditures. in comparison $1.6 million, which is OVERVIEW OF THE FINANCIAL STATEMENTS This document serves as the basic financial statements an introduction the County s basic financial statements. There are three components government wide financial statements, fund financial statements, the financial statements. This report also contains required supplementary and other supplementary information in addition the basic financial statements themselves. and notes GOVERNMENT-WiDE FINANCIAL STATEMENTS These statements are designed provide readers with private-secr business, using the economic resources measurement manner similar basis of accounting. a broad overview of Carroll County s finances, focus and the in a accrual The statement of net assets presents information two reported on all of the County s assets and liabilities, with between the indicar of improvements or deterioration of the financial position of the County. as net assets. Over time, increases or decreases in net assets may serve the as a difference useful The statement of activities presents information that shows how the County s net assets changed during the year. most recent fiscal change occurs, regardless of the timing of related cash statement for some items that will result in cash flows in future fiscal years. All changes in net assets are reported as flows. the underlying event giving rise Thus revenues and expenses are reported in soon as the this -3-

9 - MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 GOVERNMENT-WIDE FINANCIAL STATEMENTS (continued) These statements highlight the functions of the County that are principally supported by taxes intergovernmental revenues (governmental activities). The governmental activities of Carroll County include general control and administration, county development, public safety, judiciary and court related, public business-type activities health, public welfare, transportation, other expenditures, and interest. There are accounted for by the County. no and The government-wide financial statements can be found on pages 13 and 14 of this report. Fund Financial Statements used maintain control over resources that have been segregated for specific activities or objectives. Carroll County, like other state and local governments, uses accounting ensure and demonstrate compliance with finance-related A fund is a grouping of related accounts that is legal requirements. Governmental funds. Governmental funds are used account for essentially the same functions reported governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus spendable resources, as well as information may be useful in evaluating on on balances of spendable resources available a fund near-term inflows and outflows of at the end of the fiscal as year. Such government s near-term financing requirements. The County s Governmental Funds during the reporting period use the modified accrual basis of accounting and activities converted the accrual basis of accounting for reporting purposes. Because the focus of governmental funds useful compare the information presented for governmental funds with similar information presented is is narrower than that of the government-wide financial statements, governmental activities in the government-wide financial statements. By doing so, readers understand the long-term impact of the county s near-term financial decisions. Both the governmental balance sheet and the governmental funds statement of revenues, expenditures and changes in fund balances provide reconciliation facilitate this comparison between governmental funds and government-wide activities. a Carroll County maintains individual governmental funds. Information governmental funds balance sheet and changes in fund balances for maj or in is may presented separately are it for better funds in the and Bridge, the funds are funds is the governmental funds statement of revenues, expenditures, funds, (the General Fund, the County Highway, the County Maintenance and Child Support Fund, and the Matching Fund). All other non-maj or governmental combined and presented in one column. Individual fund data for each of the non-major governmental provided in the form of combining statements elsewhere in this report. The governmental fund financial statements can be found on pages 15 and 17 of this report. Fiduciaiy Funds. The County also maintains are used account for resources - a number of fiduciary funds in the form of agency almost exclusively cash and investments held by the County for funds, the which benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available accounting used for fiduciary funds statement can be found on page 19 is the same of this report. as support the County s own programs. The that used for proprietary funds. The fiduciary fund financial -4-

10 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 GOVERNMENT-WIDE FINANCIAL STATEMENTS (continued) Notes the Financial Statements These provide additional information that is essential gaining a full understanding of the data provided in the government-wide and fund financial statements. The Notes the Financial Statements can be found on pages of this report. Required Supplementary Information This information addresses the County s budgetary comparison schedules of major funds, and the IMRF (Illinois Municipal Retirement Fund), Schedule of Funding Progress, and SLEP (Sheriff s Law Enforcement Personnel) Schedule of Funding Progress. The County adopts an annual appropriated budget for its General Fund and Special Revenue Funds. A budgetary comparison schedule has been provided for the General Fund and major Special Revenue Funds demonstrate compliance with this budget. The IMRF and SLEP pension schedules have been provided present the County s progress in funding its obligation provide pension benefits County employees through the IMRF system. Required supplementary information can be found on pages of this report. Combining Fund Statements and Schedules This information as discussed earlier in connection with non-major governmental funds is presented immediately following the required supplementary information on pensions. Combining fund statements and other schedules can be found on pages 53 through 62 of this report. GOVERNMENT-WIDE FINANCIAL ANALYSIS As previously addressed, net assets may serve the purpose over time as a useful indicar of a government s financial position. To that end, Carroll County s assets exceeded its liabilities by $10.0 million for FY2008. The following table represents a condensed Statement of Net Assets of the County for govermnental activities as of November 30, 2008 and Net Assets (in millions) Governmental Activities November Current assets $8.8 $8.4 Noncurrent assets Total assets Current liabilities Long term liabilities 0 0 Total liabilities Net assets Invested in capital assets, net of debt Restricted Unrestricted Total net assets $10.0 $

11 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 GOVERNMENT-WIDE FINANCIAL ANALYSIS (continued) A portion of the County s net assets are reflected in its investments in capital assets (i.e., land, buildings, equipment, and infrastructure), less any related debt used acquire those assets that are still outstanding. The County uses these assets provide services. Therefore these assets are not available for future spending. Although the County s investments in its capital assets are reported net of available debt, it is important note that under this consideration the resources required repay this type of debt must be provided from other sources, since the capital assets themselves cannot be used liquidate these types of liabilities. The following condensed financial information was derived from the Government-Wide Statement of Activities and reflects how the County s net assets changed during the fiscal years. Revenues: Program revenues: Changes in Net Assets (in millions) Governmental Activities For the year ended November Charge for services $1.0 $1.1 Operating grants and contributions Capital grants and contributions General revenue: Local property taxes Sales taxes State income taxes Mor fuel taxes Public safety taxes Other taxes Unrestricted investment earnings Miscellaneous Total revenues Expenses: General control and administration County development Public safety Judiciary and court related Public health Public welfare Transportation All other expenditures Interest Total expenses Change in net assets (0.5) 0.3 Net assets, beginning Net assets, ending $10.0 $10.5 The County s 2008 tal revenues (Figure A- 1) come from a variety of sources including 33% from property taxes, and 28 cents of every dollar raised comes from some other type of tax. Another 22% comes from operating grants and contributions and much of the remainder is fees charged for services. -6-

12 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 GOVERNMENT-WIDE FINANCIAL ANALYSIS (continued) The County s 2008 expenses (Figure A-2) cover a range of services, with about 22% related public safety and general control and administration. Another 27% is devoted roads and bridges along with 11% wards judiciary and court related services. Figure A-i Total Revenues for Fiscal Year 2008 Figure A-2 Total Expenses for Fiscal Year 2008 Miscellaneous Operating grants and contributions 19% Capital grants and contributions 0% Public safe \ 22% Public health \..Judiciary and 9% court related 110/ Figure A-i Total Revenues for Fiscal Year 2007 Figure A-2 Total Expenses for Fiscal Year 2007 Other taxes Investment Miscellaneous 2% nschaes for Transportation 23% All other Interest General expenditures 0% control and 7% I 21% \ County development Publicwelfare,... 3% / / 31% and contributions 0% Public health [NPublicsafety Judiciary and court relate 12% Net assets decreased $0.5 million over the previous year. For the fiscal year ended November 30, 2008 revenues from governmental activities taled $6.8 million. Tax revenues ($4.1 million, or 60%) represent the largest source. Charges for services in 2008, accounts for $1.0 million (15%) of the governmental activities revenue. are mainly derived from fees and fines collected from the various departments within the County. These -7-

13 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 GOVERNMENT-WIDE FINANCIAL ANALYSIS (continued) In the following table, we have presented the cost of each of the County s functions cost less revenues generated by the activities) for each. Net costs help covered by direct revenue and those that are covered by the net revenue of others. For the year ended November 30, 2008 as well as show what functions the net cost (tal being are Total cost of service (in millionsi Net cost of service (in millions) General control and administration $1.4 $1.1 County development Public safety Judiciary and court related Public health Public welfare Transportation All other expenditures Interest Total governmental activities $7.3 $4.8 For the year ended November 30, 2007 Total cost of service (in millions) Net cost of service (in millions) General control and administration $1.5 $1.1 County development Public safety Judiciary and court related Public health Public welfare Transportation All other expenditures Interest Total governmental activities $7.0 $4.5 For the fiscal year ended November General and administrative expenditures accounted for $1.4 or 20% of the governmental activities expenditures are used for the operations of departments conducting such functions financial functions, elections, document recording and retrieval, and assessment of property. 30, Public Safety (22% of the tal) accounted for percentage of public safety emergency service function is is 2008 expenditures for governmental activities taled $1.6 as $7.3 million. tal. and administrative These million in expenditures during The highest directly tied the operations of the Sheriff s Department. The coroner also part of this activity group. and -8-

14 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 GOVERNMENT-WmE FINANCIAL ANALYSIS (continued) Transportation accounted for $2.0 million (27%) of the tal governmental activities expenditures Various funds established for the County Highway Department account for these expenditures. in Health Department expenditures represented $0.7 million (9%) of the tal governmental expenditures activity. Judiciary and Court related expenditures taled $0.7 million (11%) circuit court, public defender, court services, and the State s Atrney relate in Expenditures relating this function. the FINANCIAL ANALYSIS OF THE COUNTY S MAJOR FUNDS Carroll County uses fund accounting requirements. ensure and demonstrate compliance with finance-related legal Governmental Funds The focus of the County s governmental funds balances of spendable resources. Such information In particular, unreserved fund balances may serve for spending at the end of the fiscal year. is is as a provide information on near-term inflows, outflows, and useful in assessing the County s financing requirements. useful measure of a government s net resources available As of the end of the current fiscal year the County s governmental funds reported combined balances of $5.3 million, a decrease of $0.3 million in comparison with the previous fiscal year. ending fund The general fund is the primary operating fund of the County. At the end of the current fiscal unreserved fund balance of the general fund was may be useful $1.6 compare the unreserved fund balance represents 48.8% of tal general fund expenditures. year, the As a measure of the general fund s liquidity, it fund million. tal fund expenditures. Unreserved balance The fund balance of the General Fund decreased by $0.2 million before transfers during the current fiscal year. Budgetary Highlights budget based on accounting for certain transactions provided information for the General Fund and major special revenue funds. The a County s is prepared according Illinois law and modified accrual basis of accounting. A budget General Fund Budgetary Variances Revenues is actual schedule is as on required supplementary The most significant revenue sources for all funds during fiscal year 2008 continue be property taxes and for 2008 were $106,300 compared with intergovernmental sources. Municipal sales tax revenues on page budgeted amount of $540,000. The decline in the sales tax revenue Carroll County in July is the result of the addition, the States Atrney salary reimbursement Tax Contribur for State of Illinois paying slower in salary reimbursements. The County anticipates but not within was $63,432 compared with 60 days after year-end. a In budgeted amount of $110,000. The shortfall loss a Major Sales on is as a of page result of the receive the reimbursement -9-

15 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 FINANCIAL ANALYSIS OF THE COUNTY S MAJOR FUNDS (continued) General Fund Budgetary Variances (continued) Expenditures Personnel Services remains the highest expenditure in County operations. Government service requires people provide both services and information the citizens it supports. It is a sizeable expenditure; however, it is also a long-term investment. Benefit payments remain a significant portion of the tal personnel services costs. Pension, FICA and Health Insurance rates have all affected the tal cost of personnel services. Overall, the General Fund actual expenditures were less than budgeted expenditures with no significant variances. Highway Fund Budgetary Variances Revenues The most significant revenue sources for all funds during fiscal year 2008 continue be property taxes and intergovernmental sources. Sale of materials and labor revenues on page 47 for 2008 were $289,673 compared with budgeted amount of $130,000. When budget was prepared the highway department did not know the summer work load. The variance is a result of a larger summer work load than predicted. Expenditures Reimbursable expenditures on page 48 for 2008 was $262,168 compared with a budgeted amount of $70,000. When budget was prepared the highway department did not know the summer work load. These variances are a result of a larger summer work load than predicted. The following is the analysis of expenditures for the year for the General Fund and other major Governmental Funds of the County. From a government-wide perspective, overall expenditures were down 1.65% in 2008 compared with Within the General Fund, the functions which reflected the largest portion of tal expenditures within the General Fund are General Control and Administration and Public Safety. The functions which reflected the largest percentage decrease over 2006 were Public Health and County Development. CAPITAL ASSET AND LONG-TERM DEBT ACTIVITY cpjtal Assets Carroll County s investment in capital assets for its governmental activities at year end taled $4.6 million (net of accumulated depreciation). This investment in capital assets includes, land, buildings and improvements, equipment, and highway infrastructure such as roads and bridges. There were $0.3 million of capital asset additions recorded during the year and $0.5 million of depreciation charges were expensed on the tal capital assets. More detailed information can be found in footnote (D) of the financial statements. -10-

16 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 CAPITAL ASSET AND LONG-TERM DEBT ACTIVITY (continued) Capital Assets (continued) Major capital asset events during the fiscal year included the following: 2 sheriff squad cars $44,955 Infrastructure = $21 8,311 Net Book Value of Capital Assets at November 30 (in millions) Land $0.1 $0.1 Buildings 0.1 Building improvements Office furniture, equipment and vehicle 1.2 Infrastructure Total $4.6 $4.7 ECONOMIC FACTORS The unemployment rate has increased from 5% in % in Based on the US Census Bureau, the County s population is 16,035 as of Interest earnings have declined; Municipal and Supplemental sales tax revenue decreased (as expected due the loss of a major Sales Tax Contribur) approximately 41% from This trend is likely level off in A Year-End report on 2008 must include two developments in the Savanna Depot Business, Industry and Technology Park: A $1 million USDA grant was awarded N Ovation, Inc. and its partners, Packard Engineering in Naperville and Northern Illinois University. N Ovation is building a pro-type fertilizer producer. Riverport Railroad has constructed the first new building built in the Savanna Depot Park since the closure of the Army Depot. Its building is a new engine house. In the rest of the County, it is noteworthy that every wn in the County experienced the opening of at least one new retail business located in their downwn. We must also note the closure of the Medallion Cabinetry at the end of 2008 and the loss of more than 100j obs from this facility. 11

17 MANAGEMENT DISCUSSION AND ANALYSIS (CONTINUED) For the years ended November 30, 2008 and 2007 REQUESTS FOR INFORMATION This financial report is designed provide our citizens, taxpayers, cusmers, and potential credirs with a general overview of the County s finances and demonstrate the County s accountability for the money it receives. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed : Diane Powers County Treasurer Carroll County, Illinois 301 North Main Mt Carroll, IL Phone number (815)

18 BASIC FINANCIAL STATEMENTS

19 STATEMENT OF NET ASSETS November 30, 2008 ASSETS Governmental Activities Cash on hand and in bank $4,428,369 Deposits 661,664 Investments 68,959 Invenry 31,602 Property taxes receivable 2,832,203 Accounts receivable 236,021 Due from State of Illinois 494,468 Prepaid expenses 36,068 Total current assets 8,789,354 Capital assets: Land 85,032 Depreciable property and equipment, net of depreciation 4,472,045 Total assets 13,346,431 LIABILITIES Current liabilities: Accounts payable and accrued payroll 488,702 Accrued compensated absences 119,728 Deferred property taxes 2,799,737 Total current liabilities 3,408,167 NET ASSETS Invested in capital assets, net related debt 4,557,077 Restricted for: Transportation 2,011,183 Employee benefits 386,392 Court services 299,221 Public safety 362,651 Public and mental health 403,318 Other 234,315 Unrestricted 1,684,107 of Total net assets $9,938,264 See Notes Financial Statements. -13-

20 STATEMENT OF ACTIVITIES For the year ended November 30, 2008 Program Revenues Operating Capital Charges for Grants and Grants and Functions/Programs Expenses Services Contributions Contributions Total Governmental activities: General control and administration $1,449,933 $270,308 $28,482 $0 ($1,151,143) County development 264,158 78,514 5,043 0 (180,601) Public safety 1,611, ,025 10,961 17,220 (1,276,527) Judiciary and court related 766, , ,425 0 (267,865) Public health 687,605 21, ,888 0 (340,914) Public welfare 92, (92,910) Transportation 1,959, ,831 0 (1,064,627) All other expenditures 463, (463,417) Total governmental activities $7,295,343 $971,489 $1,468,630 $17,220 (4,838,004) General revenues: Taxes: Property taxes 2,211,756 Sales taxes 414,153 State income taxes 651,592 Mor fuel tax allotments 308,206 Public safety taxes 238,406 Other 288,408 Unrestricted investment earnings 119,938 Miscellaneous 78,287 Total general revenues 4,310,746 Change in net assets (527,258) Net assets - beginning 10,465,522 Net assets - ending $9,938,264 See Notes Financial Statements. -14-

21 GOVERNMENTAL FUNDS BALANCE SHEET November 30, 2008 Maintenance Other Total County County and Governmental Governmental A S S E T S General Highway Bridge Child Support Matching Funds Funds Cashonhand $3,565 $100 $0 $0 $0 $200 $3,865 Cash in banks 1,247, , ,327 26, ,528 2,036,924 4,424,504 Deposits 101, ,546 51, ,664 Investments 8, , ,959 Invenry 13, ,147 31,602 Property taxes receivable 981, , , ,873 1,144,245 2,832,203 Accounts receivable 68,691 30, , , ,021 Mor fuel tax allotment receivable ,534 19,534 Due from State of Illinois 408, , ,934 Prepaid expenses ,068 36,068 Due from other funds 53, ,500 Total assets $2,886,110 $765,159 $693,542 $87,439 $1,008,516 $3,402,088 $8,842,854 LIABILITIES AND EQUITY Liabilities: Accounts payable $45,814 $53,435 $174,330 $0 $0 $27,383 $300,962 Accrued payroll 123,047 19, , ,740 Deferred revenue 108, , ,020 Deferred property taxes 974, , , ,500 1,127,874 2,799,737 Due other funds ,500 53,500 Total liabilities 1,251, , , ,500 1,273,671 3,469,959 Equity Fund balances: Reserved for invenry and prepaid expenses 13, ,215 67,670 Unreserved for: General fund 1,620, ,620,737 Specialrevenuefunds 0 356, ,712 87, ,016 2,074,202 3,684,488 Total equity 1,634, , ,712 87, ,016 2,128,417 5,372,895 Total liabilities and equity $2,886,110 $765,159 $693,542 $87,439 $1,008,516 $3,402,088 $8,842,854 See Notes Financial Statements. -15-

22 governmental governmental RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET ASSETS For the year ended November 30, 2008 Total fund balances - funds $5,372,895 Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not financial resources and therefore are not reported as assets in governmental funds. The cost of assets is $8,088,902 and the accumulated depreciation of $3,531,825. 4,557,077 Because the focus of governmental funds is not short-term fmancing, some assets will not be available pay for current period expenditures. Those assets are offset by deferred revenues in the funds. 128,020 Compensated absences are not due and payable from current resources and therefore are not reported in the governmental funds. (119,728) Total net assets - activities $9,938,264 See Notes Financial Statements. -16-

23 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES For the GOVERNMENTAL FUNDS year ended November 30, 2008 Maintenance Other Total County County and Governmental Governmental General Highway Bridge Child Support Matching Funds Funds Revenues: Taxes $861,017 $324,240 $161,641 $0 $161,641 $1,356,972 $2,865,511 Intergovernmental revenue 1,087, , ,868 2,683,238 Licenses and permits ,565 2,565 Revenues from services 535, , , ,132 Revenue from use of money and property 33,522 6,463 9,527 1,669 26,957 42, ,637 Other revenue 22,809 20, , ,113 Total revenues 2,540,309 1,085, ,168 17, ,598 2,724,368 6,727,196 Expenditures: Cuffent: General control and administration 1,078, ,299 1,352,859 County development 135, , ,560 Public safety 1,337, ,052 1,459,949 Judiciary and court related 680, , , ,012 Publichealth 9, , ,217 Public welfare ,910 92,910 Transportation 0 1,074,814 80, ,196 1,655,657 All other expenditures 23, , ,417 Debt service: Principal Interest Capital outlay 58, , , , ,133 Total expenditures 3,323,199 1,074, ,503 3,480 33,190 2,392,528 7,048,714 Excess (deficiency) of revenues over expenditures (782,890) 10,246 (50,335) 14, , ,840 (321,518) Other financing sources and (uses): Operating transfers in 417, , ,305 Operating transfers out (115,000) 0 0 (5,256) 0 (492,049) (612,305) Netchangeinfundbalance (480,681) 10,246 (50,335) 8, ,408 34,887 (321,518) Fund balances, beginning of year 2,114, , ,047 78, ,608 2,093,530 5,694,413 Fund balances, end ofyear $1,634,192 $356,119 $338,712 $87,439 $828,016 $2,128,417 $5,372,895 See Notes Financial Statements. -17-

24 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES For the year ended November 30, 2008 Net change in fund balance - Governmental funds ($321,518) Amounts reported for governmental activities in the statement of activities are different because: Revenues that do not provide current financial resources are not reported as revenues in the the governmental funds. This change represents the increase in the deferred revenue that occurred during the year. (16,299) Capital outlays are reported in governmental funds as expenditures. However, in the statement of activities, the cost of those assets is allocated over their useful lives as depreciation expense. Donated capital assets are only reported in the statement of activities. This is the amount by which depreciation expenses $497,588 exceeds capitalized fixed assets $336,133 in the period. (161,455) The net effect of various transactions involving capital assets (i.e., disposals and sales) is decrease net assets (3,608) Vacation and compensated pay for employees is expensed in the statement of activities. However, since these amounts will not be paid from current resources, this expense is not recorded in the governmental funds. This is the amount by which vacation and compensated pay increased over the prior period. (24,378) Change in net assets of governmental activities ($527,258) See Notes Financial Statements. -18-

25 STATEMENT OF FIDUCIARY NET ASSETS November 30, 2008 ASSETS Cash in banks $904,900 Investments 41,391 Due from State of Illinois 45,503 Total assets $991,794 LIABILITIES Accounts payable $138,374 Agency funds due others 853,420 Total liabilities $991,794 NET ASSETS Unrestricted $0 See Notes Financial Statements. -19-

26 NOTES TO FINANCIAL STATEMENTS November 30, 2008 (A) Summary of Significant Accounting Policies: The accounting policies of the County of Carroll, Illinois (County) conform accounting principles generally accepted in the United States of America as applicable governments. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the more significant accounting policies: 1) Nature of operations: The County provides many functions and services citizens, including law enforcement, health and social services, transportation, planning and zoning and general administrative services. 2) Reporting entity: Generally accepted accounting principles require that the financial reporting entity include (1) the primary government, (2) organizations for which the primary government is financially accountable and (3) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity s financial statements be misleading or incomplete. The County has the statury authority adopt its own budget, levy taxes and issue bonded debt without the approval of another government. It has the right sue and be sued, and has the right buy, sell, lease or mortgage property in its own name. Based on these criteria, the County is considered a primary government and there are no other organizations or agencies whose financial statements should be combined and presented with these financial statements. 3) Joint Ventures: The County has entered in an intergovernmental agreement with Jo Daviess County, Illinois establish an entity known as the Jo-Carroll Depot Local Redevelopment Authority (LRA). This LRA replaces an entity previously known as the Savanna Army Depot Local Redevelopment Authority. The former entity was charged with the authority prepare a plan for the re-use of the Savanna Army Depot facilities in accordance with the Base Closure Community Redevelopment Assistance Act. The current LRA is charged with the authority implement the re-use plan for the Savanna Army Depot and modifi the plan as may become necessary. Both Counties are jointly and severally liable for all liabilities, debts and obligations of any kind incurred by the LRA. The County s share of LRA s operating expenses for the fiscal year ended November 30, 2008 was $0.The agreement provides for the LRA consent an audit of its funds by either County as either County may direct. These financial statements are available through the Jo-Carroll Depot Local Redevelopment Authority offices in Savanna, Illinois. 4) Govermnent-wide and Fund Financial Statements Government-wide Financial Statements: The government wide Statement of Net Assets and the Statement of Activities report the overall financial activity of the County. The fmancial activities of the County consist of governmental activities, which are primarily supported by taxes, intergovernmental revenues, and charges for services. -20-

27 NOTES TO FINANCIAL STATEMENTS (CONTINUED) November 30, 2008 (A) Summary of Significant Accounting Policies (continued): 4) Government-wide and Fund Financial Statements (continued) The Statement of Net Assets presents the County s non-fiduciary assets and liabilities with the difference reported in three categories: Invested in capital assets, net of related debt consists of capital assets, net of accumulated depreciation and reduced by outstanding balances for bonds and other debt that are attributable the acquisition, construction, or improvement of those assets. As of November 30, 2008, there was no other debt outstanding attributable those assets. Restricted net assets result when constraints placed on net asset use are either externally imposed by credirs, granrs, contriburs, and the like, or imposed by law through constitutional provisions or enabling legislation. Unrestricted net assets consist of net assets that do not meet the criteria of the two preceding categories. It is the County s policy first apply restricted resources when an expenditure/expense is incurred for purposes for which both restricted and unrestricted net assets are available. The Statement of Activities demonstrates the degree which the direct expense of a given function (i.e. general control and administration, public safety, etc.) is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function. Program revenues include (a) charges paid by the recipients of goods or services offered by the programs (including fines and fees), and (b) grants and contributions that are restricted meeting the operational requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. Fiduciary funds are excluded from the government-wide financial statements. Fund Financial Statements: Separate financial statements are provided for governmental funds and fiduciary (agency) funds, even though the latter are excluded from the government-wide financial statements. The fund financial statements provide information about the County s funds. The emphasis of fund fmancial statements is on major funds, each displayed in a separate colunm. The County has the following major governmental funds and all remaining governmental funds are aggregated and reported as nonmaj or governmental funds. General Fund This fund is the County s primary operating fund. It accounts for all financial resources of the general government, except those required be accounted for in another fund. The services which are administered by the Department and accounted for in the general fund include general control and administration, county development, public safety, judiciary and court related, public health, and other miscellaneous expenditures. County Highway Fund This fund is used operate the County Highway Department, including, but not limited salaries, supplies, and purchase of machinery aild equipment. -21-

28 This NOTES TO FINANCIAL STATEMENTS (CONTINUED) November 30, 2008 (A) Summary of Significant Accounting Policies (continued): 4) Government-wide and Fund Financial Statements (continued) County Bridge This fund is used assist local Townships in building bridges and culverts and improve County bridges after all obligations of the Township requests are met. Maintenance and Child Support This fund is used operate the County services of collecting and distributing maintenance and child support payments. The County collects an annual $36 fee from users of this service help pay for postage, supplies, and wages relating maintenance and child support payments. County Matching fund is used defray the costs of Federal and State funding. This fund is also used match County Mor Fuel Tax funds on projects. Additionally, the County administers fiduciary (agency) funds for assets held by the County in a fiduciary capacity. 5) Measurement focus, basis of accounting and financial statement presentation: The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the fiduciary fund financial statements. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flow takes place. Nonexchange transactions, in which the County gives (or receives) value without directly receiving (or giving) equal value in exchange, include various taxes, state shared revenues and various state, federal and local grants. On an accrual basis, revenues from taxes are recognized when the County has a legal claim the resources. Grants, entitlements, state shared revenues and similar items are recognized in the fiscal year in which all eligibility requirements imposed by the provider have been met. Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered be available when they are collectible within the current period or soon enough thereafter pay liabilities of the current period. For this purpose, the County considers revenues be available if they are collected within 60 days of the end of the current fiscal year. Significant revenue sources which are susceptible accrual include property taxes, other taxes, grants, charges for services, and interest. All other revenue sources are considered be measurable and available only when cash is received. Expenditures generally are recorded when the liability is incurred, as under accrual accounting. However, compensated absences are recorded only when payment is due. General capital asset acquisitions are reported as expenditures in governmental funds. -22-

29 NOTES TO FINANCIAL STATEMENTS (CONTINUED) November 30, 2008 (A) Summary of Significant Accounting Policies (continued): 6) Investments: Investments are reported Funds Money Market Fund, which at The Illinois Funds Money Market Fund value of the position in the external investment pool fair value. A portion of the County s investments are is an external investment pool which is regulated by the State Treasurer s is the same as is in the SEC Office. pooi shares. is a money market not the value of the A portion of the County s investments are in Financial Invesrs Trust, which mutual fund which is registered with the SEC. Illinois registered. The fair 7) Invenry Invenries are stated at cost, using the first-in, first-out method. Invenries are accounted under the consumption method, whereby acquisitions are recorded in invenry accounts initially expenditures when used. and charged as for 8) Capital Assets Capital assets, which include buildings, building improvements, equipment and infrasturure, are reported in the applicable governmental activities columns in the government-wide financial estimated useful life statements. The County defines capital assets one year. are stated Such assets are recorded at at as assets with hisrical cost if purchased estimated fair market value maintenance and repair that do not add as an or constructed. Donated in excess assets of the date of acquisition. The cost of normal the value of the asset of or materially extend the useful as are life are not capitalized. Major outlays for capital assets and improvements are capitalized projects are constructed. All capital assets, except land and construction in progress which not depreciated, are being depreciated using the straight line method over the following useful lines: Assets which are acquired and held for the County s use are stated at hisrical the capital asset includes the acquisition price plus the expenditures necessary its at in intended location and condition for use. Donated their fair market value cost of construction. as The County defines capital assets of the date the asset as is or acquired, contributed capital assets or for infrastructure, cost. The cost asset are the assets with an initial individual cost of more than listed below and an estimated useful life in excess of one recorded in the Statement of Activities with accumulated depreciation reflected in of net assets and is provided on year. Depreciation of capital the straight-line basis over the estimated useful Land $20,000 Land Improvements Buildings 20,000 Building improvements 5,000 Vehicles Office furniture and equipment Infrastructure 20, , , , years years years years years years of place the recorded the lives: estimated amount assets is statement

30 NOTES TO FINANCIAL STATEMENTS (CONTINUED) November 30, 2008 (A) Summary of Significant Accounting Policies (continued): 8) Capital Assets (continued) Gains or losses from sales Statement of Activities, if or any. retirements of capital assets are included in the operations on the 9) Deferred Revenue In the government-wide and fund financial statements, the County defers recognition of property taxes that are intended In finance next year s operations. the fund financial statements, the County also defers revenue recognition in connection with receivables that are measurable but not available within 60 days afier year end ) Compensated Absences Governmental Accounting Standards Board principles require employers future vacation and compensated leave benefits which meet certain conditions. The liability for compensated absences reported in the government-wide financial statements consists of unpaid, accumulated vacation leave and compensary time off balances for County employees. reported for unpaid accumulated sick leave liability is employment. as this is not paid out accrue at a liability for No termination of 11) Fund Equity In the fund financial statements, governmental funds report reservations of fund balance for not available for appropriation for amounts that a are specific purpose. Designated fund balances, if of financial resources. or are legally restricted by outside parties for use any, represent tentative plans for future use 12) Accounting Estimates The preparation of the financial statements requires management make estimates assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities the date of the financial statements, and the reported amount of revenues and expenditures/expenses during the period. Actual results could differ from these estimates. at and 13) Interfund Transactions The County has the following types of transactions between funds: Loans amounts provided with interfund loans are reported borrower funds. as a requirement for repayment. due from other funds in lender funds and due In the fund financial statements, other funds in -24-

31 NOTES TO FINANCIAL STATEMENTS (CONTINUED) November 30, 2008 (A) Summary of Significant Accounting Policies (continued): 13) Interfund Transactions (continued) flows of assets (such as cash or goods) without equivalent flows of assets in return and without a requirement for repayment. In governmental funds, transfers are reported as other Transfers financing uses in the funds making transfers and as other financing sources in the funds receiving transfers. 14) Budgets and Budgetary Accounting: The County follows these procedures in establishing the budgetary data reflected in the financial statements: a) The Finance Committee of the County Board requests and receives from the County Officers proposed operating budgets for the fiscal year commencing the following December prepares a tentative operating budget including both proposed expenditures and the means 1. of financing them. The Finance Committee reviews and investigates budget requests and b) Prior December 1, the budget is legally adopted by the County Board. The budget was adopted on November 15, It was adjusted on Ocber 16, 2008 for a transfer within the same fund. c) After the adoption of the budget, no further appropriations can be made except for transfers from one appropriation another in the same fund, providing the tal amount appropriated for the fund has not changed, and 2) appropriations in excess of those authorized by the budget in order meet an immediate emergency. Both of these exceptions must be approved by a two-thirds majority of the Board. Unused appropriations lapse at the end of the fiscal year. 1) d) Formal budgetary integration is used as a management control device during the year for the General and Special Revenue Funds. e) Budgets for the General and Special Revenue Funds are prepared on the modified accrual basis, consistent with generally accepted accounting principles. Budgets are not prepared for Agency Funds. 15) Property taxes: The County s property tax is levied each year on all taxable real property located in the County. Since the 2008 property tax levy is levied finance the operations of fiscal year 2009, the 2008 property tax is recorded as a receivable and the 2008 property tax revenue is deferred. The 2007 property tax levy is recorded as revenue by the County in accordance with the applicable measurement focus and basis of accounting for fiscal year The County must file its tax levy by the last Tuesday of December each year. The 2007 levy was approved on November 15, The 2008 levy was approved on November 20,