HENDRY COUNTY, FLORIDA COMBINED FINANCIAL STATEMENTS INCLUDING BOARD OF COUNTY COMMISSIONERS, CONSTITUTIONAL OFFICERS, AND COMPONENT UNITS

Transcription

1 COMBINED FINANCIAL STATEMENTS SEPTEMBER 30, 2012 INCLUDING BOARD OF COUNTY COMMISSIONERS, CONSTITUTIONAL OFFICERS, AND COMPONENT UNITS

2 TABLE OF CONTENTS Pages SECTION I COMBINED STATEMENTS REPORT OF INDEPENDENT AUDITORS I -1 I-2 MANAGEMENT DISCUSSION AND ANALYSIS I -3 I-10 BASIC FINANCIAL STATEMENTS GOVERNMENT-WIDE FINANCIAL STATEMENTS Statement of Net Assets I-11 Statement of Activities I-12 FUND FINANCIAL STATEMENTS Balance Sheet Governmental Funds I-13 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets I-14 Statement of Revenues, Expenditures and Changes in Fund Balance Governmental Funds I-15 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balance of Governmental Funds to the Statement of Assets Governmental Funds I-16 Statement of Revenues, Expenses and Changes in Fund Balances Budget and Actual General Fund I-17 Statement of Revenues, Expenses and Changes in Fund Balances Budget and Actual County Transportation Trust Fund I-18 Statement of Revenues, Expenses and Changes in Fund Balances Budget and Actual Solid Waste Disposal Fund I-19 Statement of Revenues, Expenses and Changes in Fund Balances Budget and Actual Capital Projects Fund I-20 Statement of Net Assets Proprietary Funds I-21 Statement of Revenues, Expenses and Changes in Fund Net Assets Proprietary Fund I-22 Statement of Cash Flows Proprietary Funds I-23 Statement of Fiduciary Net Assets Fiduciary Funds I-24 NOTES TO FINANCIAL STATEMENTS I-25 I-44 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES NON-MAJOR GOVERNMENTAL FUNDS Combining Schedule Balance Sheet General Fund I-45 Combining Statement of Revenues, Expenditures and Changes in Fund Balance General Fund I-46 Combining Schedule of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual General Fund I-47 I-48

3 TABLE OF CONTENTS (CONTINUED) Pages NON-MAJOR GOVERNMENTAL FUNDS Combining Balance Sheet Non-major Governmental Funds I-49 I-52 Combining Statement of Revenues, Expenditures and Changes in Fund Balance Non-major Governmental Funds I-53 I-56 Combining Schedule Balance Sheet Fiduciary Funds I-57 Statement of Changes in Assets and Liabilities Fiduciary Funds I-58 INDEPENDENT AUDITORS REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTER SBASED ON AN OF FINANCIAL STATEMENTSPERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS I-59 I-60 MANAGEMENT LETTER I-61 I-62

4 Report of Independent Auditors 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: To the Board of County Commissioners and the Constitutional Officers of Hendry County, Florida We have audited the accompanying financial statements of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of Hendry County, Florida (the County ) as of and for the fiscal year ended September 30, 2012, 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 to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of the County, as of September 30, 2012, and the respective changes in financial position and cash flows, where applicable, thereof and the respective budgetary comparison for the General Fund, County Transportation Trust Fund, Solid Waste Disposal Fund, Disaster Relief Fund, and Capital Projects Fund for the fiscal year then ended in conformity with accounting principles generally accepted in the United States of America. I-1

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6 Hendry County, Florida Management s Discussion and Analysis This discussion and analysis of Hendry County s (the County ) financial statements is designed to introduce the basic financial statements and provide an analytical overview of the County s financial activities for the fiscal year ended September 30, The basic financial statements are comprised of the government-wide financial statements, fund financial statements, and footnotes. We hope this will assist readers in identifying significant financial issues and changes in the County s financial position. Financial Highlights At the close of fiscal year 2012 the County s assets exceeded its liabilities, resulting in net assets of $92,875,708 which is an decrease of $4,464,368 over last year or (4.62) percent. Governmental and business-type assets exceeded its liabilities by $71,614,854 and $21,260,854, respectively which was a decrease of $3,267,582 for governmental assets, or (4.37) percent and decrease of ($1,196,786) for business-type assets or, (5.33) percent. Total revenues for governmental activities were $42,494,904 which was a decrease of $413,849 over prior year. Total expenses for governmental activities increased $2,386,318 Long-term liabilities are reported at $3,422,580 on September 30, 2012 for governmental activities and $9,687,829 for business-type activities. Decreases were associated with the pay-off of several buildings and no additional debt service during the 2012 fiscal year. Capital Assets net of depreciation are reported at $75,427,979 on September 30, 2012 for all fund types. Government-Wide Financial Statements The government-wide financial statements (statement of net assets and statement of activities) concentrate on the County as a whole and do not emphasize fund types but rather a governmental or a business-type classification, which are presented in separate columns. The governmental and business-type activities comprise the primary government and are reported separate from the component unit for which the County is accountable. General governmental and intergovernmental revenues support the governmental activities, whereas the business-type activities are primarily supported by user fees and charges for services. The purpose of the government-wide financial statements is to allow the user to be able to analyze the County s total financial position. The statement of activities reflect the expenses of a given function or segment, which are offset by program revenues. Program revenues are defined as charges for services, operating grants and contributions, and capital grants and contributions directly associated with a given function. Taxes are reported under general revenue. Fund Financial Statements The accounts of the County are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity or retained earnings, revenues, and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. I - 3

7 The County s funds are presented in separate fund financial statements. These funds are presented on a governmental fund financial statement and a proprietary fund financial statement. The County s major funds are presented in separate columns on the fund financial statements. The definition of a major fund is one that meets certain criteria set-forth in Governmental Accounting Standards Board Statements Number 34, Basic Financial Statements and Management s Discussion and Analysis for State and Local Governments (GASB 34). The funds that do not meet the criteria of a major fund are considered non-major funds and are combined into a single column on the fund financial statements. The County adopts an annual budget for all funds. A budgetary comparison has been presented for the General Fund, County Transportation Trust Fund, Solid Waste Disposal Fund, Disaster Relief Fund, Capital Projects Fund, and Debt Service Fund which compares not only actual results to budget but also the original adopted budget to final budget. Governmental Fund Financial Statements Governmental fund financial statements are prepared on the modified accrual basis using current financial resources measurement focus. Under the modified accrual basis, revenues are recognized when they become measurable and available as net current assets. Five of the County s governmental funds, the General Fund, County Transportation Trust Fund, Solid Waste Disposal Fund, Disaster Relief Fund and Capital Projects Fund are classified as major funds. All other governmental funds are combined into a single column on the governmental fund financial statements. Individual fund data for the non-major funds are found in combining statement as supplemental financial data. Proprietary Fund Financial Statements Proprietary fund financial statements like government-wide financial statements are prepared on the full accrual basis. Proprietary funds record both operating and non-operating revenues and expenses. Operating revenues are those that are obtained from the operations of the proprietary fund. The County reports their Port LaBelle Utility System in the proprietary fund financial statement. This enterprise fund represents our water and sewer system that the county owns and operates. Fiduciary Fund Financial Statement The fiduciary fund financial statement is not included in the government-wide financial statements because the resources of those funds are not available to support the County s programs. The only type of fiduciary funds the County maintains, agency funds, are used to account for assets held by the County as an agent for individuals. Government-Wide Financial Analysis The government-wide financial statements were designed so that the user could determine if the County is in a better or worse condition from the prior year. In fiscal year ending 2003 GASB 34 was implemented and reporting requirements changed significantly. I - 4

8 The following is a condensed summary of net assets for the primary government for fiscal years 2011 and 2012 with increases and decreases. Hendry County, Florida Summary of Net Assets with Prior Year Comparison September 30, 2010 Governmental Governmental Governmental Business-type Business-type Business-type All Actvities All Actvities Activities Activities Activities Activities Activities Activities Total Total Inc / (Dec) Inc / (Dec) 2012 Inc / (Dec) Current and other assets $ 34,333,583 $ 31,553,429 $ (2,780,154) $ 10,948,208 $ 7,866,652 $ (3,081,556) $ 39,420,081 $ (5,861,710) Capital Assets 57,289,471 57,326,875 37,404 25,525,347 24,616,506 (908,841) 81,943,381 (871,437) Total Assets 91,623,054 88,880,304 (2,742,750) 36,473,555 32,483,158 (3,990,397) 121,363,462 (6,733,147) Other Liabilities 13,571,989 13,807, ,091 4,067,289 1,534,476 (2,532,813) 15,341,556 (2,297,722) Non-current Liabilities 3,168,629 3,458, ,741 9,948,626 9,687,829 (260,797) 13,146,199 28,944 Total liabilities 16,740,618 17,265, ,832 14,015,915 11,222,305 (2,793,610) 28,487,755 (2,268,778) Net assets: Invested in capital assets, net of related debt 56,058,610 56,134,547 75,937 18,043,565 14,701,728 (3,341,837) 70,836,275 (3,265,900) Restricted 1,170,136 1,098,385 (71,751) ,098,385 (71,751) Unrestricted 17,653,690 14,381,922 (3,271,768) 4,414,075 6,559,126 2,145,051 20,941,048 (1,126,717) Total Net Asset $ 74,882,436 $ 71,614,854 (3,267,582) $ 22,457,640 $ 21,260,854 $ (1,196,786) $ 92,875,708 $ (4,464,368) Investment in capital assets, net of related debt is the largest portion of the net assets. This represents capital assets (land, buildings, improvements, equipment, furniture, vehicles, and infrastructure), net of accumulated depreciation, and the outstanding related debt used to acquire the assets. The restricted net asset balance of $1,098,385 in 2012 represents a bonding requirement and capital project requirement in The unrestricted net asset balance of $20,941,048 represents assets that are available for spending at the County s discretion however it is important to note that this balance is county wide and there are restrictions within each source of funds as to what these funds can be used for. The largest decrease in asset type for fiscal year ending in 2012 was restricted assets for governmental activities. Governmental Activities Analysis The Governmental Revenue Accounts had a decrease of 1 percent from 2011 to The majority of this variance is due to decreased Grant Revenues and Taxes associated with the current economic downturn Hendry County has faced over the last several years. None of the remaining revenue accounts had material differences. Expenses increased 5.51 percent in The majority of all expenses remain fairly constant which is directly associated with the economic crisis faced by all governmental agencies currently. Transportation and Recreation expenses have increased this year due to Capital Projects funded by Cash Carried Forward from Grants in previous years and increased West Recreation MSBU assessments. The Hendry County Board of County Commissioners as well as all Hendry County Constitutional Officials have worked diligently to become more efficient and cost effective over the past few years and will continue this process into the future. Business Activities Analysis The slight decrease in revenues from 2011 to 2012 is due to a decreased customer base due to the economic downturn. Expenses increased due to a Loan Agreement with the Bank of New York against our Banyan Village Project. Expenditures should stabilize over the next few years with the completion of major capital improvement projects. I - 5

9 The following schedule represents Summary of Revenue and Expenditures and Changes in Net Assets for the year September 30, As of September 30, 2012 Governmental Governmental Business-type Business-type Activities Activities Activities Activities Total Revenues: Program Revenues: Charges for Service $ 7,728,157 $ 8,183,069 $ 1,363,773 $ 1,166,582 $ 9,349,651 Operating Grants and Contributions 3,702,220 5,134, ,134,099 Capital Grants and Contributions 2,473, , ,296 General Revenues: Taxes 19,500,655 19,837, ,837,248 Impact Fees Intergovernmental revenues, not restricted for specific purposes 7,042,851 7,011, ,011,394 Other 2,461,266 1,607, ,480 62,125 1,669,923 Total Revenues 42,908,753 42,494,904 1,501,253 1,228,707 43,723,611 Expenses: Program Activities: General Government 12,586,377 11,735, ,735,518 Court Related 1,235, , ,976 Public Safety 16,356,293 18,544, ,544,599 Physical Environment 3,471,084 3,180, ,180,690 Transportation 5,519,694 7,882, ,882,313 Economic environment 1,097, , ,916 Human Services 2,281,914 1,222, ,222,227 Culture and recreation 797,297 1,858, ,858,869 Interest on long-term debt 31,147 65, ,378 Business-type activities: Water and wastewater - - 1,613,136 2,425,493 2,425,493 43,376,168 45,762,486 1,613,136 2,425,493 48,187,979 Increase in net assets (467,415) (3,267,582) (111,883) (1,196,786) (4,464,368) Net assets October 1 75,349,851 74,882,436 22,569,523 22,457,640 97,340,076 Net assets September 30 $ 74,882,436 $ 71,614,854 $ 22,457,640 $ 21,260,854 $ 92,875,708 I - 6

10 Governmental Activities The following is a chart of revenues by source for governmental activities by percent of total revenues for fiscal year Revenues by Source - Governmental Activities 16% 0% 4% 47% 19% 12% 2% Charges for Service Operating Grants and Contributions Capital Grants and Contributions Taxes Impact Fees Intergovernmental revenues, not restricted for specific purposes Other I - 7

11 The following is a chart of expenses by program for governmental activities for fiscal year 2012 Expenses by Program - Govermental Activities 17% 7% 2% 3% 4% 0% 40% 26% 1% General Government Public Safety Transportation Human Services Interest on long-term debt Court Related Physical Environment Economic environment Culture and recreation I - 8

12 Business-Type Activities The following is a chart of Revenues by Source for our Business Activities for fiscal year Our Business Activities consist of Port LaBelle Utilities. Total Revenues created from Charges for Services consisted of $1,166,582. This represents charges for water/sewer usage. Other revenues totaling $62,125 resulted from a special assessment, interest revenue and miscellaneous charges. All business type expenditures for fiscal year 2012 consisted of water and wastewater expenses to operate Port LaBelle Utility Systems and administrative fees. Business Revenues 62,125 1,166,582 Charges for Service Other Financial Analysis of the Government s Funds Governmental Funds Governmental funds are comprised of the General Fund, Fine & Forfeiture Fund, Special Revenue Funds, Debt Service Funds, Capital Projects Funds, and Disaster Relief Fund. As noted earlier governmental funds use the current financial resources measurement focus that focus on near-term inflows and outflows. The General Fund is the general operating fund that is used to account for all financial resources, except those required to be accounted for in another fund. The Fine & Forfeiture fund is comprised to fund the Hendry County Sheriff s office, probation department, courthouse security, mandated costs for law enforcement, and other misc. items to do with the same. Proprietary Funds Proprietary funds are comprised of enterprise funds and internal service funds. An enterprise fund is used to account for activities for which a fee is charged to external users for goods and services. Internal service funds are those that provide a service, primarily within the government, and charge a recovery fee. I - 9

13 Capital Assets Non-depreciable capital assets include land and construction in progress. Depreciable assets include buildings, improvements other than buildings, machinery and equipment, and infrastructure. Total Capital assets total $81,943,381. This is a decrease of $571,437 over prior year. Debt Administration At September 30, 2012, the County had $28,487,755 of total liabilities. Of this amount $13,146,199 consisted of non-current liabilities which mostly consists of bonds and notes payable of $9,658,235 for Port LaBelle Utilities bonds. The remaining balance consists of accounts payable, accrued liabilities, deferred revenue, and inter-fund liabilities. Request for information This financial report is designed to provide the reader an overview of the County. Questions regarding any information provided in this report should be directed to: Hendry County Clerk of Courts, Finance Department, 25 East Hickpochee Avenue, LaBelle, FL 33935, phone (863) I - 10

14 BASIC FINANCIAL STATEMENTS

15 STATEMENT OF NET ASSETS September 30, 2012 Primary Government Component Units Governmental Business-type Activities Activities Total ASSETS Cash and cash equivalents $ 12,680,513 $ 723,588 $ 13,404,101 $ 9,811 Investments, at fair value 5,167,033-5,167,033 - Receivables, net 13,705,883 4,313,662 18,019,545 - Inventory - 5,433 5,433 - Restricted assets: Investments, at fair value - 2,823,969 2,823,969 - Capital assets: Non-depreciable 5,978, ,006 6,515,402 - Depreciable, net 51,348,479 24,079,500 75,427,979 - Total assets 88,880,304 32,483, ,363,462 9,811 LIABILITIES Accounts payable 12,023,409 1,074,298 13,097,707 - Accrued liabilities 581,835 39, ,455 - Other liabilities 897, ,272 - Current portion of long term debt 340, , ,898 - Customer deposits - 164, ,014 - Noncurrent liabilities: Due in more than one year 3,422,580 9,687,829 13,110,409 - Total liabilities 17,265,450 11,222,305 28,487,755 - NET ASSETS Invested in capital assets, net of related debt 56,134,547 14,701,728 70,836,275 - Restricted for: Capital projects 1,044,209-1,044,209 - Unrestricted 14,436,098 6,559,126 20,995,224 9,811 Total net assets $ 71,614,854 $ 21,260,854 $ 92,875,708 $ 9,811 The accompanying notes to the financial statements are an integral part of this statement. I-11

16 STATEMENT OF ACTIVITIES September 30, 2012 Program Revenues Operating Capital Charges for Grants and Grants and Functions/Programs Expenses Services Contributions Contributions Primary government: Governmental Activities : General government $ 11,735,518 $ 4,371,739 $ 972,404 $ 57,364 Court related 300,976 1,054, Public safety 18,544, , ,939 49,280 Physical environment 3,180, , ,122 - Transportation 7,882,313 1,484,690 2,624,825 98,294 Economic environment 971,916 11, ,691 - Culture and recreation 1,222,227 13, ,434 - Human services 1,858,869-32, ,358 Interest on long-term debt 65, Total governmental activities 45,762,486 8,183,069 5,134, ,296 Business-type Activities : Water and Wastewater 2,425,493 1,166, Total primary government $ 48,187,979 $ 9,349,651 $ 5,134,099 $ 721,296 General revenues : Property taxes Gasoline taxes Communications taxes Other taxes Intergovernmental revenues Interest income Miscellaneous Total general revenues Change in net assets Net assets, beginning Net assets, ending The accompanying notes to the financial statements are an integral part of this statement.

17 Net (Expense) Revenue and Changes in Net Assets Primary Government Governmental Business-type Component Activities Activities Total Units $ (6,334,011) $ - $ (6,334,011) $ - 753, ,693 - (16,578,105) - (16,578,105) - (2,761,347) - (2,761,347) - (3,674,504) - (3,674,504) - (699,676) - (699,676) - (1,054,867) - (1,054,867) - (1,309,827) - (1,309,827) - (65,378) - (65,378) - (31,724,022) - (31,724,022) - - (1,258,911) (1,258,911) - (31,724,022) (1,258,911) (32,982,933) - 11,842,982-11,842,982-1,109,862-1,109, , ,599-6,679,805-6,679,805-7,011,394-7,011, ,642 8, , ,198,156 53,523 1,251,679-28,456,440 62,125 28,518, (3,267,582) (1,196,786) (4,464,368) 22 74,882,436 22,457,640 97,340,076 9,789 $ 71,614,854 $ 21,260,854 $ 92,875,708 $ 9,811 I-12

18 BALANCE SHEET GOVERNMENTAL FUNDS September 30, 2012 County Solid Transportation Waste Air Glades General Trust Disposal Airport ASSETS Cash and cash equivalents $ 2,070,017 $ 2,165,835 $ 98,849 $ 625,265 Investments 5,167, Receivables (net) 3,275,813 1,912,896 6,036, ,320 Total assets $ 10,512,863 $ 4,078,731 $ 6,135,622 $ 990,585 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 7,091,737 $ 1,563,615 $ 234,367 $ 486,764 Accrued liabilities 527,058 28,603 4, Other liabilities 425, ,509 Total liabilities 8,044,295 1,592, , ,450 Fund balances Committed 5,000, Assigned - 2,486,513 5,897, ,135 Unassigned (2,531,432) Total fund balances 2,468,568 2,486,513 5,897, ,135 Total liabilities and fund balances $ 10,512,863 $ 4,078,731 $ 6,135,622 $ 990,585 The accompanying notes to the financial statements are an integral part of this statement.

19 Other Total Capital Governmental Governmental Projects Funds Funds $ 1,242,072 $ 6,478,475 $ 12,680, ,167, ,470 1,475,611 13,705,883 $ 1,881,542 $ 7,954,086 $ 31,553,429 $ 837,333 $ 1,809,593 $ 12,023,409-21, , , , ,333 2,282,719 13,502, ,000,000 1,044,209 6,117,723 16,028,701 - (446,356) (2,977,788) 1,044,209 5,671,367 18,050,913 $ 1,881,542 $ 7,954,086 $ 31,553,429 I-13

20 RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS September 30, 2012 Fund Balances - total governmental funds $ 18,050,913 Capital assets used in governmental activities are not financial resources and are therefore not reported in the governmental funds Non-depreciable governmental capital assets $ 5,978,396 Depreciable governmental capital assets, net 51,348,479 57,326,875 Long-term liabilities are not due and payable in the current period and therefore are not reported in the governmental funds Notes payable (963,356) Landfill closure (243,392) Capital leases (228,972) Other Post Employment Benefits (876,313) Compensated absences (1,450,901) (3,762,934) Net assets of governmental activities $ 71,614,854 The accompanying notes to the financial statements are an integral part of this statement. I-14

21 STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 County Solid Transportation Waste Air Glades General Trust Disposal Airport REVENUES Taxes $ 12,047,581 $ 1,109,862 $ 1,768,876 $ - Licenses and permits 231, Intergovernmental 4,910,514 4,675,904 70, ,687 Charges for services 5,230, , , ,054 Fines and forfeitures Miscellaneous 623,236 61, , ,388 Total revenues 23,043,240 6,277,924 2,233,211 1,519,129 EXPENDITURES Current General government 9,777, Court related 1,158, Public safety 14,554, Physical environment 416,774-1,801,577 - Transportation - 5,432,768-1,147,908 Economic environment 479, Culture and recreation 127, Human services 469, Capital outlay General government 412, Public safety 624, Physical environment Transportation - 929, ,775 Debt service Principal retirement 173, Interest and fiscal charges 38, Total expenditures 28,234,188 6,362,626 1,801,577 2,017,683 Excess (deficiencies) of revenues over (under) expenditures (5,190,948) (84,702) 431,634 (498,554) OTHER FINANCING SOURCES (USES) Proceeds from issuance of debt 621, Transfers in 14,748, Transfers out (12,438,393) (103,569) - - Total other financing sources (uses) 2,931,087 (103,569) - - Net change in fund balances (2,259,861) (188,271) 431,634 (498,554) Fund balances - beginning 4,728,429 2,674,784 5,465, ,689 Fund balances - ending $ 2,468,568 $ 2,486,513 $ 5,897,121 $ 483,135 The accompanying notes to the financial statements are an integral part of this statement.

22 Other Total Capital Governmental Governmental Projects Funds Funds $ 2,048,171 $ 2,862,758 $ 19,837, , ,337 1,389,137 12,448,167-1,394,582 8,134, , , , ,547 1,572,142 3,114,820 6,332,318 42,520, , ,017 10,615, ,804 1,501,486-1,540,352 16,095, ,720 2,951, ,979 7,439, , ,740-1,011,968 1,139,150-86, , , ,600 1,112, ,574 1,064, , ,336-61,077 1,860, , ,837-26,675 65,378 1,081,778 6,662,696 46,160,548 2,033,042 (330,378) (3,639,906) , ,455 14,928,775 (1,974,614) (412,199) (14,928,775) (1,974,614) (231,744) 621,160 58,428 (562,122) (3,018,746) 985,781 6,233,489 21,069,659 1,044,209 $ 5,671,367 $ 18,050,913 I-15

23 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES GOVERNMENTAL FUNDS For the Year ended September 30, 2012 Net change in fund balances - total governmental funds: $ (3,018,746) Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation or amortization expense. This is the amount by which depreciation, amortization and capital asset adjustments were below capital outlays in the current period. 40,487 Debt proceeds provide current financial resources for governmental funds, but issuing debt increases long-term liabilities in the statement of net assets. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net assets. Proceeds from the issuance of debt $ (621,160) Principal payments 331,837 (289,323) Certain expenses reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Decrease in landfill closure liability 34,997 Change in compensated absences (118,028) Change in other post employment benefits (241,772) Change in net assets of governmental activities $ (3,267,582) The accompanying notes to the financial statements are an integral part of this statement. I-16

24 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL GENERAL FUND For the Year Ended September 30, 2012 Budgeted Amounts Variance with Actual Final Budget - Original Final Amounts Positive (Negative) REVENUES Taxes $ 12,875,124 $ 12,584,124 $ 12,047,581 $ (536,543) Licenses and permits 271, , ,555 (39,445) Intergovernmental 4,563,882 4,961,774 4,910,514 (51,260) Charges for services 5,385,688 5,179,162 5,230,354 51,192 Miscellaneous 713,755 1,343, ,236 (719,800) Total revenues 23,809,449 24,339,096 23,043,240 (1,295,856) EXPENDITURES Current General government 10,400,448 10,134,997 9,777, ,635 Court related 1,091,655 1,316,719 1,158, ,037 Public safety 13,309,944 14,385,025 14,554,813 (169,788) Physical environment 436, , ,774 19,744 Economic environment 398, , ,823 1,564 Culture and recreation 110, , ,182 (17,108) Human services 692, , , ,526 Capital Outlay General government 93, , ,818 53,319 Public safety 275, , ,898 - Debt service Principal retirement 43, , ,159 (1,518) Interest and fiscal charges 2,000 40,019 38,703 1,316 Total expenditures 26,853,975 28,854,915 28,234, ,727 Deficiencies of revenues under expenditures (3,044,526) (4,515,819) (5,190,948) (675,129) OTHER FINANCING SOURCES (USES): Proceeds from issuance of debt - 361, , ,000 Transfers in 14,895,204 15,322,721 14,748,320 (574,401) Transfers out (12,298,259) (11,805,414) (12,438,393) (632,979) Total other financing sources (uses) 2,596,945 3,878,467 2,931,087 (947,380) Net change in fund balances (447,581) (637,352) (2,259,861) (1,622,509) Fund balances - beginning 447, ,352 4,728,429 4,091,077 Fund balances - ending $ - $ - $ 2,468,568 $ 2,468,568 The accompanying notes to the financial statements are an integral part of this statement. I-17

25 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL COUNTY TRANSPORTATION TRUST For the Year Ended September 30, 2012 Budgeted Amounts Variance with Actual Final Budget - Original Final Amounts Positive (Negative) REVENUES Taxes $ 1,176,529 $ 1,176,529 $ 1,109,862 $ (66,667) Intergovernmental 6,382,968 6,382,968 4,675,904 (1,707,064) Charges for services 357, , ,025 74,025 Miscellaneous 31,800 31,800 61,133 29,333 Total revenues 7,948,297 7,948,297 6,277,924 (1,670,373) EXPENDITURES Current Transportation 9,163,111 9,143,016 5,432,768 3,710,248 Capital outlay Transportation 2,542,933 2,165, ,858 1,235,752 Total expenditures 11,706,044 11,308,626 6,362,626 4,946,000 Excess (deficiencies) of revenues over (under) expenditures (3,757,747) (3,360,329) (84,702) 3,275,627 OTHER FINANCING SOURCES Transfers in 745, ,239 (103,569) (848,808) Total other financing sources 745, ,239 (103,569) (848,808) Net change in fund balance (3,012,508) (2,615,090) (188,271) 2,426,819 Fund balance - beginning 3,012,508 2,615,090 2,674,784 59,694 Fund balance - ending $ - $ - $ 2,486,513 $ 2,486,513 The accompanying notes to the financial statements are an integral part of this statement. I-18

26 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL SOLID WASTE DISPOSAL For the Year Ended September 30, 2012 Budgeted Amounts Variance with Actual Final Budget - Original Final Amounts Positive (Negative) REVENUES Taxes $ 1,845,482 $ 1,845,482 $ 1,768,876 $ (76,606) Intergovernmental 70,588 70,588 70,588 - Charges for services 286, , ,221 (38,583) Miscellaneous , ,526 Total revenues 2,202,874 2,202,874 2,233,211 30,337 EXPENDITURES Current Physical environment 2,240,687 2,240,687 1,801, ,110 Capital outlay Physical environment 877, , ,500 Total expenditures 3,118,187 3,118,187 1,801,577 1,316,610 Excess (deficiencies) of revenues over (under) expenditures (915,313) (915,313) 431,634 1,346,947 Net change in fund balance (915,313) (915,313) 431,634 1,346,947 Fund balance - beginning 915, ,313 5,465,487 4,550,174 Fund balance - ending $ - $ - $ 5,897,121 $ 5,897,121 The accompanying notes to the financial statements are an integral part of this statement. I-19

27 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL CAPITAL PROJECTS For the Year Ended September 30, 2012 Budgeted Amounts Variance with Actual Final Budget - Original Final Amounts Positive (Negative) REVENUES Taxes $ 1,939,565 $ 1,939,565 $ 2,048,171 $ 108,606 Intergovernmental - 1,461, ,337 (551,013) Miscellaneous , ,312 Total revenues 1,939,565 3,400,915 3,114,820 (286,095) EXPENDITURES Current General government - 1,157, , ,599 Capital outlay General government 100, , ,111 38,689 Debt service Principal retirement 52,453 52,453-52,453 Interest and fiscal charges 2,835 2,835-2,835 Total expenditures 155,288 1,668,354 1,081, ,576 Excess (deficiencies) of revenues over (under) expenditures 1,784,277 1,732,561 2,033, ,481 OTHER FINANCING (USES) Transfers out (1,846,771) (1,974,614) (1,974,614) - Total other financing sources (uses) (1,846,771) (1,974,614) (1,974,614) - Net change in fund balance (62,494) (242,053) 58, ,481 Fund balance - beginning 62, , , ,728 Fund balance - ending $ - $ - $ 1,044,209 $ 1,044,209 The accompanying notes to the financial statements are an integral part of this statement. I - 20

28 STATEMENT OF NET ASSETS PROPRIETARY FUND For the Year Ended September 30, 2012 Business-type Activities Enterprise Fund Port Labelle Utility System ASSETS Current Assets Cash and cash equivalents $ 723,588 Receivables (net) 4,313,662 Inventory 5,433 Restricted Assets: Investments at fair value 2,823,969 Total current assets 7,866,652 Capital Assets Non-depreciable 537,006 Depreciable 29,197,139 Less accumulated depreciation (5,117,639) Total noncurrent assets 24,616,506 Total capital assets $ 32,483,158 The accompanying notes to the financial statements are an integral part of this statement.

29 STATEMENT OF NET ASSETS PROPRIETARY FUND For the Year Ended September 30, 2012 Business-type Activities Enterprise Fund Port Labelle Utility System LIABILITIES Current liabilities Accounts payable $ 1,074,298 Accrued liabilities 39,620 Total current liabilities 1,113,918 Current liabilities payable from restricted assets Current portion of long-term debt 256,544 Customer deposits 164,014 Total current liabilities payable from restricted assets 420,558 Noncurrent liabilities Accrued compensated absences 29,594 Bonds payable 9,658,235 Total noncurrent liabilities 9,687,829 Total liabilities 11,222,305 NET ASSETS Invested in capital assets, net of related debt 14,701,728 Unrestricted 6,559,126 Total net assets $ 21,260,854 The accompanying notes to the financial statements are an integral part of this statement. I-21

30 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUND For the Year Ended September 30, 2012 Business-type Activities Enterprise Fund Port Labelle Utility System OPERATING REVENUES Charges for services $ 1,165,366 Special assessments 1,216 Miscellaneous 53,523 Total operating revenues 1,220,105 Operating expenses Personal services 368,880 Contractual services 74,495 Repairs and maintenance 78,223 Office 24,144 Supplies 65,562 Utilities 221,407 Other expense 77,572 Total operating expenses 910,283 Operating income 309,822 Non-operating revenues (expenses) Interest revenue 8,602 Depreciation and amortization (973,306) Interest and fiscal charges (541,904) Total non-operating (expenses) (1,506,608) Change in net assets (1,196,786) Total net assets - beginning 22,457,640 Total net assets - ending $ 21,260,854 The accompanying notes to the financial statements are an integral part of this statement. I-22

31 STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For the Year Ended September 30, 2012 Business-type Activities Enterprise Funds Port LaBelle Utility System CASH FLOWS FROM OPERATING ACTIVITIES: Cash received from customers $ 4,215,861 Cash payments to suppliers for goods and services (496,388) Cash payments to employees for services (366,097) Net cash provided by operating activities 3,353,376 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Repayment of amounts borrowed from governmental funds (2,664,064) Net change of customer deposits 118,661 Principle paid on revenue bonds and notes payable (242,482) Interest paid on revenue bonds (541,904) Net cash used in capital financing activities (3,329,789) CASH FLOWS FROM INVESTING ACTIVITIES: Acqusition of capital assets (64,466) Interest on investments 8,602 Net cash provided by investing activities (55,864) Net increase in cash and cash equivalents (32,277) Cash and cash equivalents at beginning of year 755,865 Cash and cash equivalents at end of year $ 723,588 The accompanying notes to the financial statements are an integral part of this statement.

32 STATEMENT OF CASH FLOWS (CONTINUED) PROPRIETARY FUNDS For the Fiscal Year Ended September 30, 2012 Business-type Activities Enterprise Funds Port LaBelle Utility System Reconciliation of operating income to net cash provided by operating activities: Operating income $ 309,822 Adjustments to reconcile operating income to net cash provided by operating activities: Changes in assets and liabilities: (Increase) in: Accounts receivable 3,049,279 Increase (decrease) in: Accounts payable (4,253) Accrued liabilities (1,472) Total adjustments 3,043,554 Net cash provided by operating activities $ 3,353,376 The accompanying notes to the financial statements are an integral part of this statement. I-23

33 STATEMENT OF FIDUCIARY NET ASSETS FIDUCIARY FUNDS As of September 30, 2012 Agency Funds ASSETS Cash and cash equivalents $ 1,554,766 Due from other governments 2,521 Total assets $ 1,557,287 LIABILITIES AND FUND BALANCES Accounts Payable $ 276,518 Deposits 426,936 Due to other governments 544,410 Due to individuals 309,423 Total liabilities $ 1,557,287 The accompanying notes to the financial statements are an integral part of this statement. I-24

34 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity Hendry County (the County ) was created in 1923 by the Laws of Florida 1923, Chapter as amended, Section 7.26, Florida Statutes and is a political subdivision of the State of Florida. It is governed by an elected Board of County Commissioners (the Board ) which is a body of elected Constitutional Officers of Hendry County. Based on the criteria set forth by the Governmental Accounting Standards Board, the Board is a part of the County s primary government and its financial statements are included in the basic financial statements of Hendry County, Florida. However, Chapter 11.45, of the Florida Statutes defines the Board as a County agency. For the purposes of that section, County agencies are treated as local governmental agencies. Section , Rules of the Auditor General for Local Governmental Entity Audits, requires a separate financial audit report for each County agency. The accounts of the Board do not constitute a complete presentation of the County, but present only the financial position and results of operations of the Board. The accompanying financial statements present the combined financial position and results of operations of the County, by major fund, and non-major funds in aggregate, that are governed by the Board. As required by accounting principles generally accepted in the United States of America, the financial statements of the reporting entity include those of Hendry County (the primary government) and its component units. A component unit is a legally separate organization for which the elected officials of the primary government are financially accountable. In addition, a component unit may be another organization for which the nature and significance of its relationship with a primary government is such that exclusion would cause the reporting entity s financial statements to be misleading or incomplete. In conformity with accounting principles generally accepted in the United States of America, the financial statements of the component units have been included in the financial reporting entity as a discretely presented component unit. Discretely Presented Component Unit Hendry County Industrial Development Authority is a predominantly dormant organization which convenes on an as needed basis. By Resolution 83-43, dated March 8, 1983, the Board appoints the members of the Authority and provides the funding for the Authority s operations when the Authority s approval is necessary to issue Industrial Revenue Bonds for development in the County. Hendry County Economic Development Council, Inc. (the Council) was incorporated on August 29, 1997 with operations beginning October 1, 1997 as a Florida not-for-profit corporation. The Council s purpose is to promote, develop, stimulate, and coordinate the economic development activities of governments, businesses, and educational institutions in Hendry County. The Council s mission is also to address issues affecting the economic development in Hendry County, as well as, to heighten community awareness of the related economic effect concerning these issues. I-25

35 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Discretely Presented Component Unit (Continued) The Council acts as an advocate for the promotion of the professions and skills necessary to sustain and expand economic growth by promoting, encouraging and coordinating education and vocational training in Hendry County. Complete financial information of the individual component units can be obtained directly from the Authority or the Council. Government-Wide and Fund Financial Statements The government-wide financial statements and the major-fund financial statements along with the notes to the financial statements comprise the basic financial statements. The government-wide financial statements (the statement of net assets and the statement of activities) report on the Board as a whole and do not emphasize fund types but rather a governmental or a business-type classification, which are presented in separate columns. These statements report on the Board as a whole, both the primary government and its component units, and provide a consolidated financial picture of the Board of County Commissioners. As part of the consolidation process, inter-fund activities are eliminated to avoid distorted financial results. The Statement of Net Assets reports all financial and capital resources of the Board s governmental and business-type activities. It is presented in a net assets format (assets less liabilitiesequal net assets) and shown with three components: amounts invested in capital assets, net of related debt; restricted net assets; and unrestricted net assets. The statement of activities reflects the expenses of a given function or segment, which are offset by program revenues. Program revenues are defined as charges for services, operating grants and contributions, and capital grants and contributions directly associated with a given function. Taxes are reported under general revenue. Program revenues are classified into three categories; charges for services, operating grants and contributions, and capital grants and contributions. Charges refer to direct recovery from customers for services rendered. Grants and contributions refer to revenues restricted for specific programs whose use may be restrictedfurther to operational or capital items. The general revenues section displays revenue collected that helps support all functions of our government and contribute to the change in the net assets for the fiscal year. The Board s major funds are presented in separate columns on the governmental fund financial statements and the proprietary fund financial statements. The definition of a major fund is one that meets certain criteria setforth in GASB 34. The funds that do not meet the criteria of a major fund are considered non-major funds and are combined into a single column on the fund financial statements. I-26

36 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Measurement Focus, Basis of Accounting, and Financial Statement Presentation The accounts of the Board are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity or retained earnings, revenues, and expenditures or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. Basis of accounting refers to when revenues and expenditures, or expenses, are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. The government-wide financial statements are prepared on a full accrual basis using the economic resources measurement focus, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred. Property taxes are recognized in the year for which they are levied. Grants and similar items are recognized as revenues as soon as all of the eligibility requirements have been met. Proprietary funds record both operating and non-operating revenues and expenses. Operating revenues are those that are obtained from the operations of the proprietary fund and include user fees. Non-operating revenues are not related to the operations of the proprietary fund and include interest and other miscellaneous earnings. Operating expenses represent the cost of operations, which includes depreciation. Non-operating expenses are not related to operations such as interest expense. Governmental fund financial statements are prepared on the modified accrual basis using the current financial resources measurement focus. Under the modified accrual basis, revenues are recognized when they become measurable and available as net current assets. The Board considers all revenues available if they are collected within sixty days after year-end. Primary revenues, such as property taxes, special assessments, intergovernmental revenues, charges for services, sales and franchise taxes, rents, and interest are treated as susceptible to accrual under the modified accrual basis and have been recognized as revenues. Expenditures reported in governmental fund financial statements are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. An exception to this general rule includes principal and interest on general long-term debt, which is recognized when due. The business-type activities reported in the government-wide financial statements and proprietary funds follow private sector standards issued prior to December 1, 1989, to the extent those standards do not conflict with Governmental Accounting Standards Board statements. I-27

37 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued) However, pursuant to Government Accounting Standards Board Statement Number 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities That Use Proprietary Fund Accounting, the Board has elected not to apply accounting standards issued after November 30, 1989, by the Financial Accounting Standards Board. When both restricted and unrestricted resources are available, restricted resources will be used first for incurred expenses, and then unrestricted as needed. The Board reports the following major funds in the governmental fund financial statements: General Fund The General Fund is the general operating fund of the Board that is used to account for all financial resources, except those required to be accounted for in another fund. County Transportation Trust Fund The County Transportation Trust Fund construction and maintenance of roadways. accounts for revenues received and expended for the Solid Waste Disposal Fund The Solid Waste Disposal Fund is used to account for the activities related to the solid waste disposal program. Airglades Airport Fund The Airglades Airport Fund is used to account for the activities related to the construction and maintenance of the Airglades Airport. Capital Projects Fund The Capital Projects Fund accounts for revenues received from the infrastructure surtax. Non-major Governmental Funds The non-major governmental funds are a combination of special revenue, debt service, and capital projects funds. I-28

38 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued) Budgets and Budgetary Accounting Chapters 129 and 200 of the Florida Statutes govern the preparation, adoption and administration of the Board s annual budget. The budget is required to be balanced; that is; the total of the estimated revenues, including balances brought forward, shall equal the total of the appropriations and reserves. The following procedures are followed by the Board in establishing the operating budget: (1) On or before July 15, a tentative budget for the fiscal year commencing the following October 1 is presented to the Board. (2) The tentative budget is reviewed by the Board and any necessary changes are made. (3) Public hearings are conducted to inform the taxpayers of the tentative budget and proposed tax levies and to obtain taxpayer comments. (4) On or before September 30, the budget is legally adopted through passage of a resolution. (5) (6) (7) (8) (9) Section of the Florida Statutes prohibits incurring expenditures in excess of total fund appropriations. Formal budgetary integration is employed as a management control device during the year in all Governmental Fund Types. Estimated beginning fund balances are considered in the budgetary process, but are not included in the financial statements as budgeted revenue. Budgets for General, Special Revenue, Debt Service and Capital Projects Funds are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Formal budgetary integration is employed as a management control device during the year in all Governmental Fund Types. Estimated beginning fund balances are considered in the budgetary process, but are not included in the financial statements as budgeted revenue. Budgets for General, Special Revenue, Debt Service and Capital Projects Funds are adopted on a basis consistent with accounting principles generally accepted in the United States of America. The annual budgets serve as the legal authorization for expenditures. Expenditures cannot legally exceed the total amount budgeted for each fund. The Board must approve all budget amendments, which change the legally adopted total appropriation for a fund. If, during the fiscal year, additional revenues become available for appropriation in excess of those estimated in the budget, the Board may make supplemental appropriations by resolution for the year up to the amount of such excess. During the fiscal year the Board, in accordance with Florida Statutes, approved various supplemental appropriations. Appropriations lapse at fiscal year-end. I-29

39 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Assets, Liabilities, and Net Assets or Fund Equity Cash and Investments The Board considers cash and cash equivalents to be cash on hand, demand deposits, highly liquid investments, including those held as restricted assets, with original maturities of three months or less when purchased, and those included in the internal investment pool. For accounting and investment purposes, the Board maintains a cash pool that is available for use by all funds except those whose cash and investments may be segregated due to legal or other restrictions. Interest earned on investments in the pool is allocated to the various funds based upon each fund s equity balance in the pool during the allocation period. The Board reports all investments at fair value. Inventories and Prepaid items Inventories, consisting primarily of materials and supplies, are stated at cost, which approximates fair market value. The first-in, first-out method of accounting is used to determine cost. All inventories are recorded as expenditures, or expenses, as they are used (consumption method). Some payments to vendors represent costs applicable to future accounting periods and are recorded as prepaid items in government-wide and fund financial statements. Capital Assets Capital assets include property, plant, and equipment. Infrastructure assets are defined as public domain fixed assets such as roads, bridges, curbs and gutters, streets and sidewalks, drainage systems, lighting systems, and similar assets that are immovable and of value only to the government unit. Pursuant to GASB Statement No. 34, the County, a Phase 3 government, has elected to report infrastructure retroactively. Retroactive infrastructure is reported at the estimated historical cost. Capital assets are reported in the government-wide financial statements in the applicable governmental or business-type activities column, as well as the proprietary fund financial statements. The threshold for capitalizing property, plant, and equipment is $5,000. The threshold for capitalizing infrastructure is $100,000. Capital assets are recorded at cost, or estimated historical cost. Contributed assets are recorded at estimated fair market value at the time received. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets. I-30

40 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Assets, Liabilities, and Net Assets or Fund Equity (Continued) Capital Assets (continued) The ranges of the useful lives are as follows: Asset Years Buildings Infrastructure Improvements other than Buildings 6-50 Equipment 3-35 Computer Equipment 3-10 Furniture 4-20 Vehicles & rolling stock 3-15 Florida Statutes require that the Board maintain accountability for all assets used in operations, except those maintained by the Sheriff. Deferred Revenues Deferred revenue represents revenues collected in advance of services performed. This revenue will be recognized when the services are rendered. Compensated Absences The Board maintains a policy that permits employees to accumulate earned but unused vacation and sick pay benefits that will be paid to employees upon separation from Board service if certain criteria are met. These benefits, plus their related tax and retirement costs are classified as compensated absences. Both the current and long-term portion of compensated absences are accrued and reported in the government-wide and proprietary fund financial statements. This is accounted for pursuant to GASB Statement Number 16, Accounting for Compensated Absences. Net Assets/Fund Balance Classification Governmental funds report fund balances as either nonspendable or spendable. Spendable fund balances are further classified as restricted, committed, assigned or unassigned, based on the extent to which there are external or internal constraints on the spending of these fund balances. Nonspendable fund balances include amounts that cannot be spent because they are not in spendable form or legally or contractually required to be maintained intact. The County considers inventories and prepaid items as part of this category, as well as long-term receivables from which proceeds are not restricted, committed, or assigned. I-31

41 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Assets, Liabilities, and Net Assets or Fund Equity (Continued) Net Assets/Fund Balance Classification (Continued) Spendable Fund Balances: Restricted Fund Balance: Amounts that are restricted to specific purposes, and are restricted through enabling legislation and are legally enforceable. The legislation that creates the revenue stream must also stipulate the purposes for which that revenue can be used. Committed Fund Balance: Amounts that are committed for specific purposes by formal action of the governments highest level of decision making authority. These amounts are not subject to legal enforceability as in restricted, however those amounts cannot be used for any other purpose unless the government removes or changes the limitation by taking the same form of action it employed to previously impose the limitation. Assigned Fund Balance: Amounts that are intended by the government to be used for specific purposes but are neither restricted nor limited. Intent should be expressed by (a) the governing body itself, or (b) a subordinate high-level body or official possessing the authority to assign amounts to be used for specific purposes. Unassigned Fund Balance: Is the residual classification for the general fund. This classification represents fund balance that has not been assigned to other funds and that has not been restricted, limited, or assigned to specific purposes within the general fund. Government-wide statements and proprietary fund statements utilize an economic resources measurement focus and categorize net assets among the following components: Invested in Capital Assets, Net of Related Debt indicates that portion of net assets which represents the County s equity in capital assets, less the amount of related debt. Restricted Net Assets indicates that portion of net assets which are segregated due to external restrictions imposed by creditors, grantors, contributors, or laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation. Unrestricted Net Assets indicates that portion of net assets which is available for general operations. NOTE 2 - PROPERTY TAXES Property taxes become due and payable on November 1 of each year and are delinquent on April 1 of the following year. Discounts on property taxes are allowed for payments made prior to the April 1 delinquent date. Tax certificates for the full amount of any unpaid taxes must be sold no later than June 1 of each year. I-32

42 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 2 - PROPERTY TAXES (CONTINUED) No accrual for the property tax levy becoming due in November 2012 is included in the accompanying financial statements, since such taxes are collected to finance expenditures of the subsequent period. Procedures for collecting delinquent taxes, including applicable tax certificate sales and tax deed sales, are provided by Florida Statutes and are performed by the Hendry County Tax Collector. The enforceable lien date is approximately two years after taxes become delinquent and occurs only upon request of a holder of a delinquent tax certificate. There was no significant delinquent property taxes receivable at September 30, Important dates in the property tax cycle are as follows: - Assessment roll certified- July 1 - Millage resolution approved- no later than 93 days following certification of assessment roll - Beginning of fiscal year for which taxes have been levied- October 1 - Taxes due and payable (levy date)- November 1 - Property taxes payable (maximum discount of 4 percent)- 30 days after levy date - Due date- March 31 - Taxes become delinquent (lien date)- April 1 - Tax certificate sold- prior to June 1 NOTE 3 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY Deficit fund net assets The Emergency 911 Fund has a deficit fund balance of $69,259. It is anticipated that the deficit will be resolved in the next fiscal year through an adjustment. The East Hendry County Fire District has a deficit fund balance of $207,450. It is anticipated that the deficit will be resolved in the next fiscal year through an adjustment. The East Hendry County Recreational MSBU has a deficit fund balance of $223,823. It is anticipated that the deficit will be resolved in the next fiscal year through an adjustment. NOTE 4 - CASH, CASH EQUIVALENTS AND INVESTMENTS All Board depositories are banks or savings institutions designated by the State Treasurer as qualified public depositories. Chapter 280, Florida Statues Florida Security for Public Deposits Act provides procedures for public depositories to insure monies in banks and savings and loans are collateralized with the Treasurer as an agent for the public entities. I-33

43 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 4 - CASH, CASH EQUIVALENTS, AND INVESTMENTS (CONTINUED) The Public Deposit Security Trust Fund has a procedure to allocate and recover losses in the event of a default or insolvency. When public deposits are made in accordance with Chapter 280, no public depositor shall be liable for any loss thereof. Chapter 280 defines deposits as time deposit accounts, demand deposit accounts, and certificates of deposit. The total amount of bank deposits, $22,381,742, is insured by Federal depository insurance and pursuant to Chapter 280, Florida Statutes. Board investments are made in accordance with the provisions of Section , Florida Statutes Investment of Local Government Surplus Funds. Authorized investments include U.S. Government obligations, passbook savings accounts, tax-exempt State and municipal securities, certificates of deposit, Local Government Surplus Funds Investment Pool Trust Fund (SBA), the Florida Local Government Investment Trust (FLGIT), and any other investments authorized by Chapter 218, Florida Statutes. There were no violations of this policy during the fiscal year. NOTE 5 - ACCOUNTS RECEIVABLE At September 30, 2012, receivables were as follows: Enterprise: Labelle Utility Accounts receivable $ 4,313,662 Less: allowance for bad debt - Total receivables $ 4,313,662 NOTE 6 - SPECIAL ASSESSMENT In connection with the Port LaBelle Utility System (PLUS), the Board has commenced a phased construction program to provide utility service to vacant lots in Units 1 9 in Hendry County and Unit 102 in Glades County. The costs of the improvements are to be financed by special assessments levied against individual lots. The remaining balance of the assessment (if any) is to be paid over a twenty-year period through the real estate tax collection process. Interest at 7% is to be charged on the unpaid balance. The special assessment rate for lots in Hendry County is $975 per lot, and the rate per lot in Glades County is $1,080 per lot. NOTE 7 - RESTRICTED ASSETS AND LIABILITIES Restricted assets of the proprietary fund represent monies to be restricted for debt service, renewal and replacement, capital improvements and construction, and customer deposits under the terms of outstanding bond agreements, resolutions, and other contractual agreements. I-34

44 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 7 - RESTRICTED ASSETS AND LIABILITIES (CONTINUED) Restricted assets reported on the proprietary fund statement of net assets at September 30, 2012, were as follows: Port LaBelle Utility Restricted cash and investments $ 2,823,969 Assets restricted for debt service are for the payment of bond principal and interest and bond reserve requirements. Assets restricted for renewal and replacement are for the payment of unusual or extra-ordinary maintenance or repairs. Additionally, assets are restricted for capital improvements and construction. Customer deposits are advance payments held until certain conditions are met. Liabilities payable from restricted assets were at September 30, 2012 comprised of the following: Port LaBelle Utility Current portion of long-term debt $ 256,544 Customer deposits 164,014 Total $ 420,558 NOTE 8 - CAPITAL ASSETS Depreciation cost was charged to functions as follows: Governmental activities: General government Court related Public safety Physical environment Transportation Economic environment Culture and recreation Human services $ 963,900 33, , , ,486 98,176 83,077 1,301,895 Total depreciation cost for governmental activities $ 4,458,448 I-35

45 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 8 - CAPITAL ASSETS (CONTINUED) Business-type activities: Water and wastewater depreciation cost $ 973,306 Capital asset activity for the fiscal year ended September 30, 2012 was as follows: Governmental Activites Beginning Ending Balance Increases Decreases Balance Capital Assets not being depreciated: Land $ 5,538,708 $ 439,688 $ - $ 5,978,396 Total capital assets not being depreciated 5,538, ,688-5,978,396 Capital assets being depreciated: Buildings and improvements 65,446,746 2,358,838-67,805,584 Furniture and equipment 30,564,370 1,716,274 (239,280) 32,041,364 Infrastructure 54,433, ,433,754 Total capital assets being depreciated 150,444,870 4,075,112 (239,280) 154,280,702 Less accumulated depreciation for: Buildings and improvements 22,747,990 2,378,229-25,126,219 Furniture and equipment 21,512,363 2,080,219 (220,332) 23,372,250 Infrastructure 54,433, ,433,754 Total accumulated depreciation 98,694,107 4,458,448 (220,332) 102,932,223 Total capital assets being depreciated, net 51,750,763 8,533,560 (459,612) 51,348,479 Total governmental activities capital assets, net $ 57,289,471 $ 8,973,248 $ (459,612) $ 57,326,875 Business-Type Activities: Capital assets not being depreciated: Land $ 537,006 $ - $ - $ 537,006 Total capital assets not being depreciated 537, ,006 Capital assets being depreciated: Buildings & Infrastructure 28,950,124 64,466-29,014,590 Furniture and equipment 182, ,550 Total capital assets being depreciated 29,132,674 64,466-29,197,140 Less accumulated depreciation for: Buildings & Infrstructure 3,980, ,137-4,940,654 Furniture and equipment 163,816 13, ,985 Total accumulated depreciation 4,144, ,306-5,117,639 Total capital assets being depreciated, net 24,988,341 (908,840) - 24,079,501 Total business-type activities capital assets, net $ 25,525,347 $ (908,840) $ - $ 24,616,507 I-36

46 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT Business Type - Notes Payable & Revenue Bonds Notes Payable $1,430,705 bank loan, bearing interest at a rate of 7%, (15) annual payments of $157,084. Final payment due September $1,355,656 bank loan, bearing interest at a rate of 7%, (15) annual payments of $148,844. Final payment due September Total business type - notes payable $ 1,373,771 1,301,708 2,675,479 Revenue Bonds The Board issued revenue bonds for business-type activities. The descriptions and balances of the outstanding revenue bonds as of September 30, 2008, were as follows: $4,700,000 Hendry County, Water and Sewer System Revenue Bonds, Series 1996, bearing interest of 5% payable on September 1, 1996 and annually thereafter on September 1, with principal maturing from September 1, 1997 to September 1, $3,689,000 Hendry County, Water and Sewer System Revenue Bonds, Series 2007, bearing interest of 4.125% payable on September 1, 2007 and annually thereafter on September 1, with principal maturing from September 1, 2010 to September 1, Total business type - revenue bonds Total business-type Long-Term Debt $ 3,725,300 3,514,000 7,239,300 9,914,779 Government Funds - Notes Payable & Other Payables Notes Payable $621,833 capital equipment lease, bearing interest at a rate of 4.0%, one annual payment of $85,668. Final payment due June $25,547 loan from a financial institution for the purpose of machinery, bearing interest at a variable rate which was 4.275% at September 30, 2012 quarterly payments of $1426. Final payment due October $650,000 loan from a financial institution for the purchase of airplane hangars bearing interest at a rate of 2.625%, annual payments of differing values. Final payment due January I-37 $ 306,446 10, ,053

47 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT (CONTINUED) Government Funds - Notes Payable & Other Payables (Continued) Note Payables & Capital Leases (Continued) $450,000 loan from a financial institution used for road improvements, bearing interest at a rate of 4.5%, annual payments of $80,000. Final payment due October $125,363 bank loan for the purchase of an ambulance, bearing interest at a rate of 3.5%, with three annual payments of $40,000. Final payment due February $67,556 bank loan for the purchase of a fire truck, bearing interest at a rate of 3.5%, with equal annual payments of $20,000. Final payment due February $ 212,552 89,751 50,679 $361,160 open ended capital lease from a financial institution for ten police cars, bearing interest at a rate of 6%, quarterly payments of $26,160. Final payment due June 30, The lease is in the name of the Hendry County Sheriff's Office. 228,972 Total governmental - notes payable Other Payables Post-closure care costs for monitoring of the landfill for twenty years after the landfill has stopped accepting waste and the final cover has been completed. The County has 8 years remaining. Total governmental other payables Total Government Funds Long-Term Debt TOTAL LONG-TERM DEBT $ 1,192, , ,392 1,435,720 11,350,499 I-38

48 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT (CONTINUED) The annual debt service requirements for revenue bonds at September 30, 2012, were as follows: Government Funds Business-type Long-Term Debt Long-Term Debt Total Fiscal Year(s) Principal Interest Principal Interest Principal Interest 2013 $ 299,789 $ 31,354 $ 256,544 $ 521,279 $ 556,333 $ 552, ,010 25, , , , , ,421 18, , , , , ,034 12, , , , , , , , , , , ,018 2, , , , , , , , , , , , , , , ,271,423 1,619,256 2,271,423 1,619, ,671, ,549 1,671, , ,747, ,143 1,747, , , , , , ,021, ,444 1,021, ,444 Total $ 1,192,328 $ 375,301 $ 9,914,779 $ 7,109,579 $ 11,107,107 $ 7,484,880 Bond Resolutions The resolution for the bonds established certain accounts and determined the order in which certain revenues are to be deposited into those accounts. In addition, there are various other covenants established by the official statements and Board resolutions, including such items as debt service coverage, reporting requirements, and maintenance of facilities. Management believes that it has complied, in all material respects, with these covenants. The 1996 Series Bonds pledge the net revenues of the utility system for the payment of the principal, redemption price and the interest on the bonds. The Board covenants to fix, establish, and maintain rates and to collect such revenues from the product and services to provide in each fiscal year net revenues which at least equal the annual debt service on all of the outstanding bonds. I-39

49 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT (CONTINUED) Bond Resolutions (Continued) Changes in bonded and other indebtedness of the Board for the year ended September 30, 2012, was as follows: Beginning Ending Due Within Balance Additions Reductions Balance One Year Governmental Activities Notes payable $ 1,230,861 $ 361,160 $ (399,693) $ 1,192,328 $ 299,789 Landfill Closure 278,389 - (34,997) 243,392 40,565 Other Post Employment Benefits 634, , ,313 - Compensated absences 1,332, ,028-1,450,901 - Total governmental activities long-term liabilities $ 3,476,664 $ 720,960 $ (434,690) $ 3,762,934 $ 340,354 Business-Type Activities Port LaBelle Utility Systems Notes payable $ 2,786,361 $ - $ (110,882) $ 2,675,479 $ 118,644 Revenue bonds 7,370,900 - (131,600) 7,239, ,900 Compensated absences 33,848 - (4,255) 29,593 - Total business-type activities long-term liabilities $ 10,191,109 $ - $ (246,737) $ 9,944,372 $ 256,544 NOTE 10 - LANDFILL CLOSURE AND POSTCLOSURE CARE COSTS State and Federal laws and regulations require that Hendry County place a final cover on its landfill that was closed and perform certain maintenance and monitoring functions at the landfill site for twenty years after closure. The liability is being recognized based on the future post closure costs that will be incurred after the date the landfill no longer accepts waste. The landfill stopped accepting solid waste on December 1, 1992, and finished placing the required cover on the landfill during the fiscal year ended September 30, Since the landfill is closed, the estimated liability is based on the current estimated costs for services to monitor and maintain the closed landfill for the required period. However, the actual cost of postclosure care may be higher due to inflation, changes in technology, or changes in landfill laws and regulations. The Board is required by state and federal regulations to make annual contributions to finance the post closure care. The Board has set aside funds in the amount of $40,565 for post closure care. The funding for costs for providing the final cover was provided by Lee County under the interlocal agreement for the joint solid waste disposal program. I-40

50 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 11 - CONTINGENCIES Grants and Assistance Activities of certain funds of the Board are financed in whole or in part by various forms of grants and assistance, principally from the federal government. There can be no absolute assurance that such assistance will continue in the future at the present levels. Amounts received from grantor agencies are subject to audit or adjustment by the grantor agencies. Also, any amounts disallowed could constitute liabilities of the applicable funds. Litigation The Board, in accordance with the normal conduct of its affairs, is involved in various judgments, claims, and litigation. It is expected that the final settlement of these matters will not materially affect the financial statements of the Board. NOTE 12 - RETIREMENT PLAN Plan Description and Provisions The Board participates in the Florida Retirement System (FRS), a cost sharing, multiple-employer, public employee retirement system, which covers substantially all of the full-time and part-time employees. The FRS is noncontributory and is totally administered by the State of Florida. Benefits under the plan vest after six years of service. Employees who retire at or after age 62 (age 55 for special risk) or 30 years of service (25 years for special risk), with six years of credited service, are entitled to an annual retirement benefit, payable monthly for life. The FRS also provides for early retirement at reduced benefits and death and disability benefits. These benefit provisions and all other requirements are established by Chapters 112 and 121, Florida Statutes. Effective July 1, 2011, covered members are required to contribute 3% of gross earnings. The County is required to make contributions based on actuarially determined statewide contribution rates. The contribution rates by job class for the periods from October 1, 2011 through June 30, 2012 and July 1, 2012 through September 30, 2012, respectively, were as follows: regular, 4.91% and 5.18%; senior management, 6.27% and 6.30%; county elected officers, 11.14% and 10.23%; special risk, 14.10% and 14.90%; and DROP participants, 4.42% and 5.44%. The contribution The County s contributions made during the years ended September 30, 2012, 2011, and 2010 were $1,345,489, $2,059,144, and $1,971,743, respectively, equal to the required contributions for each year. A copy of the FRS s June 30, 2012 annual report can be obtained by writing to the Division of Retirement, 2639 North Monroe Street, Building C, Tallahassee, Florida , or by phoning (850) I-41

51 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 13 - RISK MANAGEMENT The Board is exposed to various risks of loss related to torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees, and natural disasters. The County is a member of Public Risk Management (PRM), a local government liability risk pool. PRM administers insurance activities relating to property, general, automobile, public official's liability, workers compensation, health, and auto physical damage. The pool assesses each member its pro rata share of the estimated amount required to meet current year losses, operating expenses and reinsurance costs (premiums). To reduce its exposure to large losses on all types of insured events PRM uses reinsurance policies purchased from third parties. The Fund is fully funded annually. Major uninsurable risks include damages to infrastructure assets and damages or governmental fines due to seepage, pollution, or contamination of any kind. Since the amounts of loss cannot be reasonably estimated and the likelihood is undeterminable, no provision for such occurrences is included in these financial statements. NOTE 14 - OTHER POST-EMPLOYMENT BENEFITS Plan Description In accordance with Section , Florida Statutes, because the Board provides medical plans to employees of the County and their eligible dependents, the Board is also required to provide retirees the opportunity to participate in the group employee health plan. Retirees participating in the group insurance plans offered by the County are required to contribute 100% of the active participants cost of participation. Eligibility for Insurance Coverage Employees of the County and all constitutional officers who were participants in the existing medical plan at the time of retirement are entitled to participate in the Plan. Depending on the class of employee the following eligibility rules apply: Regular Class and Elected Officials - Age 62 and 6 years of service or 30 years of service, regardless of age, is normal retirement. Employees may retire early at age 43 and 6 years of service. Special Risk - Age 55 and 6 years of service or 25 years of service, regardless of age is normal retirement. Employees may retire early at age 36 and 6 years of service. Membership As of September 30, 2012, membership consisted of: Active Employees 354 Retired Participants 11 I-42

52 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 14 - OTHER POST-EMPLOYMENT BENEFITS (CONTINUED) Funding Policy Funding for this plan is on a pay-as-you-go basis. The Program is currently unfunded. There is no separate trust through which benefits for retirees are funded. No assets are currently accumulated or earmarked for this purpose. Annual OPEB Costs and Net OPEB Obligation Hendry County had an actuarial valuation performed for the plan as of September 30, 2012 to determine the funded status of the plan as of that date, as well as the employer's annual required contribution (ARC) for the fiscal year ended September 30, The County s annual OPEB cost for the fiscal year was set at $296,796 as the transition liability was set to zero as of September 30, The Board s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net obligation from 2012 is as follows: Fiscal Year Ended Annual OPEB Cost Employer contributed % of Annual OPEB Cost Contributed Net OPEB Obligation September 30, 2012 $ 296,796 $ 55, % $ 876,313 The funded status of the plan as of September 30, 2012 was as follows: Actuarial Accrued Liability (AAL) $ 2,300,775 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (AAL) $ 2,300,775 Covered Payroll $ 12,062,110 Ration of UAAL to Covered Payroll 19.2% NOTE 15 - COMMITMENTS The Property Appraiser entered into an interlocal agreement with the Hendry County Board of County Commissioners for the purchase of a Computer Assisted Mass Appraisal system. The Property Appraiser is not permitted by law to borrow money extending beyond his term is office. Therefore the Board has signed a loan agreement with Centerstate Bank for the amount of $200,000, requiring the money to be used by the Property Appraiser for the purchase of the software. Within the interlocal agreement, the Property Appraiser agrees to remit all required payments stipulated in the loan agreement to the Board in lieu of payments made to Centerstate Bank. The loan agreement between the Board and Centerstate Bank and the interlocal agreement between the Board and the Property Appraiser are dated 12/28/2011 and 12/13/2011, respectively. I-43

53 NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 15 - COMMITMENTS (CONTINUED) Fund Balance Commitments The County adopted a resolution to commit $5,000,000 of the General Funds' fund balance for a disaster emergency reserve to enable the County to properly respond to emergencies affecting the County caused by natural and other disasters. I-44

54 REQUIRED SUPPLEMENTARY INFORMATION

55 COMBINING SCHEDULE - BALANCE SHEET GENERAL FUND As of September 30, 2012 Board of County Clerk of Property Commissioners Circuit Court Appraiser Sheriff ASSETS Cash and cash equivalents $ 995,284 $ 301,367 $ 61,535 $ 626,753 Investments 5,167, Receivables, net 3,168,001 17,801-90,011 Total assets $ 9,330,318 $ 319,168 $ 61,535 $ 716,764 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 6,714,178 $ 26,144 $ - $ 299,108 Accrued liabilities 44,856 45,780 24, ,986 Other liabilities 102, ,244 36,867 11,670 Total liabilities 6,861, ,168 61, ,764 Fund balances Committed 5,000,000 Unassigned: (2,531,432) Total fund balances 2,468, Total liabilities and fund balances $ 9,330,318 $ 319,168 $ 61,535 $ 716,764

56 Supervisor Tax of Elections Collector Total $ 5,094 $ 79,984 $ 2,070, ,167, ,275,813 $ 5,094 $ 79,984 $ 10,512,863 $ - $ 52,307 $ 7,091,737-5, ,058 5,094 21, ,500 5,094 79,984 8,044,295 5,000, (2,531,432) - - 2,468,568 $ 5,094 $ 79,984 $ 10,512,863 I-45

57 COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GENERAL FUND As of September 30, 2012 Board of County Clerk of Property Commissioners Circuit Court Appraiser Sheriff REVENUES Taxes $ 12,047,581 $ - $ - $ - Licenses and permits 231, Intergovernmental 4,519, ,471 Charges for services 1,765, ,421 1,071,710 - Miscellaneous 299, ,329 Total revenues 18,862, ,421 1,072, ,800 EXPENDITURES Current General government 6,107, ,917 1,020,713 - Court related - 945, ,034 Public safety 4,084, ,470,046 Physical environment 416, Economic environment 479, Culture and recreation 127, Human services 469, Capital outlay General government 398,185-14,633 - Public safety ,898 Debt service Principal retirement 40, ,188 Interest and fiscal charges 4, ,972 Total expenditures 12,129,738 1,739,565 1,035,346 11,474,138 Excess (deficiencies) of revenues over (under) expenditures 6,732,780 (795,144) 36,867 (10,770,338) OTHER FINANCING SOURCES (USES) Proceed from financing 260, ,160 Transfers in 3,059, ,944-10,416,333 Transfers out (12,312,568) (44,800) (36,867) (7,155) Total other financing sources (uses) (8,992,641) 795,144 (36,867) 10,770,338 Net change in fund balances (2,259,861) Fund balances - beginning 4,728, Fund balances - ending $ 2,468,568 $ - $ - $ -

58 Supervisor Tax of Elections Collector Total $ - $ - $ 12,047, , ,910,514 7,030 1,442,066 5,230,354 6,921 4, ,236 13,951 1,446,337 23,043, ,973 1,424,428 9,777, ,158, ,554, , , , , , , , , ,973 1,424,428 28,234,188 (417,022) 21,909 (5,190,948) , ,116-14,748,320 (15,094) (21,909) (12,438,393) 417,022 (21,909) 2,931, (2,259,861) - - 4,728,429 $ - $ - $ 2,468,568 I-46

59 COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL GENERAL FUND As of September 30, 2012 Board of County Commissioners Clerk of Circuit Court Budget Actual Budget Actual REVENUES Taxes $ 12,584,124 $ 12,047,581 $ - $ - Licenses and permits 271, , Intergovernmental 4,570,303 4,519, Charges for services 1,757,795 1,765,127 1,103, ,421 Miscellaneous 774, , Total revenues 19,957,224 18,862,518 1,103, ,421 EXPENDITURES Current General government 6,273,339 6,107, , ,917 Court related - - 1,103, ,648 Public safety 3,914,979 4,084, Physical environment 436, , Economic environment 481, , Culture and recreation 110, , Human services 687, , Capital outlay General government 429, , Public safety Debt Service Principal retirement 39,453 40, Interest and fiscal charges 6,047 4, Total expenditures 12,378,766 12,129,738 1,995,536 1,739,565 Excess (deficiencies) of revenues over (under) expenditures 7,578,458 6,732,780 (891,851) (795,144) OTHER FINANCING SOURCES (USES) Proceeds from Financing - 260, Transfers in 3,582,449 3,059, , ,944 Transfers out (11,798,259) (12,312,568) - (44,800) Total other financing sources (uses) (8,215,810) (8,992,641) 891, ,144 Net change in fund balances (637,352) (2,259,861) - - Fund balances - beginning - as restated 637,352 4,728, Fund balances - ending $ - $ 2,468,568 $ - $ -

60 Property Appraiser Sheriff Supervisor of Elections Budget Actual Budget Actual Budget Actual $ - $ - $ - $ - $ - $ , , ,080,154 1,071, , , ,329-6,921 1,080,154 1,072, , ,800-13,951 1,060,154 1,020, , , , , ,470,046 10,470, ,000 14, , , , , ,972 33, ,080,154 1,035,346 11,474,138 11,474, , ,973-36,867 (10,770,338) (10,770,338) (432,088) (417,022) , , ,416,333 10,416, , ,116 - (36,867) (7,155) (7,155) - (15,094) - (36,867) 10,770,338 10,770, , , $ - $ - $ - $ - $ - $ - I-47

61 COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (CONTINUED) GENERAL FUND As of September 30, 2012 Total Tax Collector Variance - Positive Budget Actual Budget Actual (Negative) REVENUES Taxes $ - $ - $ 12,584,124 $ 12,047,581 $ (536,543) Licenses and permits , ,555 (39,445) Intergovernmental - - 4,961,774 4,910,514 (51,260) Charges for services 1,237,528 1,442,066 5,179,162 5,230,354 51,192 Miscellaneous 256,705 4,271 1,343, ,236 (719,800) Total revenues 1,494,233 1,446,337 24,339,096 23,043,240 (1,295,856) EXPENDITURES Current General government 1,477,565 1,424,428 10,134,997 9,777, ,635 Court related - - 1,316,719 1,158, ,037 Public safety ,385,025 14,554,813 (169,788) Physical environment , ,774 19,744 Economic environment , ,823 1,564 Culture and recreation , ,182 (17,108) Human services , , ,526 Capital outlay General government 16, , ,818 53,319 Public safety , ,898 - Debt Service Principal retirement , ,159 (1,518) Interest and fiscal charges ,019 38,703 1,316 Total expenditures 1,494,233 1,424,428 28,854,915 28,234, ,727 Excess (deficiencies) of revenues over (under) expenditures - 21,909 (4,515,819) (5,190,948) (675,129) OTHER FINANCING SOURCES (USES) Proceeds from Financing , , ,000 Transfers in ,322,721 14,748,320 (574,401) Transfers out - (21,909) (11,805,414) (12,438,393) (632,979) Total other financing sources (uses) - (21,909) 3,878,467 2,931,087 (947,380) Net change in fund balances - - (637,352) (2,259,861) (1,622,509) Fund balances - beginning - as restated ,352 4,728,429 4,091,077 Fund balances - ending $ - $ - $ - $ 2,468,568 $ 2,468,568 I-48

62 COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds Law Court Local Enforcement Section 8 Technology Affordable Emergency Trust Housing Fund Housing 911 ASSETS Cash and cash equivalents $ 10,804 $ 51,757 $ 143,503 $ 431,489 $ 159 Receivables (net) - - 2,290 3,074 15,333 Total assets $ 10,804 $ 51,757 $ 145,793 $ 434,563 $ 15,492 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ - $ 375 $ 4,153 $ 25 $ 83,522 Accrued liabilities - 1,444-1,588 1,229 Other liabilities ,001 - Total liabilities - 1,819 4, ,614 84,751 Fund balances Assigned 10,804 49, ,640 16,949 - Unassigned (69,259) Total fund balances (deficits) 10,804 49, ,640 16,949 (69,259) Total liabilities and fund balances $ 10,804 $ 51,757 $ 145,793 $ 434,563 $ 15,492

63 Special Revenue Funds Port Labelle East Hendry East Hendry West Hendry East Hendry West Hendry Street County County County County County Lighting Drainage Fire Fire Mid-County Recreational Recreational Airport-Sears District District District District MSBU MSBU MSBU MSBU $ 14,885 $ 118,227 $ 101 $ 287,549 $ 461,758 $ 910 $ 275,536 $ 845, ,794 4, ,208 12,711 $ 14,885 $ 118,548 $ 187,895 $ 292,264 $ 462,317 $ 1,845 $ 995,744 $ 858,547 $ 5,756 $ 5,234 $ 393,870 $ 84,346 $ 10,890 $ 224,382 $ 447,038 $ 11, ,475 1,674-1,286 6, ,756 5, ,345 86,020 10, , ,662 11,086 9, , , , , , (207,450) - - (223,823) - - 9, ,314 (207,450) 206, ,427 (223,823) 542, ,461 $ 14,885 $ 118,548 $ 187,895 $ 292,264 $ 462,317 $ 1,845 $ 995,744 $ 858,547 I-49

64 COMBINING BALANCE SHEET (CONTINUED) NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds North Four Wheeler Hooker's Felda Labelle Property Corners Road Point MSBU MSBU Appraiser MSBU MSBU Lighting ASSETS Cash and cash equivalents $ 362,720 $ 409,528 $ 137,950 $ 592,799 $ 124,425 $ 15,781 Receivables (net) 67,794 50, , Total assets $ 430,514 $ 460,520 $ 137,950 $ 592,842 $ 135,277 $ 15,993 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 4,617 $ 7,685 $ 50,001 $ 2,768 $ 4,773 $ 999 Accrued liabilities Other liabilities Total liabilities 4,617 7,685 50,001 2,768 4, Fund balances Assigned 425, ,835 87, , ,504 14,994 Unassigned Total fund balances 425, ,835 87, , ,504 14,994 Total liabilities and fund balances $ 430,514 $ 460,520 $ 137,950 $ 592,842 $ 135,277 $ 15,993

65 Special Revenue Funds Clerk of Sheriff's Supervisor of Phillips Circuit Court's Sheriff's Sheriff's Equitable Elections Mosquito Road Modernization Gun Range Training Sharing Federal Sky Valley Control MSBU Trust Fund Fund Fund Program Fund Activities Fund MSBU $ 1,005,109 $ 3,638 $ 280,414 $ 10,643 $ 1,061 $ 9,734 $ - $ 324,556 9,689-41, $ 1,014,798 $ 3,638 $ 321,921 $ 10,643 $ 1,061 $ 9,734 $ - $ 324,556 $ 98,519 $ - $ 1,875 $ - $ - $ - $ - $ 1, , ,025-1, , ,773 3, ,046 10,643 1,061 9, , ,773 3, ,046 10,643 1,061 9, ,556 $ 1,014,798 $ 3,638 $ 321,921 $ 10,643 $ 1,061 $ 9,734 $ - $ 324,556 I-50

66 COMBINING BALANCE SHEET (CONTINUED) NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds LaBelle Building Fines and Airport Impact Fees Impact Fees Impact Fees Projects Forfeitures Fund Zone One Zone Two Zone Three ASSETS Cash and cash equivalents $ 140,215 $ 156,989 $ 93,003 $ 7,578 $ - $ - Receivables (net) 66, ,947 56, Total assets $ 206,616 $ 380,936 $ 149,237 $ 7,578 $ - $ - LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 150,440 $ 129,460 $ 17,980 $ - $ - $ - Accrued liabilities - 6, Other liabilities 2,000 1,500 28, Total liabilities 152, ,975 46, Fund balances Assigned - 243, ,473 7, Unassigned 54, Total fund balances 54, , ,473 7, Total liabilities and fund balances $ 206,616 $ 380,936 $ 149,237 $ 7,578 $ - $ -

67 Special Revenue Funds Impact Fees Impact Fees Impact Fees Impact Fees Impact Fees Impact Fees Impact Fees Law Impact Fees Pioneer Zone Four Zone Five School Board Administration West Park Enforcement Felda Fire Fire/EMS $ 41,108 $ 46,224 $ - $ 68,692 $ - $ 580 $ 775 $ $ 41,108 $ 46,224 $ - $ 68,692 $ - $ 580 $ 775 $ 771 $ - $ - $ - $ 68,692 $ - $ - $ - $ , ,108 46, ,108 46, $ 41,108 $ 46,224 $ - $ 68,692 $ - $ 580 $ 775 $ 771 I-51

68 COMBINING BALANCE SHEET (CONTINUED) NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds Total Impact Fees Non-Major Impact Fees Impact Fees Admin Governmental Public Buildings Library Phase II Funds ASSETS Cash and cash equivalents $ 1,412 $ 149 $ 107 $ 6,478,475 Receivables (net) ,475,611 Total assets $ 1,412 $ 149 $ 107 $ 7,954,086 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ - $ - $ 107 $ 1,809,593 Accrued liabilities ,863 Other liabilities ,263 Total liabilities ,282,719 Fund balances Assigned 1, ,117,723 Unassigned (446,356) Total fund balances 1, ,671,367 Total liabilities and fund balances $ 1,412 $ 149 $ 107 $ 7,954,086 I-52

69 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds Law Court Local Enforcement Section 8 Technology Affordable Emergency Trust Housing Fund Housing 911 REVENUES Intergovernmental $ - $ 260,691 $ - $ 98,942 $ 107,545 Taxes Charges for services - 11,549 33, ,184 Fines and forfeitures 1, Miscellaneous - - 4,512 1, Total revenues 1, ,240 38, , ,159 EXPENDITURES Current General Government Court Related , Public safety 9, ,647 Physical environment Transportation Economic environment - 294,975-98,942 - Culture and recreation Human Services Capital outlay General government Public safety ,406 Physical environment Transportation Debt service Principal retirement Interest and fiscal charges Total expenditures 9, ,975 46,578 98, ,053 Excess (deficiencies) of revenues over (7,753) (22,735) (8,488) 1,140 (313,894) (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out - - (40,750) - - Total other financing sources (uses) - - (40,750) - - Net change in fund balances (7,753) (22,735) (49,238) 1,140 (313,894) Fund balances - beginning 18,557 72, ,878 15, ,635 Fund balances - ending $ 10,804 $ 49,938 $ 141,640 $ 16,949 $ (69,259)

70 Special Revenue Funds Port Labelle East Hendry East Hendry West Hendry East Hendry West Hendry Street County County County County County Lighting Drainage Fire Fire Mid-County Recreational Recreational Airport-Sears District District District District MSBU MSBU MSBU MSBU $ - $ - $ - $ - $ - $ - $ 294, $ 57,364 39,651 44, , , , , ,885 96, , ,776 3,940 8,398 12,002 27,972 20,445 19,874 39,651 47, , , , , , , , , ,895 24, , , , , , ,556 44, ,973 2, ,895 24, , , , , ,410 76,955 (4,244) 23,684 (32,357) (12,252) 55,581 35,399 18,920 96, (4,983) (10,216) (4,983) (10,216) (4,244) 23,684 (37,340) (22,468) 55,581 35,399 18,920 96,588 13,373 89,630 (170,110) 228, ,846 (259,222) 523, ,873 $ 9,129 $ 113,314 $ (207,450) $ 206,244 $ 451,427 $ (223,823) $ 542,082 $ 847,461 I-53

71 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE (CONTINUED) NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds North Four Wheeler Hooker's Felda Labelle Property Corners Road Point MSBU MSBU Appraiser MSBU MSBU Lighting REVENUES Intergovernmental $ 67,794 $ 125,803 $ - $ - $ - $ - Taxes 23,071 47,727-17,292 79,606 11,094 Charges for services , Fines and forfeitures Miscellaneous 9,386 10, ,894 3, Total revenues 100, , ,369 31,186 82,613 11,498 EXPENDITURES Current General Government , Court Related Public safety Physical environment 10,190 73,608-15,542 19,323 10,155 Transportation Economic environment Culture and recreation Human Services Capital outlay General government 67, ,882 2, Public safety Physical environment Transportation Debt service Principal retirement ,579 - Interest and fiscal charges ,853 - Total expenditures 77, , ,500 15,542 67,755 10,155 Excess (deficiencies) of revenues over 22,267 (59,345) 22,869 15,644 14,858 1,343 (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses) Net change in fund balances 22,267 (59,345) 22,869 15,644 14,858 1,343 Fund balances - beginning 403, ,180 65, , ,646 13,651 Fund balances - ending $ 425,897 $ 452,835 $ 87,949 $ 590,074 $ 130,504 $ 14,994

72 Special Revenue Funds Clerk of Sheriff's Supervisor of Phillips Circuit Court's Sheriff's Sheriff's Equitable Elections Mosquito Road Modernization Gun Range Training Sharing Federal Sky Valley Control MSBU Trust Fund Fund Fund Program Fund Activities Fund MSBU $ 18,334 $ - $ 110,248 $ - $ - $ - $ - $ - 428, , ,680-2, , , , , ,248 10,680 7,404 2,465-20, , ,704 17, , , ,698-75,539 6,704 17, ,297 45, ,709 3,976 (9,603) 2,465 (28) 11, , ,709 3,976 (9,603) 2,465 (28) 11, ,091 3, ,337 6,667 10,664 7, ,299 $ 912,773 $ 3,638 $ 320,046 $ 10,643 $ 1,061 $ 9,734 $ - $ 323,556 I-54

73 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE (CONTINUED) NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds LaBelle Impact Impact Impact Building Fines and Airport Fees Fees Fees Projects Forfeitures Fund Zone One Zone Two Zone Three REVENUES Intergovernmental $ 25,000 $ 177,449 $ 45,967 $ - $ - $ - Taxes Charges for services - 394, , Fines and forfeitures - 295, Miscellaneous 55, ,460 1,885 4,096 4,329 - Total revenues 80, , ,488 4,096 4,329 - EXPENDITURES Current General Government 18,710 54, Court Related - 220, Public safety - 259, Physical environment Transportation , Economic environment Culture and recreation Human Services - 86, Capital outlay General government 42, Public safety - 80, Physical environment , ,376 - Transportation , Debt service Principal retirement , Interest and fiscal charges - - 8, Total expenditures 61, , , , ,376 - Excess (deficiencies) of revenues over 19, ,975 42,683 (171,317) (273,047) - (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in - 80, , Transfers out (150,000) (206,250) Total other financing sources (uses) (150,000) (125,795) 100, Net change in fund balances (130,179) 153, ,683 (171,317) (273,047) - Fund balances - beginning 184,355 90,781 (40,210) 178, ,047 - Fund balances - ending $ 54,176 $ 243,961 $ 102,473 $ 7,578 $ - $ -

74 Special Revenue Funds Impact Impact Impact Impact Impact Impact Fees Impact Impact Fees Fees Fees Fees Fees Fees Law Fees Pioneer Zone Four Zone Five School Board Administration West park Enforcement Felda Fire Fire/EMS $ - $ - $ - $ - $ - $ - $ - $ ,310 1,080-1, ,310 1,080-1, , , , , (97,237) 1,080 - (67,087) (97,237) 1,080 - (67,087) ,345 45,144-67, $ 41,108 $ 46,224 $ - $ - $ - $ 580 $ 775 $ 771 I-55

75 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE (CONTINUED) NONMAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds Total Impact Fees Impact Impact Fees Non-Major Public Fees Admin Governmental Buildings Library Phase II Funds REVENUES Intergovernmental $ - $ - $ - $ 1,389,137 Taxes ,862,758 Charges for services ,394,582 Fines and forfeitures ,294 Miscellaneous ,547 Total revenues ,332,318 EXPENDITURES Current General Government ,017 Court Related ,804 Public safety ,540,352 Physical environment ,720 Transportation ,979 Economic environment ,917 Culture and recreation ,011,968 Human Services ,999 Capital outlay General government ,600 Public safety ,574 Physical environment ,336 Transportation ,077 Debt service Principal retirement ,678 Interest and fiscal charges ,675 Total expenditures ,662,696 Excess (deficiencies) of revenues over 33 3 (103) (330,378) (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in ,455 Transfers out (412,199) Total other financing sources (uses) (231,744) Net change in fund balances 33 3 (103) (562,122) Fund balances - beginning 1, ,233,489 Fund balances - ending $ 1,412 $ 149 $ - $ 5,671,367 I-56

76 COMBINING SCHEDULE - BALANCE SHEET FIDUCIARY FUNDS As of September 30, 2012 Clerk of Tax Circuit Court Sheriff Collector Total ASSETS Cash and cash equivalents $ 803,470 $ 285,301 $ 465,995 $ 1,554,766 Accounts Receivable 2, ,521 Total assets $ 805,991 $ 285,301 $ 465,995 $ 1,557,287 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 276,518 $ - $ - $ 276,518 Deposits , ,936 Due to other governments 520,054 1,043 23, ,410 Due to individuals 9, ,258 15, ,423 Other liabilities Total liabilities 805, , ,995 1,557,287 Fund balances Unreserved, undesignated Total fund balances Total liabilities and fund balances $ 805,991 $ 285,301 $ 465,995 $ 1,557,287 I-57

77 STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FIDUCIARY FUNDS For the Year Ended September 30, 2012 Beginning Ending Balance Additions Deletions Balance Clerk of Circuit Court ASSETS Cash and cash equivalents $ 956,972 $ 6,682,256 $ 6,835,758 $ 803,470 Accounts Receivable 30,378 55,170 83,027 2,521 Total assets $ 987,350 $ 6,737,426 $ 6,918,785 $ 805,991 LIABILITIES Accounts payable $ 372,213 $ 2,318,726 $ 2,414,421 $ 276,518 Due to other governments 607, ,912 1,009, ,054 Due to individuals 7,909 10,293 8,783 9,419 Total liabilities $ 987,350 $ 3,250,931 $ 3,432,290 $ 805,991 Sheriff ASSETS Cash and cash equivalents $ 220,754 $ 1,001,918 $ 937,371 $ 285,301 Total assets $ 220,754 $ 1,001,918 $ 937,371 $ 285,301 LIABILITIES Due to other governments $ 3,753 $ 4,078 $ 6,788 $ 1,043 Due to individuals 217, , , ,258 Total liabilities $ 220,754 $ 1,001,918 $ 937,371 $ 285,301 Tax Collector ASSETS Cash and cash equivalents $ 607,332 $ 56,119,282 $ 56,260,619 $ 465,995 Total assets $ 607,332 $ 56,119,282 $ 56,260,619 $ 465,995 LIABILITIES Due to other governments $ 42,978 $ 10,158,409 $ 10,178,074 $ 23,313 Due to individuals 51, , ,317 15,746 Due to other funds - 7,590 7,590 - Deposits 513,247 46,072,483 46,158, ,936 Total liabilities $ 607,332 $ 57,200,438 $ 57,341,775 $ 465,995

78 STATEMENT OF CHANGES IN ASSETS AND LIABILITIES (CONTINUED) FIDUCIARY FUNDS For the Year Ended September 30, 2012 Beginning Ending Balance Additions Deletions Balance TOTAL ASSETS Cash and cash equivalents $ 1,785,058 $ 63,803,456 $ 64,033,748 $ 1,554,766 Accounts Receivable 30,378 55,170 83,027 2,521 Total assets $ 1,815,436 $ 63,858,626 $ 64,116,775 $ 1,557,287 LIABILITIES Accounts payable $ 372,213 $ 2,318,726 $ 2,414,421 $ 276,518 Due to other governments 653,959 11,084,399 11,193, ,410 Due to individuals 276,017 1,970,089 1,936, ,423 Due to other funds - 7,590 7,590 - Deposits 513,247 46,072,483 46,158, ,936 Total liabilities $ 1,815,436 $ 61,453,287 $ 61,711,436 $ 1,557,287 I-58

79 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards To the Board of County Commissioners and the Constitutional Officers of Hendry County, Florida We have audited the financial statements of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of Hendry County, Florida (the County ) as of and for the fiscal year ended September 30, 2012, which collectively comprise the County s basic financial statements and have issued our report thereon dated June 17, We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the County s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the County s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the County s internal control over financial reporting. A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A significant deficiency is a control deficiency, or a combination of control deficiencies, that adversely affects the County s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the County s financial statements that is more than inconsequential will not be prevented or detected by the County s internal control. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the County s internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. I-59

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81 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Management Letter To the Board of County Commissioners and the Constitutional Officers of Hendry County, Florida We have audited the financial statements of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of Hendry County, Florida (the County ) as of and for the fiscal year ended September 30, 2012, which collectively comprise of County s basic financial statements and have issued our report thereon dated June 17, We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. We have issued our Independent Auditor's Report on Internal Control over Financial Reporting and Compliance and Other Matters, Independent Auditor s Report on Compliance with Requirements Applicable to each Major Federal Program and State Project and on Internal Control over Compliance, and Schedule of Findings and Questioned Costs. Disclosures in those reports and schedule, which are dated June 17, 2013, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter , Rules of the Auditor General, which govern the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditor s reports or schedule: Section (1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were multiple comments in the prior year. Reference to whether corrective actions have been taken is provided in separate management letters for each County agency. Section (1)(i)2., Rules of the Auditor General, require our audit to include a review of the provisions of Section , Florida Statutes, regarding the investment of public funds. In connection with our audit, we determined that the County complied with Section , Florida Statutes. Section (1)(i)3., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. Reference to recommendations is provided in separate management letters for each County agency. I-61

82

83 BOARD OF COUNTY COMMISSIONERS September 30, 2012 SPECIAL PURPOSE FINANCIAL STATEMENTS, TOGETHER WITH REPORTS OF INDEPENDENT AUDITORS

84 TABLE OF CONTENTS REPORT OF INDEPENDENT AUDITORS BASIC FINANCIAL STATEMENTS GOVERNMENT-WIDE FINANCIAL STATEMENTS Statement of Net Assets Statement of Activities FUND FINANCIAL STATEMENTS Balance Sheet Governmental Funds Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets Statement of Revenues, Expenditures and Changes in Fund Balance Governmental Funds Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Statement of Revenues, Expenses and Changes in Fund Balance Budget and Actual General Fund Statement of Revenues, Expenses and Changes in Fund Balance Budget and Actual County Transportation Trust Statement of Revenues, Expenses and Changes in Fund Balance Budget and Actual Solid Waste Disposal Fund Statement of Revenues, Expenses and Changes in Fund Balance Budget and Actual Capital Projects Fund Statement of Net assets Proprietary Fund Statement of Revenues, Expenses and Changes in Fund Net Assets Proprietary Fund Statement of Cash Flows Proprietary Fund NOTES TO FINANCIAL STATEMENTS II-1 II-2 II-3 II-4 II-5 II-6 II-7 II-8 II-9 II-10 II-11 II-12 II-13 II-14 II-15 II-16 II-17 II-36 REQUIRED SUPPLEMENTARY INFORMATION COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES NON-MAJOR GOVERNMENTAL FUNDS Combining Balance Sheet Non-major Governmental Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balance Non-major Governmental Funds INDEPENDENT AUDITORS REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS MANAGEMENT LETTER RESPONSE TO MANAGEMENT LETTER II-37 II-40 II-41 II-44 II-45 II-46 II-47 II-48 II 49

85 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report To the Honorable Board of County Commissioners Of Hendry County, Florida: We have audited the accompanying financial statements of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of Hendry County, Florida Board of County Commissioners (the Board ) as of and for the fiscal year ended September 30, 2012, which collectively comprise the Board 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 to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of the Board, as of September 30, 2012, and the respective changes in financial position and cash flows, where applicable, thereof and the respective budgetary comparison for the General Fund, County Transportation Trust Fund, Solid Waste Disposal Fund, Disaster Relief Fund, and Capital Projects Fund for the fiscal year then ended in conformity with accounting principles generally accepted in the United States of America. As discussed in Note 1, the Board adopted Statement of Governmental Accounting Standards No. 54, Fund Balance Reporting and Governmental Fund Type Definitions, for the year end September 30, In accordance with Government Auditing Standards, we have also issued our report dated June 17, 2013 on our consideration of the Board s internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. II-1

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87 BOARD OF COUNTY COMMISSIONERS STATEMENT OF NET ASSETS September 30, 2012 Primary Government Component Units Governmental Business-type Activities Activities Total ASSETS Cash and cash equivalents $ 11,165,978 $ 723,588 $ 11,889,566 $ 9,811 Investments, at fair value 5,167,033-5,167,033 - Receivables, net 13,556,564 4,313,662 17,870,226 - Inventory - 5,433 5,433 - Restricted assets: Investments, at fair value - 2,823,969 2,823,969 - Capital assets: Non-depreciable 5,978, ,006 6,515,402 - Depreciable, net 49,147,259 24,079,500 73,226,759 - Total assets 85,015,230 32,483, ,498,388 9,811 LIABILITIES Accounts payable 11,593,974 1,074,298 12,668,272 - Accrued liabilities 99,633 39, ,253 - Deposits 574, ,488 - Liabilities payable from restricted assets: Current portion of long-term debt 250, , ,610 - Customer deposits - 164, ,014 - Noncurrent liabilities: Due in more than one year 1,598,617 9,687,828 11,286,445 - Total liabilities 14,116,778 11,222,304 25,339,082 - NET ASSETS Invested in capital assets, net of related debt 54,162,298 14,701,728 68,864,026 - Restricted for: Capital projects 1,044,209-1,044,209 - Unrestricted 15,691,945 6,559,126 22,251,071 9,811 Total net assets $ 70,898,452 $ 21,260,854 $ 92,159,306 $ 9,811 The accompanying notes to the financial statements are an integral part of this statement. II-3

88 BOARD OF COUNTY COMMISSIONERS STATEMENT OF ACTIVITIES September 30, 2012 Program Revenues Operating Capital Charges for Grants and Grants and Functions/Programs Expenses Services Contributions Contributions Primary government: Governmental activities : General government $ 7,796,221 $ 1,725,922 $ 972,404 $ 57,364 Court related 300, Public safety 6,220, , ,748 - Physical environment 3,180, , ,122 - Transportation 7,882,313 1,484,690 2,624,825 98,294 Economic environment 971,916 11, ,691 - Culture and recreation 1,222,227 13, ,434 - Human services 1,858,869-32, ,358 Interest on long-term debt 31, Total governmental activities 29,465,200 4,462,034 4,791, ,016 Business-type activities : Water and Wastewater 2,425,493 1,166, Total business-type activities 2,425,493 1,166, Total primary government $ 31,890,693 $ 5,628,616 $ 4,791,908 $ 672,016 General revenues : Property taxes Gasoline taxes Communications taxes Other taxes Intergovernmental revenues Interest income Miscellaneous Transfers Total general revenues and transfers Change in net assets Net assets, beginning Net assets, ending The accompanying notes to the financial statements are an integral part of this statement.

89 Net (Expense) Revenue and Changes in Net Assets Primary Government Governmental Business-type Component Activities Activities Total Units $ (5,040,531) $ - $ (5,040,531) $ - (300,976) - (300,976) - (4,666,110) - (4,666,110) - (2,761,347) - (2,761,347) - (3,674,504) - (3,674,504) - (699,676) - (699,676) - (1,054,867) - (1,054,867) - (1,309,827) - (1,309,827) - (31,406) - (31,406) - (19,539,242) - (19,539,242) - - (1,258,911) (1,258,911) - - (1,258,911) (1,258,911) - (19,539,242) (1,258,911) (20,798,153) - 11,842,982-11,842,982-1,109,862-1,109, , ,599-6,679,805-6,679,805-7,011,394-7,011, ,332 8, , ,084 53, ,607 - (11,302,568) - (11,302,568) - 16,829,490 62,125 16,891, (2,709,752) (1,196,786) (3,906,538) 22 73,608,204 22,457,640 96,065,844 9,789 $ 70,898,452 $ 21,260,854 $ 92,159,306 $ 9,811 II-4

90 BOARD OF COUNTY COMMISSIONERS BALANCE SHEET GOVERNMENTAL FUNDS September 30, 2012 County Solid Transportation Waste General Trust Disposal ASSETS Cash and cash equivalents $ 995,284 $ 2,165,835 $ 98,849 Investments 5,167, Receivables (net) 3,168,001 1,912,896 6,036,773 Total assets $ 9,330,318 $ 4,078,731 $ 6,135,622 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 6,714,178 $ 1,563,615 $ 234,367 Accrued liabilities 44,856 28,603 4,134 Other liabilities 102, Fund balances Total liabilities 6,861,750 1,592, ,501 Committed 5,000, Assigned - 2,486,513 5,897,121 Unassigned (2,531,432) - - Total fund balances 2,468,568 2,486,513 5,897,121 Total liabilities and fund balances $ 9,330,318 $ 4,078,731 $ 6,135,622 ` The accompanying notes to the financial statements are an integral part of this statement.

91 Other Total Airglades Capital Governmental Governmental Airport Projects Funds Funds $ 625,265 $ 1,242,072 $ 6,038,673 $ 11,165, ,167, , ,470 1,434,104 13,556,564 $ 990,585 $ 1,881,542 $ 7,472,777 $ 29,889,575 $ 486,764 $ 837,333 $ 1,757,717 $ 11,593, ,863 99,633 20, , , , ,333 2,230,843 12,268, ,000, ,135 1,044,209 5,688,290 15,599,268 - (446,356) (2,977,788) 483,135 1,044,209 5,241,934 17,621,480 $ 990,585 $ 1,881,542 $ 7,472,777 $ 29,889,575 II-5

92 BOARD OF COUNTY COMMISSIONERS RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS September 30, 2012 Fund Balances - total governmental funds $ 17,621,480 Capital assets used in governmental activities are not financial resources and are therefore not reported in the governmental funds Non-depreciable governmental capital assets $ 5,978,396 Depreciable governmental capital assets, net 49,147,259 55,125,655 Long-term liabilities including bonds payable are not due and payable in the current period and therefore are not reported in the governmental funds Notes payable (963,357) Landfill closure (243,392) Other Post Employment Benefits (342,108) Compensated absences payable (299,826) (1,848,683) Net assets of governmental activities $ 70,898,452 The accompanying notes to the financial statements are an integral part of this statement. II-6

93 BOARD OF COUNTY COMMISSIONERS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 County Solid Transportation Waste General Trust Disposal REVENUES Taxes $ 12,047,581 $ 1,109,862 $ 1,768,876 Licenses and permits 231, Intergovernmental 4,519,043 4,675,904 70,588 Charges for services 1,765, , ,221 Fines and forfeitures Miscellaneous 299,212 61, ,526 Total revenues 18,862,518 6,277,924 2,233,211 EXPENDITURES Current General government 6,107, Court related Public safety 4,084, Physical environment 416,774-1,801,577 Transportation - 5,432,768 - Economic environment 479, Culture and recreation 127, Human services 469, Capital outlay General government 398, Public safety Physical environment Transportation - 929,858 - Debt service Principal retirement 40, Interest and fiscal charges 4, Total expenditures 12,129,738 6,362,626 1,801,577 Excess (deficiencies) of revenues over (under) expenditures 6,732,780 (84,702) 431,634 OTHER FINANCING SOURCES (USES) Proceeds from debt 260, Transfers in 3,059, Transfers out (12,312,568) (103,569) - Total other financing sources (uses) (8,992,641) (103,569) - Net change in fund balances (2,259,861) (188,271) 431,634 Fund balances - beginning 4,728,429 2,674,784 5,465,487 Fund balances - ending $ 2,468,568 $ 2,486,513 $ 5,897,121 The accompanying notes to the financial statements are an integral part of this statement.

94 Other Total Airglades Capital Governmental Governmental Airport Projects Funds Funds $ - $ 2,048,171 $ 2,862,758 $ 19,837, , , ,337 1,278,889 11,946, ,054-1,256,426 4,530, , , , , ,785 1,240,356 1,519,129 3,114,820 6,076,152 38,083, ,667 72,989 6,844, , , ,516,641 5,601, ,720 2,951,071 1,147, ,979 7,439, , , ,011,968 1,139, , , , ,100 1,095, , , , , ,775-61,077 1,860, , , ,675 31,406 2,017,683 1,081,778 6,460,918 29,854,320 (498,554) 2,033,042 (384,766) 8,229, , ,455 3,240,382 - (1,974,614) (412,199) (14,802,950) - (1,974,614) (231,744) (11,302,568) (498,554) 58,428 (616,510) (3,073,134) 981, ,781 5,858,444 20,694,614 $ 483,135 $ 1,044,209 $ 5,241,934 $ 17,621,480 II - 7

95 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES GOVERNMENTAL FUNDS For the Year ended September 30, 2012 Net change in fund balances - total governmental funds: $ (3,073,134) Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation or amortization expense. This is the amount by which depreciation, amortization and capital asset adjustments were below capital outlays in the current period. 222,287 Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net assets. Principal payments 199,649 Landfill Closure 34,997 Other Post Employment Benefits (84,437) Certain expenses reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. Change in compensated absences (9,114) Change in net assets of governmental activities $ (2,709,752) The accompanying notes to the financial statements are an integral part of this statement. II - 8

96 BOARD OF COUNTY COMMISSIONERS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL GENERAL FUND For the Year Ended September 30, 2012 Budgeted Amounts Actual Variance with Original Final Amounts Final Budget - REVENUES Taxes $ 12,875,124 $ 12,584,124 $ 12,047,581 $ (536,543) Licenses and permits 271, , ,555 (39,445) Intergovernmental 4,563,882 4,570,303 4,519,043 (51,260) Charges for services 1,743,500 1,757,795 1,765,127 7,332 Miscellaneous 457, , ,212 (474,790) Total revenues 19,910,556 19,957,224 18,862,518 (1,094,706) EXPENDITURES Current General government 6,321,177 6,273,339 6,107, ,008 Public safety 3,169,196 3,914,979 4,084,767 (169,788) Physical environment 436, , ,774 19,744 Economic environment 398, , ,823 1,564 Culture and recreation 110, , ,182 (17,108) Human services 692, , , ,526 Capital outlay General government 93, , ,185 31,284 Debt service Principal retirement 43,500 39,453 40,971 (1,518) Interest and fiscal charges 2,000 6,047 4,731 1,316 Total expenditures 11,266,716 12,378,766 12,129, ,028 Excess of revenues over expenditures 8,643,840 7,578,458 6,732,780 (845,678) OTHER FINANCING SOURCES (USES): Other Financing Sources , ,000 Transfers in 3,206,838 3,582,449 3,059,927 (522,522) Transfers out (12,298,259) (11,798,259) (12,312,568) (514,309) Total other financing sources (uses) (9,091,421) (8,215,810) (8,992,641) (776,831) Net change in fund balance (447,581) (637,352) (2,259,861) (1,622,509) Fund balance - beginning 447, ,352 4,728,429 4,091,077 Fund balance - ending $ - $ - $ 2,468,568 $ 2,468,568 The accompanying notes to the financial statements are an integral part of this statement. II - 9

97 BOARD OF COUNTY COMMISSIONERS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL COUNTY TRANSPORTATION TRUST For the Year Ended September 30, 2012 Budgeted Amounts Actual Variance with Original Final Amounts Final Budget - REVENUES Taxes $ 1,176,529 $ 1,176,529 $ 1,109,862 $ (66,667) Intergovernmental 6,382,968 6,382,968 4,675,904 (1,707,064) Charges for services 357, , ,025 74,025 Miscellaneous 31,800 31,800 61,133 29,333 Total revenues 7,948,297 7,948,297 6,277,924 (1,670,373) EXPENDITURES Current Transportation 9,163,111 9,143,016 5,432,768 3,710,248 Capital outlay General government 2,542,933 2,165, ,858 1,235,752 Total expenditures 11,706,044 11,308,626 6,362,626 4,946,000 Excess (deficiencies) of revenues over (under) expenditures (3,757,747) (3,360,329) (84,702) 3,275,627 OTHER FINANCING SOURCES Transfers in 745, ,239 (103,569) (848,808) Total other financing sources 745, ,239 (103,569) (848,808) Net change in fund balance (3,012,508) (2,615,090) (188,271) 2,426,819 Fund balance - beginning 3,012,508 2,615,090 2,674,784 59,694 Fund balance - ending $ - $ - $ 2,486,513 $ 2,486,513 The accompanying notes to the financial statements are an integral part of this statement. II - 10

98 BOARD OF COUNTY COMMISSIONERS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL SOLID WASTE DISPOSAL For the Year Ended September 30, 2012 Budgeted Amounts Actual Variance with Original Final Amounts Final Budget - REVENUES Taxes $ 1,845,482 $ 1,845,482 1,768,876 $ (76,606) Intergovernmental 70,588 70,588 70,588 - Charges for services 286, , ,221 (38,583) Miscellaneous , ,526 Total revenues 2,202,874 2,202,874 2,233,211 30,337 EXPENDITURES Current Physical environment 2,240,687 2,240,687 1,801, ,110 Capital outlay General government 877, , ,500 Total expenditures 3,118,187 3,118,187 1,801,577 1,316,610 Excess (deficiencies) of revenues over (under) expenditures (915,313) (915,313) 431,634 1,346,947 Net change in fund balance (915,313) (915,313) 431,634 1,346,947 Fund balance - beginning 915, ,313 5,465,487 4,550,174 Fund balance - ending $ - $ - $ 5,897,121 $ 5,897,121 The accompanying notes to the financial statements are an integral part of this statement. II - 11

99 BOARD OF COUNTY COMMISSIONERS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL AIRGLADES AIRPORT For the Year Ended September 30, 2012 Budgeted Amounts Actual Variance with Original Final Amounts Final Budget - REVENUES Intergovernmental $1,538,563 $1,538,563 $491,687 ($1,046,876) Charges for services 635, , ,054 44,501 Miscellaneous 165, , ,388 9,149 Total revenues 2,339,855 2,512,355 1,519,129 (993,226) EXPENDITURES Current Transportation 906,094 1,078,594 1,147,908 (69,314) Capital outlay General government 3,377,126 3,216, ,775 2,346,855 Total expenditures 4,283,220 4,295,224 2,017,683 2,277,541 Excess (deficiencies) of revenues over (under) expenditures (1,943,365) (1,782,869) (498,554) 1,284,315 OTHER FINANCING SOURCES Transfers in 566, ,000 - (566,000) Total other financing sources 566, ,000 - (566,000) Net change in fund balance (1,377,365) (1,216,869) (498,554) 718,315 Fund balance - beginning 1,377,365 1,216, ,689 (235,180) Fund balance - ending $ - $ - $ 483,135 $ 483,135 The accompanying notes to the financial statements are an integral part of this statement. II - 12

100 BOARD OF COUNTY COMMISSIONERS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL CAPITAL PROJECTS For the Year Ended September 30, 2012 Budgeted Amounts Actual Variance with Original Final Amounts Final Budget - REVENUES Taxes $ 1,939,565 $ 1,939,565 $ 2,048,171 $ 108,606 Intergovernmental - 1,461, ,337 (551,013) Miscellaneous , ,312 Total revenues 1,939,565 3,400,915 3,114,820 (286,095) EXPENDITURES Current General government - 1,157, , ,599 Capital outlay General government 100, , ,111 38,689 Debt service Principal retirement 52,453 52,453-52,453 Interest and fiscal charges 2,835 2,835-2,835 Total expenditures 155,288 1,668,354 1,081, ,576 Excess (deficiencies) of revenues over 1,784,277 1,732,561 2,033, ,481 (under) expenditures OTHER FINANCING (USES) Transfers out (1,846,771) (1,974,614) (1,974,614) - Total other financing sources (uses) (1,846,771) (1,974,614) (1,974,614) - Net change in fund balance (62,494) (242,053) 58, ,481 Fund balance - beginning 62, , , ,728 Fund balance - ending $ - $ - $ 1,044,209 $ 1,044,209 The accompanying notes to the financial statements are an integral part of this statement. II - 13

101 BOARD OF COUNTY COMMISSIONERS STATEMENT OF NET ASSETS PROPRIETARY FUND For the Year Ended September 30, 2012 Business-type Activities Enterprise Fund Port Labelle Utility System ASSETS Current Assets Cash and cash equivalents $ 723,588 Receivables (net) 4,313,662 Inventory 5,433 Restricted Assets: Investments at fair value 2,823,969 Total current assets 7,866,652 Noncurrent Assets Capital Assets Non-depreciable 537,006 Depreciable 29,197,139 Less accumulated depreciation (5,117,639) Total noncurrent assets 24,616,506 Total assets 32,483,158 The accompanying notes to the financial statements are an integral part of this statement.

102 Business-type Activities Enterprise Fund Port Labelle Utility System LIABILITIES Current liabilities Accounts payable $ 1,074,298 Accrued liabilities 39,620 Total current liabilities 1,113,918 Current liabilities payable from restricted assets Current portion of long-term debt 256,544 Customer deposits 164,014 Total current liabilities payable from restricted assets 420,558 Noncurrent liabilities Accrued compensated absences 29,594 Bonds and notes payable 9,658,234 Total noncurrent liabilities 9,687,828 Total liabilities 11,222,304 NET ASSETS Invested in capital assets, net of related debt 14,701,728 Unrestricted 6,559,126 Total net assets $ 21,260,854 II - 14

103 BOARD OF COUNTY COMMISSIONERS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUND For the Year Ended September 30, 2012 Business-type Activities Enterprise Fund Port Labelle Utility System OPERATING REVENUES Charges for services $ 1,165,366 Special assessments 1,216 Miscellaneous 53,523 Total operating revenues 1,220,105 Operating expenses Personal services 368,880 Contractual services 74,495 Repairs and maintenance 78,223 Office 24,144 Supplies 65,562 Utilities 221,407 Other expense 77,572 Total operating expenses 910,283 Operating income 309,822 Non-operating revenues (expenses) Depreciation and amortization (973,306) Interest revenue 8,602 Interest and fiscal charges (541,904) Total non-operating (expenses) (1,506,608) Change in net assets (1,196,786) Total net assets - beginning 22,457,640 Total net assets - ending $ 21,260,854 The accompanying notes to the financial statements are an integral part of this statement. II-15

104 BOARD OF COUNTY COMMISSIONERS STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For the Year Ended September 30, 2012 Business-type Activities Enterprise Funds Port LaBelle Utility System CASH FLOWS FROM OPERATING ACTIVITIES: Cash received from customers $ 4,215,861 Cash payments to suppliers for goods and services (496,388) Cash payments to employees for services (366,097) Net cash provided by operating activities 3,353,376 CASH FLOWS FROM CAPITAL, NON-CAPITAL AND RELATED FINANCING ACTIVITIES: Deposits collected from customers less deposits refunded to customers 118,661 Repayment of amounts borrowed from governmental funds (2,664,064) Principal paid on notes payable and revenue bonds (242,482) Interest paid on revenue bonds (541,904) Net cash used in capital financing activities (3,329,789) CASH FLOWS FROM INVESTING ACTIVITIES: Acquisition of capital assets (64,466) Interest on investments 8,602 Net cash provided by investing activities (55,864) Net decrease in cash and cash equivalents (32,277) Cash and cash equivalents at beginning of year 755,865 Cash and cash equivalents at end of year $ 723,588 The accompanying notes to the financial statements are an integral part of this statement. II-16

105 BOARD OF COUNTY COMMISSIONERS STATEMENT OF CASH FLOWS PROPRIETARY FUNDS (Continued) For the Fiscal Year Ended September 30, 2012 Business-type Activities Enterprise Funds Port LaBelle Utility System Reconciliation of operating income to net cash provided by operating activities: Operating income $ 309,822 Adjustments to reconcile operating income to net cash provided by operating activities: Changes in assets and liabilities: (Increase) in: Accounts receivable 3,049,279 Increase (decrease) in: Accounts payable (4,253) Accrued liabilities (1,472) Total adjustments 3,043,554 Net cash provided by operating activities $ 3,353,376 The accompanying notes to the financial statements are an integral part of this statement.

106 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity Hendry County (the County ) was created in 1923 by the Laws of Florida 1923, Chapter as amended, Section 7.26, Florida Statutes and is a political subdivision of the State of Florida. It is governed by an elected Board of County Commissioners (the Board ) which is a body of elected Constitutional Officers of Hendry County. Based on the criteria set forth by the Governmental Accounting Standards Board, the Board is a part of the County s primary government and its financial statements are included in the basic financial statements of Hendry County, Florida. However, Chapter 11.45, of the Florida Statutes defines the Board as a County agency. For the purposes of that section, County agencies are treated as local governmental agencies. Section , Rules of the Auditor General for Local Governmental Entity Audits, requires a separate financial audit report for each County agency. The accounts of the Board do not constitute a complete presentation of the County, but present only the financial position and results of operations of the Board. The accompanying financial statements present the combined financial position and results of operations of the County, by major fund, and non-major funds in aggregate, that are governed by the Board. As required by accounting principles generally accepted in the United States of America, the financial statements of the reporting entity include those of Hendry County (the primary government) and its component units. A component unit is a legally separate organization for which the elected officials of the primary government are financially accountable. In addition, a component unit may be another organization for which the nature and significance of its relationship with a primary government is such that exclusion would cause the reporting entity s financial statements to be misleading or incomplete. In conformity with accounting principles generally accepted in the United States of America, the financial statements of the component units have been included in the financial reporting entity as a discretely presented component unit. Discretely Presented Component Unit Hendry County Industrial Development Authority is a predominantly dormant organization which convenes on an as needed basis. By Resolution 83-43, dated March 8, 1983, the Board appoints the members of the Authority and provides the funding for the Authority s operations when the Authority s approval is necessary to issue Industrial Revenue Bonds for development in the County. Hendry County Economic Development Council, Inc. (the Council) was incorporated on August 29, 1997 with operations beginning October 1, 1997 as a Florida not-for-profit corporation. The Council s purpose is to promote, develop, stimulate, and coordinate the economic development activities of governments, businesses, and educational institutions in Hendry County. The Council s mission is also to address issues affecting the economic development in Hendry County, as well as, to heighten community awareness of the related economic effect concerning these issues. II-17

107 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Discretely Presented Component Unit (Continued) The Council acts as an advocate for the promotion of the professions and skills necessary to sustain and expand economic growth by promoting, encouraging and coordinating education and vocational training in Hendry County. Complete financial information of the individual component units can be obtained directly from the Authority or the Council. Government-Wide and Fund Financial Statements The government-wide financial statements and the major-fund financial statements along with the notes to the financial statements comprise the basic financial statements. The government-wide financial statements (the statement of net assets and the statement of activities) report on the Board as a whole and do not emphasize fund types but rather a governmental or a business-type classification, which are presented in separate columns. These statements report on the Board as a whole, both the primary government and its component units, and provide a consolidated financial picture of the Board of County Commissioners. As part of the consolidation process, inter-fund activities are eliminated to avoid distorted financial results. The Statement of Net Assets reports all financial and capital resources of the Board s governmental and business-type activities. It is presented in a net assets format (assets less liabilities equal net assets) and shown with three components: amounts invested in capital assets, net of related debt; restricted net assets; and unrestricted net assets. The statement of activities reflects the expenses of a given function or segment, which are offset by program revenues. Program revenues are defined as charges for services, operating grants and contributions, and capital grants and contributions directly associated with a given function. Taxes are reported under general revenue. Program revenues are classified into three categories; charges for services, operating grants and contributions, and capital grants and contributions. Charges refer to direct recovery from customers for services rendered. Grants and contributions refer to revenues restricted for specific programs whose use may be restricted further to operational or capital items. The general revenues section displays revenue collected that helps support all functions of our government and contribute to the change in the net assets for the fiscal year. The Board s major funds are presented in separate columns on the governmental fund financial statements and the proprietary fund financial statements. The definition of a major fund is one that meets certain criteria setforth in GASB 34. The funds that do not meet the criteria of a major fund are considered non-major funds and are combined into a single column on the fund financial statements. II-18

108 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Measurement Focus, Basis of Accounting, and Financial Statement Presentation The accounts of the Board are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity or retained earnings, revenues, and expenditures or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. Basis of accounting refers to when revenues and expenditures, or expenses, are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. The government-wide financial statements are prepared on a full accrual basis using the economic resources measurement focus, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred. Property taxes are recognized in the year for which they are levied. Grants and similar items are recognized as revenues as soon as all of the eligibility requirements have been met. Proprietary funds record both operating and non-operating revenues and expenses. Operating revenues are those that are obtained from the operations of the proprietary fund and include user fees. Non-operating revenues are not related to the operations of the proprietary fund and include interest and other miscellaneous earnings. Operating expenses represent the cost of operations, which includes depreciation. Non-operating expenses are not related to operations such as interest expense. Governmental fund financial statements are prepared on the modified accrual basis using the current financial resources measurement focus. Under the modified accrual basis, revenues are recognized when they become measurable and available as net current assets. The Board considers all revenues available if they are collected within sixty days after year-end. Primary revenues, such as property taxes, special assessments, intergovernmental revenues, charges for services, sales and franchise taxes, rents, and interest are treated as susceptible to accrual under the modified accrual basis and have been recognized as revenues. Expenditures reported in governmental fund financial statements are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. An exception to this general rule includes principal and interest on general long-term debt, which is recognized when due. The business-type activities reported in the government-wide financial statements and proprietary funds follow private sector standards issued prior to December 1, 1989, to the extent those standards do not conflict with Governmental Accounting Standards Board statements. II-19

109 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued) However, pursuant to Government Accounting Standards Board Statement Number 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities That Use Proprietary Fund Accounting, the Board has elected not to apply accounting standards issued after November 30, 1989, by the Financial Accounting Standards Board. When both restricted and unrestricted resources are available, restricted resources will be used first for incurred expenses, and then unrestricted as needed. The Board reports the following major funds in the governmental fund financial statements: General Fund The General Fund is the general operating fund of the Board that is used to account for all financial resources, except those required to be accounted for in another fund. County Transportation Trust Fund The County Transportation Trust Fund construction and maintenance of roadways. accounts for revenues received and expended for the Solid Waste Disposal Fund The Solid Waste Disposal Fund is used to account for the activities related to the solid waste disposal program. Airglades Airport Fund The Airglades Airport Fund is used to account for the activities related to the construction and maintenance of the Airglades Airport. Capital Projects Fund The Capital Projects Fund accounts for revenues received from the infrastructure surtax. Non-major Governmental Funds The non-major governmental funds are a combination of special revenue, debt service, and capital projects funds. II-20

110 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued) Budgets and Budgetary Accounting Chapters 129 and 200 of the Florida Statutes govern the preparation, adoption and administration of the Board s annual budget. The budget is required to be balanced; that is; the total of the estimated revenues, including balances brought forward, shall equal the total of the appropriations and reserves. The following procedures are followed by the Board in establishing the operating budget: (1) On or before July 15, a tentative budget for the fiscal year commencing the following October 1 is presented to the Board. (2) The tentative budget is reviewed by the Board and any necessary changes are made. (3) Public hearings are conducted to inform the taxpayers of the tentative budget and proposed tax levies and to obtain taxpayer comments. (4) On or before September 30, the budget is legally adopted through passage of a resolution. (5) (6) (7) (8) (9) Section of the Florida Statutes prohibits incurring expenditures in excess of total fund appropriations. Formal budgetary integration is employed as a management control device during the year in all Governmental Fund Types. Estimated beginning fund balances are considered in the budgetary process, but are not included in the financial statements as budgeted revenue. Budgets for General, Special Revenue, Debt Service and Capital Projects Funds are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Formal budgetary integration is employed as a management control device during the year in all Governmental Fund Types. Estimated beginning fund balances are considered in the budgetary process, but are not included in the financial statements as budgeted revenue. Budgets for General, Special Revenue, Debt Service and Capital Projects Funds are adopted on a basis consistent with accounting principles generally accepted in the United States of America. The annual budgets serve as the legal authorization for expenditures. Expenditures cannot legally exceed the total amount budgeted for each fund. The Board must approve all budget amendments, which change the legally adopted total appropriation for a fund. If, during the fiscal year, additional revenues become available for appropriation in excess of those estimated in the budget, the Board may make supplemental appropriations by resolution for the year up to the amount of such excess. During the fiscal year the Board, in accordance with Florida Statutes, approved various supplemental appropriations. Appropriations lapse at fiscal year-end. II-21

111 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Assets, Liabilities, and Net Assets or Fund Equity Cash and Investments The Board considers cash and cash equivalents to be cash on hand, demand deposits, highly liquid investments, including those held as restricted assets, with original maturities of three months or less when purchased, and those included in the internal investment pool. For accounting and investment purposes, the Board maintains a cash pool that is available for use by all funds except those whose cash and investments may be segregated due to legal or other restrictions. Interest earned on investments in the pool is allocated to the various funds based upon each fund s equity balance in the pool during the allocation period. The Board reports all investments at fair value. Inventories and Prepaid items Inventories, consisting primarily of materials and supplies, are stated at cost, which approximates fair market value. The first-in, first-out method of accounting is used to determine cost. All inventories are recorded as expenditures, or expenses, as they are used (consumption method). Some payments to vendors represent costs applicable to future accounting periods and are recorded as prepaid items in government-wide and fund financial statements. Capital Assets Capital assets include property, plant, and equipment. Infrastructure assets are defined as public domain fixed assets such as roads, bridges, curbs and gutters, streets and sidewalks, drainage systems, lighting systems, and similar assets that are immovable and of value only to the government unit. Pursuant to GASB Statement No. 34, the County, a Phase 3 government, has elected to report infrastructure retroactively. Retroactive infrastructure is reported at the estimated historical cost. Capital assets are reported in the government-wide financial statements in the applicable governmental or business-type activities column, as well as the proprietary fund financial statements. The threshold for capitalizing property, plant, and equipment is $5,000. The threshold for capitalizing infrastructure is $100,000. Capital assets are recorded at cost, or estimated historical cost. Contributed assets are recorded at estimated fair market value at the time received. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets. II-22

112 Assets, Liabilities, and Net Assets or Fund Equity (Continued) Capital Assets (continued) HENDRY COUNTY, FLORIDA BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The ranges of the useful lives are as follows: Asset Years Buildings Infrastructure Improvements other than Buildings 6-50 Equipment 3-35 Computer Equipment 3-10 Furniture 4-20 Vehicles & rolling stock 3-15 Florida Statutes require that the Board maintain accountability for all assets used in operations, except those maintained by the Sheriff. Deferred Revenues Deferred revenue represents revenues collected in advance of services performed. This revenue will be recognized when the services are rendered. Compensated Absences The Board maintains a policy that permits employees to accumulate earned but unused vacation and sick pay benefits that will be paid to employees upon separation from Board service if certain criteria are met. These benefits, plus their related tax and retirement costs are classified as compensated absences. Both the current and long-term portion of compensated absences are accrued and reported in the government-wide and proprietary fund financial statements. This is accounted for pursuant to GASB Statement Number 16, Accounting for Compensated Absences. Net Assets/Fund Balance Classification Governmental funds report fund balances as either nonspendable or spendable. Spendable fund balances are further classified as restricted, committed, assigned or unassigned, based on the extent to which there are external or internal constraints on the spending of these fund balances. Nonspendable fund balances include amounts that cannot be spent because they are not in spendable form or legally or contractually required to be maintained intact. The County considers inventories and prepaid items as part of this category, as well as long-term receivables from which proceeds are not restricted, committed, or assigned. II-23

113 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Assets, Liabilities, and Net Assets or Fund Equity (Continued) Net Assets/Fund Balance Classification (Continued) Spendable Fund Balances: Restricted Fund Balance: Amounts that are restricted to specific purposes, and are restricted through enabling legislation and are legally enforceable. The legislation that creates the revenue stream must also stipulate the purposes for which that revenue can be used. Committed Fund Balance: Amounts that are committed for specific purposes by formal action of the governments highest level of decision making authority. These amounts are not subject to legal enforceability as in restricted, however those amounts cannot be used for any other purpose unless the government removes or changes the limitation by taking the same form of action it employed to previously impose the limitation. Assigned Fund Balance: Amounts that are intended by the government to be used for specific purposes but are neither restricted nor limited. Intent should be expressed by (a) the governing body itself, or (b) a subordinate high-level body or official possessing the authority to assign amounts to be used for specific purposes. Unassigned Fund Balance: Is the residual classification for the general fund. This classification represents fund balance that has not been assigned to other funds and that has not been restricted, limited, or assigned to specific purposes within the general fund. Government-wide statements and proprietary fund statements utilize an economic resources measurement focus and categorize net assets among the following components: Invested in Capital Assets, Net of Related Debt indicates that portion of net assets which represents the County s equity in capital assets, less the amount of related debt. Restricted Net Assets indicates that portion of net assets which are segregated due to external restrictions imposed by creditors, grantors, contributors, or laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation. Unrestricted Net Assets indicates that portion of net assets which is available for general operations. NOTE 2 - PROPERTY TAXES Property taxes become due and payable on November 1 of each year and are delinquent on April 1 of the following year. Discounts on property taxes are allowed for payments made prior to the April 1 delinquent date. Tax certificates for the full amount of any unpaid taxes must be sold no later than June 1 of each year. II-24

114 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 2 - PROPERTY TAXES (CONTINUED) No accrual for the property tax levy becoming due in November 2012 is included in the accompanying financial statements, since such taxes are collected to finance expenditures of the subsequent period. Procedures for collecting delinquent taxes, including applicable tax certificate sales and tax deed sales, are provided by Florida Statutes and are performed by the Hendry County Tax Collector. The enforceable lien date is approximately two years after taxes become delinquent and occurs only upon request of a holder of a delinquent tax certificate. There was no significant delinquent property taxes receivable at September 30, Important dates in the property tax cycle are as follows: - Assessment roll certified- July 1 - Millage resolution approved- no later than 93 days following certification of assessment roll - Beginning of fiscal year for which taxes have been levied- October 1 - Taxes due and payable (levy date)- November 1 - Property taxes payable (maximum discount of 4 percent)- 30 days after levy date - Due date- March 31 - Taxes become delinquent (lien date)- April 1 - Tax certificate sold- prior to June 1 NOTE 3 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY Deficit fund net assets The Emergency 911 Fund has a deficit fund balance of $69,259. It is anticipated that the deficit will be resolved in the next fiscal year through an adjustment. The East Hendry County Fire District has a deficit fund balance of $207,450. It is anticipated that the deficit will be resolved in the next fiscal year through an adjustment. The East Hendry County Recreational MSBU has a deficit fund balance of $223,823. It is anticipated that the deficit will be resolved in the next fiscal year through an adjustment. NOTE 4 - CASH, CASH EQUIVALENTS AND INVESTMENTS All Board depositories are banks or savings institutions designated by the State Treasurer as qualified public depositories. Chapter 280, Florida Statues Florida Security for Public Deposits Act provides procedures for public depositories to insure monies in banks and savings and loans are collateralized with the Treasurer as an agent for the public entities. II-25

115 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 4 - CASH, CASH EQUIVALENTS, AND INVESTMENTS (CONTINUED) The Public Deposit Security Trust Fund has a procedure to allocate and recover losses in the event of a default or insolvency. When public deposits are made in accordance with Chapter 280, no public depositor shall be liable for any loss thereof. Chapter 280 defines deposits as time deposit accounts, demand deposit accounts, and certificates of deposit. The total amount of bank deposits, $18,001,308, is insured by Federal depository insurance and pursuant to Chapter 280, Florida Statutes. Board investments are made in accordance with the provisions of Section , Florida Statutes Investment of Local Government Surplus Funds. Authorized investments include U.S. Government obligations, passbook savings accounts, tax-exempt State and municipal securities, certificates of deposit, Local Government Surplus Funds Investment Pool Trust Fund (SBA), the Florida Local Government Investment Trust (FLGIT), and any other investments authorized by Chapter 218, Florida Statutes. There were no violations of this policy during the fiscal year. NOTE 5 - ACCOUNTS RECEIVABLE At September 30, 2012, receivables were as follows: Enterprise: Labelle Utility Accounts receivable $ 4,313,662 Less: allowance for bad debt - Total receivables $ 4,313,662 NOTE 6 - SPECIAL ASSESSMENT In connection with the Port LaBelle Utility System (PLUS), the Board has commenced a phased construction program to provide utility service to vacant lots in Units 1 9 in Hendry County and Unit 102 in Glades County. The costs of the improvements are to be financed by special assessments levied against individual lots. The remaining balance of the assessment (if any) is to be paid over a twenty-year period through the real estate tax collection process. Interest at 7% is to be charged on the unpaid balance. The special assessment rate for lots in Hendry County is $975 per lot, and the rate per lot in Glades County is $1,080 per lot. NOTE 7 - RESTRICTED ASSETS AND LIABILITIES Restricted assets of the proprietary fund represent monies to be restricted for debt service, renewal and replacement, capital improvements and construction, and customer deposits under the terms of outstanding bond agreements, resolutions, and other contractual agreements. II-26

116 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 7 - RESTRICTED ASSETS AND LIABILITIES (CONTINUED) Restricted assets reported on the proprietary fund statement of net assets at September 30, 2012, were as follows: Port LaBelle Utility Restricted cash and investments $ 2,823,969 Assets restricted for debt service are for the payment of bond principal and interest and bond reserve requirements. Assets restricted for renewal and replacement are for the payment of unusual or extra-ordinary maintenance or repairs. Additionally, assets are restricted for capital improvements and construction. Customer deposits are advance payments held until certain conditions are met. Liabilities payable from restricted assets were at September 30, 2012 comprised of the following: Port LaBelle Utility Current portion of long-term debt $ 256,544 Customer deposits 164,014 Total $ 420,558 NOTE 8 - CAPITAL ASSETS Depreciation cost was charged to functions as follows: Governmental activities: General government Court related Public safety Physical environment Transportation Economic environment Culture and recreation Human services $ 963,900 33, , , ,658 98,176 83,077 1,301,895 Total depreciation cost for governmental activities $ 3,734,791 II-27

117 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 8 - CAPITAL ASSETS (CONTINUED) Business-type activities: Water and wastewater depreciation cost $ 973,306 Capital asset activity for the fiscal year ended September 30, 2012 was as follows: Governmental Activites Beginning Ending Balance Increases Decreases Balance Capital Assets not being depreciated: Land $ 5,538,708 $ 439,688 $ - $ 5,978,396 Total capital assets not being depreciated 5,538, ,688-5,978,396 Capital assets being depreciated: Buildings and improvements 65,446,746 2,358,838-67,805,584 Furniture and equipment 25,478,202 1,090,697-26,568,899 Infrastructure 54,433, ,433,754 Total capital assets being depreciated 145,358,702 3,449, ,808,237 Less accumulated depreciation for: Buildings and improvements 22,747,990 2,378,229-25,126,219 Furniture and equipment 18,744,443 1,356,562-20,101,005 Infrastructure 54,433, ,433,754 Total accumulated depreciation 95,926,187 3,734,791-99,660,978 Total capital assets being depreciated, net 49,432,515 7,184,326-49,147,259 Total governmental activities capital assets, net $ 54,971,223 $ 7,624,014 $ - $ 55,125,655 Business-Type Activities: Capital assets not being depreciated: Land $ 537,006 $ - $ - $ 537,006 Total capital assets not being depreciated 537, ,006 Capital assets being depreciated: Buildings & Infrastructure 28,950,124 64,466-29,014,590 Furniture and equipment 182, ,550 Total capital assets being depreciated 29,132,674 64,466-29,197,140 Less accumulated depreciation for: Buildings & Infrstructure 3,980, ,137-4,940,654 Furniture and equipment 163,816 13, ,985 Total accumulated depreciation 4,144, ,306-5,117,639 Total capital assets being depreciated, net 24,988,341 (908,840) - 24,079,501 Total business-type activities capital assets, net $ 25,525,347 $ (908,840) $ - $ 24,616,507 II-28

118 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT Business Type - Notes Payable & Revenue Bonds Notes Payable $1,430,705 bank loan, bearing interest at a rate of 7%, (15) annual payments of $157,084. Final payment due September $1,355,656 bank loan, bearing interest at a rate of 7%, (15) annual payments of $148,844. Final payment due September Total business type - notes payable $ 1,373,771 1,301,708 2,675,479 Revenue Bonds The Board issued revenue bonds for business-type activities. The descriptions and balances of the outstanding revenue bonds as of September 30, 2008, were as follows: $4,700,000 Hendry County, Water and Sewer System Revenue Bonds, Series 1996, bearing interest of 5% payable on September 1, 1996 and annually thereafter on September 1, with principal maturing from September 1, 1997 to September 1, $3,689,000 Hendry County, Water and Sewer System Revenue Bonds, Series 2007, bearing interest of 4.125% payable on September 1, 2007 and annually thereafter on September 1, with principal maturing from September 1, 2010 to September 1, Total business type - revenue bonds Total business-type Long-Term Debt $ 3,725,300 3,514,000 7,239,300 9,914,779 Government Funds - Notes Payable & Other Payables Notes Payable $621,833 capital equipment lease, bearing interest at a rate of 4.0%, one annual payment of $85,668. Final payment due June $25,547 loan from a financial institution for the purpose of machinery, bearing interest at a variable rate which was 4.275% at September 30, 2012 quarterly payments of $1426. Final payment due October $650,000 loan from a financial institution for the purchase of airplane hangars bearing interest at a rate of 2.625%, annual payments of differing values. Final payment due January $ 306,446 10, ,053 II-29

119 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT (CONTINUED) Government Funds - Notes Payable & Other Payables (Continued) Notes Payable (Continued) $450,000 loan from a financial institution used for road improvements, bearing interest at a rate of 4.5%, annual payments of $80,000. Final payment due October $125,363 bank loan for the purchase of an ambulance, bearing interest at a rate of 3.5%, with three annual payments of $40,000. Final payment due February $67,556 bank loan for the purchase of a fire truck, bearing interest at a rate of 3.5%, with equal annual payments of $20,000. Final payment due February Total governmental - notes payable Other Payables Post-closure care costs for monitoring of the landfill for twenty years after the landfill has stopped accepting waste and the final cover has been completed. The County has 8 years remaining. Total governmental other paypables Total Government Funds Long-Term Debt $ 212,552 89,751 50, , , ,392 1,206,749 TOTAL LONG-TERM DEBT $ 11,121,528 II-30

120 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT (CONTINUED) The annual debt service requirements for revenue bonds at September 30, 2012, were as follows: Government Funds Business-type Long-Term Debt Long-Term Debt Total Fiscal Year(s) Principal Interest Principal Interest Principal Interest 2013 $ 209,501 $ 31,354 $ 256,544 $ 521,279 $ 466,045 $ 552, ,722 25, , , , , ,025 18, , , , , ,034 12, , , , , , , , , , , ,018 2, , , , , , , , , , , , , , , ,271,423 1,619,256 2,271,423 1,619, ,671, ,549 1,671, , ,747, ,143 1,747, , , , , , ,021, ,444 1,021, ,444 Total $ 962,597 $ 375,301 $ 9,914,779 $ 7,109,579 $ 10,877,376 $ 7,484,880 Bond Resolutions The resolution for the bonds established certain accounts and determined the order in which certain revenues are to be deposited into those accounts. In addition, there are various other covenants established by the official statements and Board resolutions, including such items as debt service coverage, reporting requirements, and maintenance of facilities. Management believes that it has complied, in all material respects, with these covenants. The 1996 Series Bonds pledge the net revenues of the utility system for the payment of the principal, redemption price and the interest on the bonds. The Board covenants to fix, establish, and maintain rates and to collect such revenues from the product and services to provide in each fiscal year net revenues which at least equal the annual debt service on all of the outstanding bonds. II-31

121 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 9 - LONG-TERM DEBT (CONTINUED) Bond Resolutions (Continued) Changes in bonded and other indebtedness of the Board for the year ended September 30, 2012, was as follows: Beginning Ending Due Within Balance Additions Reductions Balance One Year Governmental Activities Notes payable $ 1,230,861 $ - $ (267,504) $ 963,357 $ 209,501 Landfill Closure 278,389 - (34,997) 243,392 40,565 Other Post Employment Benefits 257,671 84, ,108 - Compensated absences 290,712 9, ,826 - Total governmental activities long-term liabilities $ 2,057,633 $ 93,551 $ (302,501) $ 1,848,683 $ 250,066 Business-Type Activities Port LaBelle Utility Systems Notes payable $ 2,786,361 $ - $ (110,882) $ 2,675,479 $ 118,644 Revenue bonds 7,370,900 - (131,600) 7,239, ,900 Compensated absences 33,848 - (4,255) 29,593 - Total business-type activities long-term liabilities $ 10,191,109 $ - $ (246,737) $ 9,944,372 $ 256,544 NOTE 10 - LANDFILL CLOSURE AND POSTCLOSURE CARE COSTS State and Federal laws and regulations require that Hendry County place a final cover on its landfill that was closed and perform certain maintenance and monitoring functions at the landfill site for twenty years after closure. The liability is being recognized based on the future post closure costs that will be incurred after the date the landfill no longer accepts waste. The landfill stopped accepting solid waste on December 1, 1992, and finished placing the required cover on the landfill during the fiscal year ended September 30, Since the landfill is closed, the estimated liability is based on the current estimated costs for services to monitor and maintain the closed landfill for the required period. However, the actual cost of postclosure care may be higher due to inflation, changes in technology, or changes in landfill laws and regulations. The Board is required by state and federal regulations to make annual contributions to finance the post closure care. The Board has set aside funds in the amount of $40,565 for post closure care. The funding for costs for providing the final cover was provided by Lee County under the interlocal agreement for the joint solid waste disposal program. II-32

122 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 11 - CONTINGENCIES Grants and Assistance Activities of certain funds of the Board are financed in whole or in part by various forms of grants and assistance, principally from the federal government. There can be no absolute assurance that such assistance will continue in the future at the present levels. Amounts received from grantor agencies are subject to audit or adjustment by the grantor agencies. Also, any amounts disallowed could constitute liabilities of the applicable funds. Litigation The Board, in accordance with the normal conduct of its affairs, is involved in various judgments, claims, and litigation. It is expected that the final settlement of these matters will not materially affect the financial statements of the Board. NOTE 12 - RETIREMENT PLAN Plan Description and Provisions The Board participates in the Florida Retirement System (FRS), a cost sharing, multiple-employer, public employee retirement system, which covers substantially all of the full-time and part-time employees. The FRS is noncontributory and is totally administered by the State of Florida. Benefits under the plan vest after six years of service. Employees who retire at or after age 62 (age 55 for special risk) or 30 years of service (25 years for special risk), with six years of credited service, are entitled to an annual retirement benefit, payable monthly for life. The FRS also provides for early retirement at reduced benefits and death and disability benefits. These benefit provisions and all other requirements are established by Chapters 112 and 121, Florida Statutes. Effective July 1, 2011, covered members are required to contribute 3% of gross earnings. The County is required to make contributions based on actuarially determined statewide contribution rates. The contribution rates by job class for the periods from October 1, 2011 through June 30, 2012 and July 1, 2012 through September 30, 2012, respectively, were as follows: regular, 4.91% and 5.18%; senior management, 6.27% and 6.30%; county elected officers, 11.14% and 10.23%; special risk, 14.10% and 14.90%; and DROP participants, 4.42% and 5.44%. The contribution The County s contributions made during the years ended September 30, 2012, 2011, and 2010 were $497,064, $755,831, and $577,879, respectively, equal to the required contributions for each year. A copy of the FRS s June 30, 2012 annual report can be obtained by writing to the Division of Retirement, 2639 North Monroe Street, Building C, Tallahassee, Florida , or by phoning (850) II-33

123 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 13 - RISK MANAGEMENT The Board is exposed to various risks of loss related to torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees, and natural disasters. The County is a member of Public Risk Management (PRM), a local government liability risk pool. PRM administers insurance activities relating to property, general, automobile, public official's liability, workers compensation, health, and auto physical damage. The pool assesses each member its pro rata share of the estimated amount required to meet current year losses, operating expenses and reinsurance costs (premiums). To reduce its exposure to large losses on all types of insured events PRM uses reinsurance policies purchased from third parties. The Fund is fully funded annually. Major uninsurable risks include damages to infrastructure assets and damages or governmental fines due to seepage, pollution, or contamination of any kind. Since the amounts of loss cannot be reasonably estimated and the likelihood is undeterminable, no provision for such occurrences is included in these financial statements. NOTE 14 - OTHER POST-EMPLOYMENT BENEFITS Plan Description In accordance with Section , Florida Statutes, because the Board provides medical plans to employees of the County and their eligible dependents, the Board is also required to provide retirees the opportunity to participate in the group employee health plan. Retirees participating in the group insurance plans offered by the County are required to contribute 100% of the active participants cost of participation. Eligibility for Insurance Coverage Employees of the County and all constitutional officers who were participants in the existing medical plan at the time of retirement are entitled to participate in the Plan. Depending on the class of employee the following eligibility rules apply: Regular Class and Elected Officials - Age 62 and 6 years of service or 30 years of service, regardless of age, is normal retirement. Employees may retire early at age 43 and 6 years of service. Special Risk - Age 55 and 6 years of service or 25 years of service, regardless of age is normal retirement. Employees may retire early at age 36 and 6 years of service. Membership As of September 30, 2012, membership consisted of: Active Employees 137 Retired Participants 15 II-34

124 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 14 - OTHER POST-EMPLOYMENT BENEFITS (CONTINUED) Funding Policy Funding for this plan is on a pay-as-you-go basis. The Program is currently unfunded. There is no separate trust through which benefits for retirees are funded. No assets are currently accumulated or earmarked for this purpose. Annual OPEB Costs and Net OPEB Obligation Hendry County had an actuarial valuation performed for the plan as of September 30, 2012 to determine the funded status of the plan as of that date, as well as the employer's annual required contribution (ARC) for the fiscal year ended September 30, The Board s annual OPEB cost for the fiscal year was set at $115,868 as the transition liability was set to zero as of September 30, The Board s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net obligation from 2012 is as follows: Fiscal Year Ended Annual OPEB Cost Employer contributed % of Annual OPEB Cost Contributed Net OPEB Obligation September 30, 2012 $ 115,868 $ 21, % $ 342,108 The funded status of the plan as of September 30, 2012 was as follows: Actuarial Accrued Liability (AAL) $ 897,302 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (AAL) $ 897,302 Covered Payroll $ 4,708,987 Ration of UAAL to Covered Payroll 19.2% NOTE 15 - COMMITMENTS The Property Appraiser entered into an interlocal agreement with the Hendry County Board of County Commissioners for the purchase of a Computer Assisted Mass Appraisal system. The Property Appraiser is not permitted by law to borrow money extending beyond his term is office. Therefore the Board has signed a loan agreement with Centerstate Bank for the amount of $200,000, requiring the money to be used by the Property Appraiser for the purchase of the software. Within the interlocal agreement, the Property Appraiser agrees to remit all required payments stipulated in the loan agreement to the Board in lieu of payments made to Centerstate Bank. The loan agreement between the Board and Centerstate Bank and the interlocal agreement between the Board and the Property Appraiser are dated 12/28/2011 and 12/13/2011, respectively. II-35

125 BOARD OF COUNTY COMMISSIONERS NOTES TO THE FINANCIAL STATEMENTS September 30, 2012 NOTE 15 - COMMITMENTS (CONTINUED) Fund Balance Commitments The County adopted a resolution to commit $5,000,000 of the General Funds' fund balance for a disaster emergency reserve to enable the County to properly respond to emergencies affecting the County caused by natural and other disasters. II-36

126 SUPPLEMENTAL INFORMATION

127 BOARD OF COUNTY COMMISSIONERS COMBINING BALANCE SHEET NON-MAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds Law Court Local Enforcement Section 8 Technology Affordable 911 Trust Housing Fund Housing Emergency ASSETS Cash and cash equivalents $ 10,804 $ 51,757 $ 143,503 $ 431,489 $ 159 Receivables (net) - - 2,290 3,074 15,333 Total assets $ 10,804 $ 51,757 $ 145,793 $ 434,563 $ 15,492 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ - $ 375 $ 4,153 $ 25 $ 83,522 Accrued liabilities - 1,444-1,588 1,229 Other liabilities ,001 - Total liabilities - 1,819 4, ,614 84,751 Fund balances Assigned 10,804 49, ,640 16,949 Unassigned (69,259) Total fund balances (deficits) 10,804 49, ,640 16,949 (69,259) Total liabilities and fund balances $ 10,804 $ 51,757 $ 145,793 $ 434,563 $ 15,492

128 Special Revenue Funds Port Labelle East Hendry East Hendry West Hendry East Hendry Street County County County County Lighting Drainage Fire Fire Mid-County Recreational District District District District MSBU MSBU $ 14,885 $ 118,227 $ 101 $ 287,549 $ 461,758 $ ,794 4, $ 14,885 $ 118,548 $ 187,895 $ 292,264 $ 462,317 $ 1,845 $ 5,756 $ 5,234 $ 393,870 $ 84,346 $ 10,890 $ 224, ,475 1,674-1, ,756 5, ,345 86,020 10, ,668 9, , , , (207,450) - - (223,823) 9, ,314 (207,450) 206, ,427 (223,823) $ 14,885 $ 118,548 $ 187,895 $ 292,264 $ 462,317 $ 1,845 II-37

129 BOARD OF COUNTY COMMISSIONERS COMBINING BALANCE SHEET NON-MAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds West Hendry County North Four Recreational Airport-Sears Felda Labelle Corners MSBU MSBU MSBU MSBU MSBU ASSETS Cash and cash equivalents $ 275,536 $ 845,836 $ 362,720 $ 409,528 $ 592,799 Receivables (net) 720,208 12,711 67,794 50, Total assets $ 995,744 $ 858,547 $ 430,514 $ 460,520 $ 592,842 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 447,038 $ 11,086 $ 4,617 $ 7,685 $ 2,768 Accrued liabilities 6, Other liabilities Total liabilities 453,662 11,086 4,617 7,685 2,768 Fund balances Assigned 542, , , , ,074 Unassigned Total fund balances (deficits) 542, , , , ,074 Total liabilities and fund balances $ 995,744 $ 858,547 $ 430,514 $ 460,520 $ 592,842

130 Special Revenue Funds Wheeler Hooker's Phillips Sky Road Point Mosquito Road Valley Building MSBU Lighting Control MSBU MSBU Projects $ 124,425 $ 15,781 $ 1,005,109 $ 3,638 $ 324,556 $ 140,215 10, , ,401 $ 135,277 $ 15,993 $ 1,014,798 $ 3,638 $ 324,556 $ 206,616 $ 4,773 $ 999 $ 98,519 $ - $ 1,000 $ 150, , ,000 4, ,025-1, , ,504 14, ,773 3, , , ,504 14, ,773 3, ,556 54,176 $ 135,277 $ 15,993 $ 1,014,798 $ 3,638 $ 324,556 $ 206,616 II-38

131 BOARD OF COUNTY COMMISSIONERS COMBINING BALANCE SHEET NON-MAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special revenue Funds LaBelle Fines and Airport Impact Fees Impact Fees Forfeitures Fund Zone One Zone Two ASSETS Cash and cash equivalents $ 156,989 $ 93,003 $ 7, $ - Receivables (net) 223,947 56, Total assets $ 380,936 $ 149,237 $ 7,578 $ - LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 129,460 $ 17,980 $ - $ - Accrued liabilities 6, Other liabilities 1,500 28, Total liabilities 136,975 46, Fund balances Assigned 243, ,473 7,578 - Unassigned Total fund balances (deficits) 243, ,473 7,578 - Total liabilities and fund balances $ 380,936 $ 149,237 $ 7,578 $ -

132 Special Revenue Funds Impact Fees Impact Fees Impact Fees Impact Fees Impact Fee Zone Three Zone Four Zone Five School Board Administration $ - $ 41,108 $ 46,224 $ - $ 68, $ - $ 41,108 $ 46,224 $ - $ 68,692 $ - $ - $ - $ - $ 68, ,692-41,108 46, ,108 46, $ - $ 41,108 $ 46,224 $ - $ 68,692 II-39

133 BOARD OF COUNTY COMMISSIONERS COMBIING BALANCE SHEET NON-MAJOR GOVERNMENTAL FUNDS For the year ended September 30, 2012 Special Revenue Funds Impact Fees Impact Fees Impact Fees West Park Law Enforcement Felda Fire ASSETS Cash and cash equivalents $ - $ 580 $ 775 Receivables (net) Total assets $ - $ 580 $ 775 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ - $ - $ - Accrued liabilities Other liabilities Fund balances Assigned Unassigned Total fund balances (deficits) Total liabilities and fund balances $ - $ 580 $ 775

134 Special Revenue Funds Total Non-Major Impact Fees Impact Fees Impact Fees Impact Fees Governmental Pioneer Fire/EMS Public Buildings Library Admin Phase II Funds $ 771 $ 1,412 $ 149 $ 107 $ 6,038, ,434,104 $ 771 $ 1,412 $ 149 $ 107 $ 7,472,777 $ - $ - $ - $ 107 $ 1,757, , , ,230, , $ 5,688, (446,356) 771 1, $ 5,241,934 $ 771 $ 1,412 $ 149 $ 107 $ 7,472,777 II-40

135 BOARD OF COUNTY COMMISSIONERS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NON-MAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Law Court Local Enforcement Section 8 Technology Affordable Trust Housing Fund Housing REVENUES Intergovernmental $ - $ 260,691 $ - $ 98,942 Taxes Charges for services - 11,549 33,578 - Fines and forfeitures 1, Miscellaneous - - 4,512 1,140 Total revenues 1, ,240 38, ,082 EXPENDITURES Current General government Court related ,578 - Public safety 9, Physical environment Transportation Economic environment - 294,975-98,942 Culture and recreation Human Services Capital outlay General government Public safety Physical environment Debt service Principal retirement Interest and fiscal charges Total expenditures 9, ,975 46,578 98,942 Excess (deficiencies) of revenues over (7,753) (22,735) (8,488) 1,140 (under) expenditures Special Revenue Funds OTHER FINANCING SOURCES (USES) Transfers in Transfers out - - (40,750) - Total other financing sources (uses) - - (40,750) - Net change in fund balances (7,753) (22,735) (49,238) 1,140 Fund balances - beginning 18,557 72, ,878 15,809 Fund balances - ending $ 10,804 $ 49,938 $ 141,640 $ 16,949

136 Special Revenue Funds Port Labelle East Hendry East Hendry West Hendry East Hendry Street County County County County Emergency Lighting Drainage Fire Fire Mid-County Recreational 911 District District District District MSBU MSBU $ 107,545 $ - $ - $ - $ - $ - $ ,651 44, , , , , , , ,776 3,940 8,398 12,002 27, ,159 39,651 47, , , , , , , , ,895 24, , , , , ,556 44, ,973 2, ,053 43,895 24, , , , ,558 (313,894) (4,244) 23,684 (32,357) (12,252) 55,581 35, (4,983) (10,216) (4,983) (10,216) - - (313,894) (4,244) 23,684 (37,340) (22,468) 55,581 35, ,635 13,373 89,630 (170,110) 228, ,846 (259,222) $ (69,259) $ 9,129 $ 113,314 $ (207,450) $ 206,244 $ 451,427 $ (223,823) II-41

137 BOARD OF COUNTY COMMISSIONERS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NON-MAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds West Hendry County North Four Recreational Airport-Sears Felda Labelle Corners MSBU MSBU MSBU MSBU MSBU REVENUES Intergovernmental $ 294,000 $ 57,364 $ 67,794 $ 125,803 $ - Taxes 547,885 96,305 23,071 47,727 17,292 Charges for services Fines and forfeitures Miscellaneous 20,445 19,874 9,386 10,615 13,894 Total revenues 862, , , ,145 31,186 EXPENDITURES Current General government Court related Public safety Physical environment - 76,955 10,190 73,608 15,542 Transportation Economic environment Culture and recreation 843, Human Services Capital outlay General government , ,882 - Public safety Physical environment Debt service Principal retirement Interest and fiscal charges Total expenditures 843,410 76,955 77, ,490 15,542 Excess (deficiencies) of revenues over 18,920 96,588 22,267 (59,345) 15,644 (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses) Net change in fund balances 18,920 96,588 22,267 (59,345) 15,644 Fund balances - beginning 523, , , , ,430 Fund balances - ending $ 542,082 $ 847,461 $ 425,897 $ 452,835 $ 590,074

138 Special Revenue Funds Wheeler Hooker's Phillips Sky Road Point Mosquito Road Valley Building MSBU Lighting Control MSBU MSBU Projects $ - $ - $ 18,334 $ - $ - $ 25,000 79,606 11, ,547-12, , , ,596 55,955 82,613 11, , ,554 80, , ,323 10, ,698-9, , , , ,755 10, ,698-9,297 61,134 14,858 1,343 45, ,257 19, (150,000) (150,000) 14,858 1,343 45, ,257 (130,179) 115,646 13, ,091 3, , ,355 $ 130,504 $ 14,994 $ 912,773 $ 3,638 $ 323,556 $ 54,176 II-42

139 BOARD OF COUNTY COMMISSIONERS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NON-MAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds LaBelle Hurricane TS Faye 3rd Party Fines and Airport Recovery Disaster Comp Plan CSGB - ARRA Forfeitures Fund Fund Recovery Study Stimulus Grant REVENUES Intergovernmental $ 177,449 $ 45,967 $ - $ - $ - $ - Taxes Charges for services 394, , Fines and forfeitures 295, Miscellaneous 113,460 1, Total revenues 981, , EXPENDITURES Current General government 54, Court related 220, Public safety 259, Physical environment Transportation - 552, Economic environment Culture and recreation Human Services 86, Capital outlay General government Public safety 80, Physical environment Transportation - 61, Debt service Principal retirement - 37, Interest and fiscal charges - 8, Total expenditures 702, , Excess (deficiencies) of revenues over 278,975 42, (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in 80, , Transfers out (206,250) Total other financing sources (uses) (125,795) 100, Net change in fund balances 153, , Fund balances - beginning 90,781 (40,210) Fund balances - ending $ 243,961 $ 102,473 $ - $ - $ - $ -

140 Homeless & Fl Homeowner Rehousing Opportunity Impact Fees Impact Fees Impact Fees Impact Fees Impact Fees Impact Fees Impact Fee HPRP Program Zone One Zone Two Zone Three Zone Four Zone Five School Board Administration $ - $ - $ - $ - $ - $ - $ - $ - $ ,096 4,329-3,310 1,080-1, ,096 4,329-3,310 1,080-1, , , , , , , , , (171,317) (273,047) - (97,237) 1,080 - (67,087) (171,317) (273,047) - (97,237) 1,080 - (67,087) , , ,345 45,144-67,087 $ - $ - $ 7,578 $ - $ - $ 41,108 $ 46,224 $ - $ - II-43

141 BOARD OF COUNTY COMMISSIONERS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NON-MAJOR GOVERNMENTAL FUNDS For the Year Ended September 30, 2012 Special Revenue Funds Impact Fee Impact Fees Impact Fees Impact Fees West Park Law Enforcement Felda Fire Pioneer Fire/EMS REVENUES Intergovernmental $ - $ - $ - $ - Taxes Charges for services Fines and forfeitures Miscellaneous Total revenues EXPENDITURES Current General government Court related Public safety Physical environment Transportation Economic environment Culture and recreation Human Services Capital outlay General government Public safety Physical environment Transportation Debt service Principal retirement Interest and fiscal charges Total expenditures Excess (deficiencies) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Fund balances - beginning Fund balances - ending $ - $ 580 $ 775 $ 771

142 Total Non-Major Impact Fees Impact Fees Impact Fees Governmental Public Buildings Library Admin Phase II Funds $ - $ - $ - $ 1,278, ,862, ,256, , , ,076, , , ,516, , , , ,011, , , , , , , , ,460, (103) (384,766) , (412,199) (231,744) 33 3 (103) (616,510) 1, ,858,444 $ 1,412 $ 149 $ - $ 5,241,934 II-44

143 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards To the Honorable Board of County Commissioners Of Hendry County, Florida: We have audited the basic financial statements of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of Hendry County, Florida Board of County Commissioners (the Board ) as of and for the fiscal year ended September 30, 2012, which collectively comprise the Boards basic financial statements and have issued our report thereon dated June 17, We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Board s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Board s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Board s internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the Board s financial statements will not be prevented, or detected and corrected on a timely basis, adversely affects the Board s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Board s financial statements that is more than inconsequential will not be prevented or detected by the Board s internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. II-45

144

145 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Management Letter To the Honorable Board of County Commissioners of Hendry County, Florida: We have audited the financial statements of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of Hendry County, Florida, Board of County Commissioners, (the Board ) as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated June 17, We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. We have issued our Independent Auditor's Report on Internal Control over Financial Reporting and Compliance and Other Matters, Bases on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards, Independent Auditors Report on Compliance with Requirements that Could Have a Direct and Material Effect on each Major Federal Awards Program and State Financial Assistance Project and on Internal Control over Compliance, and Schedule of Findings and Questioned Costs. Disclosures in those reports and schedule, which are dated June 17, 2013, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter , Rules of the Auditor General, which governs the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditor s reports or schedule for the Board of County Commissioners (the Board ) or, where applicable, the County. Section (1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no comments in the prior year. Section (1)(i)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section , Florida Statutes, regarding the investment of public funds. In connection with our audit, nothing came to our attention that would cause us to believe that the Board was in noncompliance with Section , Florida Statutes regarding the investment of public funds. Section (1)(i)3., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. There were no such recommendations in the current year. II-47

146

147

148 CLERK OF THE CIRCUIT COURT September 30, 2012 SPECIAL PURPOSE FINANCIAL STATEMENTS, TOGETHER WITH REPORTS OF INDEPENDENT AUDITOR S

149 TABLE OF CONTENTS Report of Independent Auditor s III-1 III-2 Special Purpose Financial Statements Balance Sheet Governmental Funds III-3 Statement of Revenues, Expenditures and Changes in Fund Balance Governmental Funds Statement of Fiduciary Net Assets Agency Funds III-4 III-5 Notes to Financial Statements III-6 III-11 Supplemental Information Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual General Fund III-12 Combining Statements Combining Statement of Changes in Assets and Liabilities All Agency Funds III-13 III-15 Independent Auditor s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Management Letter Response to Management Letter III-16 III-17 III-18 III-19 III-20

150 Report of Independent Auditors 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Honorable Barbara S. Butler Clerk of the Circuit Court Hendry County, Florida We have audited the accompanying special-purpose financial statements of the Hendry County, Florida, Clerk of the Circuit Court as of and for the fiscal year ended September 30, 2012 as listed in the Table of Contents. These special-purpose financial statements are the responsibility of the Hendry County, Florida, Clerk of the Circuit Court. Our responsibility is to express an opinion on these special-purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special-purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the specialpurpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, and evaluating the overall special-purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying special-purpose financial statements were prepared for the purpose of complying with Section (2), Florida Statutes, and Section , Rules of the Auditor General-Local Governmental Entity Audits, and are not intended to be a complete presentation of the financial position and changes in financial position of the Hendry County, Florida Clerk of the Circuit Court. Additionally, the special-purpose financial statements present only the Hendry County, Florida Clerk of the Circuit Court and are not intended to present the financial position and changes in financial position of Hendry County, Florida, taken as a whole. In our opinion, the special-purpose financial statements referred to above present fairly, in all material respects, the financial position of the Hendry County, Florida, Clerk of the Circuit Court as of September 30, 2012 and the respective changes in financial position thereof for the fiscal year then ended, in conformity with accounting principles generally accepted in the United States of America. III-1

151

152 CLERK OF THE CIRCUIT COURT Balance Sheet - Governmental Funds September 30, 2012 General Fund Modernization Trust Fund Total ASSETS Cash $ 301,367 $ 280,414 $ 581,781 Accounts receivable 3,458-3,458 Due from other governments 14,343 3,590 17,933 Prepaid expenses - 37,917 37,917 Total Assets $ 319,168 $ 321,921 $ 641,089 LIABILITIES AND FUND EQUITY Liabilities Accounts payable $ 26,144 $ 1,875 $ 28,019 Accrued payroll 45,780-45,780 Deferred revenue Due to other governments 247, ,244 Total Liabilities 319,168 1, ,043 Fund Equity Fund balance Assigned - 320, ,046 Total Liabilities and Fund Equity $ 319,168 $ 321,921 $ 641,089 See accompanying notes. III - 3

153 CLERK OF THE CIRCUIT COURT Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds For the Fiscal Year Ended September 30, 2012 Revenues General Fund Modernization Trust Fund Total Intergovernmental $ - $ - $ - Charges for services 944, ,248 1,054,669 Fines & Forfeitures Miscellaneous Total Revenues 944, ,248 1,054,669 Expenditures General government 793,917 75, ,456 Court related 945, ,648 Total Expenditures 1,739,565 75,539 1,815,104 Excess of revenues over (under) expenditures (795,144) 34,709 (760,435) Other financing sources (uses) Operating transfers in 839, ,944 Operating transfers out (44,800) - (44,800) Total other financing sources (uses) 795, ,144 Excess of revenues and other sources sources over (under) expenditures and other sources - 34,709 34,709 Fund balance - October 1, , ,337 Fund balance - September 30, 2012 $ - $ 320,046 $ 320,046 See accompanying notes. III - 4

154 CLERK OF THE CIRCUIT COURT Statement of Fiduciary Net Assets - Agency Funds September 30, 2012 Operating Fines and Christmas Trust Registry Forfeitures Club Total ASSETS Cash $ 252,957 $ 107,868 $ 433,226 $ 9,419 $ 803,470 Accounts receivable 30-2,491-2,521 Total Assets $ 252,987 $ 107,868 $ 435,717 $ 9,419 $ 805,991 LIABILITIES Accounts payable $ 153,536 $ - $ 122,982 $ - $ 276,518 Due to other governments 99, , , ,054 Due to individuals ,419 9,419 Other liabilities Total Liabilities $ 252,987 $ 107,868 $ 435,717 $ 9,419 $ 805,991 See accompanying notes. III - 5

155 CLERK OF THE CIRCUIT COURT Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity The Clerk, as an elected constitutional officer was established by the Constitution of the State of Florida, Article VIII, Section 1 (d). As such, the Clerk's special purpose financial statements are included in the government wide financial statements of Hendry County, the primary government. A component unit is a legally separate organization for which the elected officials of the primary government are financially accountable. Based on the criteria established by Statement of Governmental Accounting Standards Board Number 14, "Financial Reporting Entity", there are no component units included in the Clerk's financial statements. (a) Fund Accounting The accounts of the Clerk are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of selfbalancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures, as appropriate. Government resources are allocated to, and accounted for, in individual funds, based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The following fund types are utilized by the Clerk: Governmental Funds General Fund The General Fund is used to account for all revenues and expenditures applicable to the general operations of the Clerk, which are not properly accounted for in another fund. All operating revenues, which are not specifically restricted or designated as to use, are recorded in the General Fund. Excess revenues at the end of the year, due back to the Board of County Commissioners and the State of Florida, are shown as operating transfers out. Special Revenue Funds The Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specific purposes. Fudiciary Funds Agency Funds The Agency Funds are used to account for assets held by public officials in a trustee capacity or as an agent for individuals, private organizations, other governments and/or other funds. III - 6

156 CLERK OF THE CIRCUIT COURT Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (b) Measurement Focus, Basis of Accounting, and Financial Statement Presentation Governmental Funds The General Fund and Special Revenue Funds are accounted for on a "spending" or "financial flow "measurement focus. This means that only current assets and current liabilities are generally included on the balance sheet. Accordingly, the reported undesignated fund balances (net current assets) art considered a measure of available, spendable or appropriable resources. General operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Fiduciary Funds Agency Funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. Basis of Accounting Basis of accounting refers to when revenues and expenditures are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. The modified accrual basis of accounting is followed by all funds. The modification in such method from the accrual basis is that revenues are recorded when they become measurable and available to finance operations of the current year. Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. Exceptions to this general rule include: 1. Principal and interest on general long-term debt, which is recognized when due; and 2. Expenditures are not divided between years by the recording of prepaid expenses. Budgetary Process Chapter 218, Florida Statutes, governs the preparation, adoption and administration process of the Clerk's annual budget. The Clerk's budget, however, is prepared in two parts. One portion relates to the State court system, including Recording, and is required to be filed with the State Court Administrator. The remaining portion relates to the requirements of the Clerk as ex officio to the Board, Clerk of the Board of County Commissioners, County Auditor and custodian, or treasurer, of all County funds. The budget for this portion is submitted to and approved by the Board of County Commissioners. However, the budget in total is required to be filed with the State Court Administrator. III - 7

157 CLERK OF THE CIRCUIT COURT Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (b) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (continued) Budgetary Process (continued) The annual budget serves as the legal authorization for expenditures. Expenditures cannot legally exceed the total amount budgeted for each fund. All budgets are prepared on the modified accrual basis. The level of control for appropriations is exercised at the functional level. Encumbrances Encumbrance accounting, under which purchase orders and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is not employed by the Clerk. (c) Assets, Liabilities, and Equity Capital Assets Acquisitions of tangible personal property are recorded as expenditures in the General Fund at the time of purchase. These assets are reported to the Hendry County, Florida, Board of County Commissioners and are recorded in the government wide financial statements. Compensated Absences The Clerk's employees accumulate sick and annual leave based on the number of years of continuous service and other criteria. Upon termination of employment, employees generally receive payment for accumulated annual and sick leave. As of September 30, 2012, the Clerk had $92,457 in long-term compensated absences payable. This amount is reported in the government-wide financial statements of Hendry County, Florida. Statement of Governmental Accounting Standards Board No. 16, "Accounting for Compensated Absences", requires the compensated absences liability to be measured using the salary rate in effect at the balance sheet date and requires additional amounts to be accrued for certain salary related payments associated with the payment of compensated absences. The liability shown in the financial statements of Hendry County has been accrued in accordance with this criteria. Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management of the Clerk to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenue and expenditures or expenses during the reporting period. Actual results could differ from those estimates. III - 8

158 CLERK OF THE CIRCUIT COURT Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (c) Assets, Liabilities, and Equity (continued) Fund Balances Assigned Unassigned Assigned fund balances are constrained by the Clerk's intent to be used for specific purposes, but are neither restricted nor committed. Fund balance that has not been reported in any other classification. When both assigned and unassigned resources are available for use, it is the Clerk's policy to use assigned resources first, then unassigned resources as needed. NOTE 2 - CASH AND INVESTMENTS During the fiscal year, the Clerk maintained deposits in interest-bearing savings and checking accounts. At September 30, 2012, the bank balance of all accounts was $1,397,769 and the book balance of deposits was $1,384,716. The Clerk had $535 of cash on hand at September 30, The deposits whose values exceeded the limits of federal depository insurance are entirely insured or collateralized pursuant to the Public Depository Security Act of the State of Florida, Chapter 280 of the Florida Statutes. The Clerk held no investments during the fiscal year. NOTE 3 - RETIREMENT PLAN Plan Description and Provisions The Clerk contributes to the Florida Retirement System (the "System"), a cost-sharing multiple employer PERS defined benefit pension plan controlled by the State Legislature and administered by the Florida Department of Administration, Division of Retirement. The System provides retirement and disability benefits, annual cost-of-living adjustments, a health insurance subsidy, and survivor benefits to plan members and beneficiaries, respectively. The System was established in 1970 by Chapter 121, Florida Statutes. Changes to the law can be made only by an act of the Florida Legislature. Rules governing the operations and administration of the System may be found in Chapter 60S of the Florida Administrative Code. The Florida Retirement System Annual Report is a document printed for members of the Legislature and the public, reflecting the financial operation and condition of the state-administered retirement systems. The publication contains financial statements, actuarial comments, investment information, and statistical data on the System. A copy can be obtained by writing to Division of Retirement, Research, Education, & Policy Section, C North Monroe Street, Tallahassee, Florida III - 9

159 CLERK OF THE CIRCUIT COURT Notes to Financial Statements September 30, 2012 NOTE 3 - RETIREMENT PLAN (continued) Funding Policy Presently, the System requires contributions from coverd members of 3% of gross wages. The current rates, based on employees gross earnings, are reegular employees 5.18%; senior management 6.30%; DROP participants 5.44%; and elected officials 10.23%. The contribution requirements of the Clerk are established and may be amendedby the State Legislature. The Clerks contributions to the System for the fiscal year ended September 30, 2012 were $63,557 equal to the required contributions. NOTE 4 - CONTINGENCIES The Clerk is involved from time to time in certain routine litigation, the substance of which as other liabilities for recoveries, would not materially affect the financial position of the Clerk. NOTE 5 - INSURANCE The Clerk participates in the County-wide self insurance program. The Hendry County, Florida, Board of County Commissioners maintains a self-insurance internal service fund to administer insurance activities relating to employee health insurance, life insurance, general liability, automobile liability and workers' compensation. Also, the Board carries excess insurance coverage for workers' compensation. Charges to operating departments are based upon amounts believed by management to meet the required annual payout during the fiscal year and to pay for the estimated operating costs of the program and for premiums for third party carrier insurance plans. For fiscal year ended September 30, 2012, the Clerk was charged $249,888. NOTE 6 - GENERAL LONG-TERM DEBT The following changes in general long-term debt occurred during the year ended September 30, 2012: Long-term debt payable at October 1, 2011 $ 76,643 Increase in accrued compensated absences 15,814 Long-term debt payable at September 30, 2012 $ 92,457 General long-term debt is comprised of the following: Noncurrent portion of compensated absences. Employees of the Clerk are entitled to paid annual leave, based on length of service and job classification. $ 92,457 III - 10

160 CLERK OF THE CIRCUIT COURT Notes to Financial Statements September 30, 2012 NOTE 7- OTHER POST EMPLOYMEN BENEFITS Plan Description In accordancewith Section , Florida Statutes, because the Clerk provides meical plans to employees of the Tax collector and there eligible dependents, the Tax Collector is also required to provide retirees the opportunity to participate in the group employee health plan. Retirees participating in the group insurance plans offered by the County are required to contribute 100% of the active participants. Eligibility for Insurance Coverage Employees of the County and all constitutional officers who were participants in the existing medical plan at the time of Retirement are entitled to participate in the Plan. Depending on the class of employee the following eligibility rules apply: Regular Class and Elected Officials - Age 62 and 6 years of service or 30 years of service, regardless of age, is normal retirement. Employees may reire early at age 43 and 6 years of service. Special Risk - Age 55 and 6 years of service or 25 years of service, regardless of age is normal retirement. Employees may retire early at age 36 and 6 years of service. %of Annual Annual OPEB Employer OPEB Cost Net OPEB Fiscal Year Ended cost Contributed Contributed Obligation September 30, 2012 $ 24,985 $ 4, % $ 73,769 The funded status of the plsn as of September 30, 2012 was as follows: Actuarial Accrued Liability (AAL) $ 193,265 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (AAL) $ 193,265 Coverd Payroll $ 1,015,401 Ration of UAAL to Covered Payroll 19.2% III - 11

161 REQUIRED SUPPLEMENTAL INFORMATION

162 CLERK OF THE CIRCUIT COURT GENERAL FUND Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended September 30, 2012 Variance with Final Budget Original Final Positive Budget Budget Actual (Negative) Revenues Intergovernmental $ - $ - $ - $ - Charges for Services 1,091,655 1,087, ,421 (143,559) Fines & Forfeitures Miscellaneous Total Revenues 1,091,655 1,087, ,421 (143,559) Expenditures General Government Personal Services 744, , ,712 7,983 Operating Expenses 95,250 95,250 57,205 38,045 Court Related Personal Services 886, , ,502 (19,107) Operating Expenses 205, ,585 40, ,439 Total Expenditures 1,931,600 1,927,925 1,739, ,360 Excess of expenditures over revenues (839,945) (839,945) (795,144) 44,801 Other financing sources (uses) Operating transfers in 839, , ,944 (1) Operating transfers out - - (44,800) (44,800) Total other financing sources (uses) 839, , ,144 (44,801) Excess of revenues and other sources over (under) expenditures and other uses Fund balance - October 1, Fund balance - September 30, 2012 $ - $ - $ - $ - III - 12

163 CLERK OF THE CIRCUIT COURT Combining Statement of Changes in Assets and Liabilities - All Agency Funds For the fiscal year ended September 30, 2012 OPERATING TRUST Balance Balance October 1, September 30, 2011 Additions Deletions 2012 ASSETS Cash $ 301,114 $ 3,346,912 $ 3,395,069 $ 252,957 Accounts receivable 17,482 23,800 41, Due from other governments 3,750-3,750 - Total Assets $ 322,346 $ 3,370,712 $ 3,440,071 $ 252,987 LIABILITIES Accounts payable $ 154,159 $ 752,739 $ 753,362 $ 153,536 Due to other governments 168,187 5,621 74,357 99,451 Other Liability Total Liabilities $ 322,346 $ 758,360 $ 827,719 $ 252,987 REGISTRY OF COURT ASSETS Cash $ 205,672 $ 1,358,952 $ 1,456,756 $ 107,868 Due from other funds Total Assets $ 205,672 $ 1,358,952 $ 1,456,756 $ 107,868 LIABILITIES Accounts Payable 45, , ,211 - Due to Other Governments 160, , , ,868 Total Liabilities $ 205,672 $ 1,314,928 $ 1,412,732 $ 107,868 III - 13

164 CLERK OF THE CIRCUIT COURT Combining Statement of Changes in Assets and Liabilities - All Agency Funds September 30, 2012 CHRISTMAS CLUB Balance Balance October 1, September 30, 2011 Additions Deletions 2012 ASSETS Cash $ 7,909 $ 10,293 $ 8,783 $ 9,419 Total Assets $ 7,909 $ 10,293 $ 8,783 $ 9,419 LIABILITIES Due to individuals $ 7,909 $ 10,293 $ 8,783 $ 9,419 Total Assets $ 7,909 $ 10,293 $ 8,783 $ 9,419 FINES AND FORFEITURES ASSETS Cash $ 442,277 $ 1,966,099 $ 1,975,150 $ 433,226 Accounts receivable 9,146 31,370 38,025 2,491 Total Assets $ 451,423 $ 1,997,469 $ 2,013,175 $ 435,717 LIABILITIES Accounts payable $ 172,591 $ 882,239 $ 931,848 $ 122,982 Due to other governments 278, , , ,735 Deposits - - Total Liabilities $ 451,423 $ 1,167,350 $ 1,183,056 $ 435,717 III - 14

165 CLERK OF THE CIRCUIT COURT Combining Statement of Changes in Assets and Liabilities - All Agency Funds September 30, 2012 TOTAL - ALL AGENCY FUNDS Balance Balance October 1, September 30, 2011 Additions Deletions 2012 ASSETS Cash $ 956,972 $ 6,682,256 $ 6,835,758 $ 803,470 Accounts receivable 26,628 55,170 79,277 2,521 Due from other governments 3,750-3,750 - Total Assets $ 987,350 $ 6,737,426 $ 6,918,785 $ 805,991 LIABILITIES Accounts payable $ 372,213 $ 2,318,726 $ 2,414,421 $ 276,518 Due to other governments 607, ,912 1,009, ,054 Due to individuals 7,909 10,293 8,783 9,419 Other liabilities Total Liabilities $ 987,350 $ 3,250,931 $ 3,432,290 $ 805,991 III - 15

166 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report on Internal Control over Financial Reporting And on Compliance and Other Matters Based on an Audit of Special-Purpose Financial Statements Performed In Accordance with Government Auditing Standards Honorable Barbara S. Butler Clerk of the Circuit Court Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Clerk of the Circuit Court as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated June 14, 2013 for the purpose of compliance with Section (2), Florida Statutes, and Chapter , Rules of the Auditor General-Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Hendry County, Florida, Clerk of the Circuit Court s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the special-purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Hendry County, Florida, Clerk of the Circuit Court s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Hendry County, Florida, Clerk of the Circuit Court s internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity s special-purpose financial statements will not be prevented, or detected and corrected on a timely basis. III-16

167

168 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Management Letter Honorable Barbara S. Butler Clerk of the Circuit Court Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Clerk of the Circuit Court (the Clerk ), as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated June 14, We conducted our audit in accordance with auditing standards generally accepted in the United States of America; and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States of America. We have also issued our Independent Auditor's Report on Internal Control over Financial Reporting and Compliance and Other Matters. Disclosures in that report which is dated June 14, 2013, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter , Rules of the Auditor General, which govern the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditor s reports or schedule: Section (1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no recommendations made in the preceding annual financial audit report. Section (1)(i)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section , Florida Statutes, regarding the investment of public funds. In connection with our audit, we determined that the Hendry County, Florida, Clerk of the Circuit Court complied with Section , Florida Statutes. Section (1)(i)3., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. III-18

169

170 BARBARA S. BUTLER CLERK CIRCUIT COURT, HENDRY COUNTY PO. BOX 1760 LABELLE, FLORIDA David W. Martin, CPA Auditor General P.O. Box 1735 Tallahassee, Florida Per Rule (1 ), this is our response to auditor's comments contained in the audit report for the fiscal year September 30, Report on Internal Accounting Controls Prior year comments and recommendations which continue to apply: None. Current year comments: None. Independent Auditors' management letter Prior year comments and recommendations which continue to apply: None. Current year comments: None. If you should have any questions or comments regarding these responses, please contact me at (863) ~t!u Stephen W. Clark Finance Director Clerk of Circuit Court Hendry County, Florida III-20

171 PROPERTY APPRAISER September 30, 2012 SPECIAL PURPOSE FINANCIAL STATEMENTS, TOGETHER WITH REPORTS OF INDEPENDENT AUDITORS

172 Table of Contents Report of Independent Auditor's IV-1 - IV-2 Special Purpose Financial Statements Balance Sheet - Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds Notes to Financial Statements IV-3 IV-4 IV-5 - IV-11 Supplemental Information Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Management Letter Response to Management Letter IV-12 IV-13 - IV-14 IV-15 - IV-16 IV-17

173 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Report of Independent Auditors Honorable Phillip L. Pelletier Property Appraiser Hendry County, Florida We have audited the accompanying special-purpose financial statements of the Hendry County, Florida, Property Appraiser as of and for the fiscal year ended September 30, 2012 as listed in the Table of Contents. These special-purpose financial statements are the responsibility of the Hendry County, Florida, Property Appraiser. Our responsibility is to express an opinion on these special-purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special-purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the specialpurpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, and evaluating the overall special-purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying special-purpose financial statements were prepared for the purpose of complying with Section (2), Florida Statutes, and Section , Rules of the Auditor General-Local Governmental Entity Audits, and are not intended to be a complete presentation of the financial position and changes in financial position of the Hendry County, Florida Property Appraiser. Additionally, the special-purpose financial statements present only the Hendry County, Florida Property Appraiser and are not intended to present the financial position and changes in financial position of Hendry County, Florida, taken as a whole. In our opinion, the special-purpose financial statements referred to above present fairly, in all material respects, the financial position of the Hendry County, Florida, Property Appraiser as of September 30, 2012 and the respective changes in financial position thereof for the fiscal year then ended, in conformity with accounting principles generally accepted in the United States of America. IV-1

174

175 PROPERTY APPRAISER Balance Sheet - Governmental Funds September 30, 2012 General Fund Special Revenue Fund Total Governmental Funds ASSETS Cash $ 61,535 $ 137,950 $ 199,485 Total Assets $ 61,535 $ 137,950 $ 199,485 LIABILITIES AND FUND EQUITY Liabilities Due to Board of County Commissioners $ 36,867 $ - $ 36,867 Accounts Payable - 50,001 50,001 Accrued Wages 24,668-24,668 Total Liabilities 61,535 50, ,536 Fund Equity Fund Balance Assigned - 87,949 87,949 Total Liabilities and Fund Equity $ 61,535 $ 137,950 $ 199,485 IV-3

176 PROPERTY APPRAISER Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds For the Fiscal Year Ended September 30, 2012 Revenues General Fund Special Revenue Fund Total Governmental Funds Charges for Services $ 1,071,710 $ 125,011 $ 1,196,721 Miscellaneous Total Revenues 1,072, ,369 1,197,582 Expenditures General Government Personal Services 867,913 88, ,331 Operating Expenditures 152,800 11, ,382 Capital Outlay 14,633 2,500 17,133 Total Expenditures 1,035, ,500 1,137,846 Excess of Revenues over Expenditures 36,867 22,869 59,736 Other financing (uses) sources Operating transfers out (36,867) - (36,867) Total other financing (uses) sources (36,867) - (36,867) Excess of revenues and other sources over (under) expenditures and other uses - 22,869 22,869 Fund balances - October 1, ,080 65,080 Fund balances - September 30, 2012 $ - $ 87,949 $ 87,949 IV-4

177 PROPERTY APPRAISER Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity The Property Appraiser is an elected Constitutional Officer of Hendry County (County), a political subdivision of the State of Florida. The position of Property Appraiser was established by Article VIII, Section 1 (d) of the State of Florida Constitution. Under Chapter 192, Florida Statutes, the Property Appraiser is charged with determining the just value of real and tangible personal property located within the County. The Property Appraiser functions as a Constitutional County Officer subject to the general oversight of the Florida Department of Revenue. The office receives compensation from several taxing authorities in the County, based on the budget approved by the Department of Revenue, as provided in Section , Florida Statutes. As required by generally accepted accounting principles, the financial statements of the reporting entity include those of the Property Appraiser and its component units. Component units are entities for which the government is considered to be financially accountable. Financial accountability is determined on the basis of the Property Appraiser's ability to significantly influence operations, select the governing authority, and participate in fiscal management. Based on application of the criteria set forth by the Governmental Accounting Standards Board, management has determined that no component units exist which would require inclusion in these financial statements. (a) Fund Accounting The accounts of the Property Appraiser are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for using a separate set of self-balancing accounts which comprise its assets, liabilities, fund equities, revenues, and expenditures. The various funds are grouped by type in the financial statements. The Property Appraiser utilizes the following governmental funds: General Fund The General Fund is used to account for all revenues and expenditures applicable to the general operations of the Property Appraiser. All general operating revenues which are not restricted or designated as to use by outside sources are recorded in the General Fund. Special Revenue Fund The Special Revenue Funds are used to account for proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. (b) Measurement Focus, Basis of Accounting, and Financial Statement Presentation Basis of accounting refers to when revenues and expenditures are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. IV-5

178 PROPERTY APPRAISER Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) (b) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (continued) The modified accrual basis of accounting is followed by the General Fund and the Special Revenue Fund. Revenues are recognized when they become measurable and available as net current assets. Expeditures are generally recognized when the related fund liabilty is incurred, if measurable, except expenditures for debt service and other long-term obligations which are recognized when paid. Budgetary Requirements Expenditures of the General Fund are controlled by appropriations in accordance with the budgetary requirements set forth in the Florida Statutes. The budgeted revenues and expenditures in the accompanying financial statements reflect all amendments approved by the State of Florida Department of Revenue. The General Fund budget is prepared on the modified accrual basis of accounting. The Property Appraiser follows these procedures in establishing the budgetary data reflected in the financial statements: On or before June 1 of each year the Property Appraiser shall, concurrently submit an annual budget to the Florida Department of Revenue and to the Board of County Commissioners. Budgetary control is established at the functional level. On or before August 15 the Department shall make its final budget amendments or changes to the budget and shall provide notice thereof to the Property Appraiser and the Board of County Commissioners. The budget for the General Fund is adopted on a basis consistent with generally accepted governmental accounting principles. A budget was not adopted for the Special Revenue Fund, as it is not required. Encumbrances Encumbrance accounting, under which purchase orders and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is not employed by the Property Appraiser. (c) Assets, Liabilities, and Equity Compensated Absences The Property Appraiser's employees accumulate sick and annual leave based on the number of years of continous service and other criteria. Upon termination of employment, employees receive payment for accumulated annual leave, up to a maximum of 240 hours. After 10 years of service, employees receive payment for 25% of their accumulated sick leave, up to a maximum of 500 hours. IV-6

179 PROPERTY APPRAISER Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) (c) Assets, Liabilities, and Equity (continued) Compensated Absences (continued) "Statement of Government Accounting Standards Board Number 16, Accounting for Compensated Absences", requires the compensated absences liability to be measured using the salary rate in effect at the balance sheet date and requires additional amounts to be accrued for certain salary related payments associated with the payment of compensated absences. The liability shown in the Board's financial statement has been accrued in accordance with this criteria. At September 30, 2012, the Property Appraiser had $52,027 in long-term compensated absences payable. Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management of the Property Appraiser to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenue and expenditures or expenses during the reporting period. Actual results could differ from those estimates. Fund Balances Assigned Unassigned Assigned fund balances are constrained by the Property Appraiser's intent to be used for specific purposes, but are neither restricted nor committed. Fund balance that has not been reported in any other classification. When both assigned and unassigned resources are available for use, it is the Property Appraiser's policy to use assigned resources first, then unassigned resources as needed. NOTE 2 - CASH AND INVESTMENTS During the fiscal year, cash consisted of an interest-bearing bank account. The funds in the bank account were entirely covered by federal depository insurance or by a collateral pool pledged to the State Treasurer by financial institutions which comply with the requirements of Florida statutes and have been designated as qualified public depositories by the State Treasurer. At September 30, 2012, the book balance of deposits was $199,485 for the Property Appraiser and the bank balance was $244,425. Florida Statutes authorize the Property Appraiser to invest in the Local Government Surplus Funds Trust Fund administered by the State Treasurer; negotiable direct obligations of or obligations unconditionally guaranteed by the U.S. Government; interest bearing time deposits or savings accounts in financial institutions located in Florida and organized under Federal or Florida laws. IV-7

180 PROPERTY APPRAISER Notes to Financial Statements September 30, 2012 NOTE 3 - AMOUNTS DUE TO FUNDING ENTITIES AND EXCESS FUNDS Substantial funding for the operations of the Property Appraiser is provided by the Hendry County Board of County Commissioners. The amount of such funding is estimated in the budgeting process and by Statute, any excess of revenues over expenditures which would otherwise exist is returned to the appropriate funding entity and is, therefore, reflected as a liability and an operating transfer out in the accompanying financial statements. NOTE 4 - GENERAL LONG-TERM DEBT Changes in General Long-Term Debt Changes in the general long-term debt of the Property Appraiser for the year ended September 30, 2012, are summarized below: Compensated Absences General long-term debt at 10/1/2011 $ 38,831 Increase in accrued compensated absences 13,196 General long-term debt at 9/30/2012 $ 52,027 NOTE 5 - GENERAL FIXED ASSETS Tangible personal property used by the Property Appraiser in his operations is shown in the statement of net assets of the Board of County Commissioners. In addition, office space used in the Property Appraiser's operations is provided at no cost by the Board of County Commissioners. NOTE 6 - RETIREMENT PLAN Plan Description and Provisions The Property Appraiser contributes to the Florida Retirement System (System), a cost-sharing multipleemployer PERS defined benefit plan controlled by the State Legislature and administered by the Florida Department of Administration, Division of Retirement. The System provides retirement and disability benefits, annual cost-of-living adjustments, a health insurance subsidy, and survivor benefits to plan members and beneficiaries, respectively. The System was established in 1970 by Chapter 121, Florida Statutes. Changes to the law can be made only by an act of the Florida Legislature. Rules governing the operations and administration of the System may be found in Chapter 60S of the Florida Administrative Code. The Florida Retirement System Annual Report is a document printed for members of the Legislature and the public, reflecting the financial operation and condition of the state-administered retirement systems. The publication contains financial statements, actuarial comments, investment information, and statistical data on the System. A copy can be obtained by writing to Division of Retirement, Research, Education, & Policy Section, 2639-C North Monroe Street, Tallahassee, Florida IV-8

181 PROPERTY APPRAISER Notes to Financial Statements September 30, 2012 NOTE 6 - RETIREMENT PLAN (Continued) Funding Policy Presently, the System requires covered members to contribute 3% of gross wages. The Property Appraiser is required to contribute an actuarially determined rate. The current rates, based on employees' gross earnings, are: regular employees, 5.18%; senior management,6.30%; deferred retirement option program, 5.44%; and elected officials, 10.23%. The contribution requirements of the Property Appraiser are established and may be amended by the State Legislature. The Property Appraiser's contributions to the System for the fiscal year ended September 30, 2012 were $41,450, equal to the required contributions. NOTE 7 - OTHER POST-EMPLOYMENT BENEFITS Plan Description In accordance with Section , Florida Statutes, because the Property Appraiser provides medical plans to employees of the Property Appraiser and their eligible dependents, the Property Appraiser is also required to provide retirees the opportunity to participate in the group employee health plan. Retirees participating in the group insurance plans offered by the County are required to contribute 100% of the active participants. Eligibility for Insurance Coverage Employees of the County and all constitutional officers who were participants in the existing medical plan at the time of retirement are entitled to participate in the Plan. Depending on the class of employee the following eligibility rules apply: Regular Class and Elected Officials - Age 62 and 6 years of service or 30 years of service, regardless of age, is normal retirement. Employees may retire early at age 43 and 6 years of service. Special Risk - Age 55 and 6 years of service or 25 years of service, regardless of age is normal retirement. Employees may retire early at age 36 and 6 years of service. Fiscal Year Ended Annual OPEB Cost Employer contributed % of Annual OPEB Cost Contributed Net OPEB Obligation September 30, 2012 The funded status of the plan as of September 30, 2012 was as follows: $ 13,569 $ 2, % $ 40,064 Actuarial Accrued Liability (AAL) $ 105,836 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (AAL) $ 105,836 Covered Payroll $ 551,468 Ration of UAAL to Covered Payroll 19.2% IV-9

182 PROPERTY APPRAISER Notes to Financial Statements September 30, 2012 NOTE 8 - RISK MANAGEMENT The Property Appraiser participates in the County-wide insurance program. The Hendry County, Florida, Board of County Commissioners is a member of Public Risk Management (PRM), a local government liability risk pool. PRM administers insurance activities relating to property, general, automobile, public official's liability, worker's compensation, health, and auto physical damage. The pool assesses each member its pro-rata share of the estimated amount required to meet current year losses, operating expenses and reinsurance costs (premiums). To reduce its exposure to large losses on all types of insured events PRM uses reinsurance policies purchased from third-party carriers. The fund is fully funded annually. The premiums for this coverage are paid by the various Constitutional Officers and Board of County Commissioners on a per employee coverage basis. For fiscal year ended September 30, 2012, the Property Appraiser was charged $148,702. NOTE 9 - CONTINGENCIES The Property Appraiser is involved from time to time in certain routine litigation, the substance of which as either liabilities or recoveries, would not materially affect the financial position of the Property Appraiser. Much of the present litigation involves appraised value issues, which depending on the final resolution, effect fees earned by the Property Appraiser and/or the loss or recovery of legal fees. The Property Appraiser is not in a position at this time to predict the final outcome of the lawsuits and claims or the exact amount of costs and/or potential recovery. The Property Appraiser plans to vigorously contest these matters unless first settled. NOTE 10 - COMMITMENTS The Property Appraiser entered into an interlocal agreement with the Hendry County Board of County Commissioners for the purchase of a Computer Assisted Mass Appraisal system in December The Property Appraiser is not permitted by law to borrow money extending beyond his term is office. Therefore the Board has signed a loan agreement with Centerstate Bank for the amount of $200,000, requiring the money to be used by the Property Appraiser for the purchase of the software. Within the interlocal agreement, the Property Appraiser agrees to remit all required payments stipulated in the loan agreement to the Board in lieu of payments made to Centerstate Bank. The loan agreement between the Board and Centerstate Bank and the interlocal agreement between the Board and the Property Appraiser are dated 12/28/2011 and 12/13/2011, respectively. IV-10

183 PROPERTY APPRAISER Notes to Financial Statements September 30, 2012 NOTE 10 - COMMITMENTS (Continued) The repayment terms are as follows: Annual interest only 2.95% Interest Principal Total Payment December 28, 2012 $ 5,900 $ - $ 5,900 December 28, ,900-5,900 Annual principal payments of $40,000, plus interest December 28, ,900 40,000 45,900 December 28, ,720 40,000 44,720 December 28, ,540 40,000 43,540 December 28, ,360 40,000 42,360 December 28, ,180 40,000 41,180 Total interest to be paid $ 29,500 Total principal payments to be paid $ 200,000 Total principal and interest to be paid $ 229,500 Additionally, the Property Appraiser entered into a license and service agreement with True Automation Incorporated for the purchase, installation, and training of the new appraising software. The Property Appraiser disbursed an initial payment of $25,000 upon signing the agreement on 09/29/2011. Contract payments are tentatively scheduled as follows: Commitment to True Automation, Inc. Purchase Order 1 - Licensed Software, Implementation and Training Item Description Payment Due Date Payment Amount Initial payment upon execution of signed agreement PAID September, 2012 $ 25,000 PACS software Fall, ,458 Hardware and third-party software Fall, ,790 Professional services part 1 Winter, ,270 Professional services part 2 Spring, ,271 Total Purchase Order 1 213,789 Purchase Order 2 - Maintenance agreement Maintenance payment 1 January 1 5,850 Maintenance payment 2 April 1 5,850 Maintenance payment 3 July 1 5,850 Maintenance payment 4 October 1 5,850 Total Purchase Order 2 23,400 Total Commitment to True Automation, Inc $ 237,189 IV-11

184 REQUIRED SUPPLEMENTAL INFORMATION

185 PROPERTY APPRAISER GENERAL FUND Schedule of Revenues, Expendituress and Changes in Fund Balances- Budget and Actual For the Fiscal Year Ended September 30, 2012 Variance with Final Budget Original Budget Final Budget Actual Positive (Negative) Revenues Charges for Services $ 1,313,005 $ 1,080,154 $ 1,071,710 $ (8,444) Miscellaneous Total Revenues 1,313,005 1,080,154 1,072,213 (7,941) Expenditures General Government Personal Services 892, , ,913 23,541 Operating Expenditures 123, , ,800 15,900 Capital Outlay - 20,000 14,633 5,367 Contingency 296, Total Expenditures 1,313,005 1,080,154 1,035,346 44,808 Excess of revenues over expenditures ,867 36,867 Other financing sources (uses) Operating transfers out - - (36,867) (36,867) Total other financing sources (uses) - - (36,867) (36,867) Excess of revenues and other sources over (under) expenditures and other uses Fund balances - October 1, Fund balances - September 30, 2012 $ - $ - $ - $ - IV-12

186 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special-Purpose Financial Statements Performed in Accordance with Government Auditing Standards Honorable Phillip L. Pelletier Property Appraiser Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Property Appraiser as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated May 22, 2013 for the purpose of compliance with Section (2), Florida Statutes, and Chapter , Rules of the Auditor General-Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Hendry County, Florida, Property Appraiser s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the special-purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Hendry County, Florida, Property Appraiser s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Hendry County, Florida, Property Appraiser s internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity s special-purpose financial statements will not be prevented, or detected and corrected on a timely basis. IV-13

187

188 366 East Olympia Avenue Punta Gorda, Florida Phone: Management Letter Fax: Honorable Phillip L. Pelletier Property Appraiser Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Property Appraiser, as of and for the fiscal year ended September 30, We conducted our audit in accordance with auditing standards generally accepted in the United States of America; and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States of America. We have also issued our Independent Auditor's Report on Internal Control over Financial Reporting and Compliance and Other Matters. Disclosures in that report which is dated May 22, 2013, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter , Rules of the Auditor General, which govern the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditor s reports or schedule: Section (1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no recommendations made in the preceding annual financial audit report. Section (1)(i)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section , Florida Statutes, regarding the investment of public funds. In connection with our audit, we determined that the Hendry County, Florida, Property Appraiser complied with Section , Florida Statutes. IV-15

189

190 IV-17

191 SHERIFF September 30, 2012 SPECIAL PURPOSE FINANCIAL STATEMENTS, TOGETHER WITH REPORTS OF INDEPENDENT AUDITOR S

192 TABLE OF CONTENTS Report of Independent Auditor s V-1 V-2 Special Purpose Financial Statements Balance Sheet Governmental Funds V-3 Statement of Revenues, Expenditures and Changes in Fund Balance Governmental Funds V-4 Statement of Fiduciary Net Assets Agency Funds V-5 V-7 Notes to Financial Statements V-8 V-14 Required Supplemental Information Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual General Fund V-15 Combining Statements Combining Balance Sheet Non-major Governmental Funds V-16 Combining Statement of Revenues, Expenditures and Changes in Fund Balance - Non-major Governmental Funds V-17 Combining Statement of Changes in Fiduciary Assets and Liabilities - Agency Funds V-18 V-22 Independent Auditor s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards V-23 V-24 Management Letter V-25 V-26 Response to Management Letter V-27

193 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Report of Independent Auditors Honorable Steve Whidden Sheriff Hendry County, Florida We have audited the accompanying special-purpose financial statements of the Hendry County, Florida, Sheriff as of and for the fiscal year ended September 30, 2012 as listed in the Table of Contents. These special-purpose financial statements are the responsibility of the Hendry County, Florida, Sheriff. Our responsibility is to express an opinion on these special-purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special-purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the specialpurpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, and evaluating the overall special-purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying special-purpose financial statements were prepared for the purpose of complying with Section (2), Florida Statutes, and Section , Rules of the Auditor General-Local Governmental Entity Audits, and are not intended to be a complete presentation of the financial position and changes in financial position of the Hendry County, Florida Sheriff. Additionally, the special-purpose financial statements present only the Hendry County, Florida Sheriff and are not intended to present the financial position and changes in financial position of Hendry County, Florida, taken as a whole. In our opinion, the special-purpose financial statements referred to above present fairly, in all material respects, the financial position of the Hendry County, Florida, Sheriff as of September 30, 2012 and the respective changes in financial position thereof for the fiscal year then ended, in conformity with accounting principles generally accepted in the United States of America. V-1

194

195 SHERIFF Balance Sheet - Governmental Funds September 30, 2012 General Non-Major Governmental Total Governmental Funds ASSETS Cash $ 626,753 $ 21,438 $ 648,191 Due from other Governments 90,011-90,011 Total Assets $ 716,764 $ 21,438 $ 738,202 LIABILITIES AND FUND EQUITY Liabilities Accounts Payable $ 299,108 $ - $ 299,108 Accrued Liabilities 405, ,986 Due to other County Funds 11,670-11,670 Total Liabilities 716, ,764 Fund Equity Fund Balance Assigned - 21,438 21,438 Total Fund Equity - 21,438 21,438 Total Liabilities and Fund Equity $ 716,764 $ 21,438 $ 738,202 See accompanying notes. V-3

196 SHERIFF Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds For the Fiscal Year Ended September 30, 2012 Non-Major Governmental Total Governmental Funds General Fund Revenues Intergovernmental $ 391,471 $ - $ 391,471 Charges for Services - 13,145 13,145 Fines and Forfeitures - 7,404 7,404 Miscellaneous 312, ,329 Total Revenues 703,800 20, ,349 Expenditures Law Enforcement Personal Services 6,035,564-6,035,564 Operating Expenditures 1,472,295 23,711 1,496,006 Capital Outlay 585, ,071 Debt Service Principle 132, ,188 Interest 33,974 33,974 Corrections Personal Services 2,301,716-2,301,716 Operating Expenditures 660, ,471 Capital Outlay 39,825-39,825 Judicial Personal Services 213, ,034 Total Expenditures 11,474,138 23,711 11,497,849 Excess of Revenues Over (Under) Expenditures (10,770,338) (3,162) (10,773,500) Other Financing Sources (Uses) Proceeds from Financing 361, ,160 Operating Transfers in 10,416,333-10,416,333 Operating Transfers out (7,155) - (7,155) Total other Financing Sources (Uses) 10,770,338-10,770,338 Excess of Revenues and Other Sources Over (Under) Expenditures and Other Uses - (3,162) (3,162) Fund Balance - October 1, ,600 24,600 Fund Balance - September 30, 2012 $ - $ 21,438 $ 21,438 See accompanying notes. V-4

197 SHERIFF Statement of Fiduciary Net Assets - Agency Funds September 30, 2012 Mounted Patrol Impound Fees Special Fund Relief Fund ASSETS Cash $ 488 $ 1,043 $ 7,701 $ 1,874 Total Assets $ 488 $ 1,043 $ 7,701 $ 1,874 LIABILITIES Due to Other Governments $ - $ 1,043 $ - $ - Due to Individuals 488-7,701 1,874 Total Liabilities $ 488 $ 1,043 $ 7,701 $ 1,874 See accompanying notes. V-5

198 SHERIFF Statement of Fiduciary Net Assets - Agency Funds September 30, 2012 Employee Fund Suspense Fine and Cost Canteen Fund Inmate Operating Account ASSETS Cash $ 7,873 $ 56,523 $ 447 $ 171,388 $ 17,355 Total Assets $ 7,873 $ 56,523 $ 447 $ 171,388 $ 17,355 LIABILITIES Due to Individuals $ 7,873 $ 56,523 $ 447 $ 171,388 $ 17,355 Total Liabilities $ 7,873 $ 56,523 $ 447 $ 171,388 $ 17,355 See accompanying notes. V-6

199 SHERIFF Statement of Fiduciary Net Assets - Agency Funds September 30, 2012 D.A.R.E Program Special Detail Explorer Program Auxiliary Fund Total Fidicuary Funds ASSETS Cash $ 263 $ 11,649 $ 449 $ 8,248 $ 285,301 Total Assets $ 263 $ 11,649 $ 449 $ 8,248 $ 285,301 LIABILITIES Due to other Governments $ - $ - $ - $ - $ 1,043 Due to Individuals , , ,258 Total Liabilities $ 263 $ 11,649 $ 449 $ 8,248 $ 285,301 See accompanying notes. V-7

200 SHERIFF Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity The Sheriff is an elected constitutional officer of Hendry County, a political subdivision of the State of Florida. The position of Sheriff was established by Article VIII, Section 1(d) of the Constitution of the State of Florida. The duties and responsibilities of the Sheriff are concerned with law enforcement, judicial process, and corrections. The operations are financed by appropriations made by the Board of County Commissioners pursuant to the approved budget. As required by accounting principles generally accepted in the United States of America, the financial statements of the reporting entity include those of the Sheriff and its component units. Component units are entities for which the government is considered to be financially accountable. Financial accountability is determined on the basis of the Sheriff's ability to significantly influence operations, select the governing authority, and participate in fiscal management. Based on the application of the criteria set forth by the Governmental Accounting Standards Board, management has determined that no component units exist which would require inclusion in these financial statements. (a) Fund Accounting The accounts of the Sheriff are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures, as appropriate. The various funds are grouped by type in the financial statements. The Sheriff utilizes the following funds: Governmental Funds General Fund The General Fund is used to account for all revenues and expenditures applicable to the general operations of the Sheriff which are not properly accounted for in another fund. All operating revenues, which are not specifically restricted or designated as to use, are recorded in the General Fund. Excess revenues at the end of the year, due back to the Board of County Commissioners, are shown as operating transfers out. Special Revenue Funds Special Revenue Funds are operating funds used to account for revenues (other than expendable trusts or capital projects), the use of which is restricted or designated. Fiduciary Funds Agency Funds The Agency Funds are used to account for assets held by public officials in a trustee capacity or as an agent for individuals, private organizations, other governments and/or other funds. V-8

201 SHERIFF Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) (b) Measurement Focus, Basis of Accounting, and Financial Statement Presentation Governmental Funds The General Fund iand Special Revenue Funds are accounted for on a "spending" or "financial flow" measurement focus. This means that only current assets and current liabilities are generally included on the balance sheet. Accordingly, the reported undesignated fund balance (net current assets) is considered a measure of available, spendable or appropriable resources. General operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Fiduciary Funds Agency Funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. Basis of Accounting Basis of accounting refers to when revenues and expenditures are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. All governmental and agency funds are accounted for using the modified accrual basis of accounting. All revenues are recognized when they become measurable and available as net current assets. Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. Exceptions to this general rule include: 1. Principal and interest on general long-term debt, which is recognized when due; and 2. Expenditures are not divided between years by the recording of prepaid expenses. Budgetary Process Chapter 30, of the Florida Statutes, governs the preparation, adoption and administration process of the Sheriff's annual budget. A budget is only required to be prepared for the General Fund. The budget and amendments, if any, for the General Fund are required to be submitted to and approved by the Board of County Commissioners. The budget is prepared on the modified accrual basis. The level of control for appropriations is exercised at the functional level. Budgets for the Special Revenue Funds are not required to be adopted. Encumbrances Encumbrance accounting, under which purchase orders and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is not employed by the Sheriff. V-9

202 SHERIFF Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) (c) Assets, Liabilities, and Equity Capital Assets Acquisitions of tangible personal property are recorded as expenditures at the time of purchase. These assets are reported to the Board of County Commissioners and are recorded in the County's basic financial statements. Compensated Absences It is the Sheriff's policy to permit employees to accumulate a limited amount of earned, but unused, sick and annual leave, which will be paid upon separation of service. Vacation is accrued as a liability when benefits are earned by the employee. The Sheriff uses the vesting method to accrue sick leave liability. The vesting method accrues sick leave liability for employees who are currently eligible to receive termination payments upon separation as well as those expected to become eligible in the future. As of September 30, 2012, the Sheriff had $932,320 in long-term compensated absences payable. This amount is reported in the government-wide financial statements of Hendry County, Florida. Statement of Governmental Accounting Standards Board No. 16, "Accounting for Compensated Absences", requires the compensated absences liability to be measured using the salary rate in effect at the balance sheet date and requires additional amounts to be accrued for certain salary related payments associated with the payment of compensated absences. The liability shown in the financial statements of Hendry County has been accrued in accordance with this criteria. Fund Balances The governmental fund financial statements fund balance is reported in two classifications. Assigned Unassigned Assigned fund balances are constrained by the Sheriff's intent to be used for specific purposes, but are neither restricted nor committed. Fund balance that has not been reported in any other classification. When both assigned and unassigned resources are available for use, it is the Sheriff's policy to use assigned resources first, then unassigned resources as needed. Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management of the Clerk to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenue and expenditures or expenses during the reporting period. Actual results could differ from those estimates. V-10

203 SHERIFF Notes to Financial Statements September 30, 2012 NOTE 2 - CASH AND INVESTMENTS Cash At September, , the carrying amount of the Sheriff's deposits was $933,490 and the bank balance was $1,461,024. The Sheriff held petty cash on hand as of September 30, 2012 in the amount of $100. These deposits were entirely covered during the year and at year-end by federal depository insurance or by collateral pursuant to the Public Depository Act of the State of Florida (Florida Statute Chapter 280). All Sheriff depositories are banks designated as qualified depositories by the State Treasurer. Investments Florida Statutes authorize the Sheriff to invest in the Local Government Surplus Funds Trust Fund administered by the State Treasurer; negotiable direct obligations of or obligations unconditionally guaranteed by the U.S. Government; interest-bearing time deposits or savings accounts in financial institutions located in Florida and organized under Federal or Florida laws; securities of any open-end or closed-end management type investment company or investment trust registered under the Investment Act of 1940 provided the portfolio is limited to United States Government obligations. The Sheriff did not have any investments during the year or at year end. NOTE 3 - GENERAL FIXED ASSETS Changes in general fixed assets are as follows: Beginning Balance Increases Decreases Ending Balances Equipment $ 5,086,168 $ 625,577 $ (239,280) $ 5,472,465 Less: Accumulated Depreciation (2,767,920) (723,657) 220,332 (3,271,245) Total Equipment being depreciated, net $ 2,318,248 $ (98,080) $ (18,948) $ 2,201,220 NOTE 4 - GENERAL LONG-TERM DEBT Changes in Long-Term Debt Changes in the general long-term debt of the Sheriff for the year ended September 30, 2012 are summarized below: Long-term debt payable at October 1, 2011 $ 1,116,609 Proceeds from financing 361,160 Increase in OPEB 106,847 Increase in accrued compensated absences 65,675 Principal retirements (132,188) Long-term debt payable at September 30, 2012 $ 1,518,103 General long-term debt is comprised of the following: Non-current portion of compensated absences $ 932,320 Non-current portion of OPEB 356,811 Non-current portion capital lease $ 228,972 1,518,103 V-11

204 SHERIFF Notes to Financial Statements September 30, 2012 NOTE 5- CAPITAL LEASE The Sheriff entered into an open ended capital lease with a financial institution for ten police cars. The cars where leased to the Sheriff for $36,166 each; totaling $361,160 and carries a 6% interest rate. The lease began on 6/26/12 and will mature on 6/30/2016. The lease provides for sixteen quarterly payments of $26,160 including interest. Total payments for the fiscal year are $166,160. NOTE 6 - RETIREMENT PLAN Plan Description and Provisions The Sheriff contributes to the Florida Retirement System (the "System"), a cost-sharing multiple employer PERS defined benefit pension plan controlled by the State Legislature and administered by the Florida Department of Administration, Division of Retirement. The System provides retirement and disability benefits, annual cost-of-living adjustments, a health insurance subsidy, and survivor benefits to plan members and beneficiaries, respectively. The System was established in 1970 by Chapter 121, Florida Statutes. Changes to the law can be made only by an act of the Florida Legislature. Rules governing the operations and administration of the System may be found in Chapter 60S of the Florida Administrative Code. The Florida Retirement System Annual Report is a document printed for members of the Legislature and the public, reflecting the financial operation and condition of the state-administered retirement systems. The publication contains financial statements, actuarial comments, investment information, and statistical data on the System. A copy can be obtained by writing to Division of Retirement, Research, Education, & Policy Section, 2639-C North Monroe Street, Tallahassee, Florida Funding Policy Presently, the System requires covered members to contribute 3% of gross wages. The Sheriff is required to contribute an actuarially determined rate. The current rates, based on employees' gross earnings, are: regular employees, 5.18%; senior management, 6.30%; deferred retirement option program, 5.44%; and elected officials, 10.23%. The contribution requirements of the Sheriff are established and may be amended by the State Legislature. The Sheriff's contributions to the System for the fiscal year ended September 30, 2012 were $690,071, equal to the required contributions. NOTE 7 - CONTINGENT LIABILITIES The Sheriff, in accordance with the normal conduct of its affairs, is involved in various judgments, claims, and litigations. It is expected that the final settlement of these matters will not materially affect the financial statements of the Sheriff. NOTE 8 - RELATED PARTY TRANSACTIONS The Sheriff is a constitutional county officer whose appropriations are approved by the Board of County Commissioners. The Board has agreed to provide certain operating expenditures for the Sheriff. The Board paid all property and casualty insurance and workers' compensation premiums for the Sheriff. V-12

205 SHERIFF Notes to Financial Statements September 30, 2012 NOTE 9 - RISK MANAGEMENT The Sheriff is exposed to various risk of loss related to torts; theft of, or damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The Sheriff is a member of a public entity risk pool which is a cooperative group of governmental entities joining together to finance an exposure, liability, or risk. The pool provides coverage for, liability, public officials liability automobile physical damage, general liability, and automobile liability. The costs of the property and casualty insurance and workers' compensation are accounted for in the General Fund of the Board of County Commissioners. The Sheriff provides hospitalization and medical coverage through the Public Risk Management of Florida Group Health Trust. A loss fund is established to pay a self-insured retention amount of $50,000 per person. Any claims in excess of this limit are paid by aggregate and stop loss insurance. NOTE 10 - OTHER POST-EMPLOYMENT BENEFITS Plan Description In accordance with Section , Florida Statutes, because the Sheriff provides medical plans to employees of the Sheriff and their eligible dependents, the Sheriff is also required to provide retirees the opportunity to participate in the group employee health plan. Retirees participating in the group insurance plans offered by the County are required to contribute 100% of the active participants. Eligibility for Insurance Coverage Employees of the County and all constitutional officers who were participants in the existing medical plan at the time of retirement are entitled to participate in the Plan. Depending on the class of employee the following eligibility rules apply: Regular Class and Elected Officials - Age 62 and 6 years of service or 30 years of service, regardless of age, is normal retirement. Employees may retire early at age 43 and 6 years of service. Special Risk - Age 55 and 6 years of service or 25 years of service, regardless of age is normal retirement. Employees may retire early at age 36 and 6 years of service. Membership As of September 30, 2012, membership consisted of: Active Employees 153 V-13

206 NOTE 10 - OTHER POST-EMPLOYMENT BENEFITS (continued) Funding Policy HENDRY COUNTY, FLORIDA SHERIFF Notes to Financial Statements September 30, 2012 Funding for this plan is on a pay-as-you-go basis. The Program is currently unfunded. There is no separate trust through which benefits for retirees are funded. No assets are currently accumulated or earmarked for this purpose. Currently, the Sheriff has no employees receiving benefits. Annual OPEB Costs and Net OPEB Obligation Hendry County had an actuarial valuation performed for the plan as of September 30, 2012 to determine the funded status of the plan as of that date, as well as the employer's annual required contribution (ARC) for the fiscal year ended September 30, The Sheriff's annual OPEB cost for the fiscal year was set at $120,871, as the transition liability was set to zero as of September 30, The Sheriff's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation from 2012 is as follows: Fiscal Year Ended Annual OPEB Cost Employer contributed % of Annual OPEB Cost Contributed Net OPEB Obligation September 30, 2012 $ 120,871 $ 22, % $ 356,880 The funded status of the plan as of September 30, 2011 was as follows: Actuarial Accrued Liability (AAL) $ 936,415 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (AAL) $ 936,415 Covered Payroll $ 4,912,314 Ration of UAAL to Covered Payroll 19.1% V-14

207 REQUIRED SUPPLEMENTAL INFORMATION

208 SHERIFF Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual - General Fund For the Fiscal Year Ended September 30, 2012 Original Budget Final Budget Actual Variance with Final Budget Positive (Negative) Revenues Intergovernmental $ - $ 391,471 $ 391,471 $ - Miscellaneous - 312, ,329 - Total Revenues - 703, ,800 - Expenditures Law Enforcement Personal Services 5,799,745 6,035,564 6,035,564 - Operating Expenditures 1,008,000 1,472,295 1,472,295 - Capital Outlay 247, , ,233 - Debt Service - 166, ,000 - Contingency 30, Total Law Enforcement 7,084,830 8,259,092 8,259,092 - Corrections Personal Services 2,300,003 2,301,716 2,301,716 - Operating Expenditures 753, , ,471 - Capital Outlay 28,500 39,825 39,825 - Contingency 20, Total Corrections 3,101,503 3,002,012 3,002,012 - Judicial Personal Services 230, , ,034 - Operating Expenditures Capital Outlay Total Judicial 230, , ,034 - Total Expenditures 10,416,333 11,474,138 11,474,138 - Excess of Revenues Over (Under) Expenditures (10,416,333) (10,770,338) (10,770,338) - Other Financing Sources (Uses) Proceeds from Financing - 361, ,160 - Operating Transfers in 10,416,333 10,416,333 10,416,333 - Operating Transfers out - (7,155) (7,155) - Total other Financing Sources (Uses) 10,416,333 10,770,338 10,770,338 - Excess of Revenues and Other Sources Over (Under) Expenditures and Other Uses Fund Balance - October 1, Fund Balance - September 30, 2012 $ - $ - $ - $ - V-15

209 SHERIFF Combining Balance Sheet Non-Major Governmental Funds September 30, 2012 ASSETS Training Fund Federal Equitable Sharing Program Fund Gun Range Total Cash $ 1,061 $ 9,734 $ 10,643 $ 21,438 Total assets $ 1,061 $ 9,734 $ 10,643 $ 21,438 FUND EQUITY Fund Equity Fund Balances Reserved for Specific Purpose $ 1,061 $ 9,734 $ 10,643 $ 21,438 Total Fund Equity $ 1,061 $ 9,734 $ 10,643 $ 21,438 V-16

210 SHERIFF Combining Statement of Revenues, Expenditures, and Changes in Fund Balance Non-Major Governmental Funds For the Year Ended September 30, 2012 Training Fund Federal Equitable Sharing Program Fund Gun Range Total Revenues Charges for Services $ - $ 2,465 $ 10,680 $ 13,145 Collections 7, ,404 Total Revenues 7,404 2,465 10,680 20,549 Expenditures Operating Expenses 17,007-6,704 23,711 Total Expenditures 17,007-6,704 23,711 Excess of Revenues Over (Under) Expenditures (9,603) 2,465 3,976 (3,162) Fund Balances - October 1, ,664 7,269 6,667 24,600 Fund Balances - September 30, 2012 $ 1,061 $ 9,734 $ 10,643 $ 21,438 V-17

211 SHERIFF Combining Statement of Changes in Assets and Liabilities - Agency Funds For the Year Ended September 30, 2012 Balance, 10/01/11 Additions Deductions Balance, 9/30/12 Special Detail Assets Cash $ 192 $ 158,787 $ 147,330 $ 11,649 Total assets $ 192 $ 158,787 $ 147,330 $ 11,649 Liabilities Due to Individuals $ 192 $ 158,787 $ 147,330 $ 11,649 Total Liabilities $ 192 $ 158,787 $ 147,330 $ 11,649 Mounted Patrol Assets Cash $ 922 $ 351 $ 785 $ 488 Total assets $ 922 $ 351 $ 785 $ 488 Liabilities Due to Individuals $ 922 $ 351 $ 785 $ 488 Total Liabilities $ 922 $ 351 $ 785 $ 488 Special Fund Assets Cash $ 6,330 $ 1,371 $ - $ 7,701 Total assets $ 6,330 $ 1,371 $ - $ 7,701 Liabilities Due to Individuals $ 6,330 $ 1,371 $ - $ 7,701 Total Liabilities $ 6,330 $ 1,371 $ - $ 7,701 V-18

212 SHERIFF Combining Statement of Changes in Assets and Liabilities - Agency Funds For the Year Ended September 30, 2012 Balance, 10/01/11 Additions Deductions Balance, 9/30/12 Relief Fund Assets Cash $ 1,871 $ 3 $ - $ 1,874 Total assets $ 1,871 $ 3 $ - $ 1,874 Liabilities Due to Individuals $ 1,871 $ 3 $ - $ 1,874 Total Liabilities $ 1,871 $ 3 $ - $ 1,874 Employee Fund Assets Cash $ 6,888 $ 27,954 $ 26,969 $ 7,873 Total assets $ 6,888 $ 27,954 $ 26,969 $ 7,873 Liabilities Due to Individuals $ 6,888 $ 27,954 $ 26,969 $ 7,873 Total Liabilities $ 6,888 $ 27,954 $ 26,969 $ 7,873 Suspense Assets Cash $ 18,700 $ 119,206 $ 81,383 $ 56,523 Total assets $ 18,700 $ 119,206 $ 81,383 $ 56,523 Liabilities Due to Individuals $ 18,700 $ 119,206 $ 81,383 $ 56,523 Total Liabilities $ 18,700 $ 119,206 $ 81,383 $ 56,523 V-19

213 SHERIFF Combining Statement of Changes in Assets and Liabilities - Agency Funds For the Year Ended September 30, 2012 Balance, 10/01/11 Additions Deductions Balance, 9/30/12 Fine and Cost Assets Cash $ 434 $ 13 $ - $ 447 Total assets $ 434 $ 13 $ - $ 447 Liabilities Due to Individuals $ 434 $ 13 $ - $ 447 Total Liabilities $ 434 $ 13 $ - $ 447 Canteen Fund Assets Cash $ 151,074 $ 240,026 $ 219,712 $ 171,388 Total assets $ 151,074 $ 240,026 $ 219,712 $ 171,388 Liabilities Due to Individuals $ 151,074 $ 240,026 $ 219,712 $ 171,388 Total Liabilities $ 151,074 $ 240,026 $ 219,712 $ 171,388 Inmate Operating Account Assets Cash $ 17,813 $ 428,946 $ 429,404 $ 17,355 Total assets $ 17,813 $ 428,946 $ 429,404 $ 17,355 Liabilities Due to Individuals $ 17,813 $ 428,946 $ 429,404 $ 17,355 Total Liabilities $ 17,813 $ 428,946 $ 429,404 $ 17,355 V-20

214 SHERIFF Combining Statement of Changes in Assets and Liabilities - Agency Funds For the Year Ended September 30, 2012 Balance, 10/01/11 Additions Deductions Balance, 9/30/12 D.A.R.E Program Assets Cash $ 3,199 $ 8,928 $ 11,864 $ 263 Total assets $ 3,199 $ 8,928 $ 11,864 $ 263 Liabilities Due to Individuals $ 3,199 $ 8,928 11,864 $ 263 Total Liabilities $ 3,199 $ 8,928 $ 11,864 $ 263 Impound Fees Assets Cash $ 3,753 $ 4,078 $ 6,788 $ 1,043 Total assets $ 3,753 $ 4,078 $ 6,788 $ 1,043 Liabilities Due to Other Governments $ 3,753 $ 4,078 $ 6,788 $ 1,043 Total Liabilities $ 3,753 $ 4,078 $ 6,788 $ 1,043 Explorer Program Assets Cash $ 1,342 $ 12,243 $ 13,136 $ 449 Total assets $ 1,342 $ 12,243 $ 13,136 $ 449 Liabilities Due to Individuals $ 1,342 12,243 13,136 $ 449 Total Liabilities $ 1,342 $ 12,243 $ 13,136 $ 449 V-21

215 SHERIFF Combining Statement of Changes in Assets and Liabilities - Agency Funds For the Year Ended September 30, 2012 Balance, 10/01/11 Additions Deductions Balance, 9/30/12 Auxiliary Fund Assets Cash $ 8,236 $ 12 $ 8,248 Total assets $ 8,236 $ 12 $ - $ 8,248 Liabilities Due to Individuals $ 8,236 $ 12 $ - $ 8,248 Total Liabilities $ 8,236 $ 12 $ - $ 8,248 Totals - Agency Funds Assets Cash $ 220,754 $ 1,001,918 $ 937,371 $ 285,301 Total assets $ 220,754 $ 1,001,918 $ 937,371 $ 285,301 Liabilities Due to Other Governments $ 3,753 $ 4,078 $ 6,788 $ 1,043 Due to Individuals 217, , , ,258 Total Liabilities $ 220,754 $ 1,001,918 $ 937,371 $ 285,301 V-22

216 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report on Internal Control over Financial Reporting And on Compliance and Other Matters Based on an Audit of Special-Purpose Financial Statements Performed In Accordance with Government Auditing Standards Honorable Steve Whidden Sheriff Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Sheriff as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated June 12, 2013 for the purpose of compliance with Section (2), Florida Statutes, and Chapter , Rules of the Auditor General-Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Hendry County, Florida, Sheriff s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the special-purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Hendry County, Florida, Sheriff s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Hendry County, Florida, Sheriff s internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity s special-purpose financial statements will not be prevented, or detected and corrected on a timely basis. V-23

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218 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Management Letter Honorable Steve Whidden Sheriff Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida Sheriff, as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated June 12, We conducted our audit in accordance with auditing standards generally accepted in the United States of America; and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States of America. We have also issued our Independent Auditor's Report on Internal Control over Financial Reporting and Compliance and Other Matters. Disclosures in that report which is dated June 12, 2013, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter , Rules of the Auditor General, which governs the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditor s reports or schedule: Section (1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no recommendations made in the preceding annual financial audit report. Section (1)(i)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section , Florida Statutes, regarding the investment of public funds. In connection with our audit, we determined that the Hendry County, Florida, Sheriff complied with Section , Florida Statutes. Section (1)(i)3., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. V-25

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221 SUPERVISOR OF ELECTIONS September 30, 2012 SPECIAL PURPOSE FINANCIAL STATEMENTS, TOGETHER WITH REPORTS OF INDEPENDENT AUDITORS

222 Table of Contents Independent Auditor's Report VI-1 - VI-2 General Purpose Financial Statements Balance Sheet - Governmental Fund Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds Notes to Financial Statements VI-3 VI-4 VI-5 - VI-10 Required Supplementary Information Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - (Non-GAAP) General Fund Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Management Letter Response to Management Letter VI-11 VI-12 - VI-13 VI-14 - VI-15 VI-16

223 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Report of Independent Auditors Honorable Brenda K. Hoots Supervisor of Elections Hendry County, Florida We have audited the accompanying special-purpose financial statements of the Hendry County, Florida, Supervisor of Elections as of and for the fiscal year ended September 30, 2012 as listed in the Table of Contents. These special-purpose financial statements are the responsibility of the Hendry County, Florida, Supervisor of Elections. Our responsibility is to express an opinion on these special-purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special-purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the specialpurpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, and evaluating the overall special-purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying special-purpose financial statements were prepared for the purpose of complying with Section (2), Florida Statutes, and Section , Rules of the Auditor General-Local Governmental Entity Audits, and are not intended to be a complete presentation of the financial position and changes in financial position of the Hendry County, Florida Supervisor of Elections. Additionally, the special-purpose financial statements present only the Hendry County, Florida Supervisor of Elections and are not intended to present the financial position and changes in financial position of Hendry County, Florida, taken as a whole. VI-1

224

225 SUPERVISOR OF ELECTIONS Balance Sheet - Governmental Funds September 30, 2012 Governmental Funds General Fund Federal Election Activities Fund Total Governmental Funds ASSETS Cash $ 5,094 $ - $ 5,094 Total assets $ 5,094 $ - $ 5,094 LIABILITIES AND FUND EQUITY Liabilities Due to the Board of County Commissioners $ 5,094 $ - $ 5,094 Total liabilities 5,094-5,094 Fund equity Fund balance Total fund equity Total liabilities and fund equity $ 5,094 $ - $ 5,094 See accompanying notes VI-3

226 SUPERVISOR OF ELECTIONS Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds For the Fiscal Year Ended September 30, 2012 Federal Election Activities Fund Total Governmental Funds General Fund Revenues Charges for services $ 7,030 $ - $ 7,030 Miscellaneous 6,743 6,743 Interest Total revenues 13,951-13,951 Expenditures Governmental expenditures 430, ,001 Excess of revenues under expenditures (417,022) (28) (417,050) Other financing sources (uses) Operating transfers in 432, ,116 Operating transfers out (15,094) - (15,094) Total other financing sources (uses) 417, ,022 Excess of revenues and other sources over (under) expenditures and other uses - (28) (28) Fund balance - October 1, Fund balance - September 30, 2012 $ - $ - $ - See accompanying notes VI-4

227 SUPERVISOR OF ELECTIONS Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Financial Reporting Entity The Supervisor of Elections is an elected Constitutional Officer of Hendry County ("County"), a political subdivision of the State of Florida. The position of Supervisor of Elections was established by Article VIII, Section 1 (d) of the State of Florida Constitution. The general powers and responsibilities of the Supervisor of Elections are specified in Chapters 97 through Florida Statutes. The Supervisor of Elections is charged with the conduct of elections within the County, except certain independent special district elections separately provided for by special acts. The operations are financed by appropriations made by the Board of County Commissioners pursuant to the approved budget. As required by accounting principles generally accepted in the United States of America, the financial statements of the reporting entity include those of the Supervisor of Elections and its component units. Component units are entities for which the government is considered to be financially accountable. Financial accountability is determined on the basis of the Supervisor of Election's ability to significantly influence operations, select the governing authority, and participate in fiscal management. Based on application of the criteria set forth by the Governmental Accounting Standards Board, management has determined that no component units exist which would require inclusion in these financial statements. Fund Accounting The accounts of the Supervisor of Elections are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for using a separate set of self-balancing accounts which comprise its assets, liabilities, fund equities, revenues, and expenditures. General Fund The General Fund is used to account for all revenues and expenditures applicable to the general operations of the Supervisor of Elections. All general operating revenues which are not restricted or designated as to use by outside sources are recorded in the General Fund. Special Revenue Funds Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. Basis of Accounting Basis of accounting refers to when revenues and expenditures are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. VI-5

228 SUPERVISOR OF ELECTIONS Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, (Continued) Basis of Accounting, (Continued) All governmental funds are accounted for using the modified accrual basis of accounting. Their revenues are recognized when they become measurable and available as net current assets. Expenditures are generally recognized when the related fund liability is incurred, if measurable, except expenditures for debt service, and other long-term obligations which are recognized when paid. Budgetary Requirements Expenditures of the General Fund are controlled by appropriations in accordance with the budgetary requirements set forth in the Florida Statutes. The budgeted revenues and expenditures in the accompanying financial statements reflect all amendments approved by the Board of County Commissioners. The Supervisor of Elections follows these procedures in establishing the budgetary data reflected in the financial statements: On or before June 1 of each year the Supervisor of Elections shall submit to the Board of County Commissioners a tentative budget for the ensuing fiscal year. Budgetary control is established at the fund level. Public hearings are held by the Board to obtain taxpayer comments and possible adjustments by the Board. The Board of County Commissioners may amend, modify, increase, or reduce any or all items of expenditures in the proposed budget submitted by the Supervisor of Elections by giving written notices of its actions, after approval of the budget. 4. Prior to October 1, the budget is legally enacted by the Board. Encumbrances Encumbrance accounting, under which purchase orders and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is not employed monies are recorded in order to reserve that portion of the applicable appropriation, is not employed by the Supervisor of Elections. Compensated Absences It is the Supervisor of Election's policy to permit employees to accumulate a limited amount of earned, but unused, vacation and sick leave, which will be paid upon separation of service. Vacation is accrued as a liability when benefits are earned by the employee. The Supervisor of Elections uses the vesting method in accruing sick leave liability. The vesting method accrues sick leave liability for employees who are currently eligible to receive termination payments upon separation, as well as those expected to become eligible in the future. For the fiscal year ended September 30, 2012, the amount of accrued compensated absences was $26,790. VI-6

229 SUPERVISOR OF ELECTIONS Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, (Continued) Compensated Absences, (Continued) "Statement of Government Accounting Standards Board Number 16, Accounting for Compensated Absences", requires the compensated absences liability to be measured using the salary rate in effect at the balance sheet date and requires additional amounts to be accrued for certain salary related payments associated with the payment of compensated absences. The liability shown in the Board's financial statement has been accrued in accordance with this criteria. NOTE 2 - CASH AND INVESTMENTS During the fiscal year, cash consisted of interest-bearing bank accounts. The funds in the bank accounts were entirely covered by Federal Depository Insurance Corporation or by a collateral pool pledged to the State Treasurer by financial institutions which comply with the requirements of Florida statutes and have been designated as qualified public depositories by the State Treasurer. Florida Statutes authorize the Supervisor of Elections to invest in the Local Government Surplus Funds Trust Fund administered by the State Treasurer; negotiable direct obligations of or obligations unconditionally guaranteed by the U.S. Government; interest bearing time deposits or savings accounts in financial institutions located in Florida and organized under Federal or Florida laws. At September, , the carrying amount of the Supervisor of Elections' deposits was $4789, the bank balance was $37, and cash on hand was $300. These deposits were entirely covered during the year and year-end by federal depository insurance or by collateral pursuant to the Florida Security for Public Deposits Act of the State of Florida (Florida Statutes Chapter 280). The banks used by the Supervisor are banks designated as qualified depositories by the State Treasurer. NOTE 3 - AMOUNT TO BE REMITTED TO BOARD OF COUNTY COMMISSIONERS Funding for the operations of the Supervisor of Elections, accounted for in the General Fund, is provided by the Hendry County Board of County Commissioners. The amount of such funding is estimated in the budgeting processand by Statute, any excess of revenues and transfers over expenditures in the General Fund are returned to the Board of County Commissioners. Such excess, if any, is reflected as an operating transfer out in the accompanying financial statements. NOTE 4 - GENERAL FIXED ASSETS Tangible personal property used by the Supervisor of Elections is shown in the statement of net assets of the Board of County Commissioners. In addition, office space used in the Supervisor of Election's operations is provided at no cost by the Board of County Commissioners. VI-7

230 SUPERVISOR OF ELECTIONS Notes to Financial Statements September 30, 2012 NOTE 5 - RETIREMENT PLAN Plan Description and Provisions The Supervisor of Elections contributes to the Florida Retirement System (the "System"), a cost-sharing multiple-employer PERS defined benefit plan controlled by the State Legislature and administered by the Florida Department of Administration, Division of Retirement. The System provides retirement and disability benefits, annual cost-of-living adjustments, a health insurance subsidy, and survivor benefits to plan members and beneficiaries, respectively. The System was established in 1970 by Chapter 121, Florida Statutes. Changes to the law can be made only by an act of the Florida Legislature. Rules governing the operations and administration of the System may be found in Chapter 60S of the Florida Administrative Code. The Florida Retirement System Annual Report is a document printed for members of the Legislature and the public, reflecting the financial operation and condition of the state-administered retirement systems. The publication contains financial statements, actuarial comments, investment information, and statistical data on the System. A copy can be obtained by writing to Division of Retirement, Research, Education, & Policy Section, 2639-C Funding Policy Presently, the System requires covered members to contribute 3% of gross wages. The Supervisor of Elections is required to contribute an actuarially determined rate. The current rates, based on employees' gross earnings, are: regular employees, 5.18%; senior management, 6.30%; deferred retirement option program, 5.44%; and elected officials, 10.23%. The contribution requirements of the Supervisor of Elections are established and may be amended by the State Legislature. The Supervisor of Elections' contributions to the System for the fiscal year ended September 30, 2012 were $13,275 which were equal to the required contributions. NOTE 6 - OTHER POST-EMPLOYMENT BENEFITS Plan Description In accordance with Section , Florida Statutes, because the Supervisor of Elections provides medical plans to employees of the Supervisor of Elections and their eligible dependents, the Supervisor of Elections required to provide retirees the opportunity to participate in the group employee health plan. Retirees participating in the group insurance plans offered by the County are required to contribute 100% of the active participants. Eligibility for Insurance Coverage Employees of the County and all constitutional officers who were participants in the existing medical medical plan at the time of retirement are entitled to participate in the Plan. VI-8

231 SUPERVISOR OF ELECTIONS Notes to Financial Statements September 30, 2012 NOTE 6 - OTHER POST-EMPLOYMENT BENEFITS, (Continued) Eligibility for Insurance Coverage, (Continued) Depending on the class of employee the following eligibility rules apply: Regular Class and Elected Officials - Age 62 and 6 years of service or 30 years of service, regardless of age, is normal retirement. Employees may retire early at age 43 and 6 years of service. Special Risk - Age 55 and 6 years of service or 25 years of service, regardless of age is normal retirement. Employees may retire early at age 36 and 6 years of service. Membership As of September 30, 2012, membership consisted of: Funding Policy Active Employees Annual OPEB Costs and Net OPEB Obligation 5 Funding for this plan is on a pay-as-you-go basis. The Program is currently unfunded. There is no separate trust through which benefits for retirees are funded. No assets are currently accumulated or earmarked for this purpose. Currently, the Supervisor has no employees receiving benefits. Hendry County had an actuarial valuation performed for the plan as of September 30, 2012 to determine the funded status of the plan as of that date, as well as the employer's annual required contribution (ARC) for the fiscal year ended September 30, The Supervisor's annual OPEB cost for the fiscal year was set at $4,359 as the transition liability was set to zero as of September 30, The Supervisor's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net obligation from 2012 is as follows: Fiscal Year Ended September 30, 2012 Annual OPEB Cost Employer contributed % of Annual OPEB Cost Contributed Net OPEB Obligation $ 4,359 $ % $ 12,869 The funded status of the plan as of September 30, 2012 was as follows: Actuarial Accrued Liability (AAL) $ 34,512 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (AAL) $ 34,512 Covered Payroll $ 177,141 Ration of UAAL to Covered Payroll 19.2% VI-9

232 SUPERVISOR OF ELECTIONS Notes to Financial Statements September 30, 2012 NOTE 7 - RISK MANAGEMENT The Supervisor of Elections participates in the County-wide insurance program. The Hendry County, Florida, Board of County Commissioners is a member of Public Risk Management (PRM), a local government liability risk pool. PRM administers insurance activities relating to property, general, automobile, public officials liability, workers' compensation, health, and auto physical damage. The pool assesses each member its pro rata share of the estimated amount required to meet current year losses, operating expenses and reinsurance costs (premiums). To reduce its exposure to large losses on all types of insured events PRM uses reinsurance policies purchased from third-party carriers. The Fund is fully funded annually. The premiums for this coverage are paid by various constitutional officers and Board of County Commissioners. For fiscal year ended September 30, 2012, the Supervisor of Elections was charged $34,971. VI-10

233 REQUIRED SUPPLEMENTARY INFORMATION

234 SUPERVISOR OF ELECTIONS Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual For the Fiscal Year Ended September 30, 2012 Original Budget Final Budget Variance with Final Budget Positive (Negative) Actual Revenues Charges for services $ 7,030 $ 7,030 Miscellaneous 6,743 6,743 Interest Total revenues ,951 13,951 Expenditures Governmental expenditures 432, , ,973 1,115 Excess of revenues over (under) expenditures (432,088) (432,088) (417,022) 15,066 Other financing sources (uses) Operating transfers in 432, , , Operating transfers out - - (15,094) (15,094) Total other financing sources (uses) 432, , ,022 (15,066) Excess of revenues and other sources over (under) expenditures and other uses $ - $ - $ - Fund balance - October 1, Fund balance - September 30, 2012 $ - VI-11

235 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report on Internal Control over Financial Reporting And on Compliance and Other Matters Based on an Audit of Special-Purpose Financial Statements Performed In Accordance with Government Auditing Standards Honorable Brenda K. Hoots Supervisor of Elections Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Supervisor of Elections as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated June 6, 2013 for the purpose of compliance with Section (2), Florida Statutes, and Chapter , Rules of the Auditor General-Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Hendry County, Florida, Supervisor of Elections internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the special-purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Hendry County, Florida, Supervisor of Elections internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Hendry County, Florida, Supervisor of Elections internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity s special-purpose financial statements will not be prevented, or detected and corrected on a timely basis. VI-12

236

237 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Management Letter Honorable Brenda K. Hoots Supervisor of Elections Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida Supervisor of Elections, as of and for the fiscal year ended September 30, We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States of America. We have also issued our Independent Auditor's Report on Internal Control over Financial Reporting and Compliance and Other Matters. Disclosures in that report, which is dated June 6, 2013, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter , Rules of the Auditor General, which governs the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditor s reports or schedule: Section (1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no recommendations made in the preceding annual financial audit report. Section (1)(i)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section , Florida Statutes, regarding the investment of public funds. In connection with our audit, we determined that the Hendry County, Florida, Supervisor of Elections complied with Section , Florida Statutes. VI-14

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239 VI-16

240 TAX COLLECTOR September 30, 2012 SPECIAL PURPOSE FINANCIAL STATEMENTS, TOGETHER WITH REPORTS OF INDEPENDENT AUDITORS

241 TAX COLLECTOR SPETEMBER 30, 2012 Table of Contents Pages Report of Independent Auditors VII-1 VII-2 Special Purpose Financial Statements Balance Sheet Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balance Governmental Funds Statement of Fiduciary Net Assets Agency Funds Notes to Financial Statements VII-3 VII-4 VII-5 VII-6 VII-10 Supplemental Information Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual General Fund VII-11 Combining Statements Combining Statement of Fiduciary Net Assets Agency Funds Combining Statement of Changes in Fiduciary Assets and Liabilities Agency Funds VII-12 VII-13 VII-14 VII-18 Independent Auditors Report on Compliance and on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards Management Letter Response to Management Letter VII-19 VII-20 VII-21 VI-22 VII-23

242 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Report of Independent Auditors Honorable Peggy S. Hampton Tax Collector Hendry County, Florida We have audited the accompanying special-purpose financial statements of the Hendry County, Florida, Tax Collector as of and for the fiscal year ended September 30, 2012 as listed in the Table of Contents. These special-purpose financial statements are the responsibility of the Hendry County, Florida, Tax Collector. Our responsibility is to express an opinion on these special-purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special-purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the specialpurpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, and evaluating the overall special-purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying special-purpose financial statements were prepared for the purpose of complying with Section (2), Florida Statutes, and Section , Rules of the Auditor General-Local Governmental Entity Audits, and are not intended to be a complete presentation of the financial position and changes in financial position of the Hendry County, Florida Tax Collector. Additionally, the special-purpose financial statements present only the Hendry County, Florida Tax Collector and are not intended to present the financial position and changes in financial position of Hendry County, Florida, taken as a whole. In our opinion, the special-purpose financial statements referred to above present fairly, in all material respects, the financial position of the Hendry County, Florida, Tax Collector as of September 30, 2012 and the respective changes in financial position thereof for the fiscal year then ended, in conformity with accounting principles generally accepted in the United States of America. VII-1

243

244 TAX COLLECTOR Balance Sheet - Governmental Funds September 30, 2012 General Fund ASSETS Cash $ 79,984 Total Assets $ 79,984 LIABILITIES Accounts payable $ 52,307 Accrued payroll 5,768 Due to other governments 21,909 Total Liabilities $ 79,984 See accompanying notes. VII-3

245 TAX COLLECTOR Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds For the Fiscal Year Ended September 30, 2012 Revenues General Fund Charges for Services $ 1,442,066 Miscellaneous 4,271 Total Revenues 1,446,337 Expenditures General Government 1,424,428 Total Expenditures 1,424,428 Excess of revenues over expenditures 21,909 Other financing sources (uses) Operating transfers out (21,909) Total other financing sources (uses) (21,909) Excess of revenues and other sources sources over (under) expenditures and other uses - Fund balance - October 1, Fund balance - September 30, See accompanying notes. VII-4

246 TAX COLLECTOR Statement of Fiduciary Net Assets - Agency Funds September 30, 2012 Agency Funds ASSETS Cash $ 465,995 Total Assets $ 465,995 LIABILITIES Due to other constitutional officers $ 22,767 Due to other governements 546 Due to individuals 15,746 Deposits 426,936 Total Liabilities $ 465,995 See accompanying notes. VII-5

247 TAX COLLECTOR Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following is a summary of the more significant accounting principles and policies: Defining the Governmental Reporting Entity The Tax Collector, as an elected constitutional officer was established by the Constitution of the State of Florida, Article VIII, Section 1 (d). As such, the Tax Collector's special purpose financial statements are included in the government wide financial statements of Hendry County, the primary government. A component unit is a legally separate organization for which the elected officials of the primary government are financially accountable. Based on the criteria established by Statement of Governmental Accounting Standards Board Number 14, "Financial Reporting Entity", there are no component units included in the Tax Collector's financial statements Fund Accounting The accounts of the Tax Collector are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of selfbalancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures, as appropriate. Government resources are allocated to, and accounted for, in individual funds, based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The following fund types are utilized by the Tax Collector: General Fund - The General Fund is used to account for all revenues and expenditures applicable to the general operations of the Tax Collector, which are not properly accounted for in another fund. All operating revenues, which are not specifically restricted or designated as to use, are recorded in the General Fund. Excess revenues at the end of the year, due back to the Board of County Commissioners, are shown as operating transfers out. Agency Funds - The Agency Funds are used to account for assets held by public officials in a trustee capacity or as an agent for individuals, private organizations, other governments and/or other funds. Measurement Focus General Fund - The General Fund is accounted for on a "spending" or "financial flow" measurement focus. This means that only current assets and current liabilities are generally included on the balance sheet. Accordingly, the reported undesignated fund balance (net current assets) is considered a measure of available, spendable or appropriable resources. General operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. VII-6

248 TAX COLLECTOR Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) Measurement Focus - (Continued) Agency Funds - Agency Funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. Basis of Accounting Basis of accounting refers to when revenues and expenditures are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. Expenditures are generally recognized under the modified accrual basis of accounting when the related related fund liability is incurred. Exceptions to this general rule include: 1. Principal and interest on general long-term debt, which is recognized when due; and 2. Expenditures are not divided between years by the recording of prepaid expenses. Budgetary Process Chapter 195, Florida Statutes, governs the preparation, adoption and amendment process of the Tax Collector's annual budget. A budget is only required to be prepared for the General Fund. The Tax Collector's budget and amendments are prepared independently of the Board of County Commissioners and are approved by the State of Florida Department of Revenue. A copy of the approved budget is provided to the Board of County Commissioners. The budget for the General Fund is prepared on the modified accrual basis of accounting. The annual budget serves as the legal authorization for expenditures. The level of control for appropriations is exercised at the functional level. Encumbrances Encumbrance accounting, under which purchase orders and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is not employed by the Tax Collector. Fixed Assets Acquisitions of tangible personal property are recorded as expenditures in the General Fund at the time of purchase. These assets are reported to the Hendry County, Florida, Board of County Commissioners and are recorded in the government-wide financial statements of the Board. VII-7

249 TAX COLLECTOR Notes to Financial Statements September 30, 2012 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) Compensated Absences The Tax Collector's employees accumulate sick and annual leave based on the number of years of continuous service and other criteria. Upon termination of employment, employees generally receive payment for accumulated annual leave, however accrued sick hours is not paid. As of September 30, 2012, the Tax Collector had $47,481 in long-term compensated absences payable. This amount is reported in the government-wide financial statements of Hendry County, Florida. Statement of Governmental Accounting Standards Board No. 16, "Accounting for Compensated Absences", requires the compensated absences liability to be measured using the salary rate in effect at the balance sheet date and requires additional amounts to be accrued for certain salary related payments associated with the payment of compensated absences. The liability shown in the financial statements of Hendry County has been accrued in accordance with this criteria. NOTE 2 - CASH AND INVESTMENTS During the fiscal year, the Tax Collector maintained deposits in interest-bearing savings and checking accounts. At September 30, 2012, the bank balance of all accounts was $1,239,852, and the book balance of deposits was $540,549. The Tax Collector had $5,430 of cash on hand at September 30, The deposits whose values exceeded the limits of federal depository insurance are entirely insured or collateralized pursuant to the Public Depository Security Act of the State of Florida, Chapter 280 of the Florida Statutes. The Tax Collector held no investments during the fiscal year. NOTE 3 - RETIREMENT PLAN Plan Description and Provisions The Tax Collector contributes to the Florida Retirement System (the "System"), a cost-sharing multiple employer PERS defined benefit pension plan controlled by the State Legislature and administered by the Florida Department of Administration, Division of Retirement. The System provides retirement and disability benefits, annual cost-of-living adjustments, a health insurance subsidy, and survivor benefits to plan members and beneficiaries, respectively. The System was established in 1970 by Chapter 121, Florida Statutes. Changes to the law can be made only by an act of the Florida Legislature. Rules governing the operations and administration of the System may be found in Chapter 60S of the Florida Administrative Code VII-8

250 TAX COLLECTOR Notes to Financial Statements September 30, 2012 NOTE 3 - RETIREMENT PLAN- (Continued) Plan Description and Provisions - (Continued) The Florida Retirement System Annual Report is a document printed for members of the Legislature and the public, reflecting the financial operation and condition of the state-administered retirement systems. The publication contains financial statements, actuarial comments, investment information, and statistical data on the System. A copy can be obtained by writing to Division of Retirement, Research, Education, & Policy Section, 2639-C North Monroe Street, Tallahassee, Florida Funding Policy Presently, the System requires covered members to contribute 3% of gross wages. The Tax Collector is required to contribute an actuarially determined rate. The current rates, based on employees' gross earnings, are: regular employees, 5.18%; senior management, 6.30%; deferred retirement option program, 5.44%; and elected officials, 10.23%. The contribution requirements of the Tax Collector are established and may be amended by the State Legislature. The Tax Collector's contributions to the System for the fiscal year ended September 30, 2012 were $40,072, which were equal to the required contributions. NOTE 4 - GENERAL LONG-TERM DEBT The following changes in general long-term debt occurred during the year ended September 30, 2012: Long-term debt payable at October 1, 2011 $ 41,664 Increase in accrued compensated absences 5,817 Long-term debt payable at September 30, 2012 $ 47,481 General long-term debt is comprised of the following: Noncurrent portion of compensated absences. Employees of the Tax Collector are entitled to paid leave time based on length of service and job classification. $ 47,481 NOTE 5 - OTHER POST-EMPLOYMENT BENEFITS Plan Description In accordance with Section , Florida Statutes, because the Tax Collector provides medical plans to employees of the Tax Collector and their eligible dependents, the Tax Collector is also required to provide retirees the opportunity to participate in the group employee health plan. Retirees participating in the group insurance plans offered by the County are required to contribute 100% of the active participants. VII-9

251 TAX COLLECTOR Notes to Financial Statements September 30, 2012 NOTE 5 - OTHER POST-EMPLOYMENT BENEFITS - (Continued) Eligibility for Insurance Coverage Employees of the County and all constitutional officers who were participants in the existing medical plan at the time of retirement are entitled to participate in the Plan. Depending on the class of employee the following eligibility rules apply: Regular Class and Elected Officials - Age 62 and 6 years of service or 30 years of service, regardless of age, is normal retirement. Employees may retire early at age 43 and 6 years of service. Special Risk - Age 55 and 6 years of service or 25 years of service, regardless of age is normal retirement. Employees may retire early at age 36 and 6 years of service. Fiscal Year Ended September 30, 2011 Annual OPEB Cost Employer Contribution % of Annual OPEB Cost Contribution Net OPEB Obligation $ 17,145 $ 3, % $ 50,622 The funded status of the plan as of September 30, 2012 was as follows: Actuarial Accrued Liability (AAL) $ 133,445 Actuarial Value of Plan Assets - Unfunded Actuarial Accrued Liability (AAL) $ 133,445 Covered Payroll $ 696,799 Ratio of UAAL to Covered Payroll 19.2% NOTE 6 - RISK MANAGEMENT The Tax Collector participates in the County-wide insurance program. The Hendry County, Florida, Board of County Commissioners is a member of the Public Risk Management (PRM), a local government liability risk pool. PRM administers insurance activities relating to property, general, automobile, public official's liability, worker's compensation, health, and auto physical damage. The pool assesses each member its pro-rata share of the estimated amount required to meet current year losses, operating expenses and reinsurance costs (premiums). To reduce its exposure to large losses on all types of insured events PRM uses reinsurance policies purchased from third-party carriers. The fund is fully funded annually. The premiums for this coverage are paid by the various Constitutional Officers and the Board of County Commissioners on a per employee coverage basis. For the fiscal year ended September 30, 2012, the Tax Collector was charged $258,602. NOTE 7 - CONTINGENCIES The Tax Collector is involved from time to time in certain routine litigation, the substance of which as other liabilities for recoveries, would not materially affect the financial position of the Tax Collector. VII-10

252 REQUIRED SUPPLEMENTAL INFORMATION

253 TAX COLLECTOR GENERAL FUND Schedule of Revenues, Expenses and Changes in Fund Balances - Budget and Actual For the Fiscal Year Ended September 30, 2012 Variance with Final Budget Original Final Positive Budget Budget Actual (Negative) Revenues Charges for Services $ 1,237,528 $ 1,237,528 $ 1,442,066 $ 204,538 Miscellaneous 256, ,705 4,271 (252,434) Total Revenues 1,494,233 1,494,233 1,446,337 (47,896) Expenditures General Government Personal services 1,237,528 1,237,528 1,172,615 64,913 Operating expenses 256, , ,145 4,892 Capital outlay - 16,668 16,668 - Total Expenditures 1,494,233 1,494,233 1,424,428 69,805 Excess of revenues over expenditures ,909 21,909 Other financing sources (uses) Operating transfers out - - (21,909) (21,909) Total other financing sources (uses) - - (21,909) (21,909) Excess of revenues and other sources over (under) expenditures and other uses Fund balance - October 1, Fund balance - September 30, VII-11

254 TAX COLLECTOR Combining Statement of Fiduciary Net Assets - Agency Funds September 30, 2012 TAX COLLECTION LABELLE CLEWISTON SPORTS ACCOUNT TAG TAG FUND ASSETS Cash $ 433,052 $ - $ - $ - Total Assets $ 433,052 $ - $ - $ - LIABILITIES Due to Board of County Commissioners $ - $ - $ - $ - Due to other governments Due to individuals 5, Due to other funds Deposits 426, Total Liabilities $ 433,052 $ - $ - $ - VII-12

255 TAX COLLECTOR Combining Statement of Fiduciary Net Assets - Agency Funds September 30, 2012 WASTE TAX SUNSHINE CHRISTMAS COLLECTION REDEMPTION FUND CLUB TOTAL ASSETS Cash $ 22,767 $ 2,575 $ 226 $ 7,375 $ 465,995 Total Assets $ 22,767 $ 2,575 $ 226 $ 7,375 $ 465,995 LIABILITIES Due to Board of County Commissioners $ 22,767 $ - $ - $ - $ 22,767 Due to other governments Due to individuals - 2, ,375 15,746 Deposits ,936 Total Liabilities $ 22,767 $ 2,575 $ 226 $ 7,375 $ 465,995 VII-13

256 Page 1 of 5 HENDRY COUNTY, FLORIDA TAX COLLECTOR Combining Statement of Changes in Assets and Liabilities - All Agency Funds September 30, 2012 TAX COLLECTION FUND Balance Balance October 1, September 30, 2011 Additions Deletions 2012 ASSETS Cash $ 530,299 $ 45,363,976 $ 45,461,223 $ 433,052 Total Assets $ 530,299 $ 45,363,976 $ 45,461,223 $ 433,052 LIABILITIES Due to Board of County Commissioners $ - $ 40,717 $ 40,717 $ - Due to other governments - 3,509 2, Due to individuals 17, , ,123 5,570 Deposits 513,247 46,072,483 46,158, ,936 Total Liabilities $ 530,299 $ 46,886,350 $ 46,983,597 $ 433,052 LABELLE TAG ASSETS Cash $ - $ 3,103,042 $ 3,103,042 $ - Total Assets $ - $ 3,103,042 $ 3,103,042 $ - LIABILITIES Due to Board of County Commissioners $ - $ 15,300 $ 15,300 $ - Due to other governments - 3,077,539 3,077,539 - Due to individuals - 3,959 3,959 - Due to other funds - 6,759 6,759 - Total Liabilities $ - $ 3,103,557 $ 3,103,557 $ - VII-14

257 Page 2 of 5 HENDRY COUNTY, FLORIDA TAX COLLECTOR Combining Statement of Changes in Assets and Liabilities - All Agency Funds September 30, 2012 CLEWISTON TAG Balance Balance October 1, September 30, 2011 Additions Deletions 2012 ASSETS Cash $ - $ 2,030,243 $ 2,030,243 $ - Total Assets $ - $ 2,030,243 $ 2,030,243 $ - LIABILITIES Due to Board of County Commissioners $ - $ 7,027 $ 7,027 $ - Due to other governments - 2,019,748 2,019,748 - Due to individuals - 4,727 4,727 - Total Liabilities $ - $ 2,031,502 $ 2,031,502 $ - SPORTS FUND ASSETS Cash $ - $ 37,884 $ 37,884 $ - Total Assets $ - $ 37,884 $ 37,884 $ - LIABILITIES Due to other governments - $ 37,053 $ 37,053 - Due to other funds Total Liabilities $ - $ 37,884 $ 37,884 $ - VII-15

258 Page 3 of 5 HENDRY COUNTY, FLORIDA TAX COLLECTOR Combining Statement of Changes in Assets and Liabilities - All Agency Funds September 30, 2012 WASTE COLLECTION Balance Balance October 1, September 30, 2011 Additions Deletions 2012 ASSETS Cash $ 42,978 $ 48,032 $ 68,243 $ 22,767 Total Assets $ 42,978 $ 48,032 $ 68,243 $ 22,767 LIABILITIES Due to Board of County Commissioners $ 42,978 $ 13,087 $ 33,298 $ 22,767 Total Liabilities $ 42,978 $ 13,087 $ 33,298 $ 22,767 TAX REDEMPTION ASSETS Cash $ 27,561 $ 5,533,878 $ 5,558,864 $ 2,575 Total Assets $ 27,561 $ 5,533,878 $ 5,558,864 $ 2,575 LIABILITIES Due to Board of County Commissioners $ - $ 4,944,429 $ 4,944,429 $ - Due to individuals 27, , ,388 2,575 Total Liabilities $ 27,561 $ 5,125,831 $ 5,150,817 $ 2,575 VII-16

259 Page 4 of 5 HENDRY COUNTY TAX COLLECTOR Combining Statement of Changes in Assets and Liabilities - All Agency Funds September 30, 2012 SUNSHINE FUND Balance Balance October 1, September 30, 2011 Additions Deletions 2012 ASSETS Cash $ 484 $ 862 $ 1,120 $ 226 Total Assets $ 484 $ 862 $ 1,120 $ 226 LIABILITIES Due to individuals $ 484 $ 862 $ 1,120 $ 226 Total Assets $ 484 $ 862 $ 1,120 $ 226 CHRISTMAS CLUB ASSETS Cash $ 6,010 $ 1,365 $ - $ 7,375 Total Assets $ 6,010 $ 1,365 $ - $ 7,375 LIABILITIES Due to individuals $ 6,010 $ 1,365 $ - $ 7,375 Total Assets $ 6,010 $ 1,365 $ - $ 7,375 VII-17

260 Page 5 of 5 HENDRY COUNTY TAX COLLECTOR Combining Statement of Changes in Assets and Liabilities - All Agency Funds September 30, 2012 TOTAL - ALL AGENCY FUNDS ASSETS Cash $ 607,332 $ 56,119,282 $ 56,260,619 $ 465,995 Total Assets $ 607,332 $ 56,119,282 $ 56,260,619 $ 465,995 LIABILITIES Due to Board of County Commissioners $ 42,978 $ 5,020,560 $ 5,040,771 $ 22,767 Due to other governments - 5,137,849 5,137, Due to individuals 51, , ,317 15,746 Due to other funds - 7,590 7,590 - Deposits 513,247 46,072,483 46,158, ,936 Total Liabilities $ 607,332 $ 57,200,438 $ 57,341,775 $ 465,995 VII-18

261 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Independent Auditor s Report on Internal Control over Financial Reporting And on Compliance and Other Matters Based on an Audit of Special-Purpose Financial Statements Performed In Accordance with Government Auditing Standards Honorable Peggy S. Hampton Tax Collector Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Tax Collector as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated May 22, 2013 for the purpose of compliance with Section (2), Florida Statutes, and Chapter , Rules of the Auditor General-Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Hendry County, Florida, Tax Collector s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the special-purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Hendry County, Florida, Tax Collector s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Hendry County, Florida, Tax Collector s internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity s special-purpose financial statements will not be prevented, or detected and corrected on a timely basis. VII-19

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263 366 East Olympia Avenue Punta Gorda, Florida Phone: Fax: Management Letter Honorable Peggy S. Hampton Tax Collector Hendry County, Florida We have audited the special-purpose financial statements of the Hendry County, Florida, Tax Collector, as of and for the fiscal year ended September 30, 2012, and have issued our report thereon dated May 22, We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States of America. We have also issued our Independent Auditor's Report on Internal Control over Financial Reporting and Compliance and Other Matters. Disclosures in that report, which is dated May 22, 2013, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter , Rules of the Auditor General, which governs the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditor s reports or schedule: Section (1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no recommendations made in the preceding annual financial audit report. Section (1)(i)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section , Florida Statutes, regarding the investment of public funds. In connection with our audit, we determined that the Hendry County, Florida, Tax Collector complied with Section , Florida Statutes. VII-21

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