CHELAN-DOUGLAS COUNTY COMMUNITY ACTION COUNCIL FINANCIAL STATEMENTS DECEMBER 31, 2016 and 2015
Table of Contents Financial statements for the years ended December 31,2016 and 2015 Page Independent Auditor's Report... 1-2 Statements of Financial Position... 3 Statements of Activities... 4-5 Statements of Functional Expenses and Summarized Functional Expenses... 6 Statements of Cash Flows... 7 Notes to Financial Statements... 8-11 Schedule of Expenditures off ederal A wards... 12-13 Schedule of Federal Awards... 14 Schedule of State Awards... 15 Schedule of Other Awards and Contributions... 16 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... :... 17-18 Independent Auditor's Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by the Uniform Guidance... 19-21 Schedule of Findings and Questioned Costs... 22-23 Summary Schedule of Prior Audit Findings... 24
II~ McQuaig&\'elk, PLLC Certified Public Accountants INDEPENDENT AUDITOR'S REPORT To the Board of Directors Chelan-Douglas County Community Action Council Wenatchee, WA Report on the Financial Statements Riverfront Center One Fifth Street, Suite 250 Wenatchee, W A 98801 p 509 665 6600 F 866 741 5754 www.mcqw.com We have audited the accompanying financial statements of Chelan-Douglas County Community Action Council (a nonprofit organization), which comprise the statement of financial position as of December 31, 2016, and the related statements of activities, functional expenses, and cash flows for the year then ended, and the related notes to the financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Chelan-Douglas County Community Action Council as of December 31, 2016, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. tl RAN ONE J business advisor
INDEPENDENT AUDITOR'S REPORT Report on Summarized Comparative Information We have previously audited the Chelan-Douglas County Community Action Council's 2015 financial statements, and we expressed an unmodified audit opinion on those audited financial statements in our report dated September 28, 2016. In our opinion, the summarized comparative information presented herein as of and for the year ended December 31, 2015, is consistent, in all material respects, with the audited financial statements from which it has been derived. Other Matters Other Information Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole. The accompanying schedule of expenditures of federal awards, as required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards, is presented for purposes of additional analysis and is not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the financial statements as a whole. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated September 28, 2016, on our consideration of Chelan-Douglas County Community Action Council's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Chelan-Douglas County Community Action Council's internal control over financial reporting and compliance. McQuai,q & VVe[k, 'PLLC Certified Public Accountants Wenatchee, Washington August 30, 2017-2 -
STATEMENTS OF FINANCIAL POSITION December 31, 2016 and 2015 ASSETS 2016 2015 CURRENT ASSETS Cash $ 345,771 $ 146,637 Grants receivable (Note 2) 177,622 294,911 Accounts receivable 13,837 14,954 Inventory (Note I) 5,738 5,327 Total current assets 542,968 461,829 FIXED ASSETS (Notes I, 3 & 6) Land 370,270 349,729 Land improvements 50,119 50,119 Building 4,827,859 4,414,510 Equipment 165,120 165,120 Less accumulated depreciation (2,723,858) (2,459,285) Total fixed assets 2,689,510 2,520,193 TOTAL ASSETS $ 3,232,478 $ 2,982,022 LIABILITIES AND NET ASSETS CURRENT LIABILITIES Accounts payable $ 17,074 $ 22,528 Deferred revenue (Note I) 53,794 42,955 Payroll and sales taxes payable 30,937 12,066 Accrued vacation payable 41,587 43,650 Tenant security deposits payable 24,110 21,480 Line of credit 92,364 Current portion of long-term debt (Note 4) 37,597 41,218 Total current liabilities 205,099 276,261 LONG-TERM DEBT, net of current portion (Note 4) 2,665,471 2,703,208 Total liabilities 2,870,570 2,979,469 NET ASSETS Unrestricted- operating 361,908 2,553 Total net assets 361,908 2,553 TOTAL LIABILITIES AND NET ASSETS $ 3,232,478 $ 2,982,022 See independent auditor's report and accompanying notes - 3 -
STATEMENTS OF ACTIVITIES For the Years Ended December 31, 2016 and 2015 PUBLIC SUPPORT AND REVENUE 2016 2015 Grants- Federal $ 1,476,704 $ 1,384,430 Grants- State 547,419 565,192 Grants- Other 504,422 690,988 Transitional housing 370,267 329,651 Miscellaneous housing 10,81 0 11,504 Wenatchee Community Center 98,286 95,274 Other income 21,727 22,076 Contributions 83,668 16,807 In-kind rent 84,200 Interest income 153 54 EXPENSES TOTAL PUBLIC SUPPORT AND REVENUE 3,197,656 3,115,976 PROGRAM SERVICES Energy 354,667 380,619 Weatherization and repair 329,248 354,831 Children's programs 6,973 Food 398,352 356,733 Housing programs 975,1 16 1 '1 03,340 Service Corps 361,385 364,473 Community assistance 518,749 421,583 TOTAL PROGRAM SERVICES 2,937,517 2,988,552 SUPPORTING SERVICES Management and general 266,188 266,039 Fundraising 10,307 11,795 TOTAL SUPPORTING SERVICES 276,495 277,834 TOTAL EXPENSES 3,214,012 3,266,386 CHANGE IN NET ASSETS (carried fonvard) $ (16,356) $ (150,410) See independent auditor's report and accompanying notes - 4-
STATEMENTS OF ACTIVITIES For the Years Ended December 31, 2016 and 2015 2016 2015 CHANGE IN NET ASSETS (brought forward) $ ( 16,356) $ (150,41 0) NET ASSETS, beginning of year 2,553 152,963 Assets transferred from merger (Note 6) 375,711 NET ASSETS, end of year $ 361,908 $ 2,553 See independent auditor's report and accompanying notes - 5-
STATEMENTS OF FUNCTIONAL EXPENSES AND SUMMARIZED FUNCTIONAL EXPENSES For the Years Ended December 31,2016 and 2015 Operating rxptnses Salaries $ 29,030 $ 143,266 $ 52,621 $ 162,552 $ Benefits & payroll taxes 8,459 47,802 10,33 1 52,508 Total personnel expenses 37,489 191,068 62,952 215,060 136,745 $ 278,31 5 $ 802,529 40,256 118,926 278,282 177,001 397,241 1,080,811 $ 120,404 $ 1,483 $ 121,887 $ 924,416 $ 965,614 42, 157 832 42,989 321,271 277,982 162,561 2,315 ~876 1,245,687 1,243,596 Contract Labor 4,363 305 Professional fees 3,004 581 7,685 Telephone 986 3,528 686 5,126 Utilities 1,729 447 10,245 55,941 Rent 5,527 12,767 21,201 13,418 Interest 13,776 Office 5,540 1,491 8,511 10,607 Printing & administrative 11 7 112 Insurance 625 7,995 2,322 27,470 Marketing 42 42 Miscellaneous (200) Repairs & maintenance 1,973 3,002 8,282 60, 159 Travel 966 2,725 1,109 1,643 Training 803 5,124 715 295 Equipment Direct aid to individuals 294,549 97,943 299 448,884 Other agency payments 281,102 Total other expenses 3 17,178 138,180 335,400 644,804 Total expenses before depreciation 354,667 329,248 398,352 859,864 Depreciation 115,252 Total operating expenses $ 354,667 $ 329,248 $ 398,352 $ 975, 11 6 $ 153 4,821 1,344 10,974 23,588 3,550 3,118 16,994 17,254 85,616 10,410 32,624 95,947 118 13,894 13,349 762 40,260 95 6,189 6,513 2,789 3,940 45. 141 61 738 883 20 ( 180) 10,004 83,420 4,614 18,368 29,425 4,810 4,346 16.093 59,162 12,900 913,737 84,200 365,302 184,384 121,508 1,741,454 361,385 518,749 2,822,265 115,252 361,385 $ 518,749 $ 2,937,517 4,821 3,639 16,819 16,819 40,407 41,889 1,973 1,973 18,967 19,176 4,859 4,859 90,475 80,607 15,202 15,202 111, 149 111,450 100 100 13,994 16,102 2,190 7,950 10,140 50,400 50,743 456 456 6,%9 8, 126 709 709 45,850 43,239 10 10 893 1,068 (1 80) 2,713 15,967 15,967 99,387 112,445 6,333 32 6,365 35,790 32,837 1,671 1,671 17,764 22,544 2 1,6 10 10 2 1,620 935,357 1,118,940 365,302 232,302 87,899 7,992 95,891 1,837,345 1,897,820 250,460 10,307 260,767 3,083,032 3,141,41 6 15,728 15,728 130,980 124,970 $ 266,1 88 $ 10,307 $ 276,495 $ 3,214,012 $ 3,266,386-6- See independent auditor's report and accompanying notes
STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2016 and 2015 2016 2015 CASH FLOWS FROM OPERATING ACTIVITIES: Change in net assets $ ( 16,356) $ (150,410) Adjustments to reconcile change in net assets to net cash provided (used) for operating activities: Depreciation 130,979 124,970 (Increase) decrease in inventory (412) (170) (Increase) decrease in grants receivable 117,289 (152,626) (Increase) decrease in accounts receivable 1,117 (875) (Increase) decrease in prepaid expenses 47,600 1 Increase (decrease) in accounts payable & accrued expenses 12,537 (3,945) Increase( decrease) in transitional housing deposits 3,514 2,348 lncrease(decrease) in deferred revenue 10,839 19,419 lncrease(decrease) in vacation accrual (2,063) (11,093) Net cash provided (used) by operating activities 257,444 (124,782) CASH FLOWS FROM INVESTING ACTIVITIES: Cash received from merger (Note 6) 75,415 Net cash provided (used) by investing activities 75,415 CASH FLOWS FROM FINANCING ACTIVITIES: Line of credit 92,364 Payments on loans ( 13 3,725) (89,447) Net cash provided (used) by financing activities (133,725) 2,917 Net Increase (Decrease) in Cash 199,134 (121,865) Cash at Beginning of Year 146,637 268,502 Cash at End of Year $ 345,771 $ 146,637 Interest paid $ 13,993 $ 16,102 See independent auditor's report and accompanying notes - 7 -
NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 Note 1 - Summary of Significant Accounting Policies and Description of Operations (A) General The Chelan-Douglas County Community Action Council (the Council) was formed as a nonprofit organization to develop, implement, administer, and assist in the Community Action Program for the elimination of poverty and general improvement of the communities and areas within the boundaries of Chelan and Douglas counties. (B) Basis of Presentation 'lfhe financial statements of the Council have been prepared on the accrual basis of accounting. (C) Depreciation Fixed asset acquisitions purchased for grant programs in which the Council does not hold title are recorded as current period expenditures. Buildings and equipment purchased with Council's funds are capitalized and depreciated over their useful lives using the straight-line method. (D) Income Tax Status The Council qualifies as a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code and, therefore, has no provision for federal income taxes. The Council has processes presently in place to ensure the maintenance of its tax-exempt status, to identify and report unrelated income, determine its filing and tax obligations, and to review other matters that may be considered tax positions. Management of the Council believes that there are no uncertain tax positions. The Council's tax returns remain subject to audit by the IRS for three years after filing. At December 31, 2016, the returns for tax years 2015,2014, and 2013 remain open. (E) Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. - 8 -
NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015 Note 1 -Summary of Significant Accounting Policies and Description of Operations (continued) (G) Cash and Cash Equivalents For purposes of the Statements of Cash Flows, the Council considers all unrestricted highly liquid investments with an initial maturity of three months or less to be cash equivalents. The Council maintains bank accounts at Washington Federal in Wenatchee, Washington. Accounts are insured by the Federal Deposit Insurance Corporation (FDIC) up to$ 250,000. Cash exceeded federally insured limits by$ 95,77 I. (H) Inventory Inventory is valued at cost. Cost is determined using the weighted-average cost method. Inventory consists of ~aterials and supplies used in the weatherization program. (I) Deferred Revenue Unearned advances from grantor agencies are deferred and recognized when earned. Note 2 - Grants Receivable Grants receivable amounts represent grant funds committed to the Council to meet expenditures incurred, but which the Council has not received as of December 3 I, 20 I 6. This figure is net of the grant funds received in advance by the Council for which expenditures had not been incurred as of December 3 I, 20 I 6. Note 3- Fixed Assets Buildings and equipment purchased with resources from grants or loan amounts in which the Council retains title are capitalized and depreciated over their useful lives. The following schedule represents these assets as of December 3 I, 20 I 6 listed at cost: 2016 2015 Land $ 370,270 $ 349,729 Land Improvements 50,119 50,1 I 9 Equipment 165,120 165,120 Building 4,827,859 4,414,510 5,413,368 4,979,478 Less accumulated depreciation (2,723,858) (2,459,285) $ 2,689,510 $ 2,520,193-9-
NOTES TO FINANCIAL STATEMENTS December 31,2016 and 2015 Note 4 - Long-Term Debt Long-term debt consists ofthe following: Note payable to U. S. Banl<. The loan accrues interest at 7.61 %. Monthly payments are $1,192 including interest and are due and payable each month until June, 2017, when the loan matures. The loan is secured by real estate. $ 8,533 Note payable to Cashmere Valley Bank. The Joan accrues interest at 3.2%. Monthly payments are $3,410 including interest and are due and payable each month until February, 2028, when the Joan matures. The Joan is secured by real estate. 380,012 Note payable to HOME Investment Partnership Program. Annual payments of$25,000 began December 31, 2013. CD-CAC has paid the first and second payments and is in deferment. Quarterly payments of $6,250 will begin March 31, 2020 through 09/30/2047, with a balloon payment of approximately $837,000 due on December 31, 2047 The non recourse Joan accrues interest at 1% compounded annually. No penalties have been assessed. The note amount includes the original principal amount of$1,084,752 and accrued interest of $178,531. 1,263,286 Note payable to Bank of America. The Joan does not accrue interest and is secured by real estate. If all compliance is met, the loan will be forgiven in 2048. The Organization is currently in compliance with the provisions of this Joan. 109,000 Note payable to HOME Investment Partnership Program. The payments are deferred, with conditions, with quarterly payment starting September 30, 2021. No interest will be accrued during defrral period, 1% interest shall begin September 30, 2021. The entire Joan amount shall be repaid in full no later than June 30, 2065 and is secured by real estate. 942,237 Total long-term debt 2,703,068 Less current portion (37,597) Long-term debt, net of current portion $ 2,665,471 - I 0-
NOTES TO FINANCIAL STATEMENTS December 31,2016 and 2015 Note 4- Long-Term Debt- continued A summary of future repayments of long-term debt is as follows: Note 5- Employee Benefit Plan 2017 2018 2019 2020 2021 Thereafter $ 37,597 30,008 30,982 31,963 33,026 2,539,492 $ 2,703,068 On January I, 2000, the Council began a SIMPLE IRA plan for employees. The plan covers substantially all employees who have earned a min imum of $5,000. The Council makes a matching contribution to the Plan equal to a maximum of 3% of each participant's compensation. Total employee benefit plan expense for the years ended December 31, 2016 and 2015 were $19,607 and $19,373 respectively. Note 6- Merger On March 15, 2016 the Chelan-Douglas Community Service Building Association merged all of its assets and operations with Chelan-Douglas Community Action Council. Chelan-Douglas Community Service Building Association's purpose was to facilitate the purchase of property located at 620 Lewis Street, Wenatchee for Chelan-Douglas Community Action Council's use. Debt on the property was satisfied in 2015, therefore the respective Boards of Directors deemed this merger advisable. Assets held by Chelan-Douglas Community Service Building Association on the date of merger were as follows: Fair Market Value Book Value Assets: Cash $ 75,415 $ 75,415 Building, net 460,600 279,756 Land 29,400 20,540 Total Assets: $ 565 415 $ 375 711 Net Assets: Unrestricted $ 565 415 $ 375 711 No consideration was given as a result of this merger, therefore the book values of assets owned Chelan Douglas Community Service Building Association were transferred into Chelan-Douglas Community Action Council's financial statements. Note 7 - Evaluation of Subsequent Events The organization has evaluated subsequent events through August 30,2017, the date which the financial statements were available to be issued. - II -
SCHEDULE OF EXPENDITURES OF FEDERAL A WARDS For the Year Ended December 31, 2016 Federal Grantor/ Federal Pass-through Expenditures Pass through Grantor/ CFDA Grantors to Program Title Number Number Ex ~enditures Subreci~ients U.S. Department of Agriculture Passed through Washington State Department of Agriculture: Temporary Emergency Food Assistance Program- Administrative Costs 10.568 Kl654 $ 32,867 $ Food Commodities* 10.569 N/A 248,976 248,976 Total Department of Agriculture and subtotal cluster 281,843 248,976 U.S. Department of Housing and Urban Development Passed through Washington State Department of Commerce: Home Investment Partnerships Program: Tenant Based Rental Assistance 14.239 15-42401-102 110,831 Tenant Based Rental Assistance - PORCH 14.239 15-4240 1-1 23 51,546 Emergency Solutions Grant 14.23 1 Fl4-46107-002 110,335 Passed through City of Wenatchee: Community Development Block Grant 14.228 N/A 32, 176 Passed through Chelan County: Community Development Block Grant 14.228 16-622 10-003 80,231 Home Investment Partnerships Program - Loan** 14.239 N/A 1,263,286 Home Investment Partnerships Program -Loan** 14.239 N/A 942,237 Total Department of Housing and Urban Development 2,590,642 U.S. Department of Health & Human Services Passed through Washington State Department of Early Learning: Homeless Child Care 93.575 F 16-1055-02 555 Passed through Washington State Department of Commerce: Community Services Block Grant 93.569 Fl6-32 10 1-004 169,775 Low-Income Home Energy Assistance- Energy 93.568 F 16-32606-055 374,076 Weatherization 93.568 Fl6-43 101-403 83,540 Total Health and Human Services 627,946 See independent auditor's report - 12-
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (Continued) For the Year Ended December 31,2016 Federal Grantor/ Pass through Grantor/ Program Title Federal CFDA Number Pass-through Grantors Number Expenditures Expenditures to Subrecipients Corporation for National and Public Service Passed through Washington State Department of Employment Security: Vista ServiceCorporation Retired Volunteer Service Corporation Total Corporation for National and Public Service 94.013 94.002 16VSPWAOOI 19,0 13 113,504 132,517 U.S. Department of Energy Passed through Washington State Department of Commerce: Department of Energy Weatherization Total Department of Energy 81.042 Fl6-431 03-403 52,736 -----'--- 52,736 Noncash Assistance Loan TOTAL FEDERAL A WARDS $ 3,685,684 $ 248,976 Note I - Basis of Presentation The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Chelan-Douglas Community Action Council under programs of the federal government for the year ended December 31, 2016. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles. and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Chelan-Douglas Community Action Counci l, it is not intended to and does not present the financial position, changes in net assets, or cash flows of Chelan-Douglas Community Action Council. Note 2 - Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance and OMB Circular A-122, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowed or are limited as to reimbursement. Note 3- Federal Expenditures from Loans Home Investment Partnership Program Home Investment Partnership Program Total Beg Bal $1,263,286 942,237 $2,205,523 Activity 0 0 End Bal $ 1,263,286 942,237 $ 2,205,523 Note 4- De-Minimis Cost Rate The Organization did not use the I 0% de-minimis cost rate. See independent auditor's report - 13 -
SCHEDULE OF FEDERAL A WARDS For the Year Ended December 31, 2016 Program Title Revenue Department of Energy Weatherization Community Services Block Grant Low-Income Home Energy Assistance- Energy Low-Income Home Energy Assistance- Weatherization Temporary Emergency Food Assistance Program Temporary Emergency Food Assistance Program-Commodities Tenant Based Rental Assistance Tenant Based Rental Assistance - PORCH Homeless Child Care Vista Volunteer Program Retired Senior Volunteer Program Community Development Block Grant Emergency Solutions Grant TOTAL FEDERAL AWARDS $ 52,553 169,775 374,076 83,540 32,867 248,977 110,831 51,546 550 26,000 103,246 112,408 110,335 $ 1,476,704 See independent auditor's report - 14 -
SCHEDULE OF STATE A WARDS For the Year Ended December 31,2016 Pass through Grantor/ Program Title Revenue Passed through Washington State Department of Commerce: State Community Services Block Grant Energy Matchmaker Program Washington Association ofrsvp Directors Asset Building Coalition $ 23,005 78,147 25,809 10,623 Passed through Washington State Department of Agriculture: Emergency Food Assistance Program 95,952 Passed through City of Wenatchee: Housing and Essential Needs Consolidated Homeless Grant Coordinated Entry Site Grant 196,686 80,487 17,239 Passed through Washington State Department of Ecology Wood Smoke Reduction Program TOTAL STATE AWARDS $ 19,471 547,419 See independent auditor's report - 15-
SCHEDULE OF OTHER A WARDS AND CONTRIBUTIONS For the Year Ended December 31, 2015 Program Title Revenue Douglas County P.U.D. Matchmaker Douglas County P.U.D. Neighbor to Neighbor Chelan County P.U.D. Matchmaker Chelan County P.U.D. Helping Hands Program Mobile Meals Literacy Council United Way of Chelan/Douglas Counties Intermountain AmeriCorps Local Retired Senior Volunteer Program County Homeless Fund Food Distribution Center $ 42,686 1,240 95,488 23,193 37,966 I 07,328 12,921 128,100 5,893 47,674 1,933 TOTAL OTHER AWARDS $ 504,422 See independent auditor's report - 16-
II~ McQuaig&\Telk, PLLC Certified Public Accountants Riverfront Center One Fifth Street, Suite 250 Wenatchee, WA 98801 p 509 665 6600 F 866 741 5754 www.mcqw.com INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCiAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Board of Directors of Chelan-Douglas County Community Action Council We have audited, in accordance with the 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, the financial statements of Chelan-Douglas County Community Action Council (a nonprofit organization), which comprise of the statement of financial position as of December 31, 2016, and the related statements of activities, and cash flows for the year then ended, and the related notes to the financial statements, and have issued our report thereon dated Internal Control Over Financial Reporting In planning and preforming our audit of the financial statements, we considered Chelan-Douglas County Community Action Council's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of Chelan-Douglas County Community Action Council's internal control. Accordingly, we do not express an opinion on the effectiveness of the Organization's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. tl RAN ONE J business advisor - 17-
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether Chelan-Douglas County Community Action Council's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the organization's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the organization's internal control and compliance. Accordingly, this communication is not suitable for ay other purpose. :McQuaig & 'We{k, P LLC CERTIFIED PUBLIC ACCOUNTANTS Wenatchee, Washington August 30, 2017-18 -
II~ McQuaig&\lelk, PLLC Certified Public Accountants Riverfront Center One Fifth Street, Suite 250 Wenatchee, W A 98801 p 509 665 6600 F 866 741 5754 www.mcqw.com INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE To the Board of Directors of Chelan-Douglas County Community Action Council Report on Compliance for Each Major Federal Program We have audited Chelan-Douglas County Community Action Council's compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of Chelan-Douglas County Community Action Council's major federal programs for the year ended December 31, 2016. Chelan-Douglas County Community Action Council's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs. Management's Responsibility Management is responsible for compliance with federal statues, regulations, and the terms and conditions of its federal awards applicable to its federal programs. Auditor's Responsibility Our responsibility is to express an opinion on compliance for each of Chelan-Douglas County Community Action Council's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance 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 the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administravtive Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of a RAN ONE I business advisor - 19-
compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about Chelan Douglas County Community Action Council's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of Chelan-Douglas County Community Action Council's compliance. Opinion on Each Major Federal Program In our opinion, Chelan-Douglas County Community Action Council complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended December 31, 2016. Report on Internal Control Over Compliance Management of Chelan-Douglas County Community Action Council is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered Chelan-Douglas County Community Action Council's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of Chelan-Douglas County Community Action Council's internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify - 20-
any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of Uniform Guidance. Accordingly, this report is not suitable for any other purpose. JvlcQuaig & 'We[k, PLLC CERTIFIED PUBLIC ACCOUNTANTS Wenatchee, Washington August 30, 2017-21 -
SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended December 31,2016 Section I- Summary of Auditor's Results Financial Statements Type of auditor's report issued: Unqualified Internal control over financial reporting: Material weakness( es) identi tied? Reportable condition(s) identified not considered to be material weakness(es) Noncompliance material to financial statements noted? Federal Awards Internal control over major programs: Material weakness(es) identified? Reportable condition(s) identified not considered to be material weakness(es) Type of auditor's report issued on compliance for major programs: Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a) Identification of major programs: Unqualified yes X no yes X none reported yes X no yes X no --- yes X none reported --- yes X no CFDA Number(s) 14.239 Name of Federal Program or Cluster Home Investment Partnership Program Dollar threshold used to distinguish between type A and type B programs: Auditee qualified as low-risk auditee? $750,000 X yes no See independent auditor's report - 22-
SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Year Ended December 31, 2016 Section II - Financial Statement Findings No matters were reported. Section III- Federal Award Findings and Questioned Costs No matters were reported. See independent auditor's report - 23-
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS December 31, 2016 and 2015 No matters were reported. See independent auditor's report - 24-