JACKSON PARISH AMBULANCE SERVICE DISTRICT JONESBORO, LOUISIANA ANNUAL FINANCIAL REPORT DECEMBER 31,2005 Under provisions of state law, this report is a public document. Acopy of the report has been submitted to the entity and other appropriate public officials. The report is available for public inspection at the Baton Rouge office of the Legislative Auditor and, where appropriate, at the office of the parish clerk of court. Release Date _
Jonesboro, Louisiana Financial Report December 31,2005 TABLE OF CONTENTS Required Supplemental Information I ' Exhibit Management's Discussion & Analysis - 1-4 Independent Auditor's Report - 5-6 Financial Statements: Proprietary Fund-Enterprise Fund Statement of Net Assets A 7 Statement of Revenues, Expenses and Changes in Net Assets B 8-9 Statement of Cash Flows C 10 Notes to Financial Statements - 12-17 Supplemental Information 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 D 18-19
JACKSON PARISH AMBULANCE SERVICE DISTRICT JONESOBORO, LOUISIANA 71251 MANAGEMENT'S DISCUSSION AND ANALYSIS This section of the 's (hereafter referred to as the District) annual financial report presents an overview and analysis of the District's financial activities for the year ended December 31, 2005. Certain comparative information with the previous year is presented to provide an overview of the District's operations. Financial Highlights The Basic Financial Statements of the District report information about the District using Governmental Accounting Standards Board's (GASB) accounting principles. These statements offer short-term and long-term financial information about its activities. The Balance Sheet (page 7) includes all of the District's assets and liabilities and provides information about the nature and amount of investments in resources (assets) and the obligations to District creditors (liabilities). All of the current year's revenues and expenses are accounted for in the Statement of Revenues, Expenses and Changes in Net Assets (pages 8-9). This statement measures improvements in the District's operations over the past year and can be used to determine whether the District has been able to recover all of its costs through its patient service revenue and other revenue sources. The final required financial statement is the Statement of Cash Flows (page 10). The primary purpose of this statement is to provide information about the District's cash from operations, investing and financing activities, and to provide answers to such questions as "where did cash come from?", what was cash used for?" and "what was the change in cash balance during the reporting period?" Financial Analysis of the Ambulance District The Balance Sheet and the Statement of Revenues, Expenses and Changes in Net Assets report information about the District's activities. These two statements report the net assets of the District and changes in them. The District's net assets-the difference between assets and liabilities-are one way to measure the District's financial health, or financial position. Over time, increases or decreases in the District's net assets is one indicator of whether its financial health is improving or deteriorating. However, other nonfinancial factors such as changes in the District's property tax base and millage, the health care industry, changes in Medicare and Medicaid regulations, and changes in commercial discounts should also be considered.
Page 2 A summary of the District's basic financial statements is as follows: Summary of Statement of Net Assets ASSETS: 2005 2004 Assets $1,411,355 $757,764 Capital Assets, Net of Accumulated Depreciation 371,860 110.854 Total Assets SI.783.215 S868.618 LIABILITIES: Current Liabilities- Payables $ 9,625 $ 18,051 Current Portion - Long-term Debt 55.000 54.000 Total Current Liabilities $ 64.625 $ 72.051 Noncurrent Liabilities- Long-term Debt $ 117,000 $172,000 Compensated Absences 23.953 21.234 Total Noncurrent Liabilities $ 140.953 $193.234 Total Liabilities $ 205.578 $265.285 NET ASSETS: Invested in Capital Assets, Net of Related Debt $ 199,860 $ 0 Unrestricted 1.377.777 603.333 Total Net Assets $1.577.637 $603.333
Page 3 Summary of Statement of Revenue and Expenses REVENUES: Operating Revenues: Ambulance Service 2005 $1,380,669 2004 $ 917,674 Non-Operating Revenues: Property Taxes & State Revenue Sharing Grants Miscellaneous Total Revenues EXPENSES: Operating Expenses Interest Expense Statutory Deductions Total Expenses Change in Net Assets 508,066 14,625 27.809 $1.931.169 $ 932,257 6,456 18.153 $ 956.866 S 974.303 341,642 13,709 8.011 $1.281,036 $ 789,914 8,837 0
Page 4 Sources of Revenue Ambulance service revenue totaled $1,380,669 or 72% of total revenue of the District for the year ended December 31,2005. Expenses The majority of the District's total expense is for payroll cost. This amounted to $620,475 or 65% of total expenses. Capital Assets The District's capital assets mainly consist of ambulances and related equipment. Debt At year-end, the District had total debt outstanding of $172,000. The District entered into the debt for the purpose of acquiring ambulances and equipment. Economic Factors The District's major revenue source is from ambulance services, which is projected to remain the same. There are no other significant changes projected. Contacting the Ambulance District's Financial Manager This financial report is designed to provide our citizens, customers and creditors with a general overview of the District's finances and to demonstrate the District's accountability for the money it receives. If you have questions about this report or requests for additional information, contact the District's Director in Jonesboro, Louisiana.
Johnson, Thomas & Cunningham Certified Public Accountants 321 Bienville Street Eddie G. Johnson, CPA - A Professional Corporation (1927-1996) Natchttoches, Louisiana 71457. (318) 352-3652 Mark D. Thomas, CPA - A Professional Corporation Fax (318) 352-4447 Roger M. Cunningham, CPA - A Professional Corporation INDEPENDENT AUDITOR'S REPORT Mr. Robert Whitten, Chairman and Members of the Board of Commissioners Jonesboro, Louisiana 71251 We have audited the accompanying financial statements of the governmental activities and the major fund of the (District), a component unit of the Jackson Parish Police Jury, as of and for the year ended December 31, 2005, which collectively comprise the District's basic financial statements as listed in the Table of Contents. These financial statements are the responsibility of the District's management. Our responsibility is to express opinions on these basic 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 and Louisiana Governmental Audit Guide. Those standards require mat 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 opinions. hi our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and the major fund of the District, as of December 31,2005, and the respective changes in financial position for the year then ended in conformity with accounting principles generally accepted in the United States of America. In accordance with Government Auditing Standards, we have also issued our report dated June 14, 2006, on our consideration of the District's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements. 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
Page 6 financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in conjunction with this report in considering the results of our audit. The Management's Discussion and Analysis on pages 1 through 4 are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the other required supplementary information. However, we did not audit the information and express no opinion on it. Johnson. Thomas & Cunningham Johnson, Thomas & Cunningham, CPA's June 14,2006 Natchitoches, Louisiana
Exhibit A Page? Statement of Net Assets Proprietary Fund December 31,2005 ASSETS: Current Assets- Cash & Cash Equivalents Receivables Total Current Assets Fixed Assets- Equipment Accumulated Depreciation Total Fixed Assets Total Assets $ 746,920 664.434 $1.411.354 $ 467,327 (95.467) S 371.860 Sl.783.214 LIABILITIES & FUND EQUITY: Current Liabilities- Accounts Payable Payroll Related Payables Accrued Interest on Certificates of Indebtedness Current Portion of Long-term Debt Total Current Liabilities Noncurrent Liabilities- Long-term Debt-Certificates of Indebtedness Compensated Absences Total Noncurrent Liabilities Total Liabilities Net Assets- Invested in Capital Assets, Net of Related Debt Unrestricted Total Net Assets $ 1,851 4,232 3,542 55.000 S 64.625 $ 117,000 23.953 140.953 205.578 $ 199,860 1.377.776 1.577.636 Total Liabilities & Net Assets See notes to financial statements.
Exhibit B PageS Statement of Revenues, Expenses and Changes in Net Assets- Proprietary Fund For the Year Ended December 31,2005 OPERATING REVENUES: Ambulance Service Total Operating Revenues OPERATING EXPENSES: Advertising Auto Fuel, Oil, & Other Maintenance Fluids Billing/Envelopes/Letterhead/Postage Depreciation Expense Dues, Subscriptions, & Licenses Insurance & Bonding Insurance - Workmen's Compensation Laundry/Uniforms Legal & Accounting Office Supplies Outside Services Payroll Taxes Rent - Radio Tower Rent & Lease (other) Repairs and Maintenance Salaries & Wages Supplies - Medical Supplies - Non-medical Taxes & Expenses Telephone & Utilities Travel/Education/Updates Total Operating Expenses Operating Income $1.380.669 $1.380.669 $ 3,884 37,584 14,898 50,099 350 20,384 33,349 5,070 13,453 4,078 2,191 48,113 1,500 2,476 26,098 620,475 23,347 12,407 4,103 6,215 2.183 $ 932.257 $ 448.412 Continued next page.
Exhibit B Page 9 Statement of Revenues, Expenses and Changes in Net Assets- Proprietary Fund-Enterprise Fund Type For the Year Ended December 31, 2005 NON-OPERATING REVENUES (EXPENSES): Ad Valorem Taxes $ 503,909 State Revenue Sharing 4,157 EMS Grant 14,625 Miscellaneous Revenue 16,055 Interest Expense (6,456) Statutory Deductions (18,153) Gain on Sale of Assets 11.754 Total Non-operating Revenues (expenses) $ 525.891 Change in Net Assets $ 974,303 Net Assets-Beginning of Year 603.333 Net Assets-End of Year $1.577.636 See notes to financial statements.
Exhibit C Page 10 Statement of Cash Flows-Proprietary Fund-Enterprise Fund Type For the Year Ended December 31,2005 CASH FLOWS FROM OPERATING ACTIVITIES: Cash Received from Customers $ 1,282,618 Cash Payments to Suppliers for Goods and Services (271,661) Cash Payments to Employees (615,138) Non-operating Revenue 370,935 Net Cash Provided (used) by Operating Activities $ 766,754 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Principal Paid on Notes $ (54,000) Interest Paid on Notes (7,522) Change in Capital Assets (299.351) Net Cash Provided (used) by Capital and Related Financing Activities Net Increase in Cash and Cash Equivalents Cash and Cash Equivalents - Beginning of Year Cash and Cash Equivalents - End of Year RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES: Operating Income $ 448,412 Adjustments to Reconcile Operating Income to Net Cash Provided (used) by Operating Activities: Depreciation 50,099 Non-operating Revenue 520,593 Changes in Assets and Liabilities: (Increase) Decrease in Accounts Receivable (247,709) Increase (Decrease) in Accounts Payable (7,360) Increase (Decrease) in Compensated Absences 2.719 Total Adjustments $ 318.343 Net Cash Provided (used) by Operating Activities S 766.754 See notes to financial statements.
NOTES TO FINANCIAL STATEMENTS
Page 12 Notes to Financial Statements December 31,2005 INTRODUCTION As provided by Louisiana Revised Statute 33:9053, the was created by an ordinance of the Jackson Parish Police Jury on May 4,1998. The District is governed by a Board of Commissioners consisting of five members appointed by the Jackson Parish Police Jury. Commissioners are residents of the parish and serve terms of 3-6 years. The commissioners do not receive compensation. The District was created for the purpose of owning and operating ambulances for the transportation of persons suffering from illness, disabilities, or injuries necessitating ambulance care. 1. Summary of Significant Accounting Policies: A. Basis of Presentation- The accompanying general purpose financial statements of the District have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. B. Reporting Entity- As the governing authority of the parish, for reporting purposes, the Jackson Parish Police Jury is the financial reporting entity for Jackson Parish. The financial reporting entity consists of (a) the primary government (police jury), (b) organizations for which the primary government is financially accountable, and (c) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity's financial statements to be misleading or incomplete. Governmental Accounting Standards Board Statement No. 14 established criteria for determining which component units should be considered part of the Jackson Parish Police Jury for financial reporting purposes. The basic criterion for including a potential component unit within the reporting entity is financial accountability. The GASB has set forth criteria to be considered in determining financial accountability. This criteria includes: 1. Appointing a voting majority of an organization's governing body, and a. The ability of the Police Jury to impose its will on that organization and/or b. The potential for the organization to provide specific financial benefits to or impose specific financial burdens on the Police Jury. 2. Organizations for which the Jackson Parish Police Jury does not appoint a voting majority but are fiscally dependent on the Jackson Parish Police Jury.
Page 13 Notes to Financial Statements December 31,2005 3. Organizations for which the reporting entity financial statements would be misleading if data of the organization is not included because of the nature or significance of the relationship. Because the Jackson Parish Police Jury appoints the organization's governing body, and the ability of the Jackson Parish Police Jury to impose its will on the District, the District was determined to be a component unit of the Jackson Parish Police Jury, the financial reporting entity. The accompanying general purpose financial statements present information only on the funds maintained by the District and do not present information on the Jackson Parish Police Jury, the general government services provided by that governmental unit, or the other governmental units that comprise the financial reporting entity. C. Fund Accounting- The District uses one fund to report on its financial position and the results of its operations. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions relating to certain government functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. The, uses an enterprise fund type of the proprietary fund category to account for operations that are financed and operated in a manner similar to a private business enterprise where the intent of the governing body is that the costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. As a proprietary activity, the District applies all applicable pronouncements by the Governmental Accounting Standards Board (GASB), as well as those pronouncements by the Financial Accounting Standards Board (FASB), Accounting Principles Board, and the Committee on Accounting Procedure issued prior to November 30, 1989. The District also applied all FASB Statements and Interpretations issued after November 30, 1989, except for those that conflict with, or contradict, GASB pronouncements, that are developed for business enterprises. D. Basis of Accounting- The accounting and financial treatment applied to a fund is determined by its measurement focus. Proprietary funds are accounted for on a flow of economic resources measurement focus and a determination of net income and capital maintenance. With this measurement focus, all assets and all liabilities associated with the operation of this fund are included on the balance sheet. The proprietary fund uses the accrual basis of accounting; revenues are recognized when earned, and expenses are recognized at the time the related liabilities are incurred.
Page 14 Notes to Financial Statements December 31,2005 Ad Valorem taxes and the related state revenue sharing are recorded in the year the taxes are assessed. Ad valorem taxes are assessed on a calendar year basis, become due on November 15 of each year, and become delinquent on December 31. Ad valorem taxes are generally collected in December of the current year and January and February of the ensuring year. Ambulance service revenues are recorded net of charges disallowed by Medicare, Medicaid, or private insurance. E. Cash and Cash Equivalents and Investments- Cash includes amounts in demand deposits, interest-bearing demand deposits, and money market accounts. Cash equivalents include amounts in time deposits and those investments with original maturities of 90 days or less. Under state law, the District may deposit funds in demand deposits, interest-bearing demand deposits, money market accounts, or time deposits with state banks organized under Louisiana law and national banks having their principal offices in Louisiana. Under state law, the District may invest in United States bonds, treasury notes, or certificates. These are classified as investments if their original maturities exceed 90 days, however, if the original maturities are 90 days or less, they are classified as cash equivalents. Jackson Parish Ambulance Service District has no investments at December 31,2005. F. Compensated Absences- The following annual and sick leave policies were in effect for the year ended December 31, 2005: All full-time employees earn annual and sick leave at varying rates from four to six days each year depending on length of service. There is a maximum accrual with varying hours depending on length of service. Upon termination, employees will receive compensation for all unused annual leave at the employees' current rate of pay. G. Fixed Assets- The fixed assets of the enterprise fund are included on the Balance Sheet of the fund, net of accumulated depreciation. Depreciation of all exhaustible fixed assets used by the enterprise fund operation is charged as an expense against operations. Depreciation has been computed using the straight-line method over the estimated useful lives of the assets, which is 5 to 10 years for ambulances and equipment. H. Estimates- The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and
Page 15 Notes to Financial Statements December 31,2005 liabilities at the date of the financial statements and the reported amounts of revenues, expenditures and expenses during the reporting period. Actual results could differ from those estimates. 2. Levied Taxes: Total taxes collected for 2005 were $503,909. The following is a summary of levied taxes: Levied Millage Expires District Taxes: Maintenance and Operation Tax 1.94 2008 Maintenance and Operation Tax 2.81 2008 Total 4.75 3. Cash and Cash Equivalents: For reporting purposes, cash and cash equivalents include demand deposits, time deposits, and certificates of deposit. At December 31, 2005, the District had cash and cash equivalents (collected bank balances) totaling $774,055. Cash and cash equivalents are stated at cost, which approximates market. Under Louisiana law, these deposits must be secured by federal deposit insurance or the pledge of securities owned by the bank. The market value of the pledged securities plus the federal deposit insurance must at all times equal the amount on deposit with the bank. These pledged securities are held in the name of the pledging bank in a holding or custodial bank in the form of safekeeping receipts held by the District. The deposits at December 31, 2005, were secured as follows: Demand Deposits $ 774,055 FDIC (100,000) Pledged Securities (674.055) Uninsured Even though the pledged securities are considered uncollateralized (Category #3), Louisiana Revised Statute 39:1229 imposes a statutory requirements on the custodial bank to advertise and sell the pledged securities within 10 days of being notified by the District that the fiscal agent has failed to pay deposited funds upon demand.
Page 16 Notes to Financial Statements December 31,2005 4. Accounts Receivable: At year-end, the District has $664,434 in receivables as follows: Intergovernmental: Ad Valorem Taxes Accounts: Medicare Private Insurance Medicaid Patient Self-Pays $468,478 102,347 81,166 8,878 3.565 Total Accounts Receivable Substantially all amounts are considered to be collectable and the District does not estimate or use an allowance for bad debt accounts. 5. Changes in Fixed Assets: The following is a summary of changes in equipment: Balance, January 1, 2005 Additions Deletions Balance, December 31, 2005 6. Long-Term Obligations: Equipment $614,931 343,401 (491.005) Accumulated Depreciation $(504,077) (50,099) 458.709 S 95.467 On August 1, 2002, the District issued Certificates of Indebtedness, Series 2002 in the amount of $325,000 for the purpose of acquiring ambulances and equipment, paying capital expenses and paying the cost of issuances of the certificates. Jonesboro State Bank purchased $280,000 of the certificates, which bear interest at 4.65% per annum. The remaining $45,000 of certificates were purchased by the State of Louisiana and bear no interest. All principal and interest requirements are funded by the annual ad valorem tax levied on taxable property within the parish. The loan agreement provides for eleven semi-annual installments. The first installment on the interest-bearing debt was paid on March 1, 2004 and the final payment is due on March 1, 2008. Principal on the non-interest bearing debt is to be repaid at $15,000 per year beginning March 1, 2005, with the final payment due March 1,2007.
Page 17 Notes to Financial Statements December 31,2005 The following is a summary of the general long-term obligation transactions relating to these certificates as of December 31,2005. Certificates of Indebtedness at January 1, 2005 Additions Payments Certificates of Indebtedness at December 31,2005 $226,600 0 (54.000) S172J The debt service requirements to maturity including $10,835 of interest are as follows: Fiscal Year Ending December 3 1 Requirement $280,000 Interest-Bearing Certificates Requirement $45,000 Non-Interest-Bearing Certificates Total Requirement Certificates of Indebtedness Series 2004 2006 2007 2008 $ 45,673 45,766 61.396 $15,000 15,000 0 $ 60,673 60,766 61.396 Total 7. Pension Plan: The District contributes to the Social Security System for its employees, and provides a 457b plan. For employees contributing up to 10% of their salary, the District will match one-half of the employees* contributions. 8. Litigation and Claims: The District is not aware of any litigation or claims at December 31, 2005.
Johnson, Thomas & Cunningham Certified Public Accountants 321 Bienville Street Eddie G. Johnson, CPA - A Professional Corporation (1927-1996) Natehitoehes, Louisiana 71457 (318) 352-3652 Mark D. Thomas, CPA - A Professional Corporation Fax (318) 352-4447 Roger M. Cunningham, CPA - A Professional Corporation 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 Mr. Robert Whitten, Chairman and Members of the Board of Commissioners Jonesboro, Louisiana 71251 We have audited the financial statements of the governmental activities and the major fund of the Jackson Parish Ambulance Service District (District), as of and for the year ended December 31, 2005, which collectively comprise the District's basic financial statements and have issued our report thereon dated June 14, 2006. 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, and the Louisiana Governmental Audit Guide. Internal Control over Financial Reporting In planning and performing our audit, we considered the District's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinions on the financial statements and not to provide an opinion on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a reportable condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by error or fraud in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operations that we consider to be material weaknesses. Compliance and Other Matters As part of obtaining reasonable assurance about whether the District's financial statements are free of 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.
Exhibit D Page 19 This report is intended solely for the information and use of the Jackson Parish Ambulance Service District's management, the Louisiana Legislative Auditor, and interested state and federal agencies and is not intended to be and should not be used by anyone other than these specified parties. However, under Louisiana Revised Statute 24:513, this report is distributed by the Legislative Auditor as a public document. Johnson. Thomas & Cunningham Johnson, Thomas & Cunningham, CPA's June 14,2006 Natchitoches, Louisiana