HomeMy WebLinkAbout2014 CIAWWCACHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2014
WITH COMPARATIVE TOTALS AS OF SEPTEMBER 30, 2013
Certified Public Accountants
CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
TABLE OF CONTENTS
TITLE PAGE
Page
TABLE OF CONTENTS 2
FINANCIAL STATEMENTS
Independent Auditor's Report 3-5
Statements of Net Position 6
Statements of Activities 7
Statement of Cash Flows 8
Notes to Financial Statements 9-10
Report on Internal Control Over Financial Reporting 11-12
Schedule of Findings and Responses 13
Deaton & Company, Chartered
Certified Public Accountants
215 North 9th, Suite A
Pocatello, Idaho 83201-5278
(208)232-5825
Members of Idaho Society of Certified Public Accountants
Members of American Institute of Certified Public Accountants
INDEPENDENT AUDITOR'S REPORT
To the Board of Commissioners
Chubbuck Impact Area Wastewater Collection Authority
Chubbuck, Idaho
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and each
major fund of the Chubbuck Impact Area Wastewater Collection Authority, a component unit of the
City of Chubbuck, Idaho, as of and for the year ended September 30, 2014, and the related notes to
the financial statements, which collectively comprise the Authority's basic financial statements as
listed in the table of contents.
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 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 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 opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and each major fund information of the
Chubbuck Development Authority, as of September 30, 2014, and the respective changes in financial
position for the years then ended in accordance with accounting principles generally accepted in the
United States of America.
Other Matters
Required Supplementary Information
Management has omitted the management and discussion analysis that accounting principles
generally accepted in the United States of America require to be presented to supplement the basic
financial statements. Such missing information, although not a part of the basic financial statements,
is required by the Governmental Accounting Standards Board, who considers it to be an essential
part of financial reporting for placing the basic financial statements in an appropriate operational,
economic, or historical context. Our opinion on the basic financial statements is not affected by this
missing information.
Other Information
We also have previously audited, in accordance with auditing standards generally accepted in the
United States of America, the Authority's basic financial statements for the year ended September 30,
2013, which are not presented with the accompanying financial statements and we expressed
unmodified opinions on the respective financial statements of the governmental activities, and the
aggregate remaining fund information. That audit was conducted for the purpose of forming opinions
on the financial statements that collectively comprise the Chubbuck Impact Area Wastewater
Collection Authority's basic financial statements as a whole. The summarized comparative
information is consistent, in all material respects, with the audited financial statements from which it
has been derived.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 26,
2015, on our consideration of the Authority'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 consideringChubbuck Impact Area
Wastewater Collection Authority's internal control over financial reporting and compliance.
Chubbuck, Idaho
March 26, 2015
CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
STATEMENT OF NET POSITION
PROPRIETARY FUND
AS OF SEPTEMBER 30, 2014
WITH COMPARATIVE TOTAL AS OF SEPTEMBER 30, 2013
ASSETS
Accounts receivable
Capital assets, net of accumulated
Depreciation, where applicable:
Work in process
LIABILITIES
Accounts payable
Long-term liabilities (Note - 4)
Due within one year
Due after one year
NET POSITION
Net investment in capital assets
Unrestricted
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2014
228,000 $
18, 560, 669
18,788,669
18,334,688
18,334,688
453,981
$ 453,981
The accompanying notes are an integral part of these statements
2013
$
18,408,131
18,408,131
18,179,220
18,179,220
228,911
$ 228,911
CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
STATEMENTS OF ACTIVITIES
PROPRIETARY FUND
FOR THE YEAR ENDED AS OF SEPTEMBER 30, 2014
WITH COMPARATIVE TOTAL AS OF SEPTEMBER 30, 2013
EXPENSES
GENERAL REVENUES
CDA grant revenue
CHANGE IN NET POSITION
NET POSITION — BEGINNING OF THE YEAR
NET POSITION — ENDING OF THE YEAR
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2014 2013
$ 2,930 $ 4,574
228,000 228,000
228,000 228,000
225,070
228,911
223,426
5,485
$ 453,981 $ 228,911
The accompanying notes are an integral part of these financial statements
CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
STATEMENT OF CASH FLOWS
PROPRIETARY FUND
FOR THE YEAR ENDED AS OF SEPTEMBER 30, 2014
WITH COMPARATIVE TOTAL AS OF SEPTEMBER 30, 2013
NET INCREASE (DECREASE) IN CASH - -
BEGINNING CASH AND CASH EQUIVALENTS - -
ENDING CASH AND CASH EQUIVALENTS
RECONCILIATION OF OPERATING INCOME
TO NET CASH PROVIDED
BY OPERATING ACTIVITIES
Net income $ 225,070 $ 223,426
Change in accounts payable - (11,579)
Change in accounts receivable (228,000) -
NET CASH PROVIDED (USED) BY OPERATING
ACTIVITIES $ (2,930) $ 211,847
0
The accompanying notes are an integral part of these financial statements
2014
2013
CASH FLOW FROM OPERATING ACTIVITIES
Cash received from customers
$ -
$ 228,000
Cash paid to suppliers
(2,930)
(16,153)
Net cash provided (used) by operating activities
(2,930)
211,847
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Proceeds from capital debt
155,468
(102,850)
Purchase of capital assets
(152,538)
(108,997)
Net cash provided (used) by capital and related
financing activities
2,930
(211,847)
NET INCREASE (DECREASE) IN CASH - -
BEGINNING CASH AND CASH EQUIVALENTS - -
ENDING CASH AND CASH EQUIVALENTS
RECONCILIATION OF OPERATING INCOME
TO NET CASH PROVIDED
BY OPERATING ACTIVITIES
Net income $ 225,070 $ 223,426
Change in accounts payable - (11,579)
Change in accounts receivable (228,000) -
NET CASH PROVIDED (USED) BY OPERATING
ACTIVITIES $ (2,930) $ 211,847
0
The accompanying notes are an integral part of these financial statements
CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
NOTES TO FINANCIAL STATEMENTS (PAGE 1 OF 2)
SEPTEMBER 30, 2014
The Chubbuck Impact Area Wastewater Collection Authority (the Authority) is a legal joint venture between the City
of Chubbuck, the City of Pocatello, and Bannock County. The Authority was created in August 2007, as a separate
legal entity pursuant to Section 67-2328, of the Idaho Code. The purpose of the Authority is to acquire, construct,
own, operate, and maintain the Facility, and to provide wastewater transmission and disposal services.
NOTE 1 - Summary of Significant Accounting Policies
A. Reporting Entity
For financial reporting purposes, management has considered potential component units. The
decision to include a potential component unit in the reporting entity is made by applying the criteria set
forth in generally accepted accounting principles. The basic criterion for including a potential
component unit within the reporting entity is the governing body's responsibility for financial
accountability. Financial accountability is defined as the level of accountability that exists if a primary
government appoints a voting majority of an organization's governing board and is either able to
impose its will on that organization or there is potential for the organization to provide specific financial
benefits to, or impose specific financial burdens on, the primary government. A primary government
may also be financially accountable for governmental organizations that are fiscally dependent on it.
Based upon the application of these criteria, the Authority has no potential component units.
Under generally accepted accounting principles, as adopted by the Governmental Accounting
Standards Board, the Authority is included in the Annual Financial Statements of the City of Chubbuck
as a blended component unit.
B. Fund Accounting
The Authority uses funds to report 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 related to certain government functions or activities. A fund is a separate
accounting entity with a self -balancing set of accounts. The Operating Fund is used to account for all
business type transactions in a manner similar to commercial enterprises.
C. Basis of Accounting
The accrual basis of accounting is used. Under the accrual basis of accounting, revenues are
recognized when susceptible to accrual (i.e., when they become both measurable and available).
"Measurable" means the amount of the transaction can be determined and "available" means
collectible within the current period or soon enough thereafter to be used to pay liabilities of the current
period. The Authority considers assessments as available when they are assessed. A one-year
availability period is used for revenue recognition. Expenditures are recorded when the related fund
liability is incurred.
D. Reclassification
In the prior year, the Authority presented the fund as a governmental fund in order to better provide
transparency of the asset and liability received by the Authority. However, due to the nature of the
Authority to receive revenues on a fee basis and not having the ability to levy property taxes, the
Authority has reclassified the fund as an enterprise fund.
CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
NOTES TO FINANCIAL STATEMENTS (PAGE 2 OF 2)
SEPTEMBER 30, 2014
NOTE 2 - Deposits
Deposits at yearend consist of the following:
Deposits
Cash and cash equivalents
Bank Book
Deposits - Custodial Credit Risk for deposits is the risk that, in the event of bank failure, the
government's deposits may not be returned to it. The Authority's deposits at yearend, were entirely
covered by federal depository insurance.
NOTE 3 - Fixed Assets
All fixed assets are valued at historical cost or estimated historical cost if actual historic cost is not
available. Donated fixed assets are valued at their estimated fair value on the date donated.
Beginning Ending
Balance Additions Deletions Balance
Work in Process $18,408,131 $ 152,538 $ - $ 18,560,669
Accumulated Depreciation - - - -
Book Value $18,408,131 $ 152,538 $ - $ 18,560,669
NOTE 4 - Long -Term Debt
The Authority has received loans from the City of Chubbuck. The loans have an undetermined
schedule of payment with zero percent (0%) interest.
Long-term Debt transactions
Beginning Ending
Balance Additions Deletions Balance
City of Chubbuck Advances $18,179,219 $ 155,469 $ - $ 18,334,688
NOTE 5 - Subsequent Events
Subsequent events were evaluated up to March 26, 2015, the date the financial statements were
available to be issued.
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CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
SCHEDULE OF FINDINGS AND RESPONSES
FOR THE YEAR ENDED SEPTEMBER 30, 2014
Findings Of Significant Deficiency And Responses
NONE
11
Deaton & Company, Chartered
Certified Public Accountants
215 North 9th, Suite A
Pocatello, Idaho 83201-5278
(208)232-5825
Members of Idaho society of Certified Public Accountants
Members of A merican Institute of Certified Public Accountants
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 Commissioners
Chubbuck Impact Area Wastewater Collection Authority
Chubbuck, Idaho
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
Standardsd issued by the Comptroller General of the United States, the financial statements of the
governmental activities and each major fund, and the aggregate remaining fund information of
Chubbuck Impact Area Wastewater Collection Authority, as of and for the years ended September
30, 2014, and the related notes to the financial statements, which collectively comprise Chubbuck
Impact Area Wastewater Collection Authority's basic financial statements, and have issued our
report thereon dated March 26, 2015.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Chubbuck Impact Area Wastewater Collection
Authority's internal control over financial reporting as a basis for designing our auditing procedures
for the purpose of expressing our opinions on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the Chubbuck Impact Area Wastewater Collection
Authority's internal control over financial reporting. Accordingly, we do not express an opinion on the
effectiveness of the Chubbuck Impact Area Wastewater Collection Authority'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 financial statements will not be prevented, or detected and
corrected on a timely basis.
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 in internal control
over financial reporting that might be deficiencies, 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.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Authority'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.
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
entity'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 entity's internal control and
compliance. Accordingly, this communication is not suitable for any other purpose.
L
Chubbuck, Idaho
March 26, 2015