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CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2015
WITH COMPARATIVE TOTALS AS OF SEPTEMBER 30, 2014
Certified Public Accountants
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CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
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TABLE OF CONTENTS
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Page
TITLE PAGE
1
TABLE OF CONTENTS
2
FINANCIAL STATEMENTS
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Independent Auditor's Report
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Statements of Net Position
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Statements of Revenues, Expenses, and Changes in Fund Net Position
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Statement of Cash Flows
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Notes to Financial Statements
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Report on Internal Control Over Financial Reporting
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Schedule of Findings and Responses
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�r Deaton & Company, Chartered —-- ----
Certified Public Accountants
215 North 9th, Suite A :9111111[l. JAM
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iow Pocatello, Idaho 83201-5278
(208) 232-5825
rlYr Members of Idaho Society of Certified Public Accountants _
Members ofAmerican Institute of Certified Public Accountants
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INDEPENDENT AUDITOR'S REPORT
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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 enterprise funds and each major fund
of the Chubbuck Impact Area Wastewater Collection Authority, a component unit of the City of
AW Chubbuck, Idaho, as of and for the year ended September 30, 2015, and the related notes to the
financial statements, which collectively comprise the Authority's basic financial statements as listed in
the table of contents.
,,W 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
%W 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.
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Auditor's Responsibility
r► Our responsibility is to express opinions on these financial statements based on our audit. We
%W 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.
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%W 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
"W error. In making those risk assessments, the auditor considers internal control relevant to the entity's
"W preparation and fair presentation of the financial statements in order to design audit procedures that
VW 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
'r► for our audit opinions.
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Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the enterprise fund and each major fund information of the Chubbuck
Impact Area Waste Water Collection Authority, as of September 30, 2015, and the respective
�. changes in financial position for the years then ended in accordance with accounting principles
4W generally accepted in the United States of America
"W Other Matters
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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,
2014, 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
"r aggregate remaining fund information. That audit was conducted for the purpose of forming opinions
"W 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
"V has been derived.
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Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 24,
2016, 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 considering Chubbuck Impact Area
Wastewater Collection Authority's internal control over financial reporting and compliance.
Chubbuck, Idaho
March 24, 2016
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CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
STATEMENT OF NET POSITION
PROPRIETARY FUND
AS OF SEPTEMBER 30, 2015
WITH COMPARATIVE TOTAL AS OF SEPTEMBER 30, 2014
ASSETS
Accounts receivable
Capital assets, net of accumulated
Depreciation, where applicable:
Work in process
Land
Infrastructure
LIABILITIES
Long-term liabilities (Note - 4)
Due after one year
FUND BALANCE/NET ASSETS
NET POSITION
Net investment in capital assets
Unrestricted
0
2015 2014
$ - $ 228,000
18,560,669
386,226
18,183,193
18,569,419 18,788,669
$ 17,890,368 $ 18,334,688
17, 890, 368 18, 334, 688
679,051 225,981
- 228,000
$ 679,051 $ 453,981
The accompanying notes are an integral part of these statements
CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION
PROPRIETARY FUND
FOR THE YEAR ENDED AS OF SEPTEMBER 30, 2015
WITH COMPARATIVE TOTAL AS OF SEPTEMBER 30, 2014
OPERATING REVENUES
Charges for services
OPERATING EXPENSES
Professional fees
OPERATING INCOME (LOSS)
NONOPERATING REVENUES
Grant revenue
CHANGE IN NET POSITION
NET POSITION — BEGINNING OF THE YEAR
NET POSITION — ENDING OF THE YEAR
7
2015 2014
2,930 2,930
(2,930) (2,930)
228,000
228,000
228,000
228,000
225,070
225,070
453,981 228,911
$ 679,051 $ 453,981
The accompanying notes are an integral part of these financial statements
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CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
STATEMENT OF CASH FLOWS
PROPRIETARY FUND
FOR THE YEAR ENDED AS OF SEPTEMBER 30, 2015
WITH COMPARATIVE TOTAL AS OF SEPTEMBER 30, 2014
BEGINNING CASH AND CASH EQUIVALENTS - -
ENDING CASH AND CASH EQUIVALENTS $ - $ -
RECONCILIATION OF OPERATING INCOME
TO NET CASH PROVIDED
BY OPERATING ACTIVITIES
Net operating loss $ (2,930) $ (2,930)
NET CASH PROVIDED BY OPERATING
ACTIVITIES $ (2,930) $ (2,930)
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The accompanying notes are an integral part of these financial statements
2015
2014
CASH FLOW FROM OPERATING ACTIVITIES
Cash received from customers
$ -
$ -
Cash paid to suppliers
(2,930)
(2,930)
Net cash provided (used) by operating activities
(2,930)
(2,930)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Proceeds from capital debt
8,750
155,468
Proceeds from capital grants
456,000
-
Purchase of capital assets
(8,750)
(152,538)
Principal paid on obligations
(453,070)
-
Net cash used in capital and related
financing activities
2,930
2,930
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 operating loss $ (2,930) $ (2,930)
NET CASH PROVIDED BY OPERATING
ACTIVITIES $ (2,930) $ (2,930)
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The accompanying notes are an integral part of these financial statements
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.. CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
NOTES TO FINANCIAL STATEMENTS (PAGE 1 OF 2)
SEPTEMBER 30, 2015
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yr The Chubbuck Impact Area Wastewater Collection Authority (the Authority) is a legal joint venture between the City
MW 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.
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NOTE 1 - Summary of Siqnificant Accountinq Policies
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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.
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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
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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
.r 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).
rr "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
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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.
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D. Reclassification
Various account balances were reclassified during the year, as previously reported. These
reclassifications were required for the comparability to the current year's financial statements and must
be considered when comparing the financial statements of this report with those of prior reports.
*, E. Restricted Resources
4W It is the Authority's policy to first apply restricted resources when an expense is incurred for purposes
%W for which both restricted and unrestricted net position is available.
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CHUBBUCK IMPACT AREA WASTEWATER COLLECTION AUTHORITY
NOTES TO FINANCIAL STATEMENTS (PAGE 2 OF 2)
SEPTEMBER 30, 2015
NOTE 2 - Deposits
Deposits at yearend consist of the following:
Deposits Bank Book
Cash in bank $ - $ -
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.
Work in Process
Land
Infrastructure
Accumulated Depreciation
Book Value
NOTE 4 - Long -Term Debt
Beginning
Ending
Balance
Additions
Deletions Balance
$18,560,669
$ 8,750
$18,569,419 $ -
-
386,226
- 386,226
-
18,183,193
- 18,183,193
$18,560,669
$18,578,169
$18,569,419 $ 18,569,419
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
City of Chubbuck Advances $18,334,688 $ 8,750 $ 453,070 $ 17,890,368
NOTE 5 - Subsequent Events
Subsequent events were evaluated up to March 24, 2016, 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, 2015
Findings Of Significant Deficiency And Responses
NONE
11
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Deaton & Company, Chartered
it Certified Public Accountants 3-
215 North 9th, Suite A
Pocatello, Idaho 83201-5278
(208) 232-5825
II+ Members of Idaho Society of Certified Public Accountants
Members ofAmerican Institute of Certified Public Accountants
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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
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44W To the Board of Commissioners
4W Chubbuck Impact Area Wastewater Collection Authority
%W 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, 2015, 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 24, 2016,
1W 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
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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
MW corrected on a timely basis.
"' Our consideration of internal control over financial reporting was for the limited purpose described in
+ir• 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.
WAM
Chubbuck, Idaho
March 24, 2016