Basic financial statements / La Paz County, Arizona for the year ended June 30, ...

              La paz County, Arizona
Basic Financial Statements
Year ended June 30, 2004
RECFI\/ ED
OFFICE Of I tit. t'Kt.~ IDENT
Table of Contents
Independent Auditors' Report 1- 2
Management's Discussion and Analysis ( Required Supplementary Information) 3- 10
Basic Financial Statements:
Government- Wide Financial Statements:
Statement ofNet Assets 11
Statement ofActivities 12
Fund Financial Statements:
Governmental Funds:
Balance Sheet 13
Reconciliation ofthe Balance Sheet of Governmental Funds
to the Statement ofNet Assets 14
Statement of Revenues, Expenditures, and Changes in
Fund Balances 15
Reconciliation of the Statement ofRevenues, Expenditures,
and Changes in Fund Balances of Governmental Funds to the
Statement ofActivities 16
Proprietary Fund:
Statement ofNet Assets 17
Statement of Revenues, Expenses, and Changes in Fund Net Assets 18
Statement of Cash Flows 19- 20
Fiduciary Funds:
Statement of Fiduciary Net Assets 21
Statement of Changes in Fiduciary Net Assets 22
Table of Contents - Continued
Page
Notes to Financial Statements 23- 40
Other Required Supplementary Information:
Schedule ofAgent Retirement Plan's Funding Progress 41
Budgetary Comparison Schedule - General Fund .42- 44
Budgetary Comparison Schedule - Road Fund 45
Budgetary Comparison Schedule - Business 95 Road Improvement Fund 46
Budgetary Comparison Schedule - Jail District Fund 47
Notes to Budgetary Comparison Schedules 48
HEINFELD, MEECH & CO., P. C.
CERTIFIED PUBLIC ACCOUNTANTS
INDEPENDENT AUDITORS' REPORT
10120 N. Oracle Road
Tucson, Arizona 85704
Tel ( 520) 742- 2611
Fax ( 520) 742- 2718
The Auditor General of the State of Arizona
The Board of Supervisors
La Paz County, Arizona
We have audited the accompanying financial statements ofthe governmental activities, the business type
activities, each major fund, and the aggregate remaining fund information of La Paz County,
Arizona ( County), as of and for the year ended June 30, 2004, which collectively comprise the
County's basic financial statements as listed in the table ofcontents. These financial statements are
the responsibility of the County's management. Our responsibility is to express opinions on these
financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United
States ofAmerica and the standards applicable to financial audits contained in GovernmentAuditing
Standards, issued by the Comptroller General ofthe United States. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are
free ofmaterial 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.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position ofthe governmental activities, business- type activities, each major fund,
and the aggregate remaining fund information ofLa Paz County, Arizona, as ofJune 30, 2004, and
the respective changes in financial position and cash flows, where applicable, thereof for the year
then ended in conformity with accounting principles generally accepted in the United States of
America.
The Management's Discussion and Analysis on pages 3 through 10, Schedule of Agent Retirement
Plan's Funding Progress on page 41, and the Budgetary Comparison Schedules on pages 42 through
48 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 required supplementary information. However, we did not
audit the information and express no opinion on it.
TUCSON • PHOENIX • FLAGSTAFF
www. heinfe1dmeech. com
In accordance with Government Auditing Standards, we will also issue our report on our
consideration ofLa Paz County, Arizona'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 at a future date. The purpose of that report is to describe the scope of our testing of
internal control over financial reporting and compliance and the results of that testing, and not to
provide an opinion on the internal control over financial reporting or on compliance. That report is
an integral part of an audit performed in accordance with Government Auditing Standards and
should be considered in assessing the results of our audit.
HEINFELD, MEECH & CO., P. C.
Certified Public Accountants
September 15, 2008
2
Management's Discussion and Analysis
Management's Discussion and Analysis
This discussion and analysis, prepared by the County's management, is intended to be an easily readable
analysis of La paz County's ( County) financial activities based on currently known facts, decisions or
conditions during the fiscal year ended June 30, 2004. This analysis focuses on current year activities and
should be read in conjunction with the County's basic financial statements following this section.
Financial Highlights
• The County's assets exceeded liabilities by $ 21,315,107 ( net assets). Ofthis amount, $ 2,530,487
( unrestricted net assets) may be used to meet ongoing general obligations, $ 7,009,866 is restricted
for specific purposes ( restricted net assets), and $ 12,158,628 is invested in capital assets, net of
related debt.
• The County's total net assets as reported in the Statement of Activities increased by $ 1,059,594.
The increase is due primarily to an increase in general revenues of $ 1.1 million and an increase in
operating and capital grants and contributions of $. 7 million while the County's expenses
increased by a smaller proportion of $. 8 million.
• At June 30, 2004, the governmental funds reported combined fund balances of $ 10,059,668, an
increase of $ 5,477 in comparison with the prior year. The increase is a result of an increase in
revenues in a greater proportion than the increase in expenditures. Approximately 94% of the
combined fund balances, or $ 9,502,962 is available to meet the County's current and future needs
( unreserved fund balance).
• At June 30,2004, unreserved fund balance for the general fund was $ 3,717,307 or 39% of general
fund expenditures. In accordance with Arizona Revised Statutes   42- 17151, this entire amount is
budgeted to be spent in the next fiscal year.
Overview ofthe Financial Statements
This discussion and analysis is intended to serve as an introduction to the County's basic financial
statements. The County's basic financial statements comprise three components: 1) Government- wide
financial statements, 2) Fund financial statements, and 3) Notes to the financial statements. Required
supplementary information is included in addition to the basic financial statements.
Government- wide Financial Statements are designed to provide readers with a broad overview of the
County's finances, in a manner similar to private- sector businesses.
The Statement ofNet Assets presents information on all County assets and liabilities, with the difference
between the two reported as net assets. Over time, increases or decreases in net assets may serve as a
useful indicator ofwhether the financial position of the County is improving or deteriorating.
The Statement ofActivities presents information showing how net assets changed during the most recent
fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change
occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this
statement for some items that will result in cash flows in future fiscal periods ( e. g., uncollected taxes and
earned but unused vacation leave).
3
Management's Discussion and Analysis
Both of these government- wide financial statements distinguish functions of the County that are principally
supported by taxes and intergovernmental revenues ( government activities) and from other functions that are
intended to recover all or part of their costs through user fees and charges ( business- type activities). The
governmental activities of the County include general government, public safety, highways and streets, sanitation,
health, welfare, culture and recreation, and education. The County has one business- type activity, the Emerald
Canyon Golf Course.
Component units are included in our basic financial statements and consist of legally separate entities for which
the County is financially accountable and that have substantially the same board as the County or provide services
entirely to the County. The County has one major component unit, the La Paz County Jail District and several
smaller component units. Refer to Note 1 A, Reporting Entity, on page 23 of this report for more information on
the County's component units.
The government- wide financial statements can be found on pages 11- 12 ofthis report.
Fund Financial Statements are groupings of related accounts that are used to maintain control over resources
that have been segregated for specific activities or objectives. The County, like other state and local governments,
uses fund accounting to ensure and demonstrate finance- related legal compliance. All of the funds of the County
can be divided into three categories: governmentalfunds, proprietaryfunds, andfiduciary funds.
Governmentalfunds are used to account for essentially the same functions reported as governmental activities in
the government- wide financial statements. However, unlike the government- wide financial statements,
governmental funds financial statements focus on near- term inflows and outflows of usable resources, as well as
on balances of usable resources available at the end of the fiscal year. Such information may be useful in
evaluating a county's near- term financing requirements.
Because the focus of governmental funds is narrower than that of the government- wide financial statements, it is
useful to compare the information presented for governmental funds with similar information presented for
governmental activities in the government- wide financial statements. By doing so, readers may better understand
the long- term impact of the government's near- term financing decisions. Both the governmental funds balance
sheet and the governmental funds statement of revenues, expenditures, and changes in fund balance provide a
reconciliation to facilitate this comparison between governmentalfunds and governmental activities.
The County reports four major governmental funds. Information is presented separately in the governmental funds
balance sheet and in the governmental funds statement of revenues, expenditures, and changes in fund balance for
the General, Road, Business 95 Road Improvement, and Jail District funds. Data from the other governmental
funds ( non- major) are combined into a single, aggregated presentation.
The governmentalfundfinancial statements can befound on pages 13- 16 ofthis report.
4
Management's Discussion and Analysis
Proprietary funds, or enterprise funds, are used to report the same functions presented as business- type activities
in the government- wide financial statements. La Paz County uses an enterprise fund to account for the Emerald
Canyon Golf Course. Fund financial statements for the enterprise fund provides the same type of information as
the government- wide financial statements, only in more detail.
The enterprise fundfinancial statements can befound on pages 17- 20 ofthis report.
Fiduciaryfunds are used to account for resources held for the benefit of parties outside the government. Fiduciary
funds are not reflected in the government- wide financial statements because the resources of those funds are not
available to support the County's own programs.
The fiduciary funds financial statements can befound on pages 21- 22 ofthis report.
Notes to financial statements provide additional information that is essential to a full understanding of the data
provided in the government- wide and fund financial statements.
The notes can befound on pages 23- 40 ofthis report.
Required supplementary information presents budgetary comparison schedules for the General, Road, Business
95 Road Improvement, and Jail District funds of the County. It also includes a schedule of agent retirement plan's
funding progress.
Required supplementary information can befound on pages 41- 49 ofthis report.
Government- Wide Financial Analysis
Net Assets
The largest portion of the County's net assets reflects the investment in capital assets ( e. g., land, buildings,
machinery and equipment, and infrastructure), less accumulated depreciation and related debt used to acquire
those assets still outstanding. The County uses these assets to provide services to its citizens; consequently, these
assets are not available for future spending. Although the County's investment in its capital assets is reported net
of related debt, it should be noted that the resources needed to repay this debt must be provided from other
sources, since the capital assets themselves cannot be used to liquidate these liabilities. Restricted net assets
represent resources that are subject to external restrictions on how they may be used. The remaining balance of
unrestricted net assets maybe used to meet the government's ongoing obligations to the citizens and creditors.
5
Management's Discussion and Analysis
The following table summarizes the Statement ofNet Assets at June 30, 2004:
2004 2003 2004 2003 2004 2003
Business- Business-
Governmental Governmental Type Type
Activities Activities Activities Activities Total Total
Current and other assets $ 12,055,981 $ 11,403,370 $ ( 338,171) $ ( 558,186) $ 11,717,810 $ 10,845,184
Capital assets 14,404,548 13,727,968 1,694,244 1,785,552 16,098,792 15,513,520
Total assets 26,460,529 25,131,338 1,356,073 1,227,366 27,816,602 26,358,704
Current and other liabilities 1,833,451 1,121,280 62,597 60,913 1,896,048 1,182,193
Long- term liabilities 2,928,197 3,183,403 1,677,250 1,737,595 4,605,447 4,920,998
Total liabilities 4,761,648 4,304,683 1,739,847 1,798,508 6,501,495 6,103,191
Net assets
Invested in capital assets,
net of related debt 12,158,528 11,199,824 84,244 80,552 12,242,772 11,280,376
Restricted for:
Public safety 499,897 260,158 499,897 260,158
Highways and streets 5,306,547 5,618,453 5,306,547 5,618,453
Sanitation 79,091 101,050 79,091 101,050
Health 194,658 191,334 194,658 191,334
Debt service 532,633 329,563 503,316 331,746 1,035,949 661,309
Other purposes 397,040 550,979 397,040 550,979
Unrestricted net assets ( deficit) 2,530,487 2,575,294 ( 971,334) ( 983,440) 1,559,153 1,591,854
Total net assets $ 21,698,881 $ 20,826,655 $ ( 383,774) $ ( 571,142) $ 21,315,107 $ 20,255,513
As noted earlier, net assets may serve over time as a useful indicator of whether the financial position of the
County is improving or deteriorating. In the case ofthe County, assets exceeded liabilities by $ 21,315,107 at June
30, 2004, indicating that the County is in a strong financial position.
Capital assets ( and the related net asset invested in capital assets) increased as a result of continued expenditures
on several road projects that are in process. Current liabilities increased as a result of an increase in amounts
owed to vendors and amounts held in trust by the court system. Operating grants and contribution revenue
increased as a result of an overall increase in grant funding for several federal and state grants. Excise tax
increased during 2004. This amount is received from the state of Arizona which is dependent on the amount
collected by the state. Public safety expenses increased due to an increase in spending on public safety grants
such as those related to emergency services.
Net assets increased by $ 1,059,594 during the fiscal year 2003- 04 resulting primarily from general and program
revenues increasing in a greater proportion than expenses. Also, the business- type activity reflected an
unrestricted net deficit of ($ 971,334) at June 30, 2004, which resulted primarily from initial start up costs incurred
in 1989 that has not yet been recovered.
6
Management's Discussion and Analysis
Changes in Net Assets
The following table indicates the changes in net assets for governmental and business- type activities:
2004 2003 2004 2003 2004 2003
Governmental Governmental Business- Type Business- Type
Activities Activities Activities Activities Total Total
Revenues
Program revenues:
Charges for services $ 4,153,799 $ 3,803,923 $ 1,560,357 $ 1,491,691 $ 5,714,156 $ 5,295,614
Operating grants & contributions 3,789,084 3,083,846 3,789,084 3,083,846
Capital grants & contributions 3,481,115 3,489,990 3,481,115 3,489,990
General revenues:
Property taxes 2,886,713 3,001,500 2,886,713 3,001,500
Share of state sales taxes 1,738,049 1,692,572 1,738,049 1,692,572
Excise tax 2,023,755 1,650,446 2,023,755 1,650,446
Payments in lieu of taxes 1,196,941 1,053,245 1,196,941 1,053,245
Vehicle license tax 989,660 892,948 989,660 892,948
Share of state lottery 550,035 550,035 550,035 550,035
Investment earnings 88,544 160,760 1,325 46,208 89,869 206,968
Miscellaneous 899,556 222,364 205 899,556 222,569
Total revenues 21,797,251 19,601,629 1,561,682 1,538,104 23,358,933 21,139,733
Expenses
General government 5,780,803 5,674,042 5,780,803 5,674,042
Public safety 7,999,745 7,216,057 7,999,745 7,216,057
Highways and streets 4,011,208 3,686,559 4,011,208 3,686,559
Sanitation 67,463 86,493 67,463 86,493
Health 1,774,793 1,969,574 1,774,793 1,969,574
Welfare 333,673 339,391 333,673 339,391
Culture and recreation 766,341 706,819 1,347,648 1,494,430 2,113,989 2,201,249
Education 154,030 147,586 154,030 147,586
Interest on long- term debt 38,093 272,468 25,542 63,635 272,468
Total expenses 20,926,149 20,098,989 1,373,190 1,494,430 22,299,339 21,593,419
Change in net assets
before transfers 871,102 ( 497,360) 188,492 43,674 1,059,594 ( 453,686)
Transfers 1,124 ( 1,124)
1,124 ( 1,124)
Change in net assets 872,226 ( 497,360) 187,368 43,674 1,059,594 ( 453,686)
Beginning net assets ( deficit) 20,826,655 21,324,015 ( 571,142) ( 614,816) 20,255,513 20,709,199
Ending net assets ( deficit) $ 21,698,881 $ 20,826,655 $ ( 383,774) $ ( 571,142) $ 21,315,107 $ 20,255,513
During 2004, certain reclassifications were made to tax and intergovernmental revenues, accordingly, the 2003
tax and intergovernmental revenues were changed to reflect these reclassifications.
7
Management's Discussion and Analysis
Financial Analysis of the County's Funds
As noted earlier, the County uses fund accounting to ensure and demonstrate compliance with finance related
legal requirements.
Governmental funds - The focus of the County's governmental funds is to provide information of near- term
inflows, outflows, and balances of useable resources. Such information is useful in assessing the County's
financial requirements. In particular, unreserved fund balance may serve as a useful measure of a government's
net resources available for spending at the end ofthe fiscal year.
At June 30, 2004, the County's governmental funds reported combined fund balances of$ 1O, 059,668, an increase
of $ 5,477 in comparison with the prior year. The increase is a result of an increase in revenues in the General and
Jail District Funds in a greater proportion than expenditures in these funds. Approximately 94% of the combined
fund balances, $ 9,502,962, constitutes unreserved fund balance, which is available to meet the County's current
and future needs. The remainder of fund balance is reserved, indicating that it is not available for new spending
because it has been committed for prepaid items and debt service expenditures.
The General Fund is the County's primary operating fund. At the end of the current fiscal year, unreserved fund
balance of the General Fund was $ 3,717,307. As a measure ofthe General Fund's liquidity, it is useful to compare
both unreserved fund balance and total fund balance to total fund expenditures. The unreserved fund balance
represents 39% oftotal General Fund expenditures while total fund balance represents 43% ofthat same amount.
The Jail District Fund is a major County fund used to report the activity ofthe County jail. During 2004, the fund
balance ofthis fund increased primarily due to an increase in charges for services which represent charges to other
governments that use the facility.
The Golf Course Fund is an enterprise fund of the County that had an increase in net assets due primarily from
golf course fees that increased in greater proportion than golf course expenses.
The following table presents the amount of governmental revenues from various sources as well as the increases
or decreases from the prior year:
Governmental Funds
Revenue Comparison - By Source
2004 2003 Increase/( Decrease)
Amount % of Total Amount % of Total Amount % Change
Taxes $ 5,965,165 27.31% $ 5,523,787 28.13% $ 441,378 7.99%
Licenses and permits 238,289 1.09% 208,300 1.06% 29,989 14.40%
Intergovemmental 10,755,224 49.24% 10,012,731 50.98% 742,493 7.42%
Fees, fines and forfeits 740,011 3.39% 728,387 3.71% 11,624 1.60%
Charges for services 3,175,499 14.54% 2,827,384 14.40% 348,115 12.31%
Investment income 88,544 0.41% 160,760 0.82% ( 72,216) - 44.92%
Miscellaneous 878,513 4.02% 178,533 0.91% 699,980 392.07%
Total revenues $ 21,841,245 100.00% $ 19,639,882 100.00% $ 2,201,363 11.21%
The increase in tax revenue is caused primarily from an increase in excise tax imposed by the State on behalf of
the County. The increase in intergovernmental revenue is due to an increase in funding from grants and contracts
received from Federal and state agencies. The increase in charges for services is due primarily from an increase
in charges to other governments for use of the County Jail Facility. Miscellaneous revenues increased primarily
due to a greater amount of private contributions and indirect cost recovery.
8
Management's Discussion and Analysis
The following table presents governmental expenditures by function compared to prior year amounts:
Governmental Funds
Expenditure Comparison - By Function
2004 2003 Increase/( Decrease)
Amount % of Total Amount % of Total Amount % Change
General government $ 5,800,371 26.52% $ 5,184,745 24.32% $ 615,626 11.87%
Public safety 7,468,173 34.15% 7,042,079 33.04% 426,094 6.05%
Highways and streets 4,244,413 19.41% 4,647,736 21.81% ( 403,323) - 8.68%
Sanitation 67,463 0.31% 85,918 0.40% ( 18,455) - 21.48%
Health 1,735,068 7.93% 2,017,745 9.47% ( 282,677) - 14.01%
Welfare 323,840 1.48% 338,599 1.59% ( 14,759) - 4.36%
Culture and recreation 654,683 2.99% 688,489 3.23% ( 33,806) - 4.91%
Education 152,177 0.70% 147,499 0.69% 4,678 3.17%
Capital outlay 1,070,487 4.89% 14,763 0.07% 1,055,724 7151.15%
Debt service 354,510 1.62% 1,147,132 5.38% ( 792,622) - 69.10%
Total expenditures $ 21,871,185 100.00% $ 21,314,705 100.00% $ 556,480 2.61%
The following provides an explanation of the expenditures by function that changed significantly over the prior
year:
• Capital outlay was significant due to expenditures on road construction projects such as improvements to
Highway B- 95, Salome Road and Vicksburg Road.
• General government expenditures increased due to an overall increase in the cost of providing necessary
services to County citizens.
• The County's debt service expense decreased in 2004 largely due to the cost savings resulting from the
refunding of certificates of participation that occurred in 2003.
General Fund Budgetary Highlights
The County did not amend the fiscal year 2003- 04 adopted budget for the General Fund. General Fund actual
expenditures were $ 1.2 million under the adopted budget and actual revenues exceeded estimated revenues by
$ 0.2 million.
Tax revenues exceeded the anticipated budget amount primarily due to greater than anticipated excise tax and
intergovernmental revenue did not meet the budgeted projection due to lower than anticipated grant and contract
revenues.
The following departments exceeded their General Fund expenditure budgets by more than ten percent and
$ 10,000:
• The Superior Court exceeded its budget by 49% due to rising indigent defense attorney costs.
• Total costs of the Health Department's Transit department exceeded the budgeted amount by 39% due to
greater than anticipated operating costs.
• Management information services exceeded its budget by 26% due to greater than anticipated outside
consultant costs.
9
Management's Discussion and Analysis
Capital Assets and Debt Administration
Capital Assets
The County's investment in capital assets as of June 30, 2004, amounted to $ 16.1 million ( net of accumulated
depreciation). This investment in capital assets includes land, buildings, machinery and equipment, construction
equipment and vehicles, infrastructure purchased or constructed after June 30, 2002, construction in progress, and
golf course improvements. The County's investment in capital assets increased 4.2 percent from the prior period.
Major capital asset events during the current fiscal year included outlays for the new judicial complex, Business
95 road improvements, and for machinery and equipment, particularly heavy machinery.
Additional information on the County's capital assets activity and balances can be found in Note 5 of the notes to
the financial statements on page 33 ofthis report.
Long- Term Debt
At June 30, 2004, the County had total long- term debt outstanding of $ 3,856,020. This amount consists of
certificates of participation of $ 3.8 million and capital leases of $ 56,020. During 2003, the County refunded all
existing certificates ofparticipation to take advantage of lower interest rates. This resulted in reduced debt service
requirements in 2004. Additional information on the County's long- term debt can be found in Note 6 of the
Notes to the Financial Statements on page 35 ofthis report.
Economic Factors
• Despite a slow economy, the County's tax revenue is relatively stable. The County's sales tax revenue has
remained stable because of tourism. The Colorado River attracts visitors in the summer, and both the river
and desert areas attract visitors in the winter.
• In 2003, the County took advantage of lower interest rates by refunding all outstanding certificates of
participation for a combined economic gain of $ 406,053. This refunding also extended the amount of time
the County has to repay the debt.
• For the years ended June 30, 2003, and June 30, 2004, the County has budgeted $ 1 million and $. 75 million
respectively, for contingencies. This practice may enable the County to better weather the current economic
climate.
Request for Information
This financial report is designed to provide a general overview of the County's finances. Questions concerning
any of the information provided in this report or requests for additional financial information should be addressed
to the La paz County Finance Department, 1108 Joshua Avenue, Parker, AZ 85344.
10
La paz County
Statement oCNet Assets
June 30, 2004
Primary Government
Governmental Business- Type
Activities Activities Total
Assets
Cash and cash equivalents $ 9,037,947 $ 29,719 $ 9,067,666
Cash and investments held by trustee 532,633 503,316 1,035,949
Receivables, net
Accounts 6,481 6,481
Property taxes 184,664 184,664
Internal balances 872,409 ( 872,409)
Due from:
Others 110,057 110,057
Other governments 1,287,717 1,287,717
Prepaid items 24,073 1,203 25,276
Capital assets, not being depreciated 1,120,626 1,120,626
Capital assets, being depreciated, net 13,283,922 1,694,244 14,978,166
Total assets 26,460,529 1,356,073 27,816,602
Liabilities
Accounts payable 633,044 29,476 662,520
Accrued payroll and employee benefits 492,333 25,894 518,227
Due to:
Others 442,243 7,227 449,470
Other governments 265,831 265,831
Noncurrent liabilities:
Due within one year 634,131 290,175 924,306
Due in more than one year 2,294,066 1,387,075 3,681,141
Total liabilities 4,761,648 1,739,847 6,501,495
Net Assets
Invested in capital assets, net of related debt 12,158,528 84,244 12,242,772
Restricted for:
Public safety 499,897 499,897
Highways and streets 5,306,547 5,306,547
Sanitation 79,091 79,091
Health 194,658 194,658
Debt service 532,633 503,316 1,035,949
Other purposes 397,040 397,040
Unrestricted ( deficit) 2,530,487 ( 971,334) 1,559,153
Total net assets $ 21,698,881 $ ( 383,774) $ 21,315,107
See accompanying notes to financial statements.
11
La paz County
Statement ofActivities
Year Ended June 30, 2004
Program Revenues Net ( Expenses) Revenues and Changes in Net Assets
Operating Capital
Charges for Grants and Grants and Governmental Business- Type
FunctionslPrograms Expenses Services Contributions Contributions Activities Activities Total
Primary government:
Governmental activities:
General government $ 5,780,803 $ 1,326,883 $ 1,000,267 $ 25,061 $ ( 3,428,592) $ - $ ( 3,428,592)
Public safety 7,999,745 1,879,612 2,224,334 - ( 3,895,799) - ( 3,895,799)
Highways and streets 4,011,208 - 49,949 3,456,054 ( 505,205) - ( 505,205)
Sanitation 67,463 212,740 42,626 - 187,903 - 187,903
Health 1,774,793 128,839 152,684 - ( 1,493,270) - ( 1,493,270)
Welfare 333,673 32,058 235,210 - ( 66,405) - ( 66,405)
Culture and recreation 766,341 510,717 53,356 - ( 202,268) - ( 202,268)
Education 154,030 62,950 30,658 - ( 60,422) - ( 60,422)
Interest on long- tenn debt 38,093 - - - ( 38,093) - ( 38,093)
Total governmental activities 20,926,149 4,153,799 3,789,084 3,481,115 ( 9,502,151) - ( 9,502,151)
Business- type activities
Golf course 1,373,190 1,560,357 - - - 187,167 187,167
Total business- type activities 1,373,190 1,560,357 - - - 187,167 187,167
Total primary government $ 22,299,339 $ 5,714,156 $ 3,789,084 $ 3,481,115 ( 9,502,151) 187,167 ( 9,314,984)
General revenues:
Taxes:
Property taxes levied for general purposes 2,877,795 - 2,877,795
Property taxes levied for improvement districts 8,918 - 8,918
Share of state sales taxes 1,738,049 - 1,738,049
Excise tax 2,023,755 - 2,023,755
Payments in lieu of taxes 1,196,941 - 1,196,941
Vehicle license tax 989,660 - 989,660
Share of state lottery 550,035 - 550,035
Investment earnings 88,544 1,325 89,869
Miscellaneous 899,556 - 899,556
Transfers 1,124 ( 1,124)
Total general revenues and transfers 10,374,377 201 10,374,578
Changes in net assets 872,226 187,368 1,059,594
Net assets - July 1,2003 20,826,655 ( 571,142) 20,255,513
Net assets - June 30, 2004 $ 21,698,881 $ ( 383,774) $ 21,315,107
See accompanying notes to fInancial statements..
12
La paz C01Dlty
Balance Sheet
Governmental FwlCls
June 30, 2004
Major Funds
Business 95
Road Other Total
General Road Improvement Jan District Governmental Governmental
Fund Fund Fund Fund Funds Funds
Assets
Cash and cash equivalents $ 2,937,639 $ 2,050,317 $ 3,246,596 $ 44,081 $ 759,314 $ 9,037,947
Cash and investments held by trustee 264,617 268,016 532,633
Receivables ( net ofallowances for
uncollectibles):
Accounts 6,481 6,481
Property taxes 183,075 1,589 184,664
Due from:
Others 63,141 2,575 44,341 110,057
Other funds 1,701,821 36,893 47,971 174,818 1,961,503
Other governments 202,122 353,076 398,123 334,396 1,287,717
Prepaid items 18,822 35 5,216 24,073
Total assets $ 5,377,718 $ 2,440,321 $ 3,246,596 $ 760,766 $ 1,319,674 $ 13,145,075
liabilities and Fund Balances
Liabilities:
Accounts payable $ 172,886 $ 89,161 $ $ 71,783 $ 299,214 $ 633,044
Accrued payroll and employee benefits 244,260 68,090 64,584 115,399 492,333
Due to:
Others 439,959 929 1,355 442,243
Other governments 265,831 265,831
Other funds 92,461 226,339 259,092 511,202 1,089,094
Deferred revenue 161,575 1,287 162,862
Totalliabilities 1,376,972 384,519 395,459 928,457 3,085,407
Fund balances:
Reserved for:
Certificates of participation payment 264,617 268,016 532,633
Prepaid items 18,822 35 5,216 24,073
Unreserved, reported in:
General fund 3,717,307 3,717,307
Special revenue funds 2,055,767 3,246,596 97,291 386,001 5,785,655
Total fund balances 4,000,746 2,055,802 3,246,596 365,307 391,217 10,059,668
Total liabilities and fund balances $ 5,377,718 $ 2,440,321 $ 3,246,596 $ 760,766 $ 1,319,674 $ 13,145,075
See accompanying notes to financial statements.
13
La paz County
Reconciliation ofthe Balance Sheet of Governmental Funds to the
Statement of Net Assets
June 30, 2004
Fund balances- total governmental funds
Amounts reported for governmental activities in the
statement ofnet assets are different because:
Capital assets used in governmental activities are not fmancial resources
and, therefore, are not reported in the funds. The cost ofthe assets is
$ 25,023,301 and the accumulated depreciation is $ 10,618,753.
Some ofthe County's taxes will be collected after year- end, but are not
available soon enough to pay for the current- period expenditures, and
therefore are deferred in the funds.
Long- term liabilities are not due and payable in the current period and
therefore, are not reported in the funds.
$ 10,059,668
14,404,548
162,862
Obligations under capital leases
Compensated absences
Certificates of participation
Estimated liabilities for claims and judgments
Net assets of governmental activities
See accompanying notes to fmancial statements.
14
( 56,020)
( 654,001)
( 2,190,000)
( 28,176) ( 2,928,197)
$ 21,698,881
La paz County
Statement ofRevenues, Expenditures, and Changes in Fund Balances
Governmental Funds
Year Ended June 30, 2004
Major Funds
Business 95
Road Other Total
General Road Improvement Jail District Governmental Governmental
Fund Fund Fund Fund Funds Funds
Revenues:
Taxes $ 4,408,435 $ 498,571 $ $ 1,049,212 $ 8,947 $ 5,965,165
Licenses and permits 227,616 10,673 238,289
Fees, fmes, and forfeits 732,544 7,467 740,011
Intergovernmental 3,531,827 3,456,054 279,032 3,488,311 10,755,224
Charges for services 539,911 1,871,294 764,294 3,175,499
Investment income 51,779 23,441 1,360 11,964 88,544
Miscellaneous 485,002 54,219 260 339,032 878,513
Total revenues 9,977,114 4,032,285 3,201,158 4,630,688 21,841,245
Expenditures:
Current:
CJeneralgovernment 5,000,797 799,574 5,800,371
Public safety 3,166,985 2,572,567 1,728,621 7,468,173
Highways and streets 4,236,055 108,606 8,358 4,353,019
Sanitation 2,879 64,584 67,463
Health 859,790 875,278 1,735,068
Welfare 90,960 232,880 323,840
Culture and recreation 654,683 654,683
Education 152,177 152,177
Capital outlay 113,861 848,020 961,881
Debt service:
Principal 81,418 235,000 316,418
Interest 17,375 20,717 38,092
Total expenditures 9,486,242 4,236,055 108,606 2,828,284 5,211,998 21,871,185
Excess ( deficiency) of
revenues over expenditures 490,872 ( 203,770) ( 108,606) 372,874 ( 581,310) ( 29,940)
Other fmancing sources ( uses):
Capital lease agreements 34,293 34,293
Transfers in 93,624 3,750 97,374
Transfers out ( 3,750) ( 92,500) ( 96,250)
Total other fmancing sources and uses 124,167 ( 92,500) 3,750 35,417
Net change in fund balances 615,039 ( 203,770) ( 108,606) 280,374 ( 577,560) 5,477
Fund balances, July 1,2003 3,385,707 2,259,572 3,355,202 84,933 968,777 10,054,191
Fund balances, June 30, 2004 $ 4,000,746 $ 2,055,802 $ 3,246,596 $ 365,307 $ 391,217 $ 10,059,668
See accompanying notes to fmancial statements.
15
La paz County
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental Funds to the Statement of Activities
Year Ended June 30, 2004
Net change in fund balances- total governmental funds $ 5,477
Amounts reported for governmental activities in the Statement ofActivities are
different because:
Governmental funds report capital outlays as expenditures. However, in
the statements of activities the cost of those assets is allocated over their
estimated useful lives and reported as depreciation expense.
Expenditures for general capital assets, infrastructure, and other
related capital assets. $ 2,033,585
Depreciation expense ( 1,391,298) 642,287
Repayment of debt principal is an expenditure in the governmental
funds, but the repayment reduces long- term liabilities in the statement
of net assets.
Principal repayments:
Certificates of participation 305,000
Capital leases 11,418 316,418
Some expenses in the Statement ofActivities do not require the
use of current financial resources and, therefore, are not reported
as expenditures in the governmental funds.
Increase in compensated absences ( 228,368)
Decrease in estimated liabilities for claims and judgments 201,450 ( 26,918)
Collections ofrevenues in the governmental funds
exceeded revenues reported in the Statement of Activities. ( 65,038)
Change in net assets of governmental activities $ 872,226
See accompanying notes to fmancial statements.
16
La paz County
Statement of Net Assets
Proprietary Fund
June 30, 2004
Business- Type
Activities Enterprise
Fund
Golf Course Fund
Assets
Current assets:
Cash and cash equivalents
Prepaid items
Total current assets
Noncurrent assets:
Cash and investments held by trustee
Capital assets, net of accumulated depreciation
Total noncurrent assets
Total assets
Liabilities
Current liabilities:
Accounts payable
Accrued payroll and employee benefits
Due to others
Due to other funds
Certificates of participation payable, current portion
Compensated absences payable, current portion
Total current liabilities
Noncurrent liabilities:
Certificates of participation payable
Compensated absences payable
Total noncurrent liabilities
Total liabilities
Net Assets
Invested in capital assets, net of related debt
Restricted for debt service
Unrestricted ( deficit)
Total net assets
See accompanying notes to fmancial statements.
17
$
$
29,719
1,203
30,922
503,316
1,694,244
2,197,560
2,228,482
29,476
25,894
7,227
872,409
270,000
20,175
1,225,181
1,340,000
47,075
1,387,075
2,612,256
84,244
503,316
( 971,334)
( 383,774)
La paz County
Statement of Revenues, Expenses, and Changes in Fund Net Assets
Proprietary Fund
Year Ended June 30, 2004
Business- Type
Activities Enterprise
Fund
Golf Course Fund
Operating revenues:
Golf course fees
Miscellaneous
Total operating revenues
Operating expenses:
Personnel services
Professional services
Supplies
Communication
Utilities
Repairs and maintenance
Depreciation
Other
Leases and rents
Total operating expenses
Operating income
$ 1,559,663
694
1,560,357
628,699
130,414
116,346
6,155
55,256
198,272
157,767
40,020
2,179
1,335,108
225,249
Nonoperating revenues ( expenses):
Investment income
Interest expense
Loss on disposal of capital assets
Total nonoperating revenues ( expenses)
Income before transfers
Transfers out
Increase in net assets
Total net assets, July 1,2003
Total net assets, June 30, 2004
See accompanying notes to fmancia1 statements.
18
1,325
( 25,542)
( 12,540)
( 36,757)
188,492
( 1,124)
187,368
( 571,142)
$ ( 383,774)
La paz County
Statement of Cash Flows
Proprietary Fund
Year Ended June 30, 2004
Business- Type
Activities Enterprise
Fund
Golf Course Fund
Cash flows from operating activities:
Receipts from customers
Payments to suppliers and providers of goods and services
Payments to employees
Net cash provided by operating activities
Cash flows from noncapital financing activities:
Negative cash balance implicitly fmanced
Negative cash balance implicitly repaid
Cash transfers to other funds
Net cash used for noncapital fmancing activities:
Cash flows from capital and related financing activities:
Purchases of capital assets
Principal paid on certificates of participation
Interest paid on certificates of participation
Net cash used for capital and related fmancing activities
Cash flows from investing activities:
Interest received on investments
Net cash provided by investing activities
Net increase in cash and cash equivalents
Cash and cash equivalents, July 1, 2003
Cash and cash equivalents, June 30, 2004
Reconciliation oftotal cash and cash equivalents:
Cash and cash equivalents
Cash and investments held by trustee
Reconciliation of beginning cash and cash equivalents:
Beginning cash and cash equivalents, as previously reported
Beginning cash held by trustee originally excluded
Adjusted beginning cash and cash equivalents
See accompanying notes to fmancial statements.
19
$
$
$
$
$
$
1,567,584
( 554,781)
( 594,044)
418,759
872,409
( 899,419)
( 1,124)
( 28,134)
( 78,999)
( 95,000)
( 25,542)
( 199,541)
1,325
1,325
192,409
340,626
533,035
29,719
503,316
533,035
8,880
331,746
340,626
( continued)
La paz County
Statement of Cash Flows - Continued
Proprietary Fund
Year Ended June 30, 2004
Reconciliation of operating
income to net cash provided by operating activities:
Business- Type
Activities Enterprise
Fund
Golf Course Fund
Operating income
Adjustments to reconcile operating income to
net cash provided by operating activities:
Depreciation
Changes in assets and liabilities:
Increase in:
Prepaid items
Due to others
Compensated absences payable
Decrease in:
Accounts payable
Accrued payroll and employee benefits
Net cash provided by operating activities
See accompanying notes to fmancial statements.
20
$
$
225,249
157,767
( 596)
7,227
34,655
( 477)
( 5,066)
418,759
La paz County
Statement of Fiduciary Net Assets
Fiduciary Funds
June 30, 2004
Investment
Trust Funds
Agency
Funds
Assets
Cash and cash equivalents
Accrued interest receivable
Total assets
Liabllities
Due to other governments
Total liabilities
Net Assets
Held in trust for investment participants
$ 13,635,004
33,144
13,668,148
$ 13,668,148
$
$
982,053
982,053
982,053
982,053
See accompanying notes to financial statements.
21
La paz County
Statement of Changes in Fiduciary Net Assets
Fiduciary Funds
Year Ended June 30, 2004
Investment
Trust Funds
Additions:
Contributions from participants $ 31,187,929
Interest and dividends 313,404
Total additions 31,501,333
Deductions:
Distributions to participants 33,265,287
Total deductions 33,265,287
Change in net assets ( 1,763,954)
Net assets, July 1, 2003 15,432,102
Net assets, June 30, 2004 $ 13,668,148
See accompanying notes to financial statements.
22
Note 1 -
La Paz County
Notes to Financial Statements
June 30, 2004
Summary of Significant Accounting Policies
The accounting policies of La Paz County conform to generally accepted accounting
principles applicable to governmental units adopted by the Governmental Accounting
Standards Board ( GASB).
A. Reporting Entity
The County is a general purpose local government that is governed by a separately elected
board of three county supervisors. The accompanying financial statements present the
activities of the County ( the primary government) and its component units.
Component units are legally separate entities for which the County is considered to be
financially accountable. Blended component units, although legally separate entities, are in
substance part of the County's operations. Therefore, data from these units is combined
with data of the primary government. Discretely presented component units, on the other
hand, are reported in a separate column in the government- wide financial statements to
emphasize they are legally separate from the County. Each blended component unit
discussed below has a June 30 year- end. The County has no discretely presented
component units.
The following table describes the County's component units:
Component
Unit
La Paz County
Jail District
La Paz County
Municipal
Property
Corporation
Various Street
Lighting
Districts
La Paz County
Health Services
District
Description; Criteria
for Inclusion
A tax- levying public improvement district that
acquires, constructs, operates, maintains, and
finances county jails and jail systems pursuant
to Arizona Revised Statutes; County board of
supervisors serves as board of directors
A nonprofit corporation created by the County
to assist in the acquisition of real and personal
property for the County; County board of
supervisors serves as board of directors
Operates and maintains street lighting in areas
outside local city jurisdictions; County board of
supervisors serves as board of directors
A tax- levying public improvement district that
provides or [ mances health services; County
board of supervisors serves as board of
directors
23
Reporting
Method
Blended
Blended
Blended
Blended
For Separate
Financial
Statements
Not available
Not available
Not available
Not available
Notes to Financial Statements - Continued
B. Basis of Presentation
The basic financial statements include both government- wide statements and fund financial
statements. The government- wide statements focus on the County as a whole, while the
fund financial statements focus on major funds. Each presentation provides valuable
information that can be analyzed and compared between years and between governments to
enhance the usefulness of the information.
Government- wide statements- provide information about the primary government ( the
County) and its component units. The statements include a statement of net assets and a
statement of activities. These statements report the financial activities of the overall
government, except for fiduciary activities. They also distinguish between the
governmental and business- type activities of the County. Governmental activities generally
are financed through taxes and intergovernmental revenues. Business- type activities are
financed in whole or in part by fees charged to external parties.
A statement of activities presents a comparison between direct expenses and program
revenues for each function of the County's governmental activities and segment of its
business- type activities. Direct expenses are those that are specifically associated with a
program or function and, therefore, are clearly identifiable to a particular function. The
County does not allocate indirect expenses to programs or functions. Program revenues
include:
• charges to customers or applicants for goods, services, or privileges provided,
• operating grants and contributions, and
• capital grants and contributions, including special assessments.
Revenues that are not classified as program revenues, including internally dedicated
resources and all taxes, are reported as general revenues.
Generally, the effect of interfund activity has been eliminated from the government- wide
financial statements to minimize the double counting of internal activities. However,
charges for interfund services provided and used are not eliminated if the prices
approximate their external exchange values.
Fund financial statements- provide information about the County's funds, including
fiduciary funds and blended component units. Separate statements are presented for the
governmental, proprietary, and fiduciary fund categories. The emphasis of fund financial
statements is on major governmental and enterprise funds, each displayed in a separate
column. All remaining governmental and enterprise funds are aggregated and reported as
nonmajor funds. Fiduciary funds are aggregated and reported by fund type.
24
Notes to Financial Statements - Continued
Proprietary fund revenues and expenses are classified as either operating or nonoperating.
Operating revenues and expenses generally result from transactions associated with the
fund's principal activity. Accordingly, revenues, such as golf course fees, in which each
party receives and gives up essentially equal values, are operating revenues. Other
revenues, such as investment income, result from transactions in which the parties do not
exchange equal values. Operating expenses include the cost of services, administrative
expenses, and depreciation on capital assets. Other expenses, such as interest expense, are
considered to be nonoperating expenses.
The County reports the following major governmental funds:
The General Fund is the County's primary operating fund. It accounts for all financial
resources of the general government, except those required to be accounted for in another
fund.
The Road Fund accounts for monies from specific revenue sources that are restricted for
road maintenance and operations, pavement preservation, and fleet services.
The Business 95 Road Improvement Fund accounts for monies from the Arizona
Department of Transportation that is restricted for roadway realignment, shoulder
improvements, and drainage improvements to state road Business 95. The State of Arizona
transferred ownership jurisdiction and maintenance responsibilities to the County during
fiscal year 2002.
The Jail District Fund was established by La Paz County resolution   89- 5845 under the
authority of Article 1, Chapter 25, and Title 48, of the Arizona Revised Statutes on
November 20, 1989. On June 18, 1990, the Jail District Board of Directors adopted
Resolution JD90- 12, under the authority of Arizona Revised Statutes   48- 4022,
establishing a one- half cent excise sales tax effective January 1, 1991, through perpetuity.
The Jail District Fund accounts for the receipt of tax revenue, maintenance of effort,
intergovernmental revenue, debt service, and operating expenditures of the County's jail.
The County reports the following major enterprise fund:
The GolfCourse Fund accounts for the activities and related operations and maintenance of
an 18 hole golf course and pro- shop.
The County reports the following fund types:
The investment trust funds account for pooled assets held and invested by the County
Treasurer on behalf of County departments and other governmental entities.
25
Notes to Financial Statements - Continued
The agency funds account for assets held by the County as an agent for the State and
various local governments, and for property taxes collected and distributed to the State,
local school districts, community college districts, and special districts.
C. Basis of Accounting
The government- wide, proprietary fund, and fiduciary fund financial statements are
presented using the economic resources measurement focus and the accrual basis of
accounting. Revenues are recorded when earned and expenses are recorded at the time
liabilities are incurred, regardless of when the related cash flows take place. Property taxes
are recognized as revenue in the year for which they are levied. Grants and donations are
recognized as revenue as soon as all eligibility requirements the provider imposed have
been met.
Governmental funds in the fund financial statements are reported using the current
financial resources measurement focus and the modified accrual basis of accounting. Under
this method, revenues are recognized when measurable and available. The County
considers all revenues reported in the governmental funds to be available if the revenues
are collected within 60 days after year end. Expenditures are recorded when the related
fund liability is incurred, except for principal and interest on general long- term debt, claims
and judgments, and compensated absences, which are recognized as expenditures to the
extent they are due and payable. General capital asset acquisitions are reported as
expenditures in governmental funds. Issuances of general long- term debt and acquisitions
under capital lease agreements are reported as other financing sources.
Under the terms of grant agreements, the County funds certain programs by a combination
of grants and general revenues. Therefore, when program expenses are incurred, there are
both restricted and unrestricted net assets available to finance the program. The County
applies grant resources to such programs before using general revenues.
The County's business- type activities and enterprise fund follows FASB Statements and
Interpretations issued on or before November 30, 1989; Accounting Principles Board
Opinions; and Accounting Research Bulletins, unless those pronouncements conflict with
GASB pronouncements. The County has chosen the option not to follow FASB Statements
and Interpretations issued after November 30, 1989.
D. Cash and Investments
For purposes of its statement of cash flows, the County considers only those highly liquid
investments with a maturity of 3 months or less when purchased to be cash equivalents.
Money market investments are stated at amortized cost. All other investments are stated at
fair value.
26
Notes to Financial Statements - Continued
E. Inventories
Purchases of inventory items are recorded at the time of purchase as expenditures in the
funds from which the purchases were made, and because the amounts on hand at June 30,
2004, were immaterial, they are not included in the Statements of Net Assets or the Balance
Sheet.
F. Property Tax Calendar
The County levies real property taxes on or before the third Monday in August that become
due and payable in two equal installments. The first installment is due on the first day of
October and becomes delinquent after the first business day of November. The second
installment is due on the first day of March of the next year and becomes delinquent after
the first business day of May.
During the year, the County also levies various personal property taxes that are due the
second Monday of the month following receipt of the tax notice and become delinquent 30
days later.
A lien assessed against real and personal property attaches on the first day of January
preceding assessment and levy.
G. Capital Assets
Capital assets are reported at actual cost. Donated assets are reported at estimated fair value
at the time received.
Capitalization thresholds ( the dollar values above which asset acquisitions are added to the
capital asset accounts), depreciation methods, and estimated useful lives of capital assets
reported in the government- wide statements and enterprise fund are as follows:
Land
Construction in progress
Land improvements
Infrastructure
Buildings and improvements
Improvements other than buildings
Machinery and equipment
Golf course and improvements
27
Capitalization
Threshold
All
All
$ 5,000
5,000
5,000
1,000
1,000
1,000
Depreciation
Method
N/ A
N/ A
Straight- line
Straight- line
Straight- line
Straight- line
Straight- line
Straight- line
Estimated
Useful Life
N/ A
N/ A
10- 30 years
25- 50 years
25- 50 years
7- 30 years
5- 20 years
30 years
Note 2 -
Notes to Financial Statements - Continued
H. Investment Income
Investment income is composed of interest, dividends, and net changes in the fair value of
applicable investments.
1. Compensated Absences
Compensated absences consist of vacation leave and a calculated amount of sick leave
earned by employees based on services already rendered.
Employees may accumulate up to 160 hours of vacation depending on years of service, but
any vacation hours in excess of the maximum amount that are unused at year end are
forfeited. Upon termination of employment, all unused and unforfeited vacation benefits
are paid to employees. Accordingly, vacation benefits are accrued as a liability in the
financial statements.
Employees may accumulate an unlimited number of sick leave hours. Generally, sick leave
benefits provide for ordinary sick pay and are cumulative but are forfeited upon termination
of employment. However, employees who accumulate unused sick leave in excess of 384
hours are paid a percentage of the excess unused sick leave based on the number of years of
consecutive service with the County; therefore, the excess sick leave is accrued.
J. Reclassifications
During 2004, certain changes were made to the classification of certain revenues and
expenses/ expenditures from the prior year presentation. These changes had no effect on
the County's beginning net assets or fund balances.
Stewardship, Compliance, and Accountability
Eleven General Fund departments and the Jail District Fund had an excess of actual
expenditures over appropriations.
General Fund departments with expenditures in excess of appropriations are caused mainly
by excess expenditures for which budget modifications were not made. In total, the
County's General Fund did not have expenditures in excess of appropriations since the
County budgeted significant expenditures for the contingency department and no budget
modifications were made.
The Jail District Fund's excess of expenditures over appropriations occurred due to
variable costs exceeding original expectations and these costs were funded by greater than
anticipated charges for services.
To avoid similar future overruns, the County analyzed the line items resulting in greater
that anticipated costs to determine whether such costs will be recurring and adjusted its
2005 budget accordingly.
28
Notes to Financial Statements - Continued
Deficit fund balances or net assets- At June 30, 2004, the following funds reported
significant deficits greater than $ 5,000 in fund balances or net assets:
Fund
Governmental funds:
Bio Terrorism
ACJC Drug Enforcement
Growing Smarter Planning Grant
CmF Contract Sheriff
Undesignated Fund
SLIF Project Boats
AORCC Boat Patrol Grant
CA Rico
HIDTA Grant
Highway Safety Grant
Criminal Justice Enhancement
Park Grants
Task Force Prosecutor
WIA Year 1
County Racketeering
Cops in School
La Paz Extension Fund
Rabies Control
Capital Projects Fund
CDBG Grant
Parker Library
Emergency Services
DES Child Support Program
Bill Williams REC Angling
La Paz County Park
Health Department
Enterprise fund:
La Paz County Golf Course
Deficit
$ 6,598
6,899
7,755
13,934
15,715
18,787
20,045
23,854
27,600
28,897
35,127
36,216
45,500
47,460
51,537
58,973
61,185
65,854
72,863
76,590
80,915
85,962
90,331
97,875
123,658
279,722
383,774
The above fund deficits resulted from the operations during the year or carryovers from
prior years and are expected to be corrected through normal operations in the future.
29
Note 3 -
Notes to Financial Statements - Continued
Deposits and Investments
Arizona Revised Statutes ( A. R. S.) authorize the County to invest public monies in the State
Treasurer's investment pool; U. S. Treasury obligations; specified state and local
government bonds; and interest- earning investments such as savings accounts, certificates
of deposit, and repurchase agreements in eligible depositories. The statutes require
collateral for demand deposits, certificates of deposit, and repurchase agreements at 101
percent of all deposits not covered by federal depository insurance.
County Treasurer's Investment Pool- Arizona Revised Statutes require community
colleges, school districts, and other local governments to deposit certain public monies with
the County Treasurer. Those monies are pooled with County monies for investment
purposes.
Deposits- At June 30, 2004, the carrying amount of the investment pool's total cash in
bank was $ 3,504,035, and the bank balance was $ 3,525,922. Ofthe bank balance, $ 100,000
was covered by federal depository insurance and $ 3,425,922 was covered by collateral held
by the pledging financial institution's trust department or agent in the County's name.
Investments- At June 30, 2004, the investments in the County Treasurer's investment pool
consisted of the following:
Fair
Value
Investment in State Treasurer's
investment pool $ 19,357,723
The State Board of Investment provides oversight for the State Treasurer's pools, and the
Local Government Investment Pool Advisory Committee provides consultation and advice
to the Treasurer. The fair value of a participant's position in the pool approximates the
value of that participant's pool shares. Those shares are not identified with specific
investments and are not subject to custodial credit risk.
Other deposits- At June 30, 2004, the total nonpooled cash on hand was $ 2,720. The
carrying amount of the County's total nonpooled cash in bank was $ 820,245, and the bank
balance was $ 865,122. Of the bank balance, $ 209,207 was covered by federal depository
insurance or by collateral held by the County or its agent in the County's name and
$ 655,915 was covered by collateral held by the pledging financial institution's trust
department or agent in the County's name.
30
Notes to Financial Statements - Continued
Other investments- At June 30, 2004, the County's nonpooled investments consisted of the
following:
u. s. government securities
Total
Fair
Value
$ 1,035,949
$ 1.035,949
These investments were uninsured and unregistered with securities held by the counterparty
or by its trust department or agent, but not in the County's name.
A reconciliation of cash and investments to amounts shown on the Statement of Net Assets
follows:
Cash and investments:
Cash on hand
Carrying amount of deposits
Reported amount of investments
Total
Statement ofNet Assets:
Cash and cash equivalents
Cash and investments held
by trustee
Total
County
Treasurer's
Investment
Pool
$
3,504,035
19,357,723
$ 22,861.758
Total
Primary
Government
$ 9,067,666
1,035,949
$ 10,103,615
Other
$ 2,720
820,245
1,035,949
$ 1.858,914
Total
Fiduciary
Funds
$ 14,617,057
$ 14,617,057
Total
$ 2,720
4,324,280
20,393,672
$ 24,720,672
Total
$ 23,684,723
1,035,949
$ 24,720,672
Note 4- Condensed Financial Statements of County Treasurer's Investment Pool
A. R. S. require community colleges, school districts, and other local governments to deposit
certain public monies with the County Treasurer. The Treasurer has a fiduciary
responsibility to administer those and the County monies under her stewardship. The
Treasurer invests, on a pool basis, all idle monies not specifically invested for a fund or
program. In addition, the Treasurer determines the fair value of those pooled investments
annually at June 30.
31
Notes to Financial Statements - Continued
The County Treasurer's investment pool is not registered with the Securities and Exchange
Commission as an investment company, and there is no regulatory oversight of its
operations. The pool's structure does not provide for shares, and the County has not
provided or obtained any legally binding guarantees to support the value of the
participants' investments.
Details of each major investment classification follow:
Investment Type
State Treasurer's
Investment Pool
Principal
$ 19,357,723
Interest
Rate( s)
No stated
interest rate
Maturities
No stated
maturity
Fair Value
$ 19,357,723
A condensed statement of the investment pool's net assets and changes in net assets
follows:
Statement of Net Assets
Assets
Net assets
Net assets held in trust for:
Internal participants
External participants
Total net assets held in trust
Statement of Changes in Net Assets
Total additions
Total deductions
Net decrease
Net assets held in trust:
July 1,2003
June 30, 2004
32
$ 21,983,492
$ 21.983.492
$ 8,315,344
13,668,148
$ 21.983.492
$ 53,854,746
56,613,494
( 2,758,748)
24,742,240
$ 21.983.492
Notes to Financial Statements - Continued
Note 5 - Capital Assets
Capital asset activity for the year ended June 30, 2004, was as follows:
Primary Government
Balance
Balance June 30,
July 1,2003 Increases Decreases 2004
Governmental activities:
Capital assets not being
depreciated:
Land $ 630,070 $ $ $ 630,070
Construction in progress 1,034,168 147,886 691,498 490,556
Total capital assets, not
being depreciated 1,664,238 147,886 691,498 1,120,626
Capital assets being depreciated:
Land improvements 49,302 49,302
Buildings and improvements 9,413,450 1,096,114 10,509,564
Improvements other than
buildings 341,075 164,803 505,878
Machinery and equipment 11,649,935 502,106 162,577 11,989,464
Infrastructure 848,467 848,467
Total 21,453,762 2,611,490 162,577 23,902,675
Less accumulated depreciation
for:
Land improvements 17,830 1,739 19,569
Buildings and improvements 1,903,503 274,940 2,178,443
Improvements other than
buildings 159,074 32,264 191,338
Machinery and equipment 7,309,625 1,064,171 162,577 8,211,219
Infrastructure 18,184 18,184
Total 9,390,032 1,391,298 162,577 10,618,753
Total capital assets being
depreciated, net 12,063,730 1,220,192 13,283,922
Governmental activities capital
assets, net $ 13,727,968 $ 1.368,078 $ ( 691.498) $ 14.404,548
33
Notes to Financial Statements - Continued
Primary Government
Balance
Balance June 30,
July 1,2003 Increases Decreases 2004
Business- type activities:
Capital assets being depreciated:
Golf course and improvements $ 2,853,632 $ 298 $ $ 2,853,930
Machinery and equipment 837,968 78,701 62,636 854,033
Total 3,691,600 78,999 62,636 3,707,963
Less accumulated depreciation
for:
Golf course and improvements 1,281,138 96,643 1,377,781
Machinery and equipment 624,910 61,124 50,096 635,938
Total 1,906,048 157,767 50,096 2,013,719
Business- type activities capital
assets, net $ 1.785,552 $( 78,768) $ 12,540 $ 1,694,244
Depreciation expense was charged to functions as follows:
Governmental activities:
General government
Public safety
Highways and streets
Welfare
Health
Culture and recreation
Education
Total governmental activities depreciation expense
Business- type activities:
Golf course
Total business- type activities depreciation expense
34
$
$
$
$
257,974
425,342
581,798
26,058
7,677
91,241
1,208
1.391.298
157,767
157,767
Notes to Financial Statements - Continued
Note 6- Long- Term Liabilities
The following schedule details the County's long- term liability and obligation activity for
the year ended June 30, 2004:
Balance Balance Due within
July 1,2003 Additions Reductions June 30, 2004 1 year
Governmental activities
Certificates of participation
payable $ 2,495,000 $ $ 305,000 $ 2,190,000 $ 415,000
Obligations under capital
leases 33,144 34,294 11,418 56,020 22,929
Compensated absences
payable 425,633 931,335 702,967 654,001 196,202
Estimated liabilities for
claims and judgments 229,626 201,450 28,176
Governmental activities
long- term liabilities $ 3,183.403 $ 965,629 $ 1.220,835 $ 2,928,197 $ 634,131
Business- type activities
Certificates of
participation payable $ 1,705,000 $ $ 95,000 $ 1,610,000 $ 270,000
Compensated absences
payable 32,595 81,852 47,197 67,250 20,175
Business- type activities
long- term liabilities $ 1.737,595 $ 81.852 $ 142,197 $ 1.677.250 $ 290,175
Certificates of participation- The County has issued certificates of participation that are
generally callable with interest payable semiannually to finance construction of the
courthouse and government center complex, the jail facility, and the Emerald Canyon golf
course.
Certificates outstanding at June 30, 2004, were as follows:
Original Maturity Interest Outstanding
Description Amount Ranges Rates Principal
Courthouse and government
center complex - 2003 refunding $ 1,165,000 2004 - 2009 2.00 - 3.00% $ 1,095,000
Jail facility - series 2003
refunding 1,330,000 2004 - 2009 2.00 - 3.00% 1,095,000
Emerald Canyon GolfCourse -
series 2003 refunding 1,705,000 2004 - 2009 2.00- 3.00% 1,610,000
$ 3,800,000
35
Business- Type
Activities
Notes to Financial Statements - Continued
The following schedule details debt service requirements to maturity for the County's
certificates of participation payable at June 30, 2004:
Governmental
Activities
Year Ending
June 30 Principal Interest Principal Interest
2005 $ 415,000 $ 50,238 $ 270,000 $ 35,138
2006 425,000 41,887 275,000 29,687
2007 430,000 32,562 280,000 23,788
2008 440,000 22,830 290,000 17,375
2009 480,000 13,175 495,000 13,056
Total $ 2,190,000 $ 160,692 $ 1.610,000 $ 119,044
In prior years, the County defeased certain certificates of participation by placing the
proceeds of new certificates of participation in an irrevocable trust to provide resources for
all future debt service payments on the old debt. The refunded debt is considered defeased
and the related liabilities are not included in the County's financial statements. During the
year ended June 30, 2004, the remaining balance of the outstanding refunded certificates of
participation were repaid.
Landfill closure and postclosure care costs- The County has contracted with an outside
agency to provide operations for its solid waste facilities. The contract requires the outside
agency to reserve funds in accordance with the closure plan for closure and postclosure
care costs. In the event of termination of the contract, the required reserve funds are to be
remitted to the County. Consequently, no liability for landfill closure and postclosure care
costs has been recorded on the Statement of Net Assets.
Insurance claims- The County provides life, health, and disability benefits to its
employees and their dependents through the Arizona Local Government Employee Benefit
Trust currently composed of six member counties. The Trust provides the benefits through
a self- funding agreement with its participants and administers the program. The County is
responsible for paying the premium and may require its employees to contribute a portion
of that premium. If it withdraws from the Trust, the County is responsible for any claims
run- out costs, including claims reported but not settled, claims incurred but not reported,
and administrative costs. If the Trust were to terminate, the County would be responsible
for its proportional share of any Trust deficit.
Compensated absences and claims and judgments- Compensated absences are paid
from various funds in the same proportion that those funds pay payroll costs. Claims and
judgments are generally paid from the fund that accounts for the activity that gave rise to
the claim. During fiscal year 2004, the County paid for compensated absences as follows:
49 percent from the General Fund, 5 percent from the Road Fund, 13 percent from the Jail
District Fund, 13 percent from the Enterprise Fund, and 20 percent from the other funds.
The County paid for claims and judgments from the General Fund.
36
Note 7-
Note 8 -
Notes to Financial Statements - Continued
Risk Management
The County is exposed to various risks of loss related to torts; theft of, damage to, and
destruction of assets; errors and omissions; injuries to employees; and natural disasters; but
was unable to obtain insurance at a cost it considered to be economically justifiable.
Therefore, the County joined and is covered by three public entity risk pools: the Arizona
Counties Property and Casualty Pool and the Arizona Counties Workers' Compensation
Pool, which are described below, and the Arizona Local Government Employee Benefit
Trust, which is described above.
The Arizona Counties Property and Casualty Pool is a public entity risk pool currently
composed of 11 member counties. The pool provides member counties catastrophic loss
coverage for risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; and natural disasters; and provides risk management services. Such
coverage includes all defense costs as well as the amount of any judgment or settlement.
The County is responsible for paying a premium, based on its exposure in relation to the
exposure of the other participants, and a deductible of $ 5,000 per occurrence for
property claims and $ 5,000 per occurrence for liability claims. The County is also
responsible for any payments in excess of the maximum coverage of $ 100 million per
occurrence for property claims and $ 10 million per occurrence for liability claims. A
County must participate in the pool at least 3 years after becoming a member; however, it
may withdraw after the initial 3- year period. If the pool were to become insolvent, the
County would be assessed an additional contribution.
The Arizona Counties Workers' Compensation Pool is a public entity risk pool currently
composed of 11 member counties. The pool provides member counties with workers'
compensation coverage, as required by law, and risk management services. The County is
responsible for paying a premium, based on an experience rating formula that allocates
pool expenditures and liabilities among the members.
The Arizona Counties Property and Casualty Pool and the Arizona Counties Workers'
Compensation Pool receive independent audits annually and an audit by the Arizona
Department of Insurance triennially. Both pools accrue liabilities for losses that have been
incurred but not reported. These liabilities are determined annually based on an
independent actuarial valuation.
Retirement Plans
Plan Descriptions- The County contributes to the three plans described below. Benefits
are established by state statute and generally provide retirement, death, long- term disability,
survivor, and health insurance premium benefits.
37
Notes to Financial Statements - Continued
The Employee Security Plan ( ESP) is a defined contribution plan administered by
Massachusetts Mutual Life Insurance Company that covers all permanent full- time
employees of the County except for participants in the Public Safety Personnel Retirement
System and the Elected Officials Retirement Plan. In a defined contribution plan, benefits
depend solely on amounts contributed to the plan plus investment earnings.
The Public Safety Personnel Retirement System ( PSPRS) is an agent multiple- employer
defined benefit pension plan that covers public safety personnel who are regularly assigned
hazardous duty as employees of the State of Arizona or one of its political subdivisions.
The PSPRS, acting as a common investment and administrative agent, is governed by a
five- member board, known as The Fund Manager, and 199 local boards according to the
provisions ofA. R. S. Title 38, Chapter 5, Article 4.
The Elected Officials Retirement Plan ( EaRP) is a cost- sharing multiple- employer defined
benefit pension plan that covers elected officials and judges of certain state and local
governments. The EORP is governed by The Fund Manager of PSPRS according to the
provisions ofA. R. S. Title 38, Chapter 5, Article 3.
Each plan issues a publicly available financial report that includes its financial statements
and required supplementary information. A report may be obtained by writing or calling the
applicable plan.
ESP
1295 State Street
Springfield, MA 01111
( 413) 788- 8411
PSPRS and EORP
3010 E. Camelback Road, Suite, 200
Phoenix, AZ 85016
( 602) 255- 5575
Funding Policy- The Arizona State Legislature establishes and may amend active plan
members' and the County's contribution rates for the PSPRS and EORP plans.
ESP- All employees under this plan were allowed to select a contribution rate of 6 to 10
percent. The plan also requires that the County contribute an amount equal to 6 percent of
the employees' compensation for employees with service of 4 years or less, 8 percent for
employees with service of at least 4 years but less than 7 years, and 10 percent for
employees with service greater than 7 years.
Both the County and covered employees made the required contributions of 6 to 10 percent
amounting to contributions of $ 525,103 by the County and $ 870,963 by covered
employees.
Agent plan- For the year ended June 30, 2004, active PSPRS members were required by
statute to contribute 7.65 percent of the members' annual covered payroll, and the County
was required to contribute at the actuarially determined rate of 14.11 percent.
38
Notes to Financial Statements - Continued
Cost- sharing plan- For the years ended June 30, 2004, 2003 and 2002, active EORP
members were required by statute to contribute 7 percent of the members' annual covered
payroll. During the years ended June 30, 2004, 2003 and 2002, employee contributions to
the plan were $ 54,597, $ 54,519 and $ 53,966, respectively, which equaled the required
contributions for the year. The County was required to contribute 6 percent of the
members' covered payroll during 2004 and there were no required contributions for 2003
and 2002. The County's contributions to EORP for the years ended June 30, 2004, 2003
and 2002 were $ 46,798, $ 0 and $ 0, which equaled the required contributions for the year.
Annual Pension Cost- The County's pension cost for the agent plan for the year ended
June 30, 2004, and related information follows:
PSPRS
Contribution rates:
County
Plan members
Annual pension cost
Contributions made
14.11%
7.65%
$ 164,042
$ 164,042
The current- year annual required contribution for the PSPRS was determined as part of
their June 30, 2002, actuarial valuations using the entry- age actuarial cost method. The
actuarial assumptions included ( a) 9 percent investment rate of return and ( b) projected
salary increases ranging from 6.5 percent to 9.5 percent per year. Both ( a) and ( b) included
an inflation component of 5.5 percent. The assumptions did not include cost- of- living
adjustments. The actuarial value of assets was determined using techniques that smooth the
effects of short- term volatility in the market value of investments over a 4- year period. The
unfunded actuarial accrued liability is being amortized as a level percentage of projected
payroll on an open basis. The remaining amortization period at June 30, 2002, was 20
years.
Trend Information- Annual pension cost information for the current and two preceding
years follows for the agent plan:
Plan
PSPRS
Year Ended
June 30
2004
2003
2002
Annual Pension
Cost ( APC)
$ 164,042
99,177
116,995
39
Percentage of
APC
Contributed
100%
100%
100%
Net Pension
Obligation
$ 0
oo
Note 9-
Notes to Financial Statements - Continued
Interfund Balances and Activity
Interfund receivables and payables- Interfund balances at June 30, 2004, were as
follows:
Payable To
Jail Nonmajor
General Road District Governmental
Fund Fund Fund Funds Total
Payable from
General Fund $ 211 $ 26,730 47,971 $ 17,549 $ 92,461
Road Fund 226,339 226,339
Jail District Fund 255,538 3,554 259,092
Nonmajor
Governmental Funds 348,100 5,953 157,149 511,202
Golf Course Fund 871,633 656 120 872,409
Total $ 1.701.821 $ 36,893 $ 47,971 $ 174,818 $ 1.961.503
Interfund balances resulted from the time lag between the dates that ( l) interfund goods
and services are provided or reimbursable expenditures occur, ( 2) transactions are
recorded in the accounting system, and ( 3) payments between funds are made. Except
for interfund balances between the Golf Course Fund and the General Fund, all
interfund balances are expected to be repaid within 1 year from the date of the financial
statements.
Interfund transfers- Interfund transfers for the year ended June 30, 2004, were as
follows:
Transfer To
Nonmajor
General Governmental
Fund Funds Total
Transfer from
General Fund $ - $ 3,750 $ 3,750
Jail District Fund 92,500 92,500
Golf Course Fund 1,124 1,124
Total $ 93,624 $ 3,750 $ 97,374
Transfers were used to ( l) move revenues from the fund that statute or budget requires
to collect them to the fund that statute or budget requires to expend them, and ( 2) use
unrestricted revenues collected in the general fund to finance various programs
accounted for in other funds in accordance with budgetary authorizations.
Note 10 - Subsequent Event
In September 2007, the County, the plaintiff in a lawsuit against an out- of- state
company regarding a contractual agreement, lost a counter suit filed by the company
against the County. The jury awarded the company $ 9.2 million in damages and the
County intends to appeal the verdict. Based on the nature of the lawsuit, a contractual
matter, the County's insurance does not cover losses related to the matter. Management
and legal counsel intend to vigorously defend the County's position. No provision has
been made in the 2004 basic financial statements for any loss that may be incurred as
the events leading to the defendant's claim and the related suit occurred subsequent to
year- end.
40
Required Supplementary Information
La paz County
Required Supplementary Information
Schedule of Agent Retirement Plan's Funding Progress
June 30, 2004
Public Safety Penonnel Retirement System
Unfunded
Actuarial Actuarial Funding Annual Liability as
Actuarial Value Accrued ( Liability) Funded Covered Percentage
Valuation ofPlan Assets Liability Excess Ratio Payroll of Covered Payroll
nate ( a) ( b) ( a- b) ( alb) ( c) ([ a- b]/ c)
06/ 30104 $ 5,151,913 $ 6,204,379 $ ( 1,052,466) 83.0% $ 1,444,771 72.8%
06/ 30103 5,145,450 5,765,572 ( 620,122) 89.2% 1,398,063 44.4%
06/ 30102 5,250,603 5,391,985 ( 141,382) 97.4% 1,290,428 11.0%
41
La paz County
Required Supplementary Information
Budgetary Comparison Schedule
General Fund
Year Ended June 30, 2004
Original and
Final Budgeted
Amounts
Actual
Amounts
Variance with
Final Budget
Revenues:
Taxes
Licenses and permits
Fees, fmes, and forfeits
Intergovernmental
Charges for services
Investment income
Miscellaneous
Total revenues
Expenditures:
Current:
General government
Assessor
County attorney
Board of supervisors
Clerk of the superior court
Constable
Elections
Justice ofthe Peace # 4
Justice ofthe Peace # 5
Justice of the Peace # 6
Planning and zoning
Recorder
Superior court
Treasurer
Contingency
Management information services
Public defender
General administration
Finance personnel
GISlMaster planning
Facilities Management
Total general government
$ 3,399,242 $ 4,408,435 $ 1,009,193
223,000 227,616 4,616
710,000 732,544 22,544
4,095,184 3,531,827 ( 563,357)
535,833 539,911 4,078
64,000 51,779 ( 12,221)
707,479 485,002 ( 222,477)
9,734,738 9,977,114 242,376
362,773 332,793 29,980
503,673 471,827 31,846
462,724 453,857 8,867
297,079 276,855 20,224
1,000 1,978 ( 978)
74,574 39,969 34,605
338,549 339,097 ( 548)
163,710 156,455 7,255
249,070 241,976 7,094
371,731 336,696 35,035
172,867 173,476 ( 609)
394,791 586,479 ( 191,688)
217,356 209,421 7,935
750,000 750,000
124,506 157,033 ( 32,527)
447,551 433,864 13,687
301,021 302,634 ( 1,613)
192,955 184,201 8,754
21,099 10,628 10,471
438,091 414,130 23,961
5,885,120 5,123,369 761,751
See accompanying notes to budgetary comparison schedule.
42
La paz County
Required Supplementary Information
Budgetary Comparison Schedule
General Fund - Continued
Year Ended June 30, 2004
Original and
Final Budgeted Actual Variance with
Amounts Amounts Final Budget
Public safety:
Regional dispatch $ 497,002 $ 508,592 $ ( 11,590)
Sheriff 1,853,497 1,938,269 ( 84,772)
Probation 99,043 104,014 ( 4,971)
Aircraft 16,850 19,149 ( 2,299)
Maintenance of effort 575,653 575,653
Juvenile probation 87,356 70,746 16,610
Total public safety 3,129,401 3,216,423 ( 87,022)
Sanitation:
Sanitary landfill 10,000 2,879 7,121
Total sanitation 10,000 2,879 7,121
Health:
Indigent health 434,130 201,630 232,500
County long term care ALTCS 731,997 553,373 178,624
C. M.! ( chronically mental ill) 116,850 17,240 99,610
Health department transit 92,064 128,191 ( 36,127)
Total health 1,375,041 900,434 474,607
Welfare:
Public fiduciary 93,229 90,960 2,269
Total welfare 93,229 90,960 2,269
Education:
School superintendent 153,662 152,177 1,485
Total education 153,662 152,177 1,485
Total expenditures 10,646,453 9,486,242 1,160,211
Excess ( deficiency) of
revenues over expenditures ( 911,715) 490,872 1,402,587
See accompanying notes to budgetary comparison schedule.
43
La paz County
Required Supplementary Information
Budgetary Comparison Schedule
General Fund - Continued
Year Ended June 30, 2004
Original and
Final Budgeted Actual Variance with
Amounts Amounts Final Budget
Other fmancing sources ( uses):
Capital lease agreements $ 34,293 $ 34,293
Transfers in 93,624 93,624
Transfers out $ ( 486,916) ( 3,750) 483,166
Total other fmancing sources ( uses) ( 486,916) 124,167 611,083
Net change in fund balances ( 1,398,631) 615,039 2,013,670
Fund balances, July 1,2003 1,398,631 3,385,707 1,987,076
Fund balances, June 30, 2004 $ $ 4,000,746 $ 4,000,746
See accompanying notes to budgetary comparison schedule.
44
La paz County
Required Supplementary Information
Budgetary Comparison Schedule
Road Fund
Year Ended June 30, 2004
Original and
Final Budgeted Actual Variance with
Amounts Amounts Final Budget
Revenues:
Taxes $ 1,097,000 $ 498,571 $ ( 598,429)
Intergovernmental 3,140,000 3,456,054 316,054
Investment income 31,000 23,441 ( 7,559)
Miscellaneous 54,219 54,219
Total revenues 4,268,000 4,032,285 ( 235,715)
Expenditures:
Current:
Highways and streets 5,784,112 4,236,055 1,548,057
Total expenditures 5,784,112 4,236,055 1,548,057
Net change in fund balances
Fund balances, July 1,2003
Fund balances, June 30, 2004
( 1,516,112) ( 203,770)
1,516,112 2,259,572
$ $ 2,055,802
1,312,342
743,460
$ 2,055,802
See accompanying notes to budgetary comparison schedule.
45
La paz County
Required Supplementary Information
Budgetary Comparison Schedule
Business 95 Road Improvement Fund
Year Ended June 30, 2004
Revenues
Total revenues
Expenditures:
Current:
Highways and streets
Total expenditures
Net change in fund balances
Fund balances, July 1, 2003
Fund balances, June 30, 2004
Original and
Final Budgeted
Amounts
$
300,000
300,000
( 300,000)
300,000
$
Actual
Amounts
$
108,606
108,606
( 108,606)
3,355,202
$ 3,246,596
Variance with
Final Budget
$
191,394
191,394
191,394
3,055,202
$ 3,246,596
See accompanying notes to budgetary comparison schedule.
46
La paz County
Required Supplementary Information
Budgetary Comparison Schedule
Jail District Fund
Year Ended June 30, 2004
Original and
Final Budgeted Actual Variance with
Amounts Amounts Final Budget
Revenues:
Taxes $ 855,000 $ 1,049,212 $ 194,212
Intergovernmental 575,653 279,032 ( 296,621)
Charges for services 1,400,000 1,871,294 471,294
Investment income 15,500 1,360 ( 14,140)
Miscellaneous 260 260
Total revenues 2,846,153 3,201,158 355,005
Expenditures:
Current:
Public safety 2,395,574 2,572,567 ( 176,993)
Debt Service:
Principal retirement 359,085 235,000 124,085
Interest and fiscal charges 20,717 ( 20,717)
Total expenditures 2,754,659 2,828,284 ( 73,625)
Excess ofrevenues
over expenditures 91,494 372,874 281,380
Other fmancing uses:
Transfers out ( 92,500) ( 92,500)
Total other fmancing uses ( 92,500) ( 92,500)
Net change in fund balances 91,494 280,374 188,880
Fund balances, July 1,2003 ( 91,494) 84,933 176,427
Fund balances, June 30, 2004 $ $ 365,307 $ 365,307
See accompanying notes to budgetary comparison schedule.
47
La paz County
Required Supplementary Information
Notes to Budgetary Comparison Schedules
June 30, 2004
Note 1 - Budgeting and Budgetary Control
A. R. S. require the County to prepare and adopt a balanced budget annually for each
governmental fund. The Board of Supervisors must approve such operating budgets on or
before the third Monday in July to allow sufficient time for the legal announcements and
hearings required for the adoption of the property tax levy on the third Monday in August.
A. R. S. prohibit expenditures or liabilities in excess of the amounts budgeted.
Expenditures may not legally exceed appropriations at the department level. In certain
instances, transfers of appropriations between departments or from the contingency account
to a department may be made upon the Board of Supervisors' approval. With the exception
of the General Fund, each fund includes only one department.
Capital outlay and debt service expenditures are budgeted by department and accumulated by
function on the Budgetary Comparison Schedule.
Note 2 - Budgetary Basis of Accounting
The County's budget is prepared on a basis consistent with generally accepted accounting
principles.
Note 3 - Expenditures in Excess of Appropriations
For the year ended June 30, 2004, expenditures exceeded final budget amounts at the
department level ( the legal level of budgetary control) as follows:
Fund/ Department
General Fund:
Constable
Justice ofthe Peace # 4
Recorder
Superior Court
Management information services
General administration
Regional dispatch
Sheriff
Probation
Aircraft
Health department transit
Jail District Fund
Excess
$ 978
548
609
191,688
32,527
1,613
11,590
84,772
4,971
2,299
36,127
73,625
The excesses were primarily the result of unexpected expenditures and expenditures made as a
result of unanticipated revenues, or both.
48