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2006 .. .. .. .. .. .. .. CHELSEA FIRE DISTRICT, NEW YORK lilt Financial Report Year Ended December 31, 2006 III .. .. ... ill ill ... II. .. .. .. .. .. CHELSEA FIRE DISTRICT CHELSEA, NEW YORK Annual Financial Report lilt Table of Contents illII Year ended December 31, 2006 .. Independent Auditor's Report 1 Financial Statement Banner 2 Balance Sheet - General Fund 3 Statement of Revenue, Expenditures, and Changes in Fund Balance Budget and Actual General Fund 4 Balance Sheet - Reserve Fund 5 Statement of Revenue, Expenditures, and Changes in Fund Balance Actual 6 Notes to the Financial Statements 7 - 10 .. .. ... .. illII ... .. .. .. ... iIlIII . ... illII ... 1M Accounting Associates 357 North Road Milan, New York 12571 .. INDEPENDENT AUDITOR'S REPORT .. The Fire District Board of Commissioners of The Chelsea Fire District, New York III We have audited the accompanying general purpose financial statements of the Chelsea Fire District, New York as of December 31, 2006, and for the year then ended. These general purpose financial statements are the responsibility of the Chelsea Fire District's Board of Commissioners and the Fire District's Treasurer. Our responsibility is to express our conclusion of these general purpose financial statements based on our audit. ill .. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our conclusions. ... - .. It is our conclusion, that the general purpose financial statements referred to in the first paragraph present fairly, in all material respects, the fmancial position of the Chelsea Fire District, New York as of December 31, 2006 and the results of its operations and changes in fund equity of its funds for the year then ended, in conformity with accounting principles generally accepted dint he United States of America. .. .. Our audit was made for the purpose of forming a conclusion on the general purpose financial statements taken as a whole. The individual fund fmancial statements are presented for purpose of analysis. The supplemental information, such as the Notes to the Financial Statements, are subject to the audit procedures applied in the audit of the financial statements. It is our conclusion, that for and as of the year ended December 31, 2006; this information is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. .. .. .. Mark Pozniak ... Rae D' Achille . . 1 - ill .. .. .. .. .. .. .. .. FINANCIAL STATEMENTS ... .. .. .. III II. ill .. ;) .. 2 .. .. .. CHELSEA FIRE DISTRICT CHELSEA, NEW YORK - - General Fund Balance Sheet 12/31/2006 .. Cash TOTAL ASSETS .. .. LIABILITIES AND FUND BALANCE FUND BALANCE Fund Balance Undesignated TOTAL LIABILITIES AND FUND BALANCE ... .. .. ... .. ... ... .. .. .. .. 3 ... $ $ $ $ 29,659 29,659 29,659 29,659 .. CHELSEA FIRE DISTRICT .. CHELSEA, NEW YORK Statement of Revenue, Expenditures, and - Changes in Fund Balance Budget and Actual General Fund ... 12/31/06 Variance ... Original Revised Favorable Budget Budget Actual (Unfavorable) REVENUE ... Real Property Taxes $ 262,300 $ 263,040 $ 263,040 $ Uses of Money and Property $ $ $ 1,393 $ 1,393 Rental of Property $ 8,000 $ 8,000 $ 8,880 $ 880 - Refund of Prior Year Expenditure $ $ $ 4,548 $ 4,548 Federal Aid (FEMA) $ $ $ 52,458 $ 52,458 TOTAL REVENUE $ 270,300 $ 271,040 $ 330,319 $ 59,279 ... EXPENDITURES Current: ... Public Safety $ 172,400 $ 172,400 $ 195,036 $ (22,636) Employee Benefits $ 91,900 $ 91,900 $ 111,280 $ (19,380) Debt Service ... Principal $ Interest $ TOTAL EXPENDITURES $ 264,300 $ 264,300 $ 306,3 16 $ (42,016) ... Excess/(Deficiency) of Revenue Over Expenditures $ 6,000 $ 6,740 $ 24,003 $ 17,263 .. OTHER FINANCIAL SOURCES/(USES) Operating Transfers In $ $ 13,197 $ 13,197 Operating Transfers Out $ 6,000 $ 6,000 $ 70,787 $ (64,787) ... TOTAL OTHER FINANCING SOURCES (USES) $ (6,000) $ (6,000) $ (57,590) $ (51,590) .. Excess/(Deficiency) of Revenue and Other Sources Over Expenses and Other Uses $ $ 740 $ (33,587) $ (34,327) .. FUND BALANCE AT BEGINNING OF YEAR $ 62,292 $ 62,292 $ 62,292 Prior Period Adjustment Increase to Fund Equity $ 954 $ 954 $ 954 .. ADJUSTED FUND BALANCE $ 63,246 $ 63,246 $ 63,246 FUND BALANCE AT END OF YEAR $ 63,246 $ 63,246 $ 29,659 .. i. 4 .. .. .. CHELSEA FIRE DISTRICT CHELSEA, NEW YORK .. .. Reserve Fund Balance Sheet .. 12/31/2006 ASSETS .. Cash $ 141,303 TOTAL ASSETS $ 141,303 ... LIABILITIES AND FUND BALANCE .. FUND BALANCE Fund Balance Reserved $ 141,303 TOTAL LIABILITIES AND FUND BALANCE $ 141,303 .. ... .. ... .. .. III ... 1M .. 5 .. III .. Statement of Revenue, Expenditures, and Changes in Fund Balance Actual - Reserve Fund 12/31/06 .. Actual REVENUE Uses of Money and Property $ 2,747 .. TOTAL REVENUE $ 2,747 EXPENDITURES .. Public Safety $ 117,316 TOTAL EXPENDITURES $ 117,316 .. OTHER FINANCING SOURCES/(USES) Operating Transfers In $ 70,787 Operating Transfers Out $ 13,197 .. TOTAL OTHER FINANCING SOURCES/(USES) $ 57,590 .. Excess(Deficiency) of Revenue & Other Sources Over Expenses and Other Uses $ ( 56,979) FUND BALANCE AT BEGINNING OF YEAR $ 73,479 .. Prior Period Adjustment Increase to Fund Equity $ 124,803 FUND BALANCE AT END OF YEAR $ 141,303 .. .. .. .. .. ... iIIIlII .. 6 l1li . CHELSEA FIRE DISTRICT ... CHELSEA, NEW YORK NOTES TO THE FINANCIAL STATEMENTS .. December 31, 2006 - Summary of Significant Accounting Policies The Chelsea Fire District, New York was established and operates in accordance with various ... applicable laws of the State of New York. The Board of Commissioners is the legislative body responsible for the District's general management and financial control. The Treasurer serves as the Chief Fiscal Officer and is responsible for the custody of moneys, maintenance of accounting .. records, and preparation of periodic financial status reports. The Treasurer is also responsible for preparing and filing, with the State Comptroller, the annual financial report, also known as the Annual Update Document. .. .. A Fire District is a District corporation of the State with the power to require the levy of taxes on real property. The Chelsea Fire District is located in the Town of Chelsea in Dutchess County the majority of its members are volunteers, and the District employs a nominal staff of paid employees which include the District Treasurer and District Secretary. .. The District accounts for its financial activities in the general and reserve funds. .. The district is governed by a Board of Fire Commissioners consisting of five elected commissioners. The Board of Commissioners is responsible for the District's general management and financial control and designates the bank for District funds, authorizes investments and approves claims for payment. .. A. The Reporting Entity ... The District, for financial purposes, includes all of the funds and account groups relevant to the operations of the District. The financial statements include organizations, functions and activities that are controlled by or dependent upon the District. Control or dependence is determined on the basis of budget adoption, taxing authority, funding and election of the respective governing board. Ii. .. B. Basis of Presentation .. Measurement Focus and Basis of Accounting .. The accounts of the District are organized and operation on the basis of funds and account groups. A fund is an independent fiscal and accounting entity with a self balancing set of accounts. Fund accounting segregates funds according to their intended purpose and is used to aid management in demonstrating compliance with finance related legal and contractual provisions. The minimum number of funds is maintained consistent with legal and managerial requirements. Account groups are a reporting device to account for certain assets and liabilities of the governmental funds not recorded directly in these funds. .. .. 7 .. .. .. CHELSEA FIRE DISTRICT CHELSEA, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (continued) .. Governmental Funds .. The District's two funds are categorized as governmental funds. Governmental fund types are used to account for the District's general government activities. Governmental fund types use current financial resources measurement focus. .. Operating statements of these funds present increases (i.e., revenue and other fmancing sources) and decreases (i.e., expenditures and other fmancing uses) in net current assets. .. The reported fund balance (net current asset) is considered a measure of "available expendable resources." .. The District utilizes the cash basis of accounting. Under the cash basis of accounting, revenues and related assets are recognized when received. Expenditures are recognized when paid. .. The foUowing are the District's governmental fund types: .. General Fund - This fund is the primary operating fund of the District. It is used to account for all fmancial resources except those required to be accounted for in another fund. ... Reserve Fund - This fund is utilized to account for moneys held for special or capital expenditures. .. C. Budgetary Information The District's Board of Commissioners follows statutory procedures for establishing the budget for the General Fund. This procedure is as follows: .. The District Treasurer presents, as required, the tentative budget to the District Board of Commissioners at a regular or special meeting. .. .. The District Board of Commissioners reviews the tentative budget and upon completion, the tentative budget as modified by the District Board, becomes the budget and is required to be filed with the Town (s) Budget Officer (s). .. .. iIIIII .. 8 .. .. .. CHELSEA FIRE DISTRICT CHELSEA, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (continued) .. D. Assets, Liabilities, and Fund Equity .. 1. Deposits ... The District's cash and cash equivalents are considered to be cash on hand, demand deposits and short term investments with original maturities of three months or less from the date of acquisition. .. State statutes govern the investment policies of the District. Permissible investments include obligations of the U.S. Treasury, U.S. agencies, and obligations of New York State and repurchase agreements of U.S. Treasuries. .. The district operates interest bearing accounts and non interest bearing checking accounts. .. 2. Receivables and Payables .. The District utilizes the Cash Basis of Accounting; therefore, there are no reportable Receivables and Payables. 3. Fixed Assets .. .. Fixed Assets used in governmental fund types of the District would normally be recorded in the general fixed asset group at cost or estimated historical cost if purchased or constructed. Donated assets are recorded at their estimated fair market value at the date of donation. No provision for depreciation is made on general fixed assets. The District does not record its Fixed Assets in the general fixed asset group of accounts on its books and records. .. 4. Long Term Liabilities .. Long term liabilities expected to be financed from governmental fund revenues are accounted for in the General Long Term Debt Account Group, rather than in the governmental funds. The District did not have any Long Term Debt in the period audited. IlIIr .. ... .. .. 9 .. . ... CHELSEA FIRE DISTRICT CHELSEA, NEW YORK NOTES TO THE FINANCIAL STATEMENTS (continued) .. Detailed Notes on All Funds and Account Groups .. Cash and Investments .. The carrying amounts of the District deposits at December 31, 2006 were $170,962. The deposits were insured by Federal deposit insurance for $200,000. The District does not have an adopted Investment Policy. ... Fixed Assets .. The District, during fiscal year 2006, had no record of Fixed Assets - which should include Land, Buildings and Machinery and Equipment. The District during the audited Fiscal year had no policy for Fixed Assets and the Board of Commissioners had not appointed a Fixed Asset Officer. .. Pension Plans ... Plan Description .. The Chelsea Fire District does not participate in the New York State and Local Employees' Retirement System and the Public Employees' Group Life Insurance Plan. The Chelsea Fire District does participate in a Service Award program for volunteer firefighters. .. .. .. ... .. .. .. .. 10 ..