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HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
FINANCIAL STATEMENTS
AS OF AND FOR THE YEAR ENDED
DECEMBER 31. 2008
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
TABLE OF CONTENTS
DECEMBER 31.2008
DESCRIPTION
PAGE(S)
Independent Auditors' Report.............................. ........................................................................ 1-2
Independent Auditors' Report on Internal Control Over Financial
Reporting and on Compliance and Other Matters Based on an
Audit of Financial Statements Performed in
Accordance with Government Auditing Standards ............................ ....................................... 3-4
Management's Discussion and Analysis (unaudited)
For The Year Ended December 31,2008....................................................... ....... 5-8
BASIC FINANCIAL STATEMENTS:
Government-Wide Financial Statements:
Statement ofN et Assets - December 31, 2008. .................................... ........................................... 9
Statement of Activities - For The Year Ended
December 31, 2008 ........... ..... ........................ .... ........ ......... ........................ ...............................10
Fund Financial Statements:
Balance Sheet - Governmental Funds - December 31,2008........................................................11
Reconciliation of Governmental Funds Balance Sheet
To The Statement of Net Assets - December 31, 2008............................. ................................ .12
Statement of Revenues, Expenditures and Changes
In Fund Balances- Governmental Funds -
For the Year Ended December 31, 2008.....................................................................................13
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Govenunental Funds to the
Statement of Activities - For the Year Ended December 31, 2008............................................14
Statement of Net Assets - Fiduciary Funds - December 31, 2008.................... ................ ......... ...15
Statement of Changes in Net Assets - Fiduciary Funds - December 31, 2008.............................16
Notes to the Financial Statements............... ............................................................................. 17-27
REQUIRED SUPPLEMENTAL INFORMATION SECTION:
Exhibit I
Schedule of Revenues, Expenditures and Encumbrances _
Budget and Actual General Fund - For the Year Ended
December 31, 2008 ................................................................................................................... .28
~~
SEDORE & COMPANY
Beechwood Office Park
2678 SOLlth Road, Suite 101
Poughkeepsie, NY 1260 I
tel 845,485.5510
fax 845.485.5547
F1sbkill 845.897.1040
www.sedoreco.com
Certified Public Accountants, pc.
James L. Sedore, JI:, Cl'l1
Mark S. O'Sullivan, Cf'l1
James F Let/elio, jI:, Cf'l1
Linda M. Hannigan, CI'l1
Karell T Hamen, ChJ
Jefftey L. Brown, Cf'l1
Charles R. Rile, jI:, CI'l1
INDEPENDENT AUDITORS' REPORT
To the Members of the Board
of Fire Commissioners
Hughsonville Fire District
88 Old Hopewell Road
Hughsonville, New York 12537
We have audited the accompanying financial statements of the governmental activities, each
major fund and the remaining fund information of the Hughsonville Fire District, Hughsonville,
New York as of December 31, 2008, and for the year then ended which collectively comprise the
District's basic financial statements as listed in the foregoing Table of Contents. These financial
statements are the responsibility of the Hughsonville Fire District, Hughsonville, New York's
management. Our responsibility is to express an opinion on these basic financial statements
based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America, and the standards applicable to financial audits contained in the Government
Auditing Standards issued by the Comptroller General of the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all material respects,
the financial position of the governmental activities, each major fund and the remaining fund
information of the Hughsonville Fire District, Hughsonville, New York, as of December 31,
2008, and the respective changes in financial position for the year ended in conformity with
accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated
July 25, 2009 on our consideration of the Hughsonville Fire District's, Hughsonville, New
York, internal control over financial reporting and our tests of its compliance with certain
1
Large Firm Expertise" Local Firm Service
provisions of laws, regulations contracts and grant agreements and other matters. The purpose
of that report is to describe the scope of our testing of internal control over financial reporting
and compliance and the results of that testing, and not to provide an opinion on 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 read in
conjunction with this report in considering the results of our audit.
Management's Discussion and Analysis and Exhibit I, budgetary comparisori information, listed
in the Table of Contents, are not a required part of the basic financial statements, but are
supplementary information required by accounting principles generally accepted in the United
States of America. We applied limited procedures, consisting principally of inquiries of
management regarding the methods of measurement and presentation of the supplementary
information. We did not audit the information and express no opinion thereon.
~'N:W~I C~Js
July 25, 2009
2
~~
Beechwood Office Park
SEDORE & COMPANY
267H Sourh Road, Suitt' ]0]
Poughkeepsie, NY 1260]
rei 845.485.55](J
fax 845.485.5547
FlShkil/ 845.897.] 040
www.sedoreco.com
Certified Public Accountants, pc.
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING jameJ L Sedore, /I, CPA
AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINAN,GIAl2:sullivan, CPA
STATEMENTS PERFORMED IN ACCORDANCE WITH James F Letterio, jI, CPA
GOVERNMENT AUDITING STANDARDS LindtlM. Hannigan, CPA
Karen T Hansen, CI'lJ
jeffiq L. Brown, Cl'lJ
Charles R. Rae, /I, CPA
To the Members of the Board
of Fire Commissioners
Hughsonville Fire District
88 Old Hopewell Road
Hughsonville, New York 12537
We have audited the accompanying financial statements of the governmental activities, each
major fund, and the aggregate remaining fund information financial statements of the
Hughsonville Fire District, Hughsonville, New York as of and for the year ended December
31, 2008, which collectively comprise the District's basic financial statements and have issued
our report thereon dated July 25, 2009. We conducted our audit in accordance with generally
accepted auditing standards and the standards applicable to financial audits contained in the
Government Auditing Standards issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the Hughsonville Fire District's internal
control over financial reporting as a basis for designing our auditing procedures for the
purpose of expressing our opinions on the financial statements but not for the purpose of
expressing an opinion on the effectiveness of the Hughsonville Fire District's internal control
over financial reporting. Accordingly, we do not express an opinion on the effectiveness of
the District's internal control over financial reporting.
Our consideration over internal control over financial reporting was for the limited purpose
described in the preceding paragraph and would not necessarily identify all deficiencies in
internal control over financial reporting that might be significant deficiencies or material
weaknesses. However, as discussed below, we identified a deficiency in internal control over
financial reporting that we consider to be a significant deficiency.
A control deficiency exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to
prevent or detect misstatements on a timely basis. A significant deficiency is a control
deficiency, or combination of control deficiencies, that adversely affects the Fire District's
ability to initiate, authorize, record, process, or report financial data reliability in accordance
with generally accepted accounting principles such that there is more than a remote likelihood
that a misstatement of the Fire District's financial statements that is more than inconsequential
will not be prevented or detected by the Fire District's internal control. The significant
deficiency is described as follows:
3
Large Firm Expertise"' Local Firm Service
The District has not taken a physical inventory of all of its fixed assets. By not taking
a physical inventory, the District's ability to monitor the existence and location of its
assets is limited.
A material weakness is a significant deficiency, or combination of significant deficiencies, that
results in more than a remote likelihood that a material misstatement of the financial statements
will not be prevented or detected by the Fire District's internal control.
Our consideration of internal control over financial reporting was for the limited purpose
described in the first paragraph of this section and would not necessarily identify all
deficiencies in internal control that might be significant deficiencies or material weaknesses.
However, we do not believe the significant deficiency described above is a material weakness.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Hughsonville Fire District's
financial statements are free of material misstatement, we performed tests of its compliance
with certain provisions of laws, regulations, contracts and grant agreements, noncompliance
with which could have a direct and material effect on the determination of financial statement
amounts. However, providing an opinion on compliance with those provisions was not an
objective of our audit and, accordingly, we do not express such an opinion. The results of our
tests disclosed no instances of noncompliance that is required to be reported under Government
Auditing Standards.
We noted certain immaterial instances of noncompliance that we have also reported to
management of the Hughsonville Fire District in a separate letter dated July 25, 2009.
This report is intended solely for the information and use of the Board of Fire Commissioners
and is not intended to be and should not be used by anyone other than these specified parties.
~ tc-/'~'-."C//l-:S
Poughkeepsie, N;; y~t.--'?t
July 25, 2009
4
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
MANAGEMENT'S DISCUSSION AND ANALYSIS-UNAUDITED
DECEMBER 31. 2008
The following "Management's Discussion and Analysis" report (MD&A) provides the reader
with an introduction and overview to the financial activities and performance of the
Hughsonville Fire District for the year ended December 31, 2008, as mandated by GASB #34.
This information should be reviewed in conjunction with the audited financial statements of the
District.
These audited financial statements consist of five parts: The Independent Auditors Report on our
financial statements, Managements Discussion and Analysis, Government Wide Financial
Statements, Fund Financial Statements, and Notes to the Financial Statements. The Government
Wide Financial Statements provide long and short term information about the District's overall
financial status. Our analysis of the District's major funds begins on page 11. The fund financial
statements provide detailed information about the most significant funds. Some funds are
required to be established by State law.
FINANCIAL POSITION SUMMARY
Net Assets serve as an indicator of the District's financial position. The District's Net Assets
exceeded liabilities by $1,201,837, an increase of $35,402 over December 31,2007. This differs
from fund balance in that fixed assets are added and bonded debt is deducted. Total assets
amounted to $2,035,814, including net fixed assets of$1,751,576. Assets amounted to
$2,060,202 at the end of 2007, having decreased by $24,388, including the acquisition of a fire
vehicle and other equipment, less depreciation. Liabilities amounted to $833,977, of which
$153,126 was due in one year or less and $680,851 is due after one year, representing a decrease
of $64,791 over 2007 resulting from payments on long term debt. Total revenues amounted to
$746,957, with real property taxes of $697,083 being the most significant. Revenues increased
$54,269 over 2007 of which $43,600 resulting from increased property taxes. Expenses
amounted to $711,555 with expenses for public safety of $668,543 being the most significant.
Net assets increased by $35,402 for the year from operations.
The following is a summarized comparative description of the District's assets, liabilities and net
assets for the years ended December 31,2008 and 2007.
5
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
MANAGEMENT'S DISCUSSION AND ANALYSIS-UNAUDITED (CONT'D.)
DECEMBER 31, 2008
Governmental
Activities
2008 2007 Change
Cash and cash equivalents $ 284,238 $ 201,762 $ 82,476
Fixed assets 1,751,576 1,858,440 (106,864)
T ota] Assets $ 2,035,814 $ 2,060,202 $ (24,388)
Current liabilities $ 153,126 $ 130,143 $ 22,983
Non-current liabilities 680,851 763,625 (82,774)
Total liabilities 833,977 893,768 (59,791)
Invested in Capital Assets, net of related debt 1,210,908 1,176,187 34,721
Unrestricted net assets (9,071) (9,752) 681
Total net assets 1,201,837 1,166,435 35,402
Total liabilities and net assets $ 2,035,814 $ 2,060,203 $ (24,389)
6
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
MANAGEMENT'S DISCUSSION AND ANALYSIS-UNAUDITED (CONT'D.)
DECEMBER 31. 2008
Governmental
Activities
2008 2007 Change
Program Revenues
Grants and contributions $ 42,563 $ 5,486 $ 37,077
General revenues
Property taxes 697,083 653,483 43,600
Interest Earnings 4,146 30,935 (26,789)
Other revenues 3,165 2,784 381
Total revenues 746,957 692,688 54,269
Expenses
Public safety 673,543 576,544 96,999
Interest 38,012 42,231 (4,219)
Total expenses 711,555 618,775 92,780
Increase (decrease) in net assets $ 35,402 $ 73,913 $ (38,511)
For details of the District's finances, see the accompanying financial statements and Notes
thereof.
GENERAL FUND
There was an increase in Fund Balance in 2008 of$I,505 from operations.
Real property taxes increased by $43,600 in 2008. This was due to an increase in the District's
budgeted amount to cover fire services provided to the community.
The District's significant purchases included two rescue vehicles and a rescue boat, as well as
other equipment. Total capitalized equipment purchases amounted to $290,983.
7
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
MANAGEMENT'S DISCUSSION AND ANALYSIS-UNAUDITED (CONT'D.)
DECEMBER 31. 2008
FINAN CIAL STATEMENTS
The District's financial statements are prepared in accordance with generally accepted accounting
principles, as promulgated by the Governmental Accounting Standards Board (GASB). The
District is structured as governmental funds. See the accompanying Notes to the Financial
Statements.
8
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
STATEMENT OF NET ASSETS
DECEMBER 31,2008
GOVERNMENTAL
ACTIVITIES
ASSETS
Current Assets:
Cash and cash equivalents
Restricted cash
$
61,281
222,957
Total Current Assets
284,238
Capital Assets
Vehicles and equipment, net of accumulated depreciation of$759,787
1,751,576
Total Assets
$ 2,035,814
LIABILITIES
Current Liabilities:
Accounts payable $ 35,512
Accrued interest 5,017
Service Award Program contributions payable 29,823
Current Portion of Long-Term Liabilities:
Obligations under capital lease 42,774
Bonds payable 40,000
Total Current Liabilities 153,126
Non-Current Liabilities:
Obligations under capital lease 520,851
Bonds payable 160,000
Total Non-Current Liabilities 680,851
Total Liabilities 833,977
NET ASSETS
Invested in Capital Assets, net of related debt 1,210,908
Unrestricted (9,071)
Total Net Assets 1,201,837
Total Liabilities and Net Assets $ 2,035,814
The accompanying Notes to the Financial Statements
should be read in conjunction with these Financial Statements.
9
FUNCTIONS/PROGRAMS
Governmental Activities:
Public Safety
Interest
Total Governmental Activities $
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31, 2008
OPERATING
GRANTS AND
EXPENSES CONTRIBUTIONS
$
673,543
38,012
$
42,563
711,555
$
42,563
General Revenues
Taxes:
Real Property Taxes
Umestricted Investment Earnings
Miscellaneous
Total General Revenues
Change in Net Assets
Net Assets at Beginning of Year
Net Assets at End of Year
The accompanying Notes to the Financial Statements
should be read in conjunction with these Financial Statements.
NET (EXPENSE) REVENUE
AND CHANGES IN
NET ASSETS
GOVERNMENTAL
ACTIVITIES
$
(630,980)
(38,012)
(668,992)
697 ,083
4,146
3,165
704,394
35,402
1,166,435
$
1,201,837
10
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
BALANCE SHEET
GOVERNMENTAL FUNDS
DECEMBER 31. 2008
Total Assets
CAPITAL TOTAL
GENERAL PROJECTS GOVERNMENTAL
FUND FUND FUNDS
$ 61,281 $ $ 61,281
222,957 222,957
81,651 81,651
$ 61,281 $ 304,608 $ 365,889
ASSETS
Cash and cash equivalents
Restricted cash
Due from other funds
LIABILITIES AND FUND EQUITY
LIABILITIES
Accounts Payable $ 35,512 $ $ 35,512
Due to Other Funds 81,651 81,651
Total Liabilities 117,163 117,163
FUND EQUITY
Fund Balance (Deficit):
Reserved for:
Capital 304,608 304,608
Encumbrances 31,165 31,165
Undesignated (87,047) (87,047)
Total Fund Equity (55,882) 304,608 248,726
Total Liabilities
and Fund Equity $ 61,281 $ 304,608 $ 365,889
The accompanying Notes to the Financial Statements
should be read in conjunction with this Financial Statement.
11
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
RECONCILIATION OF GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF NET ASSETS
DECEMBER 31. 2008
Total Fund Equity for Governmental Funds
$
248,726
Total Net Assets Reported for Governmental Activities in the Statement
of Net Assets are Different Because:
Capital assets used in governmental activities are not
financial resources and therefore are not reported in the funds.
1,751,576
Current service award liabilities and long-term liabilities,
including bonds payable are not due and payable
in this period and therefore are not reported in the funds.
(793,448)
Accrued interest is not reported in the funds.
(5,017)
Total Net Assets of Governmental Activities
$
1,201,837
The accompanying Notes to the Financial Statements
should be read in conjunction with this Financial Statement.
12
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED DECEMBER 31.2008
CAPITAL TOTAL
GENERAL PROJECTS GOVERNMENT AL
FUND FUND FUNDS
REVENUES
Real Property Taxes $ 697,083 $ $ 697,083
Other Payments In Lieu of Taxes
Use of Money and Property 3,069 1,077 4,146
Sale of Property and Compensation for Loss 202,328 202,328
Miscellaneous Local Sources 837 837
State Aid 3,542 3,542
Federal Aid 39,021 39,021
Total Revenues 945,880 1,077 946,957
EXPENDITURES
Public Safety 699,543 699,543
Employee Benefits 65,313 65,313
Debt Service 119,783 119,783
Total Expenditures 884,639 884,639
Excess of Revenues Over Expenditures 61 ,241 1,077 62,318
Other Financing Sources:
Operating transfers in 59,736 59,736
Operating transfers out (59,736) (59,736)
Total Other Financing Sources (59,736) 59,736
Excess (Deficiency) of Revenue and Other Sources
Over Expenditures and Other Uses 1,505 60,813 62,318
Fund Balance, December 31, 2007 (57,387) 243,795 186,408
Fund Balance, December 31, 2008 $ (55,882) $ 304,608 $ 248,726
The accompanying Notes to the Financial Statements
should be read in conjunction with this Financial Statement.
13
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
RECONCILIATION OF STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31, 2008
Net Change in Fund Equities - Governmental Funds
The Change in Net Assets reported for Governmental Activities in the
Statement of Activities is different because:
Governmental funds report all capital outlays as expenditures.
However, in the statement of activities, the cost of certain assets
is allocated over their estimated useful lives and reported as
depreciation expense. This is the amount by which capital outlay
expense exceeded depreciation in the current period.
In the statement of activities, the service award liability for the current
period is accrued, whereas in governmental funds, the required
annual contribution is reported when due.
Bond proceeds are reported as financing sources in governmental
funds and thus contribute to the change in fund balance. In the
statement of net assets, however, issuing debt increases long-term
liabilities and does not affect the statement of activities. Similarly,
repayment of principal is an expenditure in the governmental funds
but reduces the liability in the statement of net assets.
Repayments:
Bond Principal
Capital Lease Principal
In the statement of activities, interest is accrued on outstanding
bonds, whereas in governmental funds, an interest expenditure is
reported when due.
$
62,318
(106,861)
(1,826)
40,000
40,768
1,003
Net Change in Net Assets of Governmental Activities
$
35,402
The accompanying Notes to the Financial Statements
should be read in conjunction with this Financial Statement.
14
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
STATEMENT OF NET ASSETS
FIDUCIARY FUNDS
DECEMBER 31, 2008
ASSETS
Cash and Cash Equivalents
Investments
Contributions Receivable
Total assets
LIABILITIES
Liabilities
Total liabilities
NET ASSETS
Held in Trust for Service Award Program Benefits
Net Assets
TOTAL LIABILITIES AND NET ASSETS
SERVICE
AWARD
PROGRAM
$
71,788
279,551
29,823
$
381,162
$
380
380
380,782
380,782
$
381,162
The accompanying Notes to the Financial Statements
should be read in conjunction with these Financial Statements.
15
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
STATEMENT OF CHANGES IN NET ASSETS
FIDUCIARY FUNDS
DECEMBER 31, 2008
SERVICE
AWARD
PROGRAM
ADDITIONS
Contributions
Inves1ment Earnings
$
39,828
(54,299)
Total Additions
(14,471)
DEDUCTIONS
Benefits
19,640
Total Deductions
19,640
Change in Net Assets
(34,111 )
Net Assets - January 1, 2008
414,893
Net assets - December 31, 2008
$
380,782
The accompanying Notes to the Financial Statements
should be read in conjunction with these Financial Statements.
16
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31. 2008
NOTE A - Summary of Accounting Policies
The Hughsonville Fire District, Hughsonville, New York ("the District") was incorporated
under the provisions of the State of New York. The District operates under a District
Corporation form of government, consisting of a Board of five Fire Commissioners. The
Chairman serves as the Chief Executive Officer and the Treasurer as the Chief Fiscal Officer
of the District.
The District provides fire protection medical services to residents and businesses of the
Hughsonville Fire District which is located in the Town of Wappinger, Dutchess County, New
York.
The financial statements of the District have been prepared in conformity with generally accepted
accounting principles (GAAP), as applied to government units. The Governmental Accounting
Standards Board (GASB) is the accepted standard-setting body for establishing governmental
accounting and financial reporting principles, some of which are as follows:
1. The Reporting Entity
The District, for financial purposes, includes all of the funds and account groups
relevant to the operations of the Hughsonville Fire District, Hughsonville, New York.
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 appointment of the
respective governing board.
2. Basic Financial Statements - Government-Wide Statements
The District's basic financial statements include both government-wide (reporting the District
as a whole) and fund financial statements (reporting the District's major funds). Both the
government-wide and fund financial statements categorize primary activities as either
governmental or business type activities. The District's fire protection services and general
administrative services are classified as governmental activities.
In the government-wide Statement of Net Assets, the governmental activities columns is
presented on a consolidated basis by column, and is reported on a full accrual, economic
resource basis, which recognizes all long-term assets and receivables as well as long-term
debt and obligations. The District's net assets are reported in three parts-invested in
capital assets, net of related debt; restricted net assets; and umestricted net assets. The
District first utilizes restricted resources to finance qualifying activities.
The government-wide Statement of Activities reports both the gross and net cost of each
of the District's functions or activities. The functions are also supported by general
government revenues (property taxes, certain intergovernmental revenues, and charges,
17
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE A - Summary of Accounting Policies (Continued)
etc.). The Statement of Activities reduces gross expenses by related program revenues,
operating and capital grants. Program revenues must be directly associated with the
function (public safety, in the case of the District). Operating grants include operating-
specific and discretionary (either operating or capital) grants while the capital grants
column reflects capital-specific grants.
The net costs are normally covered by general revenue (property taxes and interest
income, etc).
This government-wide focus is more onthesustainability of the District as an entity
and the change in the District's net assets resulting from the current year's activities.
3. Basic Financial Statements- Fund Financial Statements
The financial transactions of the District are reported in individual funds in the fund
financial statements. Each fund is accounted for by providing a separate set of self-
balancing accounts that comprises its assets, liabilities, reserves, fund equity, revenues
and expenditures/expenses. Funds are organized into three major categories:
governmental, proprietary, and fiduciary. An emphasis is placed on major funds within
the governmental and proprietary categories. A fund is considered major if it is the
primary operating fund of the District or meets the following criteria:
a. Total assets, liabilities, revenues, or expenditures/expenses of that individual
governmental or enterprise fund are at least 10 percent of the corresponding total for
all funds of that category or type; and,
b. Total assets, liabilities, revenues, or expenditures/expenses of the individual
governmental fund or enterprise fund are at least 5 percent of the corresponding total
for all governmental and enterprise funds combined.
The following fund types are used by the District:
A. Governmental Funds
The focus of the governmental funds' measurement (in the fund statements) is upon
determination of financial position and changes in financial position (sources, uses, and
balances of financial resources) rather than upon net income.
18
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONTID.)
DECEMBER 31,2008
NOTE A - Summary of Accounting Policies (Continued)
The following is a description of the governmental funds of the District:
1. General Fund is the general operating fund of the District. It is used to account
for all financial resources except those required to be accounted for in another
fund. The General Fund is considered a major fund and is presented separately.
2. Capital Projects Fund is used to account for financial resources to be used for
the acquisition or construction of major facilities or equipment.
B. Fiduciary Funds
Fiduciary Funds are used to report assets held in a trustee or agency capacity for others
and therefore are not available to support District's programs. The reporting focus is on
net assets and changes in net assets and are reported using accounting principles similar
to proprietary funds.
The District's fiduciary funds are presented. in the fiduciary fund financial statements.
Since by definition these assets are being held for the benefit of a third party and cannot
be used to address activities or obligations of the government, these funds are not
incorporated into the government-wide statements.
4. Basis of Accounting
Basis of accounting refers to the point at which revenues or expenditures/expenses are
recognized in the accounts and reported in the financial statements. It relates to the
timing of the measurements made regardless of the measurement focus applied.
A. Accrual
The governmental activities in the government-wide financial statements and fiduciary
fund financial statements are presented on the accrual basis of accounting. Revenues are
recognized when earned and expenses are recognized when incurred.
B. Modified Accrual
The governmental funds financial statements are presented on the modified accrual basis
of accounting. Under the modified accrual basis of accounting, revenues are recorded
when susceptible to accrual; i.e., both measurable and available. "Available" means
collectible within the current period or within 60 days after year-end. Expenditures are
generally recognized under the modified accrual basis of accounting when the related
liability is incurred. The exception to this general rule is that principal and interest on
general obligation long-term debt, if any, is recognized when due.
19
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE A - Summary of Accountin2 Policies (Continued)
5. Financial Statement Amounts
A. Bud2ets
The District employs a formal budgetary accounting system as required by law.
During the year, a budget was adopted and modified by the Board for the General
Fund. However, for the Capital Projects Fund, budgets are established at the project
level and continue until the project is completed. Unused appropriations of the
annually budgeted funds lapse at the end of the year.
B. Cash and Investments
Cash includes amounts in demand and time deposits, as well as, short-term
investments. State statutes and the District's own written investment policy govern the
investment policies of the District. Demand and time deposits, and certificates of
deposit not covered by Federal Deposit Insurance, must be collateralized by the
banking institutions with investments governed under state statutes.
The cash and investments of the District at December 31, 2008, are as follows:
GENERAL CAPITAL PROJECTS
FUND FUND TOTAL
Interest Bearing
Accounts $ 61,281 $ 222,957 $ 284,238
TOTAL $ 61,281 $ 222,957 $ 284,238
Governmental Accounting Standards Board Statement No. 40 Deposit and Investment
Risk Disclosure, directs that deposits be disclosed as exposed to custodial credit risk if
they are not covered by depository insurance or collateralized by securities held by the
District or its agent in the District's name. Deposits and investments at Dece mber 31,
2008 were entirely covered by federal depository insurance or collateral held by the
District's custodial bank in the District's name and is not subject to custodial credit
risk.
20
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE A - Summary of Accounting Policies (Continued)
C. Pension Plan -Volunteer Firefighter Service Award Program
1. Plan Description
The District contributes to the Hughsonville Fire District Volunteer Firefighter Service
A ward Program, a plan of deferred compensation (i. e. a non -qualified plan under the
Internal Revenue Code). The District Board of Fire Commissioners of the
Hughsonville Fire District is the Trustee and Plan Administrator for the Service A ward
Program. The District Board of Fire Commissioners retains an independent third party
pension plan administration firm to assist them in administering the Service A ward
Program. In addition, plan investments are made through an independent broker who
advises the District Board of Fire Commissioners with regard to the investment of the
Program assets.
All persons who are active volunteer firefighters of the District in accordance with the
by-laws of the Hughsonville Fire Company are eligible to become participants in the
Service Award Program. An individual firefighter's earned Service Award equals $20
per month for each year of service credit earned to a maximum of 20 years with
lifetime monthly Service A ward payments commencing upon attainment of age 62. A
firefighter earns a year of service credit for a calendar year if he or she earns a
minimum number of points for participation in volunteer firefighter activities under a
point system and meet any other active volunteer firefighter requirements imposed by
the District/Fire Company. A volunteer firefighter's earned Service A ward vests after
the firefighter earns five years of Service A ward Program service credit. Death and
disability benefits are also provided to volunteer firefighters under the Service A ward
Program. The Service A ward Program was established in accordance with Article 11-
A of the New York State General Municipal Law.
2. Plan Investments
The Program assets can be invested in Money Market Funds, Mutual Funds, U.S.
Government Securities, and Certificates of Deposit and are recorded at fair market
value. They are not subject to the collateral requirements described in Note A.6.
3. Funding Status of the Program
The amount shown below as the pension benefit obligation is a standardized disclosure
measure of the present value of earned Service Awards (i.e. for this purpose, a
firefighter's earned Service A ward is considered to be a pension benefit), estimated to
be payable in the future as a result of volunteer firefighter service rendered to date.
The difference between the pension benefit obligation and the accumulated plan assets
is the unfunded portion of the pension benefit obligation (i.e. the unfunded pension
21
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE A - Summary of Accounting Policies (Continued)
benefit obligation). This measure is intended to assess the funding status of the
District's Service Award Program on a going concern basis and assess progress made
in accumulating sufficient assets to pay earned Service Awards when due. The
calculation of the pension benefit obligation is independent of the actuarial funding
method used to determine annual contributions payable to the Service Award Program
Trust Fund.
The pension benefit obligation was computed as part of an actuarial valuation
performed as of December 31, .2008. Significant actuarial assumptions used in the
valuation include:
a. the rate of return on the investment of present and future assets of 5.5 % a year,
compounded 'annually; and,
b. the actuarial value of earned Service A wards calculated on the assumption that each
participating firefighter continues to be an active volunteer firefighter, lives to age 62
and his or her post age 62 mortality is in accordance with the 1994 Unisex Pensioners
Mortality Table for males projected to 2007 with Scale AA.
The actuarial valuation performed as of December 31, 2008 used the following:
Actuarial Cost Method
Amortization Method
Remaining Amortization
Period - prior service cost
Asset valuation method
Attained Age
Level Dollar
5 years
Fair value
The total unfunded pension benefit obligation applicable to the District's volunteer
firefighter participants in the Service Award Program was $397,803 as of December
31, 2008, is as follows:
Pension Benefit Obligation:
Retirees Receiving Benefits:
Current Volunteer Firefighters
Vested Terminations
$ 256,531
443,026
79,788
779,345
(381,542)
$397.803
Total Pension Benefit Obligation
Net Assets Available for Benefits, at Market Value
Unfunded Pension Benefit Obligation
22
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE A - Summary of Accounting Policies (Continued)
The District has a pension obligation equivalent to the unfunded required contributions,
described as follows:
Actuarial Valuation Date 12/31/06 12/31/07 12/31/08
Actuarial Value of Plan Assets $386.013 $414.893 $381.542
Liability $87.361 $34.214 $29 . 823
Actuarial Accrued Liability
12/31/06 12/31/07 12/31/08
Beginning Balance $113,144 $87,361 $34,214
Accrued Interest 2,190 2,000 1,555
Contribution Due 62,027 26,000 28,268
Decrease (Payment Described Below) (90,000) (81.147) (34,214)
Ending Balance $87 .361 $34.214 $29.823
The change in net assets are as follows:
Contributions Accrued $38,273
Interest Due on Unpaid Contributions 1,555
Net Investment Income (54,299)
Benefits Paid (19,640)
Net Increase (34,111)
Net Assets January 1, 2008 414,893
Net Assets December 31, 2008 $380.782
4. Actuarially Determined Contribution Requirements and Contributions Made
The District contribution to the Service A ward Program Trust Fund for the calen dar
year ended December 31, 2008 ~of $29,823 was calculated in accordance with
actuarially determined requirements computed through the actuarial valuation
performed as of December 31, 2008 and is due in 2008. The liability is included in the
Statement of Net Assets. The contribution consisted of:
a. $ 28,268 normal cost and timing adjustment of $1,555;
b. There is no past E.A. service cost.
The computation of the service award program contribution requirements for the
current fiscal year was based on the same actuarial assumptions, benefit provisions,
actuarial funding method, and other factors used to determine the program contribution
requirements in prior years.
23
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE A - Summary of Accounting Policies (Continued)
5. Trend Information
Three year funding trend information is as follows. The net pension obligation is
equivalent to the unfunded actuarial liability representing unpaid contributions.
Annual Pension Cost
Percentage Contributed
Net Pension Obligation
$25.880
0%
$87.361
$26.000
100%
$34.214
12/31/08
$28.268
100%
$29.823
12/31/06 12/31/07
D. Property Taxes
The District submits an approved budget to the Town of Wappinger for submission to
the Dutchess County Commissioner of Finance by December 5lh of the previous year.
The County then establishes the warrant for the year which is due and payable on or
about January 1 of each year. The Town collects the taxes and forwards the District's
levy in full.
E. Lone-Term Oblieations
Long- Term Debt is recognized as a liability of a governmental fund when due, or when
resources have been accumulated in the debt service fund for payment early in the
following year. For other Long-Term Obligations, only that portion expected to be
financed from expendable available financial resources is reported as a fund liability of
a governmental fund. The full amount of such obligations is reported in the Statement
of Net Assets.
F. Insurance
The Hughsonville Fire District assumes the liability for most risk including, but not
limited to, property damage and personal injury liability. Such risks are covered by
the purchase of commercial insurance. Judgments and claims are recorded when it is
probable that an asset has been impaired or a liability has been incurred and the amount
of loss can be reasonably estimated. Workers compensation coverage is provided
through a retrospective policy, wherein premiums are recorded based on the ultimate
cost of the experience to date of workers in similar occupations.
24
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE A - Summary of Accounting Policies (Continued)
G. Capital Assets
Capital assets purchased or acquired are reported at historical cost or estimated historical cost.
Contributed assets are reported at fair market value as of the date received. Additions,
improvements and other capital outlays that significantly extend the useful life of an asset are
capitalized. Other costs incurred for repairs and maintenance are expensed as incurred.
Depreciation is provided on the straight-line basis over the estimated useful lives Of 5-20
years.
Interfund Activity
lnterfund activity is reported as either loans, services provided, reimbursements or transfers.
Loans are reported as interfund receivables and payables as appropriate and are subject to
elimination upon consolidation. The District generally records interfund transactions as
transfers. Balances and transfers between governmental or proprietary funds are netted as part
of the reconciliation to the government-wide financial statements. The District reflected the
use of Gerreral Fund funds in the amount of$59,736 by the Capital Reserve Fund at year-end.
H. Use of Estimates
The preparation of basic financial statements, in conformity with accounting principles
generally accepted in the United States of America, requires management to make
estimates and assumptions that affect the amounts reported in the basic financial
statements and the accompanying notes. Actual results could differ from those estimates.
I. Risk Management
The District assumes the liability for most risk including, but not limited to, property damage
and personal injury liability. Such risks are covered by the purchase of commercial insurance.
Judgments and claims are recorded when it is probable that an asset has been impaired or a
liability has been incurred and the amount of loss can be reasonably estimated. Workers
compensation coverage is provided through a retrospective policy, wherein premiums are
recorded based on the ultimate cost of the experience to date of workers in similar
occupations.
25
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31, 2008
NOTE B - Capital Assets
The following is a summary of the changes in Capital assets for the year:
BALANCE BALANCE
JANUARY 1, DECEMBER 31,
Governmental Activities: 2008 ADDmONS (DISPOSALS) 2008
Veh icles $ 2,690,464 $ 210,818 $ (640,709) $ 2,260,573
Equipment 170,622 80,165 250,787
Total $ 2,861,086 $ 290,983 $ (640,709) $ 2,511,360
Less Accumulated Depreciation
Veh icles $ 963,527 $ 135,709 $ (412,510) $ 686,726
Equ ipment 39,119 33,939 73,058
Total Accumulated Depreciation 1,002,646 169,648 (412,510) 759,784
Governmental Activities Capital Assets, Net $ 1,858,440 $ 121,335 $ (228,199) $ 1,751,576
*Depreciation was charged to governmental activities as follows:
Pu b lic Safety $
Total Depreciation Expense $
169,648
169,648
NOTE C - Lon2- Term Debt
The District borrows money in order to acquire equipment or construct buildings and public
improvements. This enables the cost of these capital assets to be borne by the present and
future taxpayers receiving the benefit of the capital assets. The provision to be made in future
budgets for capital indebtedness represents the amount, exclusive of interest, authorized to be
collected in future years from taxpayers and others for liquidation of long -term liabilities.
1. Serial Bonds Payable
The District may borrow an amount for any object or purpose for which has a period of
probable usefulness has been established.
The Serial Bonds Payable, as of December 31, 2008, are as follows:
ORIGINAL FINAL ORIGINAL
IS S UE MATURITY INTEREST AMOUNT
PURPOSE DATE DATE RATE OF ISSUE
Vehicles 06/10/03 06/09/13 4.30% $ 400,000
TOTAL $ 400,000
AMOUNT
OUTSTANDING
AT
DECEMBER 31,
2008
$ 200,000
$ 200,000
26
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
NOTES TO THE FINANCIAL STATEMENTS (CONT'D.)
DECEMBER 31. 2008
NOTE C - Lon2;-Term Debt (Continued)
2. Changes in Long Term Debt
The changes in the District's indebtedness during the year ended December 31, 2008 are
summarized as follows:
BAlANCE BAlANCE AM)UNTS
JANUARY 1, DECFMBER31, DUE WITHIN
2008 ADDITIONS (REDlCfIONS) 2008 ONE YEAR
Serial Bonds $ 240,000 $ - $ (40,000) $ 200,000 $ 40,000
Obligations Under Capital Lease 604,393 (40,768) 563,625 42,774
$
844,393 $
- $
(80,768) $
763,625 $
82,774
TOTAL
3. Amortization of Bonded Debt
The annual requirements to amortize bonded debt, as of December 31, 2008, are as follows:
YEAR ENDING
DECEMBER 31.
2009
2010
2011
2012
2013
TOTALS
PRINCIPAL
40,000
40,000
40,000
40,000
40,000
200,000
INTEREST
TOTAL
$
8,600 48,600
6,880 46,880
5,160 45,160
3,440 43,440
1,720 41,720
$ 25,800 $ 225,800
NOTE D - Capital Leases
In 2006, the District entered into two capital leases for fire equipment and a fire vehicle, with
a total asset cost of $642,934. These leases are considered to be capital leases for accounting
purposes, wherein, at the end of the lease the District retains ownership of the asset. At
December 31, 2008, the annual capital lease payments are as follows:
YEAR ENDING CAPITAL
DECEMBER 31. LEAS ES
2009 69,463
2010 57,841
2011 57,841
2012 57,841
2013 57,841
Thereafter 462,728
Less: Interest Portion (199,930)
TOTALS $ 563,625
27
, EXHIBIT I
HUGHSONVILLE FIRE DISTRICT
HUGHSONVILLE, NEW YORK
SCHEDULE OF REVENUES, EXPENDITURES AND ENCUMBRANCES
BUDGET AND ACTUAL - GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31,2008
ORIGINAL/ VARIANCE
AMENDED FAVORABLE
BUDGET ACTUAL (UNFAVORABLE)
REVENUES
Real Property Taxes $ 697,083 $ 697,083 $ 0
Use of Money and Property 3,000 3,069 69
Sale of Property and Compensation for Loss 20:2,328 202,328
Miscellaneous Local Sources 400 837 437
State Aid 3,542 3,542
Federal Aid 39,021 39,021
Total Revenues 700,483 945,880 245,397
Appropriation of Prior's Year's Fund Balance 12,932 (12,932)
Total Revenues and Appropriation of
Prior Year's Fund Balance 713,415 945,880 232,465
EXPENDITURES AND ENCUMBRANCES
Public Safety 477,952 699,543 (221,591)
Employee Benefits 86,000 65,313 20,687
Debt Service 69,463 119,783 (50,320)
Total Expenditures and Encumbrances 633,415 884,639 (251,224)
Excess (Deficiency) of Revenues and Appropriation of
Prior Year's Fund Balance Over (Under)
Expenditures and Encumbrances 80,000 61,241 (18,759)
Other Financing Sources (Uses):
Operating Transfers in
Operating Transfers out (80,000) (59,736) 20,264
Total Other Financing Sources (Uses) (80,000) (59,736) 20,264
Excess (Deficiency) of Revenues and Appropriation of
Prior Year's Fund Balance and Other Sources
Over (Under) Expenditures, Encumbrances
and Other Uses $ $ 1,505 $ 1,505
See independenf auditor's report
28