fire district mo. 5 of caddo parish, louisianaapp1.lla.la.gov/publicreports.nsf/6b697b8b0cc... ·...

Fire District Mo. 5of Caddo Parish, Louisianaf . ' **/ '

Financial StatementsYear Ended December 31,2004

Under provisions of state law, this report is a publicdocument. A copy of the report has been submitted tothe entity and other appropriate public officials. Thereport is available for public inspection at the BatonRouge office of the Legislative Auditor and, whereappropriate, at the office of the parish clerk of court.

Release Date t&

Fire District No. 5of Caddo Parish, Louisiana

Contents

Independent Auditors' Report 3-4

Required Supplementary Information

Management's Discussion and Analysis 5-10

Basic Financial Statements:

Government-wide Financial Statements:Statement of Net Assets 11Statement of Activities 12

Fund Financial Statements:Balance Sheet-Governmental Funds 13Reconciliation of the Governmental Funds Balance

Sheet to the Statement of Net Asset 14Statement of Revenues, Expenditures, and Changes

in Fund Balance-Governmental Funds 15Reconciliation of the Statement of Revenues,

Expenditures, and Changes in Fund Balances ofGovernmental Funds to the Statement of Activities 16

Statement of Revenues, Expenditures, and Changes inFund Balance-Budget and Actual (GAAP Basis)-General Fund 17

Summary of Accounting Policies 18-24Notes to Financial Statements 25-30

Supplemental Information:

Schedule of General Government Expenditures-Budget and Actual (GAAP Basis) 32

Report on Compliance and on Internal Control OverFinancial Reporting Based on an Audit of FinancialStatements Performed in Accordance with GovernmentAuditing Standards 33-34

Summary of Audit Results 35

Schedule of Findings and Questioned Costs 36

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Independent Auditors' Report

Board of CommissionersFire District No. 5 of Caddo Parish, LouisianaShreveport, Louisiana

We have audited the accompanying basic financial statements of Fire District No. 5 of CaddoParish, Louisiana (a component unit of Caddo Parish, Louisiana), as of December 31, 2004, andfor the year then ended, as listed in the table of contents. These financial statements are theresponsibility of the District's management. Our responsibility is to express an opinion on thesefinancial statements based on our audits.

We conducted our audit in accordance with auditing standards generally accepted in the UnitedStates of America, and the standards applicable to financial audits contained in GovernmentAuditing Standards, issued by the Comptroller General of the United States. Those standardsrequire that we plan and perform the audit to obtain reasonable assurance about whether thebasic financial statements are free of material misstatement. An audit includes examining, on atest basis, evidence supporting the amounts and disclosures in the financial statements. An auditalso includes assessing the accounting principles used and significant estimates made bymanagement, as well as evaluating the overall financial statement presentation. We believe thatour audit provides a reasonable basis for our opinion.

In our opinion, the basic financial statements referred to above present fairly, in all materialrespects, the financial position of Fire District No. 5 of Caddo Parish, Louisiana as of December31, 2004, and the results of its operations for the year then ended in conformity with UnitedStates of America generally accepted accounting principles.

In accordance with Government Auditing Standards, we have also issued our report dated June30, 2005, on our consideration of the District's internal control over financial reporting and ourtests of its compliance with certain provisions of laws, regulations, contracts, and grants. Thatreport is an integral part of an audit performed in accordance with Governmental AuditingStandards and should be read in conjunction with this report in considering the results of ouraudit.

Management's discussion and analysis on page 5-10 is not a required part of the basic financialstatements, but is supplementary information required by accounting principles generallyaccepted in the United States of America. We have applied certain limited procedures, whichconsisted principally of inquiries of management regarding the methods of measurement

and presentation of the required supplementary information. However, we did not audit theinformation and express no opinion on it.

Our audit was performed for the purpose of forming an opinion on the basic financial statementstaken as a whole. The supplemental information listed in the table of contents is presented forpurpose of additional analysis and is not a required part of the basic financial statements of FireDistrict No. 5 of Caddo Parish, Louisiana. Such information has been subjected to the auditingprocedures applied in the audit of the basic financial statements and, in our opinion, is fairlystated in all material respects inrelat ion to the basic financial statements taken as a whole.

f>Certified Public Accountants

Shreveport, LouisianaJune 30,2005

CADDO PARISH FIRE DISTRICT #51675 Leonard Road

Shreveport, Louisiana 71115(318)797-4111

(318)797-3821 Fax

Gray son Boucher, Fire Chief Del Johnson, ChairmanBrian Florsheim, Asst. Chief Lennis Elston, Sec.-Treas.

MANAGEMENT'S DISCUSSION AND ANALYSIS (UNAUDITED)

Our discussion and analysis of Fire District No. 5 of Caddo Parish (the District) financialperformance provides an overview of the District's financial activities for the fiscal year endedDecember 31, 2004. Please read it in conjunction with the District's financial statements, whichbegin on page 11.

FINANCIAL HIGHLIGHTS

For 2004, the total general revenues for the District were $552,618.

During the year ended December 31, 2004, the District had total expenses, excludingdepreciation, of $402,627.

USING THIS ANNUAL REPORT

The annual report consists of a series of financial statements. The Statement of Net Assets andthe Statement of Activities (on pages 11 and 12) provide information about the activities of theDistrict as a whole and present a longer-term view of the District's finances. Fund financialstatements start on page 13. For governmental activities, these statements tell how these serviceswere financed in the short term as well as what remains for future spending. Fund financialstatements also report the District's operations in more detail than the government-widestatements by providing information about the District's most significant funds.

Fire District No. 5 of Caddo Parish was determined to be a component unit of Caddo Parish. TheCaddo Parish Commission is financially accountable for the District because it appoints theorganization's governing body and has the ability to impose its will on them. The accompanyingfinancial statements present information only on the funds maintained by Fire District No. 5 ofCaddo Parish.

Reporting the Fire District No. 5 of Caddo Parish as a Whole

Our analysis of Fire District No. 5 of Caddo Parish as a whole begins on page 7, One of themost important questions asked about the District's finances is "Is Fire District No. 5 of Caddo

Parish as a whole better off or worse off as a result of the year's activities?" The Statement ofNet Assets and the Statement of Activities report information about the funds maintained by theDistrict as a whole and about its activities in a way that helps answer this question. Thesestatements include all assets and liabilities using the accrual basis of accounting, which is similarto the accounting method used by most private-sector companies. Accruals of the current year'srevenues and expenses are taken into account regardless of when cash is received or paid.

These two statements report the District's net assets and changes in them. You can think of theDistrict's net assets—the difference between assets and liabilities—as one way to measure theDistrict's financial health, or financial position. Over time, increases or decreases in the District'snet assets are one indicator of whether its financial health is improving or deteriorating. Youwill need to consider other non-financial factors, however, such as changes in the District'sproperty tax base, to assess the overall health of the District.

In the Statement of Net Assets and the Statement of Activities, we record the following fundsmaintained by Fire District No. 5 of Caddo Parish as governmental activities:

Governmental activities - all of the expenses paid from the funds maintained by FireDistrict No. 5 of Caddo Parish are reported here which consists primarily of personalservices, materials and supplies, fuel, repairs and maintenance, salaries, and otherprogram services. Ad valorem taxes finance most of these activities.

Reporting the District's Most Significant Funds

Our analysis of the major funds maintained by Fire District No. 5 of Caddo Parish begins onpage 13. The fund financial statements begin on page 13 and provide detailed information aboutthe most significant funds maintained by Fire District No. 5 of Caddo Parish as a whole. TheDistrict's governmental funds use the following accounting approaches: Governmental funds -All of the District's basic services are reported in governmental funds, which focus on howmoney flows into and out of those funds and the balances left at year-end that are available forspending. These funds are reported using an accounting method called modified accrualaccounting, which measures cash and all other financial assets that can readily be converted tocash. The governmental fund statements provide a detailed short-term view of the District'sgeneral government operations and the expenses paid from those funds. Governmental fundinformation helps you determine whether there are more or fewer financial resources that can bespent in the near future to finance certain District expenses. We describe the relationship (ordifferences) between governmental activities (reported in the Statement of Net Assets and theStatement of Activities) and governmental funds in a reconciliation at page 14.

FIRE DISTRICT NO. 5 OF CADDO PARISH AS A WHOLE

Following is the summary information from the statement of net assets (Table 1) and thestatement of activities (Table 2) as of December 31,2004:

Table 1Net Assets

GovernmentalActivities

2004

Current and other assetsCapital assetsCapitalized bond costs

Total assets

Current liabilitiesLong-term liabilities

Total liabilities

Net assets:Investment in capital assets, net of related debtRestricted for - Debt serviceUnrestricted

Total net assets

Total net assets & liabilities

$ 462,530951,137

12,044

$1,425,711

$ 66,965610,000

676,965

296,137131,226321,383

748,746

$1,425,711

Net assets of the District's governmental activities increased by $85,994 or 13%. Unrestrictednet assets, the part of net assets that can be used to finance the District expenses withoutconstraints or other legal requirements, increased from a year ago, from $297,516 at December31,2003 to $321,383 at December 31,2004.

Table 2Changes in Net Assets


2004

Revenues:General Revenues

Ad valorem taxes $383,797Service fees 85,931Service revenue (CPFD#9) 44,400State revenue sharing 7,259Fire insurance rebate 7,997State supplemental pay 14,560Miscellaneous 5,605Interest 3,069

Total revenues 552,618

Expenses - General governmental 466,624

Increase in net assets $ 85,994

Total revenues increased $221,085 from total revenues in the year ended December 31, 2003 of$331,533 to total revenues of $552,618 in the year ended December 3L 2004. The primarycause of the increase was an increase of $222,770 in ad valorem taxes and service fees.

THE DISTRICT'S FUNDS

As the District completed the year, its governmental funds (as presented in the balance sheet onpage 13) reported a combined fund balance of $452,609. The primary reasons for the excess are:

• General fund revenues exceeded general fund expenditures by $23,867.• Debt service fund revenues exceeded debt service fund expenditures by $52,140.

General Fund Budgetary Highlights

The District adopted a budget for its General Fund for the year ended December 31, 2004. Therewas one amendment to the budget during the year. The District's budgetary comparison ispresented as required supplementary information and shown on page 17. Highlights for the yearare as follows:

General Fund revenues from ad valorem taxes was approximately $222,770 higher thanprojected due to increased number of households assessed and commercial propertyimprovements.

The District spent more on capital outlay from its General Fund than projected. The budgetarycomparison schedule presents information only on the General Fund.

CAPITAL ASSETS AND DEBT AMINISTRATION

Capital Assets

At the end of December 31, 2004, the District had invested $1,472,207 in capital assets. (Seetable 3 below)

Table3Capital Assets at Year End


2004

Building and land $ 619,521Vehicles 698,682Equipment 154,004

Total $1,472,207

Major additions include:Equipment 33,984Land/buildingVehicles -

Total additions 33,984

Net increase $ 33,984

More detail information about capital assets is presented in Note 5 to the financial statements.

DEBT

In 2000, the District issued general obligation bonds totaling $800,000 for the purpose ofacquiring buildings, machinery and equipment, including both real and personal property, to beused in giving fire protection to the property in the District. The bonds are payable from advalorem taxes.

Table 4Outstanding Debt at Year End


2004

General obligation bonds (back by Ad valorem taxes) $ 655,000

More detailed information about the debt is presented in Note 6 to the financial statements.

ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS

The District's management considered many factors when setting a fiscal year December 31,2005 budget. Amounts available for appropriation in the governmental funds are expected toincrease due to an increase in the property valuations and increase in millage rate.

CONTACTING THE DISTRICT'S FINANCIAL MANAGEMENT

This financial report is designed to provide our citizens and taxpayers with a general overview ofthe finances for those funds maintained by Fire District No. 5 of Caddo Parish and to show theDistrict's accountability for the money it receives. If you have questions about this report orneed additional financial information, contact Fire District No. 5 of Caddo Parish, at 1675Leonard Road, Shreveport, Louisiana 71115.

Del JohnsonChairman

10


Statement of Net Assets

December 31, 2004

Assets:Cash and cash equivalentsAccounts receivable, netCapital assets, netCapitalized bond costs

Total assets

Liabilities:Accounts payableAccrued liabilitiesLong-term liabilities:

Bond payable - Portion due within one yearBond payable - Portion due after one yearInterest payable

Total liabilities

Net Assets:Investment in capital assets, net of related debtRestricted for - Debt serviceUnrestricted

Total net assets

Total net assets and liabilities

$ 6,090456,440951,137

12,044

$1,425,711

$ 6,1733,799

45,000610,000

11,993

676,965

296,137131,226321,383

748,746

$1,425,711

11

Year Ended December 31, 2004


Statements of Activities

Programs RevenuesOperating Capital

Charges for Grants and Grants andExpenses Services Contributions Contributions Net Assets

GovernmentalActivities -

Net (Expenses)Revenues and

Changes in

Functions Programs -General Government $466,624 $44,400 $14,560

Total GovernmentActivities $466,624 $44,400 $14,560

$(407,664)

$(407,664)

Taxes:Ad valorem taxesService feesState revenue sharingFire tax rebateInterestMiscellaneous

Total general revenueand special items

Excess of revenue overexpenditures

Net assets - beginning ofyear

Net assets - end of year

$383,79785,9317,2597,9973,0695,605

493,658

85,994

662,752

$748,746

12


Balance Sheet - Governmental Funds

December 3Jt 2004

Governmental Fund TypesDebt Capital Total

General Service Projects GovernmentalFund Fund Fund Funds

Assets:Cash and cash equivalentsAd valorem tax receivable, net

allowance for doubtful accountsState revenue sharing receivableStructure fee receivable, net allowance

for doubtful accountsCapitalized bond costs

Total assets

Liabilities and Fund Balances

Liabilities:Accounts payableAccrued liabilitiesInterest payable

Total liabilities

Fund balances:Reserved for debt serviceUnreserved

Total fund balances

Total liabilities and fund balances

$ 6,090

234,4196,771

84,075-

$331,355

$ 6,1733,799

-

9,972

-321,383

321,383

$331,355

$ - $ -

131,175-

-12,044

$143,219 $

$ - $-

11,993

11,993

131,226-

131,226

$143,219 $

$ 6,090

365,5946,771

84,07512,044

$474,574

$ 6,1733,799

11,993

21,965

131,226321,383

452,609

$474,574

13


Reconciliation of the Governmental Funds BalanceSheet to the Statement of Net Asset

December 31, 2004

Total Fund Balances at December 31,2004- Governmental Funds

Cost of capital assets at December 31,2004, less -accumulated depreciation as of December 31,2004

Long-term liabilities at December 31,2004Bonds payable

Net assets at December 31,2004 - Governmental Activities

$ 452,609

951,137

(655,000)

$ 748,746

14


Statement of Revenue, Expenditures, and Changesin Fund Balance - Governmental Funds


Revenues:Ad valorem taxesService feesService revenue (CPFD#9)State revenue sharingFire insurance rebateState supplemental payMiscellaneousInterest

Total revenues

Expenditures;General governmentCapital outlayDebt service:

Principal retirementInterestRetirement contribution

Total expenditures

Excess of revenue over expenditures

Fund balances, beginning of year

Fund balances, end of year

Genera]Fund

$252,41285,93144,400

7,2597,997

14,5605,6053,069

421,233

363,38233,984

---

397,366

23,867

297,516

$321,383

DebtServiceFund

$131,385-------

131,385

--

40,00036,1803,065

79,245

52,140

79,086

$131,226

Capital TotalProjects Governmental

Fund Funds

$ - $383,79785,93144,400

7,2597,997

14,5605,6053,069

552,618

363,38233,984

40,00036,1803,065

476,611

76,007

376,602

$ - $452,609

15


Reconciliation of the Statement of Revenue, Expenditures, and Changesin Fund Balances of Governmental Funds to the Statement of Activities


Net change in fund balance - total governmental funds

Amount reported for governmental activities in the statementof activities are different because:

$ 76,007

Capital outlays are reported in governmental funds asexpenditures. However, in the Statement of Activities,the cost of those assets is allocated over their estimateduseful lives as depreciation expense. This is the amountby which depreciation exceeds capital outlays in the period:

Depreciation expenseCapital outlay

Repayment of bond principal is an expenditure in thegovernmental funds, but the repayment reduceslong-term liabilities in the Statement of Net Assets

Change in net assets of governmental activities

(63,997)33,984

(30,013)

40,000

$ 85,994

16


Statement of Revenue, Expenditures, and Changes in FundBalance -Budget and Actual (GAAP Basis) - General Fund


Budget Amounts

Revenues:Ad valorem taxesService feesService revenue (CPFD#9)State revenue sharing

Fire insurance rebateState supplemental payMiscellaneous

Interest

Total revenues

Expenditures:General governmentCapital outlay

Total expenditures

Excess (deficiency) of revenueover expenditures

Fund balances, beginning of year

Fund balances, end of year

Original

$167,50074,00044,4006,500

7,500--

2,000

301,900

346,3721,000

347,372

(45,472)

297,516

$252,044

Final

$167,50074,00044,4006,5007,500

--

2,000

301,900

346,3721,000

347,372

(45,472)

297,516

$252,044

Actual

$252,41285,93144,4007,259

7,99714,560

5,6053,069

421,233

363,38233,984

397,366

23,867

297,516

$321,383

VarianceFavorable

(Unfavorable)

$ 84,91211,931

-759

49714,5605,6051,069

119,333

(17,010)(32,984)

(49,994)

69,339

_

$ 69,339

17


Summary of Significant Accounting Policies

Introduction

Basis of Presentation

Fire District No. 5 of Caddo Parish, Louisiana (the "District") wascreated by Ordinance No. 2143 adopted by the Caddo ParishCommission on April 25, 1984. The governing body of the Districtconsists of a five member Board of Commissioners, appointed by theCaddo Parish Commission and is a component the Parish of Caddo.Members serve two-year terms and do not receive compensation fortheir services. The District has four (4) paid employees and avolunteer organization.

The District provides fire protection, emergency medical andhazardous material services for the people of the District. The twenty-four (24) hour manned station is equipped with a Class A pumper,Class B pumper, emergency medical service truck, 6,000 gallon tankerand other miscellaneous vital equipment. Two unmanned stations areequipped with Class B pumper/tank truck.

The financial statements of Fire District No. 5 of Caddo Parish havebeen prepared in conformity with generally accepted accountingprinciples (GAAP) as applied to government units. The GovernmentalAccounting Standards Board (GASB) is the accepted standard-settingbody for establishing governmental accounting and financial reportingprinciples. The more significant of the District's accounting policiesare described below.

The accompanying financial statements of the District have beenprepared in conformity with generally accepted accounting principlesas prescribed by the Governmental Accounting Standards Board(GASB). In June 1999 the GASB issued Statement 34, BasicFinancial Statements - and Management's Discussion and Analysis -for State and Local Governments, and Statement 35, Basic FinancialStatements - and Management's Discussion and Analysis -for PublicColleges and Universities. These Statements establish new financialreporting requirements for state and local governments and publiccolleges and universities throughout the United States. They requirenew information and restructure much of the information thatgovernments have presented in the past. Comparability with reportsissued in prior years is affected.

18


Summary of Significant Accounting Policies(Continued)

Basis of Presentation- (continued)

Reporting Entity

For the year ended December 31, 2004, the District implementedGASB Statement No. 34, Basic Financial Statements - andManagement's Discussion and Analysis - for State and LocalGovernments; GASB Statement No. 37 Basic Financial Statements -and Management's Discussion and Analysis -for State and LocalGovernments: Omnibus; GASB Statement No. 38, Certain FinancialStatement Note Disclosures; and Governmental Accounting StandardsBoard Interpretation No. 6, Recognition and Measurement of CertainLiabilities and Expenditures in Governmental Fund FinancialStatements.

As the governing authority of the parish, for reporting purposes, theCaddo Commission is the financial reporting entity for Caddo Parish.The financial reporting entity consists of (a) the primary government(Caddo Commission), (b) organizations for which the primarygovernment is financially accountable, and (c) other organizations forwhich the nature and significance of their relationship with the primarygovernment are such that exclusion would cause the reporting entity'sfinancial statements to be misleading or incomplete.

Governmental Accounting Standards Board Statement No. 14established criteria for determining which component units should beconsidered part of the Caddo Commission for financial reportingpurposes. The basic criteria for including a potential component unitwithin the reporting entity are financial accountability. The GASB hasset forth criteria to be considered in determining financialaccountability. These criteria include:

1. Appointing a voting majority of an organization's governingbody, and

a. The ability of the Commission to impose its will on thatorganization and/or

19



Reporting Entity- (continued)

Basic FinancialStatements -Government WideStatements

b. The potential for the organization to provide specificfinancial benefits to or impose specific financial burdens onthe Commission.

2. Organizations for which the Commission does not appoint avoting majority but are fiscally dependent on the Commission

3. Organizations for which the reporting entity financialstatements would be misleading if data of the organization isnot included because of the nature or significance of therelationship.

Because the Caddo Parish Commission appoints the organization'sgoverning body, the District was determined to be a component unitof the Caddo Parish Commission, the financial reporting entity. Theaccompanying financial statements present information only on thefunds maintained by the District and do not present information onthe Parish Commission, the general government services provided bythat governmental unit, or the other governmental units that comprisethe financial reporting entity.

The Fire District No. 5 of Caddo Parish financial statements includeboth government-wide and fund financial statements. Both thegovernment-wide and fund financial statements categorize primaryactivities as either governmental or business type. The Fire DistrictNo. 5 of Caddo Parish net assets are reported in four parts - invested incapital assets (net of related debt), restricted for debt service andcapital asset purchasing, and unrestricted net assets.

The government-wide Statement of Activities reports both the grossand net cost of each of the Fire District No. 5 of Caddo Parishfunctions. The functions are supported by general governmentrevenues. The Statement of Activities reduces gross expenses(including depreciation) by any related program revenues, which mustbe directly associated with the function. The net cost (by function) isnormally covered by general revenues.

20


Summary of Significant Accounting Policies(Continue^)

Basic FinancialStatements -Government WideStatements- (continued)

Basic FinancialStatements - FundFinancial Statements

This government-wide focus is more on the sustainability of FireDistrict No. 5 of Caddo Parish as an entity and the change in the FireDistrict No, 5 of Caddo Parish's net assets resulting from the currentyear's activities.

The financial transactions of the Fire District No. 5 of Caddo Parishare recorded in individual funds in the fund financial statements. Eachfund is accounted for by providing a separate set of self-balancingaccounts that comprises its assets, liabilities, reserves, fund equity,revenues and expenditures. The various funds are reported by genericclassification within the financial statements.

Fire District No. 5 of Caddo Parish uses the following fund types:

1. General fund is the general operating funds of Fire District No.5 of Caddo Parish, Louisiana. It is used to account for allfinancial resources except those required to be accounted for inanother fund.

2. Capital projects fund is used to account for financial resourcesto be used in the acquisition or construction of major capitalfacilities and equipment.

3. Debt service fund accounts for transactions relating toresources retained and used for the payment of principal andinterest on the long-term obligations of the District.

The emphasis in fund financial statements is on the major funds in thegovernmental category. GASB Statement No. 34 sets forth minimumcriteria (percentage of the assets, liabilities, revenues, or expenditures/expenses of either fund category or the governmental and enterprisecombined) for the determination of major funds. All three of theDistrict's governmental funds are considered major funds.

21



Basis of Accounting

Cash and CashEquivalents

Accounts Receivable

Basis of accounting refers to the point at which revenues orexpenditures are recognized in the accounts and reported in thefinancial statements. It relates to the timing of the measurements maderegardless of the measurement focus applied.

Government-wide Financial Statements. The governmental funds inthe government-wide financial statements are presented on the accrualbasis of accounting. Revenues are recognized when earned andexpenses are recognized when incurred.

Revenues of the Fire District No. 5 of Caddo Parish consist principallyof property taxes, other intergovernmental revenues, donations, andinterest income. Property taxes are billed and generally collectedwithin the fiscal year in which the taxes are levied. Interest income isrecorded when earned. Donations and other intergovernmentalrevenues are recorded when received in cash because they aregenerally not measurable until actually received.

Fund Financial Statements. The governmental funds financialstatements are presented on the modified accrual basis of accounting.Under modified accrual basis of accounting, revenue is recorded whensusceptible to accrual: i.e., both measurable and available. "Available"means collectible within the current period or within 60 days afteryear-end. Expenditures are generally recognized under the modifiedaccrual basis of accounting when the related liability is incurred. Theexception to this rule is the principal and interest on general obligationlong-term debt, if any, is recognized when due. Depreciation is notrecognized in the governmental fund financial statements.

Cash and cash equivalents include amounts in demand deposits as wellas short-term investments with an original maturity of three months orless.

Uncollectible amounts due for ad valorem taxes are recognized asuncollectible using the allowance method. The allowance foruncollectible accounts at December 31,2004, was $ 13,449.

22



Capital Assets

Budget

Long-termObligations

Capital assets purchased or acquired with an original cost of $200 ormore are reported at historical cost or estimated historical cost.Contributed assets are reported at fair market value as of the datereceived. Additions, improvements, and other capital outlays thatsignificantly extend the useful life of an asset are capitalized. Othercosts incurred for repairs and maintenance are expensed as incurred.

Depreciation on all assets is provided on the straight-line basis overthe following estimated useful lives:

Building and building improvementsEquipment

15-50 years5-20 years

A budget is adopted on a basis consistent with generally acceptedaccounting principles. An annual appropriated budget is adopted forthe general fund expenditures. All annual appropriations lapse atfiscal year end.

On or before the last meeting of each year, the budget is prepared byfund, function, and activity and includes information on the past year,current year estimates, and requested appropriations for the next fiscalyear.

The proposed budget is presented to the district's Board ofCommissioners for review. The board holds a public hearing and mayadd to, subtract from, or change appropriations, but may not changethe form of the budget. Any changes in the budget must be within therevenues and reserves estimated.

Expenditures may not legally exceed budgeted appropriations by morethan five percent.

Long-term obligations are reported as liabilities in the government-wide statements. Long-term debt is recognized as a liability of agovernmental fund when due. For other long-term obligations, onlythat portion expected to be financed from expendable availablefinancial resources is reported as fund liability of a governmental fund.

23


Summary of Significant Accounting Policies(Concluded)

Fund Equity Reserves represent those portions of fund equity not appropriable forexpenditure or legally segregated for a specific future use. Designatedfund balances represent tentative plans for future use of financialresources.

24


Notes to Financial Statements

1. Ad Valorem For the year ended December 31, 2004, taxes of 9.83 and 5.50 mills wereTaxes and levied on property with assessed valuations totaling $29,574,050 and wereStructure Fees dedicated as follows:

Maintenance 9.83 millsBond Sinking 5.50 millsStructure Fees $75.00

Total taxes levied were $463,118.

Property tax millage rates are adopted hi July for the calendar year inwhich the taxes are levied and recorded. All taxes are due and collectiblewhen the assessment rolls are filed on or before November 15th of thecurrent year, and become delinquent after December 31. Property taxesnot paid by the end of February are subject to lien.

At December 31, 2004, the district has cash and cash equivalents (bookbalances) as follows:

2. Cash and CashEquivalents

Demand deposits $6,090

Those deposits are stated at cost, which approximates market. Under statelaw, these deposits (or the resulting bank balances) must be secured byfederal deposit insurance or the pledge of securities owned by the fiscalagent bank. The market value of the pledged securities plus the federaldeposit insurance must at all times equal the amount on deposit with thefiscal agent. These securities are held in the name of the pledging fiscalagent bank in a holding or custodial bank that is mutually acceptable toboth parties. At December 31, 2004, the district has $6,090 in deposits(collected bank balances). These deposits are secured from risk by$100,000 of federal deposit insurance.

25

3. Receivables


Notes to Financial Statements(Continued)

Total taxes and fees levied were $463,118. Taxes and fees receivable aDecember 31,2004, consisted of the following:

Estimated Property Tax ReceivableYear Ended December 31,2004

ServiceMillage M&O Bonds Fee Total

Assessed taxesAssessed taxesAssessed taxes

Total assessed taxes

Caddo Sheriff FeePension Contribution

Estimated Fees &PensionContributions

9.83 $241,5135.50 $135,130

$75/facility

241,513 135,130

483 2704,663 2,930

5,146 3,200

$86,475

86,475

6,486-

6,486

$241,513135,13086,475

463,118

7,2397,593

14,832

Net before allowancefor loss

Estimated allowance -3%

236,367 131,930 79,989 448,286

(7,094) (3,955) (2,400) (13,449)

Net property taxesreceivable $229,273 $127,975 $77,590 $434,837

4. Due From Other Amounts due from other governmental units (excluding the ad valoremGovernmental taxes) consist of the following:Units

Estimated State Revenue Sharing due $6,771

26



5. Changes inCapital Assets

A summary of changes in capital assets for the year ended December 31,2004, follows:

Changes in Capital AssetsYear Ended December 31,2004

Beginning EndingBalance Additions Deletions Balance

Capital assets:Buildings and

landVehiclesEquipment

Total capital assets

$ 619,521698,682120,020

1,438,223

$ $ - $ 619,521698,682

33,984 - 154,004

33,984 - 1,472,207

Less accumulateddepreciation:

Buildings andland

VehiclesEquipment

Total accumulateddepreciation

(41,677)(337,735)

(77,661)

(457,073)

(15,045)(41,637)(7,315)

(63,997)

(56,722)(379,372)(84,976)

(521,070)

$ 981,150 $(30,013) $ $951,137

6. Long-TermDebt

The following is a summary of bond transactions of the district for the yearended December 31, 2004:

Payable January 1,2004Retired

$695,000(40,000)

Payable December 31, 2004 $655,000

27



6. Long-TermDebt-(continued)

7. LouisianaFirefightersRetirementSystem PensionNote

Bonds payable at December 31,2004, is comprised of the following issue:

$800,000 general obligation bonds dated March 1, 2000; due in annualinstallments of $40,000 to $80,000 through March 1, 2015; plus interestdue semiannually on March 1 and September 1 beginning September 1,2000; secured by levy and collection of ad valorem taxes.

The annual requirements to amortize all debts outstanding as of December31,2004, are as follows:

Year Ending December 31, Principal Interest Total

20052006200720082009Thereafter

$ 45,00045,00050,00050,00055,000410,000

$ 35,19333,50531,48029,10526,20574,578

$ 80,19378,50581,48079,10581,205484,578

$655,000 $230,066 $885,066

Plan Description. Substantially all full-time employees of Fire District No.5 of Caddo Parish, Louisiana are members of the Louisiana FirefightersRetirement System (System), a cost sharing, multiple-employers definedbenefit pension plan administered by a separate board of trustees.

Membership in the System is mandatory for all full-time firefightersemployed by a municipality, parish, or fire protection District that did notenact on ordinance prior to January 1, 1980, exempting itself fromparticipation in the system. Employees are eligible to retire at or after age55 with at least 12 years of creditable service, or after age 50 with at least 20years of creditable service. At retirement, members are entitled to aretirement benefit, payable monthly for life, equal to 3 1/3% of their final-average salary for each year of creditable service, not to exceed 100% of

28



7. LouisianaFirefightersRetirementSystem PensionNote -(continued)

8. CommitmentsandContingencies

9. Related PartyTransactions

their final-average salary. Final-average salary is the employee's averagesalary over the 36 consecutive or joined months that produce the highestaverage. Employees who terminate with at least 12 years of service and donot withdraw their employee contributions may retire at or after age 55 (or ator after age 50 with at least 20 years of creditable service at termination) Theplan also provides disability benefits. Benefits are established by statestatute.

The System issues an annual publicly available financial report that includesfinancial statements and required supplementary information for the System.That report can be obtained by writing to the Firefighters' RetirementSystem, 3100, Brentwood Drive, Baton Rouge, Louisiana 70809, by calling(504) 925-4060 or www.lafirefightersret.com.

Funding Policy. Plan members are required by state statute to contribute 8.0percent of their annual covered salary and the Fire Protection District No. 5of Caddo Parish is required to contribute at an actuarially determined rate.The current rate is 21 percent of annual covered Payroll. Contributionrequirements of plan members and the Fire Protection District No. 5 ofCaddo Parish are established and may be amended by state statute. Asprovided by Louisiana Revised Statute 11:103, the employer contributionsare determined by actuarial valuation for the prior fiscal year. The District'scontributions to the System for the years ended December 2004, 2003 and2002 were $29,141, $19,553 and $10,868, respectively.

The District is exposed to various risks of loss related to torts; theft of,damage to and destruction of assets; error and omissions; injuries toemployees; and natural disasters. The District carries commercialinsurances for all risks of loss, including workers compensation.

The family of a member of the board of directors contributed the land uponwhich Fire Station 1 is located. Under the terms of the donation, if thebuilding ever ceases to be used for public safety, the property reverts to thedonors. Accordingly, the accompanying financial statements do not reflectthe value of the land in Capital Assets.

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Notes to Financial Statements(Concluded)

10. On-Behalf Payments ForFringe-Benefits andSalaries

11. Service Revenue

12. Comparison of Budgetand Actual Expenditureson a Budgetary (Cash)Basis

GASB Statement No. 24 requires that on-behalf payments berecognized as both revenue and expenditure by an employergovernmental entity. In accordance with this Statement, $14,560has been recognized in both inter governmental revenue-statesupplemental pay and public safety expenditure due to on-behalfpayments for fringe benefits and salaries.

In October 2002, the District entered into an agreement with CaddoFire District Number 9. Under the terms of the agreement, theDistrict will provide one on-site firefighter and pay recurringoperation costs of Caddo Fire District Number 9 in return for apayment of $3,700 per month. The accompanying financialstatements reflect total revenue of $44,400.

As discussed in the Summary of Accounting Policies, the District'sbudget is prepared on a cash basis and its general purpose financialstatements are presented on the basis prescribed by generallyaccepted accounting principles. The following table presents areconciliation between the two bases of accounting and thecomparison to budgeted amounts based on the cash basis ofaccounting.

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Supplemental Material

Fire District No. 5 of Caddo ParishSchedule of General Government Expenditures - Budget

and Actual (GAAP Basis) - Governmental ActivitiesYear Ended December 31,2004

Budget Amounts

SalariesRetirementPayroll taxesDeductions from ad valorem

taxes - retirementFuelInsuranceBase supplyMaintenance and repairs - vehicleGeneral and administrativeTrainingFirefighting supplies and equipmentUtilities and telephoneProfessional feesSheriffs feesBad debtUniform allotmentMedicalDepreciationInterest expense - bond retirementMiscellaneous

Total general governmental expenditures

Original

$156,36234,4524,000

5,0005,000

50,01713,40010,0002,6005,000

25,54114,70010,6005,200

-2,0003,500

---

$347,372

Final

$156,36234,4524,000

5,0005,000

50,01713,40010,0002,6005,000

25,54114,70010,6005,200

-2,0003,500

---

$347,372

Actual

$165.97929,141

5.002

8.5438.679

58.73917.37217.157

7527.0995.094

12.54712.3636.0443.5001.8374.799

63.99736.180

1.800

$466,624

VarianceFavorable

(Unfavorable)

$ (9,617)5,311(1,002)

(3,543)(3,679)(8,722)(3,972)(7,157)1,848

(2,099)20,4472,153(1,763)

(844)(3,500)

163(1,299)

(63,997)(36,180)

(1,800)

$(119,252)

32

Report on Compliance and on Internal Control OverFinancial Reporting Based on an Audit of Financial

Statements Performed in Accordance withGovernment Auditing Standards

Board of CommissionersFire District No. 5 of Caddo ParishCaddo Parish Police JuryShreveport, Louisiana

We have audited the basic financial statements of the Fire District No. 5 of Caddo Parish, acomponent unit of the Caddo Parish Commission, as of and for the year ended December 31,2004, and have issued our report thereon dated June 30, 2005. We conducted our audit inaccordance with generally accepted auditing standards applicable to financial audits contained inGovernment Auditing Standards, issued by the Comptroller General of the United States.

Compliance

As part of obtaining reasonable assurance about whether the District's basic financialstatements are free of material misstatement, we performed tests of its compliance withcertain provisions of laws, regulations, contracts and grants, noncompliance with whichcould 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 ofour audit and, accordingly, we do not express such an opinion. The results of our testsrevealed the following instance of noncompliance that is required to be to be reported underGovernment Auditing Standards:

Failure to comply with state law

Instance of Noncompliance

The District failed to comply with state law (LA R.S. 24:513) since the annual report for theyear ended December 31, 2004 was not submitted to the Louisiana Legislative Auditor'sOffice until after June 30, 2005, the statutory date.

Reason for Noncompliance

Although the audit plan was originally scheduled to provide compliance with thisrequirement, the auditor's son became ill and required hospitalization during the audit. As aresult, the audit was not completed and issued by the statutory due date.

33

Management's Plan of Corrective Action

As stated in the compliance findings, this instance of noncompliance was not caused by anyaction on the part of the District. We have discussed the situation with our auditor and havebeen assured this will not happen in future years.

Internal Control Over Financial Reporting

In planning and performing our audit, we considered the District's internal control overfinancial reporting in order to determine our auditing procedures for the purpose ofexpressing our opinion on the basic financial statements and not to provide assurance on theinternal control over financial reporting. Our consideration of the internal control overfinancial reporting would not necessarily disclose all matters in the internal control overfinancial reporting that might be material weaknesses. A material weakness is a condition inwhich the design or operation of one or more of the internal control components does notreduce to a relatively low level the risk that misstatements in amounts that would be materialin relation to the basic financial statements being audited may occur and not be detectedwithin a timely period by employees in the normal course of performing their assignedfunctions. We noted no matters involving the internal control over financial reporting and itsoperation that we consider to be material weaknesses.

This report is intended for the information of the District's management, the Board ofCommissioners, the Caddo Parish Commission, and the Legislative Auditor. However, thisreport is a matter of public record and its distribution is not limited.

/ 'Certified Public Accountants

Shreveport, LouisianaJune 30,2005

34

Fire District No. 5 of Caddo Parish

Summary of Audit Results

December 31,2004

Summary of Audit Results

1. The auditors' report expresses an unqualified opinion on the financial statements of FireDistrict No. 5 of Caddo Parish.

2. No reportable conditions were disclosed during the audit of the financial statements in thereport on compliance and internal control over financial reporting based on an audit offinancial statements performed in accordance with Government Auditing Standards.

3. There was one instance of noncompliance disclosed during the audit.

4. A separate management letter was not issued.

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Fire District No. 5 of Caddo ParishSchedule of Prior Years Audit Findings

For Year Ended December 31,2004

Ref.No.

Fiscal YearFindingInitially

Occurred

Descriptionof

Finding

CorrectiveActionTaken

CorrectiveAction/ Partial

CorrectiveAction Taken

2003-1 2003 Violation of State Yes Attempted TimelyAudit law Filing Financial

Statements - SeeCurrent Year

Compliance Report

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