Audit - 2006/20051
SALINA AREA CHAMBER OF COERCE, INC ".
Salina, Kansas
FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS' REPORT
December 31, 2006 and 2005
rl-
CLUBINES,
RETTELE
Certified Public Accountants
OW
Robert I. Clubine, C.P.A.
David A. Rettele, C.P.A.
Jay D. Langley, C.P.A.
Jon K. Bell, C.P.A.
Leslie M. Corbett, C.P.A.
Stacy J. Sokol, C.P.A.
Marci K. Fox, C.P.A.
Delores K. Longenecker, C.P.A.
John T. Millikin, C.P.A.
Linda A. Suelter, C.P.A.
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402 -2267
Salina
785 / 825 -5479
Salina Fax
785 / 825 -2446
Ellsworth
785 / 472 -3915
Ellsworth Fax
785 / 472 -5478
March 15, 2007
To the Board of Directors
Salina Area Chamber of Commerce, Inc.
Salina, Kansas
In planning and performing our audit of the financial statements of Salina Area Chamber of Commerce,
Inc., for the years ended December 31, 2006 and 2005, we considered its internal control structure in
order to determine our auditing procedures for the purpose of expressing our opinion on the financial
statements, but not for expressing our opinion on the effectiveness of the Organization's internal
control. Accordingly, we do not express an opinion on the effectiveness of the Company's internal
control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph
and would not necessarily disclose all deficiencies in internal control that might be significant
deficiencies or material weaknesses. However, as discussed below, we noted certain deficiencies in
internal control that we consider to be significant deficiencies.
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 Organization's ability to initiate, authorize, record,
process, or report financial data reliably in accordance with generally accepted accounting principles
such that there is more than a remote likelihood that a misstatement of the Organization's financial
statements that is more than inconsequential will not be prevented or detected by the Organization's
internal control.
Significant Deficiencies
The significant deficiency noted in our audit consists of the lack of segregation of duties available for
the accounting functions. This condition is due to the small size of the office staff. The benefits which
may be achieved by correcting this situation must be weighed against the cost of implementing those
changes. This condition is not unusual in small organizations. The active participation of the Board,
Finance Committee and the Treasurer and the assignments of duties among the office personnel help
alleviate the problems existing with a small office staff.
Other Comments and Recommendations
We also noted that deposits held with depository institutions exceeded F.D.I.0 insurance coverage by
$7,854, though we consider the risk involved minimal.
In addition, the Organization's books were found to be out of balance by $.01. While the dollar amount
is insignificant, the fact that the software would allow the books to close when not in balance presents a
potentially serious problem. We suggest that you contact your software vendor to find out why and how
the books could close when not in balance.
F111
Additional Items of Consideration
From an auditors perspective, we are pleased see that there has been a concerted effort by management to strengthen the
Organization's internal control. That is not to say that the internal control has not been good in the past, because it has been good for
an Organization the size of the Chamber, but we believe that the new procedures being implemented will greatly enhance the
Organization's overall level of internal control. The additional procedures, while not all inclusive, are noted are as follows:
Establishment of a Finance Committee that will provide for greater scrutiny of the day to day financial operations of the
Chamber. The finance committee will be examining the financial statements monthly, as well as analyzing monthly bank
statements and bank reconciliations and comparing the corresponding balances to those booked in the financial statements.
The Organization has added dual signatures for all checks over a certain dollar amount.
The Organization is in the planning phase of re- tooling the gift certificate program in order simplify the entire process. In the
past this program has been difficult to audit and there is no doubt that it has to be difficult for the staff to track the sales and
redemptions of so many individual gift certificates.
We found the records to be well maintained and wish to thank The Board of Directors for the opportunity to work with Salina Area
Chamber of Commerce, Inc. We also wish to thank Sandy Cole for her help in assisting us with the audit. Please feel free to call with
any questions or concerns you may have.
This report is intended solely for the use of management, the Board of Directors, and others within the organization and is not. intended
to be and should not be used by anyone other than these specified parties.
Respectfully submitted, 4'��
y D. Langley
Certified Public Accountant
Clubine & Rettele, Chartered
aw.
March 15, 2007
Board of Directors /Audit Committee
Salina Area Chamber of Commerce, Inc.
We have audited the financial statements of Salina Area Chamber of
Commerce, Inc, for the year ended December 31, 2006, and have issued our
report thereon dated March 15, 2007. Professional standards require that we
provide you with the following information related to our audit.
Our Responsibility under U.S. Generally Accepted Auditing Standards
Significant Accounting Policies
As stated in our engagement letter dated June 9, 2004, our responsibility, as
Robert I. Clubine, C.P.A.
described by professional standards, is to plan and perform our audit to obtain
David A. Rettele, C.P.A.
reasonable, but not absolute, assurance that the financial statements are free
Jay D. Langley, C.P.A.
Jon K. Bell, C.P.A.
of material misstatement and are fairly presented in accordance with U.S.
Leslie M. Corbett, C.P.A.
generally accepted accounting principles. Because an audit is designed to
Stacy J. Sokol, C.P.A.
provide reasonable, but not absolute, assurance and because we did not
perform a detailed examination of all transactions, there is a risk that material
Marci K. Fox, C.P.A.
misstatements may exist and not be detected by us.
Delores K. Longenecker, C.P.A.
Linda A. Suelter, C.P.A.
John T. Millikin, C.P.A.
As part of our audit, we considered the internal control of Salina Area Chamber
there is a lack of authoritative guidance or consensus.
of Commerce, Inc.. Such considerations were solely for the purpose of
determining our audit procedures and not to provide any assurance concerning
Audit Adiustments
such internal control.
Significant Accounting Policies
785 / 472 -5478
Management has the responsibility for selection and use of appropriate
accounting policies. In accordance with the terms of our engagement letter,
we will advise management about the appropriateness of accounting policies
and their application. The significant accounting policies used by Salina Area
Chamber of Commerce, Inc. are described in Note 1 to the financial
statements. No new accounting. policies were adopted and the application of
existing policies was not changed during the calendar year ended December
31, 2006. We noted no transactions entered into by the Organization during
the.year that were both significant and unusual, and of which, under
professional standards, we are required to inform you, or transactions for which
there is a lack of authoritative guidance or consensus.
218 South Santa Fe
P.O. Box
Salina, Kansas
Audit Adiustments
67402 -2267
For purposes of this letter, professional standards define an audit adjustment
as a proposed correction of the financial statements that, in our judgment, may
Salina
not have been detected except through our auditing procedures. An audit
785 / 825 -5479
adjustment may or may not indicate matters that could have a significant effect
Salina Fax
on the Organization's financial reporting process (that is, cause future financial
785 / 825 -2446
statements to be materially misstated). In our judgment, none of the
Ellsworth
adjustments we proposed, whether recorded or unrecorded by the
785 / 472 -3915
Organization, either individually or in the aggregate, indicate matters that could
Ellsworth Fax
have a significant effect on the Organization's financial reporting process.
785 / 472 -5478
Disaareements with Management
For purposes of this letter, professional standards define a disagreement with management as a matter,
whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing
matter that could be significant to the financial statements or the auditors' report. We are pleased to
report that no such disagreements arose during the course of our audit.
Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and
accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation
involves application of an accounting principle in the Organization's financial statements or a
determination of the type of auditor's opinion that may expressed on those statements, our
professional standards require the consulting accountant to check with us to determine that the
consultant has all the relevant facts. To our knowledge, there were no such consultations with other
accountants.
Issues Discussed Prior to Retention of Independent Auditors
We generally discuss a variety of matters, including the application of accounting principles and auditing
standards, with management each year prior to retention as the Organization's auditors. However,
these discussions occurred in the normal course of our professional relationship and our responses
were not a condition to our retention.
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our
audit.
This information is intended solely for the use of the Audit Committee, Board of Directors and
management of Salina Area Chamber of Commerce, Inc. and is not intended to be and should not be
used by anyone other than these specified parties.
Sincerely,
d6ill
Jay D. Langley
Certified Public Accountant
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS' REPORT
'
December 31, 2006 and 2005
i
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CLUBINE AND RETTELE, CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
'
SALINA, KANSAS
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SALINA AREA CHAMBER OF COMMERCE, INC.
. Salinal K9nsas
TABLE OF CONTENTS
INDEPENDENT AUDITORS' REPORT.
STATEMENTS OF FINANCIAL POSITION - Exhibit I
STATEMENTS OF ACTIVITIES - Exhibit it
STATEMENTS OF CASH FLOWS - Exhibit III
STATEMENT OF FUNCTIONAL EXPENSES - Exhibit IV
NOTES TO FINANCIAL STATEMENTS
SCHEDULES OF PROGRAM REVENUES
SCHEDULES OF DIRECT PROGRAM EXPENSES
SCHEDULES OF REVENUES AND EXPENSES UNDER AGREEMENT WITH
THE CITY OF SALINA, SALINE COUNTY AND THE SALINA AIRPORT
AUTHORITY TO PROVIDE ECONOMIC DEVELOPMENT SERVICES
SCHEDULES OF REVENUES.AND EXPENSES UNDER CONTRACT WITH THE
CITY OF SALINA TO PROVIDE CONVENTION AND TOURISM SERVICES
Page
1
2
3
4
5 -6
7 -9
10
11 -12
13 -15
16 -17
CLUBINE&
UTTELE
Certified Public Accountants To
Robert I. Clubine, C.P.A.
David A. Rettele, C.P.A.
Jay D. Langley, C.P.A.
Jon K. Bell, C.P.A.
Leslie M. Corbett, C.P.A.
Stacy J. Sokol, C.P.A.
' Marci K. Fox, C.P.A.
Delores K Longenecker,
' John T. Millikin, C.P.A.
Linda A. Suelter, C.P.A.
7
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L
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402 -2267
Salina
785 / 825 -5479
Salina Fax
785 / 825 -2446
Ellsworth
785 / 472 -3915
Ellsworth Fax
785 / 472 -5478
C.P.A.
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Salina Area Chamber of Commerce, Inc.
Salina, Kansas .
We have audited the accompanying statements of financial position of the Salina Area
Chamber of Commerce, Inc. (a nonprofit organization) as of December 31, 2006, and
2005, and the related statements of activities, functional expenses, and cash flows for the
years then ended. These financial statements are the responsibility of the Organization's
management. Our responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the
United States of America. 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 audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material
respects, the financial position of Salina Area Chamber of Commerce, Inc. as of December
31, 2006 and 2005, and the changes in its net assets and its cash flows for the years then
ended in conformity with accounting principles generally accepted in the United States of
America.
Our audits were conducted for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplemental information contained in pages 10
through 17 is presented for the purposes of additional analysis and is not a required part of
the basic financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic financial statements taken as a
whole.
March 15, 2007
(1)
CLUBINE AND RETTEL , RTERED
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1
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SALINA AREA CHAMBER QF,_COMMERCE, INC.
Salina, Kansas
STATEMENTS OF FINANCIAL POSITION
Cash and cash equivalents
Accounts receivable
Prepaid expenses
Land, building and equipment, net (Note 2)
Investment land at market value (Note 3)
Total Assets
ASSETS
LIABILITIES AND NET ASSETS
Liabilities
Accounts payable
Accrued taxes and other liabilities
Dues collected in advance
Program income collected in advance
Total Liabilities
Net Assets
Unrestricted Net Assets
Designated for fixed assets
Designated for economic development
Designated for convention and tourism
Undesignated
Total Net Assets
Total Liabilities and Net Assets
Exhibit I
For the Year Ended
December 31,
2006 2005
$ 680,692 $
831,178
9,9,061
83,019
97,576
41,682
657,975
671,694
100,000
100,000.
$ 1,635,304 $ 1,727,573
$ 801'376 $
112,677
24,811
27,632
124,244
151,859
113,676
124,448
343,107
416,616
757,975
771,694
-
61,970
109,259
62,868
424,963
414,425
1,292,197
1,310,957
$ 1,635,304 $
1,727,573
SEE THE ACCOMPANYING NOTES TO THE FINANCIAL STATEMENTS
WHICH ARE AN INTEGRAL PART HEREOF.
(2)
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
STATEMENTS OF ACTIVITIES
Revenues
Membership dues
Program revenue
Economic development contract
Convention and tourism contract
Facility Rental
Interest
Miscellaneous
Total Revenues
Expenses
Program Services
Agriculture
Community development
Internal Affairs
Economic development
Convention &tourism
Total Program Services
Exhibit II
For the Year Ended
December 31,
704,806
2006
2005
$ 328,345 $
317,863
234,704
291,950
120,000
120,000
654,574
671,937
8,110
5,850
25,956
11,833
21,615
15,478
1,393,304
1,434,911
46,550
55,529
5,361
5,799
83,629
204,109
104,052
161,726
271,725
267,771
511.317
694,934
Supporting Services
Administrative and general expenses
Staff expenses
Building operation expenses
Total Supporting Services
Total Expenses
Change in Unrestricted Net Assets
Unrestricted Net Assets, Beginning of Year
Unrestricted Net Assets, End of Year
114,363
90,546
704,806
702,913
81,578
82,176
900,747
875,635
1,412,064
1,570,569
(18,760)
(135,658)
1,310,957
1,446,615
$ 1,292,197 $ 1,310,957
SEE THE ACCOMPANYING NOTES TO THE FINANCIAL STATEMENTS
WHICH ARE AN INTEGRAL PART HEREOF.
(3)
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, 1<6hsas
STATEMENTS OF CASH FLOWS
For the Year Ended
December 31,
2006 2005
Cash Flows From Operating Activities
Exhibit III
Cash received from dues and projects
$ 652,113.
$ 692,547
Cash received from government entities
669,468
679,740
Cash received from other operating activities
29,725
21,328
Interest received
25,956
11,833
Cash paid to employees and suppliers
(1,507,722)
(1,465,048)
Net Cash Used by Operating Activities
(130,460)
(59,600)
Net Cash Used by Investing Activities
Purchase of equipment
(20,026)
(3,936)
Net Decrease in Cash and Cash Equivalents
(150,486)
(63,536)
Cash and Cash Equivalents at Beginning of Year
831,178
894,714
Cash and Cash Equivalents at End of Year
$ 680,692
$ 831,178
RECONCILIATION OF DECREASE IN NET ASSETS
TO NET CASH USED BY OPERATING ACTIVITIES
Decrease in net assets $ (18,760) $ (135,658)
Adjustments to reconcile decrease in net assets to net
cash used by operating activities
Depreciation
Increase in accounts receivable
Decrease (Increase) in prepaid expenses
Increase (decrease ) in accounts payable and accrued expenses
Increase (decrease) in dues collected in advance
Decrease in program income collected in advance
Total Adjustments
Net Cash Used by Operating Activities
33,745
30,175
(16,042)
(29,463)
(55,894)
112,947
(35,122)
1,407
(27615)
5,094
(10,772)
(44,102)
(111,700)
76,058
$ (130,460) $ (59,600)
SEE THE ACCOMPANYING NOTES TO THE FINANCIAL STATEMENTS
WHICH ARE AN INTEGRAL PART HEREOF.
(4)
SALINA AREA CHAMBEROF COMMERCE, INC.
Salina; Kansas
' STATEMENT OF FUNCTIONAL EXPENSES
For the Year Ended December 31, 2006
Direct Program Expenses
' Administrative and General Expenses
Legal and accounting
Travel expense
Office supplies
' Postage
Communications
Computer services
' Equipment services
Dues and subscriptions
Insurance
' Contingency fund
Total Administrative and General Expenses
'
Staff Expenses
'
Salaries
8,107
Contract labor
'
Payroll taxes
Group medical insurance
3,940
Retirement
'
Group life insurance
'
Cafeteria plan
10,762,
Unemployment tax
1,261
Workers compensation insurance
61834
Professional development
'
Total Staff Expenses
'
Building Operation Expenses
Property insurance
2,884
Utilities
8,107
Taxes
'
Maintenance and janitorial
Depreciation
3,940
Total Building Operation Expenses
'
4,412
2,045
Total Expenses
Exhibit IV a
Economic
Develop- Convention
Chamber ment Tourism Total
$ 135,540 $ 104,052 $ 271,725 $ 511,317
2,957
1,370
2,884
7,211
8,107
5,003
9,747
22,857
8,502
3,940
8,295
20,737
4,412
2,045
4,305
10,762,
2,588
1,261
2,985
61834
4,543
2,137
4,432
11,112
3,917
1,815
3,822
9,554
7,565
1,923
1,464
10,952
1,013
470
989
2,472
10,370
484
1,018
11,872
53,974
20,448
39,941
114,363
192,164
1.36,930
190,715
519,809
63
-
-
63
13,741
9,666
13,368
36,775
29,530
29,421
41,399
100,350
10,822
8,579
12,765
32,166
(182)
250
747
815
265
240
340
845
2,133
1,554
2,428
6,115
1,182
662
919
2,763
2,767
1,133
1,205
5,105
252,485
188,435
263,886
704,806
2,721
1,261
2,654
6,636
5,199
2,409
5,072
12,680
6,049
2,803
5,901
14,753 .
5,643
2,616
5,506
13,765
13,835
6,411
13,498
33,744
33,447
15,500
32,631
81,578
$ 475,446 $ 328,435 $ 608,183 $ 1,412,064
SEETHE ACCOMPANYING NOTES TO THE FINANCIAL STATEMENTS
WHICH ARE AN INTEGRAL PART HEREOF.
(5)
' SEE THE ACCOMPANYING NOTES TO THE FINANCIAL STATEMENTS
WHICH ARE AN INTEGRAL PART HEREOF.
(6)
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
Exhibit IV b
'
STATEMENT OF FUNCTIONAL EXPENSES
For the Year Ended December 31, 2005
'
Economic
Develop-
Convention
Chamber
ment .
Tourism
Total
161,726
267,771
$ 694,934
Direct Program Expenses
$ 265,437
$
$
'
Administrative and General Expenses
Legal and accounting
2,401
1,111
2,340
5,852
Travel expense
8,952
4,751
8,291
21,994
Office supplies
7,563
3,684
7,278
18,525
'
Postage
2;442
1,481
2,332
6,255
Communications
2,735
1,429
3,1.19
7,283
Computer services
1,765
883
1,716
4,364
'
Equipment services
3,225
1,520
3,117
7,862
Dues and subscriptions
6,542
1,775
1,603
9,920
Insurance
1,021
466
985
2,472
fund
5,794
71
154
6,019
'Contingency
Total Administrative and General Expenses.
42,440
17,171
30,935
90,546
'
Staff Expenses
Salaries
129,992
186,126
201,667
517,785
Contract labor
Payroll taxes
8,960
12,722
14,097
35,779
'
Group medical insurance
24,945
37,964
44,087
106,996
Retirement
8,486
8,943
11,706
29,135
Group life insurance
352
269
1,116
1,737
Cafeteria plan
211
246
328
785
'
Unemployment tax
797
1,185
1,616
3,598
Workers compensation insurance
648
881
928
2,457
Professional development
1,739
1,031
1,871
4,641
Total Staff Expenses
176,130
.249,367
277,416
702,913
Building Operation Expenses
'
Property insurance
2,743
1,250
2,643
6,636
Utilities
4,587
2,377
4,446
11,410
Taxes
6,827
3,186
6,580
16,593
Maintenance and janitorial
7,011
3,538
6,813
17,362
'
Depreciation
12,984
4,726
12,465
30,175
Total Building Operation Expenses
34,152
15,077
32,947
82,176
'
Total Expenses
$ 518,159
$ 443,341
$ 609,069
$ 1,570,569
' SEE THE ACCOMPANYING NOTES TO THE FINANCIAL STATEMENTS
WHICH ARE AN INTEGRAL PART HEREOF.
(6)
E
SALIVA AREA CHAMBR',OF COMMERCE; INC.
Salina; Kansas
' NOTES TO FINANCIAL STATEMENTS
December 31, 2006 and 2005
Nature of Organization and Significant Accounting Policies
A. Nature of Organization
Salina Area Chamber of Commerce, Inc. (the "Chamber ") is a nonprofit organization located in Salina,
' Kansas. Its purpose is to administer various activities advancing the general welfare and prosperity of the
Salina area especially in the areas of economic development and tourism.
' B. Income Tax Exemption
The Chamber is exempt from income tax under Internal Revenue Code Section 501(c)(6).
' C. Accounting Method
The books of the Chamber are maintained and these financial statements were prepared on the accrual
method of accounting. Under this method revenues are recognized when earned and expenses are
' recognized when incurred.
D. Net Assets
1 Salina Area Chamber of Commerce, Inc. has adopted Statement of Financial Accounting Standards (SFAS)
No. 117, Financial Statements of Not- for - Profit Organizations. SFAS No. 117 establishes standards for
external financial reporting by not - for - profit organizations and requires that resources be classified for
' accounting and reporting purposes into three net asset categories according to externally (donor) imposed
restrictions. The Chamber has no restricted net assets and therefore all net assets are classified as
unrestricted.
' The Chamber has established a policy of dividing unrestricted net assets into four components: designated
for fixed assets, designated for economic development, designated for convention and tourism and
undesignated. Unrestricted net assets designated for fixed assets is an amount equal to the Chamber's
' investment in building, furniture, fixtures, equipment, land improvements and land less accumulated
depreciation. Unrestricted net assets designated for economic development is an arbitrary amount the
Board of Directors has designated for economic development projects. Unrestricted net assets designated
for convention and tourism is the excess income over expenditures of the convention and tourism program.
' Unrestricted net assets in excess of that designated for fixed assets, economic development and convention
and tourism are undesignated.
E. Cash and Cash Equivalents
For the purpose of the cash flows statement, the Chamber considers all short-term investment securities
purchased with a maturity of three months or less to be cash equivalents. The Chamber maintains checking,
certificate of deposit, and deposits under repurchase . agreements with nine financial institutions in Salina,
Kansas. The amount not covered by F.D.I.C. insurance totaled $117,854.
Of the $117,854, $110,000 was held under repurchase agreements at Sunflower Bank and is secured by .
' direct or indirect obligations of the United States Government. With the exception of the aforementioned
deposits under repurchase agreement, accounts at each institution are insured by the Federal Deposit
Insurance Corporation up to $100,000, leaving $7,854 uninsured.
' F. Accounts Receivable
Accounts receivable are considered to be fully collectible. Accordingly, the allowance for doubtful accounts
' is zero.
G. Inventories
Purchases of supplies that might be considered as inventory are expensed when purchased. Actual
' amounts on hand are considered immaterial.
1 (7)
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SALINA AREA CHAMBER OF COMMERCE, INC.
Salina; Kansas
NOTES TO FINANCIAL STATEMENTS
December 31, 2006 and 2005
H. Membership Dues and Program Income
Membership dues and program income are recognized as revenue in the year in which they are earned. The
Chamber bills dues in December for the coming membership year, consequently a significant amount of
dues are collected in advance and recorded as dues collected in advance in the financial statements.
Program revenues are sometimes received in the year preceding the actual event, consequently these
revenues are recorded as deferred income in the financial statements.
I. Allocation of expenses
The basis for allocation of expenses to specific programs is determined by management. Expenses that can
be directly identified with specific programs are charged to that program. Other expenses are allocated
using predetermined percentages.
J. Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires
the use of management's estimates.
K. Products and services received in payment of dues are recorded at estimated market value by the Chamber.
2. Land, Building and Equipment
Land, Building and Equipment can be summarized as follows:
2006 2005
Land, Building and Equipment
Buildings
Furniture, fixtures and equipment
' Land improvements
Land
Less: Accumulated depreciation
Total Land, Building and Equipment (net)
$ 633,538 $ 633,538
338,548 318,522
15,280 15,280
192,691 192,691
1,180,057 1,160,031
(522,082) (488,337)
$ 657,975 $ 671,694
Land, building and equipment are carried at cost. Depreciation of the building and equipment is computed on a
straight -line basis over the estimated useful lives of the respective assets. The building, parking lot and
landscaping are depreciated over their estimated useful lives which range from 8 to 35 years and the estimated
useful lives of the furniture, fixtures and equipment range from 3 to 10 years.
3. Investment Land
t The Chamber purchased land on May 31, 1985 for $335,382. One -half of this land was used to construct the
building which now serves as the Chamber's office and remains on the books at its original cost. The remaining
east half of the land was recorded as-investment land and is not an integral part of Chamber operations.
1 Subsequent to its original purchase, it was appraised for $100,000 and consequently written down to its fair
market value.
1
' SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
' NOTES TO FINANCIAL STATEMENTS
December 31, 2006 and 2005
' 4. Agreement Relating to Economic Development
The Chamber receives contributions from the City of Salina, Saline County and the Salina Airport Authority
(Grantors) to help fund a program, the purpose of which is to encourage economic development in the
' Salina /Saline County area. The agreement provides that the.Chamber will expend funds received on programs
and services that the parties to this agreement believe will enhance the economic development of the area.
' In 2004, the Chamber designated $200,000 of their undesignated funds for economic development programs, of
which $138,030 was expended in 2005 and the remainder in 2006, leaving a net asset designated for economic
development balance of $0.
' 5. Agreement Relating to Convention and Tourism
The Chamber has entered into an agreement with the City of Salina to provide convention and tourism programs
to encourage, promote and solicit conventions and tourism for the City of Salina, and the City has appointed a
t Convention and Tourism Advisory Committee to recommend to the Chamber, programs in connection with this
agreement.
Under this agreement the City makes contributions to the Chamber of a portion of the proceeds of the local
transient guest tax levied on hotel and motel guests.
The Chamber board has designated excess income over expenditures for 2006 and 2005 in the amount of
t $109,259 and $62,868 respectively, as a reserved net asset for convention and tourism in order to fund future
contracted obligations,
6. Retirement Plan
The Chamber has established a defined contribution retirement plan covering substantially all qualified
' employees. Qualified employees are at least 2.1 years of age and have completed one year of service.
Contributions are made by the Chamber equal to 6% of eligible compensation. The total expense under the plan
was $32,166 and $29,135 for the years ended December 31, 2006 and 2005, respectively.
' 7. Compensated Absences
The Chamber grants annual paid vacations to.its full time employees based on the following schedule:
Annual Vacation
Years of Service Allowance
' 1 -9 .10 days
10 or more 15 days
' Vacation days earned must be used within one year and do not accumulate.
8. The Chamber leases three automobiles used in its operations. Total lease expense for the years ended
December 31, 2006 and 2005 is $13,951 and $13,860, respectively. The following is a schedule of future
' minimum lease payments required under these operating leases as of December 31, 2006:
Year Ended
December 31,
' 2007 $ 8,338
2008 1,774
Subsequent to 2008 -
SUPPLEMENTAL INFORMATION
1
1
1
'
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
'
SCHEDULES OF PROGRAM REVENUES
For the Year Ended
December 31,
2006 2005
Program Revenues
Farm show
$
81,825 $
82,555
Dairy show
12,291
15,191
Leadership Salina
7,500
7,500
Legislative action
2,081
1,200
Membership meetings
10,120
9,971
Chamber - Net
7,160
6,730
'
Annual meeting
75,050
133,260
Assessments
320
-
1 -Stop administration
Business services
-
2,800
2,715
3,600
Grant services
15,115
21,070
Fund drive
19,750
-
Special functions
692
8,158
Total Program Revenues
$
234,704 $
291,950
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
SCHEDULES OF DIRECT PROGRAM EXPENSES
Chamber Direct Program Expenses
Agriculture
Farm show
Agriculture development
Dairy show
Total Agriculture Direct Program Expenses
Community Development
Arts
Leadership Salina
Total Community Development Direct Program Expenses
Internal Affairs
Ambassadors
Membership services
Plans and directors
Communication and image
Chamber - Net
Legislative action
Membership meetings
Annual meeting
Total Internal Affairs Direct Program Expenses
Total Chamber Direct Program Expenses
Economic Development Program Expenses
New industry development
New industry advertising
Existing industry development
Commercial development
Regional assessment
Assessments
STC
Business development
Seminars
Total Economic Development Direct Program Expenses
(11)
For the Year Ended
December 31,
2006 2005
$ 31,667 $
37,702
3,027
3,019
11,856
14,808
46,550
55,529
- 10
5,361 5,789
5,361 5,799
4,646
5,376
2,890
5,014
2,509
1,828
16,439
17,486
3,880
5,936
1,830
6,428
10,439
14,494
40,996
147,547
83,629
204,109
135,540
265,437
40,420
25,625
13,645
13,458
41703
13,847
1,801
3,269
30,509
98,572
952
711
185
250
11,608
889
229
5,105
104,052
161,726
' SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
SCHEDULES OF DIRECT PROGRAM EXPENSES
' (Continued)
Convention and Tourism Direct Program Expenses
Signage
Advertising
Convention marketing
Convention services
Tourism marketing
1 -70 Association
' T.I.A.K.
Market place
Regional marketing
' Magazine - Discover the Crossroads
KATT
Global Flyer
City tour brochure
Sports and special events
SJBB women's basketball
' 3/4 -A basketball, football, baseball, softball
ASA softball
Hospitality services
Region VI
Smoky Hill River Festival
CVD organization dues
I Calendar of Events
Total Convention and Tourism Direct Program Expenses
' Total Direct Program Expenses
(12)
For the Year Ended
December 31,
2006 2005
10,570
15,447
40,065
13,362
9,568
13,487
15,292
23,576
32,755
20,242
342
90
2,348
1,117
-
317
-
1,250
918
658
1,390
852
405
20,016
1,650
7,213
1.3,000
14,821
83,918
71,585
44,188
46,451
3,368
3,000
480
-
-
3,500
5,000
5,000
4,268
3,387
2,200
2,400
271,725
267,771
$ 511,317 $ 694,934
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
SCHEDULES OF REVENUES AND EXPENSES UNDER AGREEMENT
WITH THE CITY OF SALINA, SALINE COUNTY AND
THE SALINA AIRPORT AUTHORITY TO PROVIDE
ECONOMIC DEVELOPMENT SERVICES
Revenues
City of Salina
Saline County
Salina Airport Authority
Total Revenues
Expenses
Program expenses (Schedule 1A)
Administrative and general expenses (Schedule 2A)
Staff expenses (Schedule 3A)
Building operation expenses (Schedule 4A) .
Total Expenses
(13)
For the Year Ended
December 31,
2006 2005
$ . 85,000
$
85,000
15,000
15,000
20,000
20,000
$ 120,000
$
120,000
$ 104,052
$
161,726
20,448
17,171
188,435
249,367
15,500
15,077
$ 328,435
$
443,341
'
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
'
SCHEDULES OF REVENUES AND EXPENSES UNDER AGREEMENT
WITH THE CITY OF SALINA, SALINE COUNTY AND
THE SALINA AIRPORT AUTHORITY TO PROVIDE
ECONOMIC DEVELOPMENT SERVICES
For the Year Ended
December 31,
2006
2005
Schedule 1A - Program Expenses
'
New industry development $
40,420
$
25,625
New industry advertising
13,645
13,458
Existing industry development •
4,703
13,847
Commercial development
1,801
3,269
'
Regional assessment
30,509
98,572
Assessments
952
711
STC
185
250
'
Business development
11,608
889
Seminars
229
5,105
'
Total Program Expenses $
104,052
$
161,726
Schedule 2A - Administrative and General Expenses
Legal and accounting $
1,370
$
1,111
'
Travel expense
5,003
4,751
Office supplies
3,940
3,684
Postage
2,045
1,481
Communications
1,261
1,429
Computer services
2,137
883
Equipment services
1,815
1,520
Dues and subscriptions
1,923
1,775
Insurance
470
466
Contingency fund
484
71
Total Administrative and General Expenses $
20,448
$
17,171
Schedule 3A - Staff Expenses
Salaries $
136,930
$
186,126
Payroll taxes
9,666
12,722
Group medical insurance
29,421
37,964
Retirement
8,579.
8,943
Group life insurance
250
269
'
Cafeteria plan
240
246
Unemployment tax
1,554
1,185
Workers compensation insurance
662
881
'
Professional development
1,133
1,031
Total Staff Expenses $
188,435
$
249,367
(14)
1
1
1
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
SCHEDULES OF REVENUES AND EXPENSES UNDER AGREEMENT
WITH THE CITY OF SALINA, SALINE COUNTY AND
THE SALINA AIRPORT AUTHORITY TO PROVIDE
ECONOMIC DEVELOPMENT SERVICES
(Continued)
Schedule 4A - Building Operation Expenses
Property insurance
Utilities
Taxes
Maintenance and janitorial
Depreciation
Total Building Operation Expenses
(15)
For the Year Ended
December 31,
2006 2005
$ 1,261 $
1,250
.2,409
2,378
2,803
3,185
2,616
3,538
6,411
4,726
$ 15,500 $
15,077
SALINA AREA CHAMBER OF COMMERCE, INC. .
Salina, Kansas
SCHEDULES OF REVENUES AND EXPENSES UNDER CONTRACT
WITH THE CITY OF SALINA TO PROVIDE
CONVENTION AND TOURISM SERVICES
For the Year Ended
December 31,
2006 2005
Revenues
City of Salina $ 549,468 $ 559,740
SJBB 59,419 58,139
3A Football 23,574 -
4A Football, baseball, softball 20,876 48,214
Special functions 1,237 5,844
Total Revenues $ 654,574 $ 671,937
Expenses
Program expenses (Schedule 1 B)
Administrative and general expenses (Schedule 2B)
Staff expenses (Schedule 3B)
Building operation expenses (Schedule 4B)
Total Expenses
i
(16)
$ 271,725 $ 267,771
39,941 30,935
263,886 277,416
32,631 32,947
$ 608,183 $ 609,069
SALINA AREA CHAMBER OF COMMERCE, INC.
Salina, Kansas
SCHEDULES OF REVENUES AND EXPENSES UNDER CONTRACT
' WITH THE CITY OF SALINA TO PROVIDE
CONVENTION AND TOURISM SERVICES
(17)
For the Year Ended
'
December
31,
.
2006
2005
Schedule 1 B - Program Expenses
'
Signage
$
10,570
$
15,447
Advertising
40,065
13,362
Convention marketing
9,568
13,487
'
Convention services
15,292
23,576
Tourism marketing
39,808
51,755
Sports
144,474
139,357
projects
11,948
10,787
'Special
Total Program Expenses
$
271,725
$
267,771
'
Schedule 2B - Administration and General Expenses
Legal and accounting
$
2,884
$
2,340
Travel expense
9,747
8,291
Office supplies
8,295
7,278
Postage
4,305
2,332
'
Communications
2,985
3,119
Computer services
4,432
1,716
Equipment services
3,822
3,117
'
Dues and subscriptions
1,464
1,603
Insurance
989
985
Contingency fund
1,018
154
Total Administration and General Expenses
$
39,941
$
30,935
Schedule 3B - Staff Expenses
Salaries
$
190,715
$
201,667
'
Payroll tax
13,368
14,097
Group medical insurance
41,399
44,087
Retirement
12,765
11,706
Group life insurance
747
1,116
Cafeteria plan
340
328
Unemployment tax
2,428
1,616
Workers compensation insurance
919
928
Professional development
11-205
1,871
Total Staff Expenses
$
263,886
$
277,416
'
Schedule 4B - Building Operation Expenses
Property insurance
$
2,654
$
2,643
Utilities
5,072
4,446
Taxes
5,901
6,580
'
Maintenance and janitorial
5,506
6,814
Depreciation
13,498
12,464
Total Building Operation Expenses
$
32,631
$
32,947
(17)