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Audit - 2006/2007 I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH ~alina, Kansas FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS' REPORT . December 31,2007 and 2006 CLUBINE AND RETTELE, CHARTERED CERTIFIED PUBLIC ACCOUNTANTS SALlNA,KANSAS I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas TABLE OF CONTENTS Paae Exhibit I FINANCIAL SECTION INDEPENDENT AUDITORS' REPORT MANAGEMENT'S DISCUSSION AND ANALYSIS BALANCE SHEETS STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL STATEMENTS OF CASH FLOWS NOTES TO FINANCIAL STATEMENTS 1-2 3 4 Exhibit II 5 Exhibit III 6 7-10 SUPPLEMENTAL INFORMATION Schedule 2 GRANTS FROM THE KANSAS STATE DEPARTMENT OF HEALTH AND ENVIRONMENT FEES FOR SERVICES 11 12 Schedule 1 SINGLE AUDIT SECTION 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 REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS SCHEDULE OF FINDINGS AND QUESTIONED COSTS CORRECTIVE ACTION PLAN SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS 13-14 15-16 17 18 19 20 21 I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas FINANCIAL SECTION I I I I I I I I I I I I I I I I I I I I CLUBlNE& RETTELE CHARIERED Certified Public Accountants rr Robert I. Clubine, C.P.A. David A. Rettele, C.PA Jay D. Langley, C.P.A. Jon K. Bell, C.P.A. Leslie M. Corbett, C.P.A. Stacy J. Sokol, C.PA Marci K. Fox, 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 INDEPENDENT AUDITORS' REPORT To the Governing Board Salina-Saline County Board of Health Salina, Kansas We have audited the accompanying financial statements of Salina-Saline County Board of Health, Salina, Kansas, as of and for the years ended December 31, 2007 and 2006 as listed in the table of contents. These financial statements are the responsibility of the Board of Health'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, the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States and the Kansas Municipal Audit Guide, prescribed by the Director of Accounts and Reports, Department of Administration of the State of Kansas. 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 opinions. As described in Note B(2), management has not included the capitalization and depreciation of property and equipment, which should be included in order to conform with accounting principles generally accepted in the United States of America. The amount that should be capitalized and depreciated is not reasonably determined. In our opinion, except for the effect on the financial statements of the omission described in the preceding paragraph, the financial statements referred to above present fairly, in all material respects, the financial position of the Salina-Saline County Board of Health at December 31, 2007 and 2006, and changes in financial position and cash flows for the years then 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 August 5, 2008 on our consideration of Salina-Saline County Board of Health's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of the 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. The management's discussion and analysis on page 3 is not a required part of the basic financial statements but are supplementary information required by accounting principles generally accepted in the Untied State of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. Our audits were conducted for the purpose of forming opinions on the basic financial statements taken as a whole. The supplemental information on pages 11 and 12 is presented for purposes of additional analysis and is not a required part of the basic (1) ---.----.-- I I I I I I I I I I I I I I I 'I I I I financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is also not a required part of the basic financial statements of Salina- Saline County Board of Health. The supplemental information and the schedule of expenditures of federal awards have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. Respectfully submitted, ~oJ~ CLUBINE AND RETTELE, CHARTERED August 5, 2008 (2) I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas MANAGEMENT'S DISCUSSION AND ANALYSIS The management of the Salina-Saline County Board of Health provides readers of the Board of Health's financial statements an overview and analysis of the Salina-Saline County Board of Health's financial activities for the year ended December 31, 2007. Please read it in conjunction with the Board's financial statements which begin on page 4. Financial Hiahlights 1. Interest income remained healthy in 2007. 2. State and federal grant income due for our calendar year did not come in as we expected. The State fiscal year is July 1, to June 30. Federal fiscal year is October 1 to September 30. 3. There was an increase in the Women Infant Children (WIG) federal grant reimbursement from 2006 to 2007. This portion is a pass through reimbursement to the counties in our regional WlC group. 4. In 2007, we moved all immunization revenue including all adult and flu immunizations from the nursing clinic category to the immunization fee category. Prior to 2007, only children's immunization revenue was included in that category . Exoenses 1. Under professional services, the increase from 2006 to 2007 is the WlC pass through amount to the counties. 2. In 2007, we eliminated the veterinary medical service line and included it in the professional services line. Condensed Financial Information 2007 2006 Total Assets $ 1,732,516 $ 1,284,905 Total Liabilities 453,162 466,424 Total Fund Equity 1 ,254,115 792,041 Revenues Appropriations $ 1,686,249 $ 1,547,196 Grants 916,723 924,239 Fees for services 1,089,585 926,084 Interest income 33,872 29,571 Miscellaneous 351,526 341,372 Total Revenues 4,077,955 3,768,462 Expenses Personal services 2,920,750 2,672,913 Contractual services 250,932 205,114 Expendable supplies 444,199 422,890 Total Expenses 3,615,881 3,300,917 Excess of Revenue over Expenses 462,074 467,545 Ending Fund Equity $ 1 ,254,115 $ 792,041 F utu re 1. A new contract for copier/fax machines is approved for 2008. The amount is more than the budgeted expenses for 2008 under service contracUequipment lease. 2. Mileage expense is anticipated to be considerably higher in 2008 as compared to 2007. 3. A new storage unit at the animal shelter will show an additional unbudgeted expense. The expense is being paid from animal shelter donation dollars. (3) I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas Exhibit I BALANCE SHEETS ASSETS Cash Accounts receivable State of Kansas Department of Health and Environment (Note 5) Medicare and Medicaid Other care services Saline County December 31, 2007 2006 $ 1,105,044 $ 867,614 100,400 175,985 133,432 167,696 120,693 73,610 272,947 $ 1,732,516 $ 1,284,905 Totals LIABILITIES AND FUND EQUITY Liabilities Vouchers payable Accrued salaries Accrued liability for compensated absences Animal Shelter Reward fund payable Total Liabilities $ 68,984 $ 62,129 83,084 77,346 236,803 227,706 64,291 99,243 453,162 466,424 25,239 26,440 Deferred Income (Note 5) Fund Equity Unrestricted Designated for Health Department Designated for Animal Shelter Total Fund Equity 675,401 116,640 792,041 1,125,238 128,877 1,254,115 Th~~ $ 1,732,516 $ 1,284,905 The accompanying notes are an integral part of these financial statements. (4) I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas I Exhibit II STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN FUND EQUITY - BUDGET AND ACTUAL I For the Year Ended December 31, 2007 2006 Actual Budget Actual Budget I Revenues Appropriation from Saline County, Kansas (Note 4) $ 727,859 $ 727,859 $ 661,690 $ 661,690 Appropriation from City of Salina, Kansas (Note 4) 958,390 958,390 885,506 885,506 I Grants from the State Department of Health and Environment 916,723 721,948 924,239 755,089 Fees for services 1,089,585 919,300 926,084 697,200 Interest income 33,872 5,000 29,571 I Miscellaneous revenues 351,526 150,000 341,372 222,899 Total Revenues 4,077,955 3,482,497 3,768,462 3,222,384 I Expenses Personal Services Salaries 2,095,270 2,137,807 1,992,583 1,980,384 Social security 147,444 162,003 139,884 148,202 I Retirement 97,914 100,493 85,119 84,748 Health insurance 284,779 292,302 243,052 272,616 Unemployment insurance 2,080 5,506 5,358 10,834 I Professional services 293,263 170,000 206,917 160,000 Contractual services Auditing 7,700 8,000 7,550 8,000 Accounting 675 760 738 700 I Building and grounds - Remodeling and repair 16,942 13,500 10,866 2,000 Telephone 29,248 21,000 18,091 20,000 Mileage 66,398 70,000 61,406 70,000 I Service contracts and equipment lease 60,840 45,000 41,983 45,000 Insurance 69,129 89,400 64,480 85,000 Expendable supplies Office supplies 34,118 29,500 32,081 30,000 I Postage and express 14,030 14,000 13,695 13,000 Books, dues and subscriptions 5,334 6,500 6,526 4,500 Equipment maintenance and repair 959 1,000 1,394 1,000 I Gasoline and oil 9,782 7,000 9,860 7,000 Clinical and medical supplies 157,878 120,000 144,384 120,000 Chemicals 6,738 4,000 7,527 4,000 Veterinary and medical services 23,002 25,000 I Animal supplies and donation fund expenses 51,113 14,400 19,482 3,000 Shelter refund 43,155 50,500 32,574 15,000 Professional meetings 21,421 27,000 28,368 18,000 I Utilities and water 57,766 54,400 54,970 54,400 Custodial services 7,641 5,000 3,538 5,000 Health education 27,658 26,000 39,953 26,000 Miscellaneous expense 708 1,426 5,536 1,000 I Capital equipment 5,898 6,000 8,000 Total Expenses 3,615,881 3,482,497 3,300,917 3,222,384 I Excess of Revenues. over Expenses 462,074 467,545 Fund Equity, January 1 792,041 385,130 324,496 385,130 Fund Equity, December 31 $ 1,254,115 $ 385,130 $ 792,041 $ 385,130 I The accompanying notes are an integral part of these financial statements. I (5) ----- I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas Exhibit III STATEMENTS OF CASH FLOWS Cash Flows From Operating Activities Saline County, Kansas City of Salina, Kansas Grants Fees Miscellaneous Interest income Cash paid to suppliers and others Cash paid to employees for services Net Cash Provided by Operating Activities For the Year Ended December 31, 2007 2006 454,912 $ 661,690 958,390 885,506 991,107 774,929 1,123,849 808,867 304,443 284,960 33,872 29,571 (1,548,708) (1,382,411) (2,080,435) (1,965,945) 237,430 97,167 237,430 97,167 867,614 770,447 1,105,044 $ 867,614 $ Increase in Cash Cash at Beginning of Year Cash at End of Year $ RECONCILIATION OF EXCESS OF REVENUES OVER EXPENSES TO NET CASH PROVIDED BY OPERATING ACTIVITIES Excess of Revenues over Expenses - Exhibit II $ 467,545 462,074 $ Adjustments to reconcile excess of revenues over expenses to net cash provided by operating activities Increase in accounts receivable Increase (Decrease) in vouchers payable Increase in accrued salaries Increase in accrued compensated absences Increase (Decrease) in Animal Shelter Reward fund payable Decrease in deferred income Total Adjustments (210,181) (312,890) 6,855 (76,033) 5,738 2,156 9,097 24,482 (34,952) 1,956 (1,201) (10,049) (224,644) (370,378) $ 237,430 $ 97,167 Net Cash Provided by Operating Activities The accompanying notes are an integral part of these financial statements. (6) I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas NOTES TO FINANCIAL STATEMENTS December 31,2007 and 2006 1. Summary of Significant Accounting Policies A. Reporting Entity The Salina-Saline County Board of Health was formed on June 28, 1955, under the Joint Resolution and Agreement of the County of Saline and the City of Salina. The Board of Health is a joint venture organized for the purpose of promoting the public health and sanitation of the county and city. The Governing Body of the Board of Health is composed of eleven members, three appointed City Commiss ioners, three appointed County Commissioners, and five members selected by the six appointed Commissioners. ( Based on the criteria set forth in Statement No. 14 of the Governmental Accounting Standards Board, the Board of Health is considered a joint venture between the County of Saline and the City of Salina due to ongoing financial responsibility of those governments for the Board of Health. B. Basis of Statement Presentation The Board of Health maintains its accounting records in accordance with the principles of fund accounting in order to ensure observance of limitations and restrictions placed on the use of resources available. The significant accounting policies followed by the Board of Health are described below to enhance the usefulness of the financial statements to the reader. 1) The accompanying financial statements have been prepared on the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Revenues from cost-reimbursement grants are recognized in the period the expenditure is made. It is the Board of Health's policy to follow all Financial Accounting Standards Board (FASB) standards issued after November 30, 1989. Deferred revenues arise when grant monies are received prior to the incurrence of qualifying expenditures. In subsequent periods, when both revenue recognition criteria are met, or when the Board of Health has a legal claim to the resources, the liability for deferred revenue is removed from the balance sheet and revenue is recognized. 2) Accounting principles generally accepted in the United States of America require that property and equipment be capitalized and depreciated. The accompanying financial statements do not conform with U.S. generally accepted accounting principles in that property and equipment is not capitalized and depreciated. 3) Individual accounts receivable are written off to bad debt expense in the period in which it is determined that they are uncollectible. The Board of Health considers accounts receivable to be fully collectible; accordingly, no allowance for doubtful accounts is required. 4) For purposes of the Statements of Cash Flows, cash equivalents include time deposits and all highly liquid debt instruments with maturities of three months or less. 5) The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 2. Budget The Board of Health does not have tax levying powers and is not required to publish a budget. A budget is adopted annually by the Governing Board for the purpose of determining appropriations to be requested from Saline County and the City of Salina. The budget is prepared on the modified accrual basis of accounting. (7) I I I I I I I I I I I 'I I I I I I ,I I. I II ---, 3. Deposits and Investments Deposits - At December 31, 2007 and 2006, respectively, the carrying amount of the Board of Health's deposits were $1,088,155 and $835,785, and the bank balances were $1,175,658 and $912,396. The differences are cash on hand, outstanding checks and deposits. In accordance with Kansas statutes, collateral securities were held under joint custody receipts issued by a third-party bank, which is independent of the depository financial institution, to secure balances over $100,000. Deposit balances were fully secured by FDIC and joint custody receipts as of December 31, 2007. 4. Appropriations from Taxing Authorities Saline County and the City of Salina share the net operating costs of the Board of Health. Necessary funds are included in the tax levies of the respective municipalities, and are summarized by the following schedule: 2007 2006 Saline County, Kansas Regular tax appropriation $ 727,859 $ 661,690 City of Salina, Kansas Regular tax appropriation $ 958,390 $ 885,506 5. Grants from the State of Kansas Department of Health and Environment Agreements were in effect during 2007 and 2006 with the State of Kansas Department of Health and Environment regarding certain grants which were funded by federal and state monies. Current agreements are for the state's fiscal year ended June 30, 2008. Unless specifically noted, the grants are payable 25% on or about July 1, and 12.5% on or about October 1, November 15, January 1, February 15, April 1 , and May 15. Unexpended grant amounts are periodically withheld from grant payments. If expenditures for these programs exceed the grant award, the Board of Health is responsible for the excess. Descriptions of the grants follow: Fed~ral Programs Maternal and Child Health Program Matching funds are provided to furnish comprehensive health care services for mothers and infants, children and adolescents. The current agreement provides that the Board of Health will receive $74,626. Family Planning Program Matching funds are provided to establish and maintain family planning centers to furnish and disseminate information concerning planned parenthood. The current agreement provides that the Board of Health will receive $38,306. Special Supplemental Food Program for Women, Infants, and Children Reimbursements are provided for administrative costs of the Women, Infants and Children Supplemental Food Program. The program provides nutritious foods for pregnant and nursing women, infants up to age 1 year, and children up to age 5 years. The current agreement provides that the Board of Health will be reimbursed monthly for actual expenses up to $319,168, plus any reallocated federal funds that may become available. This program is on an October 1 through September 30 year-end. Outreach Clinic Services Reimbursements are provided for coordination of Cardiac Outreach Clinics at Salina. The contract was not renewed for the fiscal year beginning July 1, 2007 and ending June 30, 2008. HIV Case Management Program Funds are provided for services performed for new and previously diagnosed HIV positive persons. The current agreement provides that the Board of Health will receive $60,000. AIDS Health Education/Risk Reduction Program Funds are provided to identify, coordinate, and provide public information and education regarding Acquired Immune Deficiency Syndrome. The current agreement provides that the Board of Health will . receive $8,375. (8) I I I I I I I I I I I I I I I I I I I Child Care Licensing Program Funds are provided for the evaluation, registration, and licensing of homes and/or centers caring for children. The current agreement provides that the Board of Health will receive $72,500 payable in quarterly amounts based on number of licenses issued. Immunization Action Plan Funds are provided for the implementation of an increased age-appropriate level of immunization for children aged birth to two years. The current agreement provides that the Board of Health will receive $11,080. Lead Poisoning Prevention Program Funds are provided to hire a registered nurse to be the dedicated childhood lead poisoning prevention nurse to coordinate and implement a screening and blood lead testing program within the county. The contract was not renewed for the fiscal year beginning July 1, 2007 and ending June 30, 2008. Public Health Preparedness and Response Program Funds are provided for the completion of a local emergency preparedness and response inventory and a submission of a final local public health preparedness plan. The Agency agrees to be a full participant in the Health Alert Network. The current agreement provides that the Board of Health will receive $151,388 which includes $22,798 for the specific threat of panademic influenza. State Programs Food Service Licensing Program Funds are provided for the evaluation, registration, and licensing of food service establishments. The current agreement provides that the Board of Health will receive 80% of annual licensing fees, payable monthly. General Health Services - State Formula Grant Matching funds are provided to help insure that adequate health services are available to the Saline County Community. The current agreement provides that the Board of Health will receive $39,603 payable in quarterly installments. AIDS Counseling and Testing Site Program Funds are provided for the counseling and testing of Acquired Immune Deficiency Syndrome. The current agreement provides that the Board of Health will receive $3,752. Local Environmental Protection Program Funds are provided for the development and implementation of the Lincoln, Ellsworth, Ottawa, and Saline County Sanitary Codes. The current agreement provides that the Board of Health will receive $50,478. Tuberculosis Control Program Funds are provided to expand services for people with low income who are not eligible for medicaid, have no health insurance and no other means of payment for diagnosis and/or treatment of tuberculosis. The current contract agreement provides that the Board of Health will receive $4,000. The Board of Health periodically receives payments in advance or reimbursements to finance expenditures incurred in administering the above programs. The following schedules summarize accounts receivable and deferred income at December 31,2007 and 2006: December 31, 2007 2006 Accounts Receivable Special Supplemental Food Program for Women, Infants, and Children Food Service Licensing Program Outreach Clinic Services HIV Case Management Public Health Preparedness and Response Total Accounts Receivable Deferred Income TB Control Nurse Local Environmental Protection Program Total Deferred Income $ 65,953 $ 24,720 144,660 13,704 1,950 2,869 12,802 175,985 $ 9,727 100,400 $ $ - $ 25,239 25,239 $ 1,201 25,239 26,440 $ (9) I I I I I I I I I I I I I I I I I I I 6. Home Health Agency The Board of Health provides services to patients which are reimbursed by third party payers, principally Medicare and Medicaid. Total fees for services include reimbursements made under the Medicare and Medicaid programs. 7. Defined Benefit Pension Plan Plan Description: The Board of Health participates in the Kansas Public Employees Retirement System (KPERS), a cost-sharing multiple-employer defined benefit pension plan as provided by KSA 74-4901, et seq. KPERS provides retirement benefits, life insurance, disability income benefits and death benefits. Kansas law establishes and amends benefit provisions. KPERS issues a publicly available financial report that includes financial statements and required supplementary information. That report may be obtained by writing to KPERS, 611 South Kansas, Suite 100, Topeka, KS 66603-3803 or by calling 1-888-275-5737. Funding Policy: KSA 74-4919 establishes the KPERS member-employer contribution rate at 4% of covered salary. The employer collects and remits member-employee contributions according to the provisions of section 414(h) of the Internal Revenue Code. State law provides that the employer contribution rate be determined annually based on the results of an annual actuarial valuation. KPERS is funded on an actuarial reserve bases. State law sets a limitation on annual increases on the contribution rates for KPERS employers. The employer rate established for calendar year 2007 was 5.31 %. The Board of Health employer contributions to KPERS for the years ended December 31, 2007, 2006 and 2005 were $98,295, $85,119 and $70,960, respectively, equal to the required contributions for each year. 8. Lease Agreement Commencing June 14, 2005, the Board of Health updated their copier lease agreement to include additional copiers and printers. The lease term is 63 months. The lease payment is $1,703 per month. Prior to June 14, 2005, the lease payment was $1,299 per month. Total rent expense under this lease was $20,796 for the year ending December 31, 2007. Future minimum rental payments required under the lease are as follows: December 31,2008 $ 20,796 December 31,2009 20,796 December 31,2010 10,398 9. Compliance with Kansas Statutes Deposits were not adequately secured for all months of the 2007 calendar year. 10. Other Post Employment Benefits As provided by KSA 12-5040, the municipality allows retirees under age 65 to participate in the group health insurance plan. While each retiree pays the full amount of the applicable premium, conceptually, the local government is subsidizing the retirees because each participant is charged a level premium regardless of age. However, the cost of this subsidy has not been quantified in these financial statements. Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), the municipality makes health care benefits available to eligible former employees and eligible dependents. Certain requirements are outlined by the federal government for this coverage. The premium is paid in full by the insured. There is no cost to the municipality under this program. 11. Certain reclassifications were made to the 2006 information to conform to the classifications used in 2007. 12. The Salina-Saline County Board of Health's insurance carrier settled a claim of gender discrimination and the case was dismissed in 2008. (10) I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas SUPPLEMENTAL INFORMATION I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas Schedule 1 GRANTS FROM THE KANSAS STATE DEPARTMENT OF HEAL TH AND ENVIRONMENT For the Year Ended December 31, 2007 2006 Federal Programs Maternal and Child Health Program $ 74,626 $ 77,259 Family Planning Program 39,651 41,634 Women, Infants, and Children Supplemental Food Program 397,180 368,993 Outreach Clinic Services 3,900 7,800 HIV Case Management 62,361 74,992 Child Care Licensing Program 73,227 73,034 Immunization Action Plan 12,680 11,080 Breast and Cervical Cancer Screening 263 Lead Poisoning Prevention 800 14,759 Bioterrorism Preparedness and Response Program 80,933 73,218 AIDS Health Education/Risk Reduction Program 8,451 8,529 Clean Water Act 308 Total Federal Programs 753,809 751,869 State Programs Food Service Licensing Program 62,228 65,792 General Health Services - State Formula Grant 39,716 39,867 Local Environmental Protection Program 51,944 51,867 AIDS Counseling and Testing Site Program 3,752 3,752 West Nile Virus Program 1,592 1,592 Tuberculosis Control Program 3,682 4,000 Hand Washing Education 5,500 Total State Programs 162,914 172,370 Total Grants $ 916,723 $ 924,239 (11 ) I I I I I I I I I I I I I I I I I I I Title XVIII Title XIX Patients and insurance Home care services Homemaker services Family planning services General nursing clinics Environmental health fees Day care provider fees Senior care fees Child health assessment fees Immunizations Total Fees for Services SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas FEES FOR SERVICES (12) Schedule 2 For the Year Ended December 31, 2007 2006 399,271 $ 277,517 232,714 269,716 98,405 58,321 25,840 18,940 5,923 4,794 40,481 49,929 92,112 160,762 30,057 27,497 9,860 9,105 3,480 4,040 4,267 2,808 147,175 42,655 1,089,585 $ 926,084 $ $ I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas SINGLE AUDIT SECTION I I I I I I I I I I I I I I I I I I I CLUBlNE& RETTELE CHARfERED Certified Public Accounrants " 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. 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 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 To the Governing Board Salina-Saline County Board of Health Salina, Kansas We have audited the financial statements of Salina-Saline County Board of Health, as of and for the years ended December 31, 2007 and 2006 and have issued our report thereon dated August 5, 2008. We conducted our audit in accordance with auditing standards generally accepted in the United States of America, the standards applicable to Government Auditing Standards, issued by the Comptroller General of the United States and the Kansas Municipal Audit Guide, prescribed by the Director of Accounts and Reports, Department of the Administration of the State of Kansas. Internal Control Over Financial Reoortina In planning and performing our audit, we considered Salina-Saline County Board of Health'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 Salina-Saline County Board of Health's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Salina-Saline County Board of Health's internal control over financial reporting. 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 Salina-Saline County Board of Health'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 Salina -Saline County Board of Health's financial statements that is more than inconsequential will not be prevented or detected by,the Salina-Saline County Board of Health's internal control. ,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 Salina-Saline County Board of Health'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. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. Comoliance and Other Matters As part of obtaining reasonable assurance about whether Salina-Saline County Board of Health'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 are required to be reported under Government Auditing Standards. {13} I I I I I I I I I I I I I II I I I I I We noted certain matters that we reported to management of the Salina -Saline County Board of Health in a separate letter dated August 5, 2008. This report is intended for the information and use of the governing board, management, others within the organization and federal awarding agencies and pass-through entities, and is not intended to be and should not be used by anyone other than these specified parties. August 5, 2008 Respectfully submitted, ~~~ CLUBINE AND RETTELE, CHARTERED (14) I I I I I I I I I I I I I I I I I I I CLUBlNE& RElTELE CHARIERED Certified Public Aa-ountant.l v 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.PA Stacy J. Sokol, C.P.A. Marci K. Fox, 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 REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 To the Governing Board Salina-Saline County Board of Health Salina, Kansas ComDliance We have audited the compliance of the Sal ina-Saline County Board of Health with the types of compliance requirements described in the U. S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that are applicable to each of its major federal programs for the year ended December 31, 2007. Salina-Saline County Board of Health's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major federal programs is the responsibility of Salina-Saline County Board of Health's management. Our responsibility is to express an opinion on Salina-Saline County Board of . Health's compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non- Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about Salina-Saline County Board of Health's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on Salina-Saline County Board of Health's compliance with those requirements. In our opinion, Salina-Saline County Board of Health complied, in all material respects, with the requirements referred to above that are applicable to each of its major federal programs for the year ended December 31, 2007. Internal Control Over ComDliance The management of Salina-Saline County Board of Health is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to federal programs. In planning and performing our audit, we considered Salina-Saline County Board of Health's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of Salina-Saline County Board of Health's internal control over compliance. A control deficiency in an entity's internal control over compliance 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 noncompliance with a type of compliance requirement of a federal program on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity's ability to administer a federal program such that there is more than a remote (15) I I I I I I I I I I I I I I I I I I I likelihood that noncompliance with a type of compliance requirement of a federal program that is more than inconsequential will not be prevented or detected by the entity's internal control A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that material noncompliance with a type of compliance requirement of a federal program will not be prevented or detected by the entity's internal control. Our consideration of internal control over compliance 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. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. This report is intended for the information and use of the governing board, management, others within the organization and federal awarding agencies and pass-through entities, and is not intended to be and should not be used by anyone other than these specified parties. Respectfully submitted, ~ c~/~:tAA.TERED August 5, 2008 (16) I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas I SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended December 31, 2007 I Federal CFDA Federal Federal Grantor/Pass-Through Grantor/Program Title Number Expenditures I U.S. Department of Aariculture Passed Through State of Kansas Department of Health and Environment I Special Supplemental Nutrition Program for Women, Infa nts, and Children - 06/07 10.557 $ 199,844 Special Supplemental Nutrition Program for Women, Infa nts, I and Children - 07/08 10.557 197,336 U.S. Department of Health and Human Services I Passed Through State of Kansas Department of Health and Environment Maternal and Child Health Services Block Grant Salina Outreach Clinic Services - 06/07 93.994 3,900 I Salina Outreach Clinic Services - 07/08 93.994 Maternal and Child Health - 06/07 93.994 37,313 Maternal and Child Health - 07/08 93.994 37,313 I Family Planning - Services 05/06 93.217 20,498 06/07 93.217 19,153 I Immunization Action Plan 06/07 93.268 5,540 07/08 93.268 7,140 I Acquired Immunodeficiency Syndrome (AIDS) Activity Aids/HERR - 06/07 93.118 3,348 Aids/HERR - 07/08 93.118 5,103 I HIV Case Management - 06/07 93.917 14,991 HIV Case Management - 07/08 93.917 47,370 Child Welfare Services I Child Care Institutions Licensing - 06/07 93.596 35,441 Child Care Institutions Licensing - 07/08 93.596 37,786 I Lead Poisoning Prevention 06/07 66.707 800 07/08 66.707 I Bioterrorism Public Health Preparedness and Response - 06/07 93.283 32,618 Public Health Preparedness and Response - 07/08 93.283 48,315 I Total $ 753,809 I , I The accompanying notes are an integral part of these financial statements. I (17) ---- I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS For the Year Ended December 31, 2007 1. Basis of Presentation The accompanying schedule of expenditures of federal awards includes federal grant activity of Salina-Saline County Board of Health and is presented on the modified accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. 2. Subrecipients Of the federal expenditures presented in the schedule, Salina-Saline County Board of Health provided federal awards to subrecipients as follows: Federal Program Amount Provided to CFDA Number Subrecipients Special Supplemental Food Program for Women, Infants and Children 10.557 $ 118,789 (18) ________ _I !I I I I I I I I I I I I I I I I I I I I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Year Ended December 31,2007 Summary of Auditor's Results Financial Statements Type of auditor's report issued: Qualified Internal control over financial reporting: Material weakness( es) identified No Significant deficiencies identified that are not considered to be material weaknesses? None reported Noncompliance material to financial statements noted? No Federal Awards Internal control over major programs: Material weakness(es) identified? No Significant deficiencies identified that are not considered to be material weakness(es) None reported Type of auditor's report issued on compliance for major programs: Any audit findings disclosed that are required to be reported in accordance with section 510(a) of Circular A-133? Unqualified No Identification of Maior oroarams: 10.557 Special Supplemental Food Program for Women, Infants and Chi Idren Dollar threshold used to distinguish between type A and type B programs: Auditee qualified as low-risk auditee: $ 300,000 Yes Section II - Financial Statement Findinas: None Section 111- Federal Award Findinas and Questioned Costs: None (19) I I ,I I I I I I I I I I I I I I I I I II SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas CORRECTIVE ACTION PLAN For the Year Ended December 31, 2007 None required. (20) I I I I I I I I I I I I I I I I I II I SALINA-SALINE COUNTY BOARD OF HEALTH Salina, Kansas SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS For the Year Ended December 31, 2007 There are no prior audit findings. (21)