Loading...
Audit - 1992/1993KENNEDY AND COE, LLC CERTIFIED PUBLIC ACCOUNTANTS HOME OFFICE: P. O. BOX 11 DO SALINA. KANSAS 67402 -1100 913- 825-1561 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS To the Governing Board Salina - Saline County Board of Health Salina, Kansas: OFFICES IN KANSAS NEBRASKA OKLAHOMA COLORADO We have audited the financial statements of the Salina - Saline County Board of Health for the year ended December 31, 1993, and have issued our report thereon dated May 26, 1994. In connection with our audit of the 1993 financial statements of the Salina - Saline County Board of Health and with our consideration of the Board of Health's internal control structure used to administer federal financial assistance programs, as required by Office of Management and Budget Circular A- 128, "Audits of State and Local Governments," we selected certain transactions applicable to certain nonmajor federal financial assistance programs for the year ended December 31, 1993. As required by OMB Circular A -128, we have performed auditing procedures to test compliance with the requirements governing types of services allowed or unallowed and eligibility requirements that are applicable to those transactions. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Salina - Saline County Board of Health's compliance with these requirements. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Salina - Saline County Board of Health had not complied, in all material respects, with those requirements. Also, the results of our procedures did not disclose any immaterial instances of noncompliance with those requirements. This report is intended for the information of the Governing Board and management of the Salina - Saline County Board of Health, the State of Kansas Department of Health and Environment, the cognizant federal agency, and other applicable federal audit agencies. This restriction is not intended to limit the distribution of this report which, upon acceptance by the Salina- SalinE: County Board of Health, is a matter of public record. Respectfully submitted, Salina, Kansas /) °"✓ L� G J May 26, 1994 -22- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE AICPA DIVISION FOR CPA FIRMS SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ended December 31, 1993 Program Finding /Noncompliance Costs None -23- HOME OFFICE: P. O. BOX 1100 SALINA. KANSAS 67402 -1100 913- 825 -1561 KENNEDY AND CO E, LLC CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS' REPORT ON SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE To the Governing Board Salina - Saline County Board of Health Salina, Kansas: OFFICES IN KANSAS NEBRASKA OKLAHOMA COLORADO We have audited the financial statements of the Salina - Saline County Board of Health, for the year ended December 31, 1993, and have issued our report thereon dated May 26, 1994. These financial statements are the responsibility of the Salina - Saline County Board of Health's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A -128, "Audits of State and Local Governments." Those standards and OMB Circular A -128 require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. Our audit was conducted for the purpose of forming an opinion on the financial statements of the Salina - Saline County Board of Health taken as a whole. The accompanying Schedule of Federal Financial Assistance is presented for purposes of additional analysis and is not a required part of the financial statements. The information in that schedule has been subjected to the auditing procedures applied in the audit of the financial statements and, in our opinion, is fairly presented in all material respects in relation to the financial statements taken as a whole. Respectfully submitted, Salina, Kansas May 26, 1994 O -24- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE AICPA DIVISION FOR CPA FIRMS Beginning Balance Revenues January 1, Local 1993 Grants Match Ending Balance December 31, Expenditures 1993 $ (1,765) $ 221,665 $ - $ 220,706 $ (806) 300,995 - 302,339 (1,344) (1,765) 522,660 - 523,045 (2,150) (783) 8,633 4,130 13,036 (1,056) - 8,523 3,501 12,025 (1) - 4,251 4,864 9,114 1 - 3,379 - 3,379 (a) - - 1,433 - 1,680 (247) - 4,800 - 4,875 (75) - 5,075 - 5,075 - (1) 37,188 13,580 50,768 (b) (1) - 38,843 19,530 58,986 (613) 1 17,689 38,666 56,356 - - 17,691 23,466 41,156 1 - 2,050 - 2,331 (281) (843) 1,769 - 1,769 (843) - 8,098 - 8,098 - - 6,761 - 6,761 - (1,626) 166,183 107,737 275,409 (3,115) $ (3,391) 5 688,843 $ 107,737 S 798,454 $ (5,265) -25- SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS' REPORTS December 31, 1993 and 1992 KENNEDY AND COE, LLC Certified Public Accountants Salina, Kansas SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas CONTENTS Page FINANCIAL INFORMATION INDEPENDENT AUDITORS' REPORT 1 Exhibit A BALANCE SHEETS 2 Exhibit B STATEMENTS OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE AND COMPARISON WITH BUDGET 3 Exhibit C STATEMENTS OF EXPENDITURES AND COMPARISON WITH BUDGET 4 NOTES TO FINANCIAL STATEMENTS 5 -10 Supplemental Information Schedule 1 Grants from the Kansas State Department of Health and Environment 11 Schedule 2 Fees for Services IN INTERNAL CONTROL AND COMPLIANCE INFORMATION INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL STRUCTURE BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 13 -14 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 15 INDEPENDENT AUDITORS' REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS 16 -18 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS 19 -20 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS 21 Contents SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas CONTENTS (CONTD.) Page INTERNAL CONTROL AND COMPLIANCE INFORMATION (CONTD.) INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO NONMAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAM TRANSACTIONS 22 SCHEDULE OF FINDINGS AND QUESTIONED COSTS 23 INDEPENDENT AUDITORS' REPORT ON SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE 24 SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE 25 Contents SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas FINANCIAL INFORMATION KENNEDY AND COE, LLC CERTIFIED PUBLIC ACCOUNTANTS OFFICES IN HOME OFFICE: KANSAS P.O. BOX 1100 NEBRASKA SALINA. KANSAS 67402 -11 DO OKLAHOMA 913- 8251561 COLORADO 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, 1993 and 1992 as fished 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 generally accepted auditing standards, the Kansas Municipal Audit Guide, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A -128, "Audits of State and Local Governments ". Those standards and OMB Circular A -128 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. Salina - Saline County Board of Health does not maintain a general fixed assets account group and, accordingly, fixed assets are not included in the accompanying financial statements, which should be included in order to conform to generally accepted accounting principles. In our opinion, except that the omission of the general fixed assets account group results in an incomplete presentation as discussed above, the financial statements referred to in fie first paragraph present fairly, in all material respects, the financial position of the Salina - Saline County Board of Health at December 31, 1993 and 1992, and the results of its operations and changes in its fund balance for the years then ended in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion 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 financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements referred to above and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. Respectfully submitted, Salina, Kansas May 26, 1994 Certified Public Accountant in charge of and actively engaged on this audit. -1- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE AICPA DIVISION FOR CPA FIRMS SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas BALANCE SHEETS ASSETS Cash Accounts receivable State of Kansas Department of Health and Environment (Note 5) Home care Medicare adjustments receivable (Note 6) Totals LIABILITIES AND FUND BALANCE Liabilities Vouchers payable Accrued salaries Accrued liability for compensated absences Deferred income Funds advanced for future restricted purposes (Note 5) Fund Balance (Exhibit B) Exhibit A December 31, 1993 1992 $ 612,490 $ 455,496 142,274 103,158 96,769 84,081 $ 898,53"i 711,004 $ 102,301 41,865 8, 98:� $ 33,305 27,113 13,001 Unreserved 633,753 575,781 Reserved for encumbrances 23,000 - Totals $ 898,531 $ 711,004 The accompanying notes are an integral part of these financial statements. WA SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas STATEMENTS OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE AND COMPARISON WITH BUDGET Revenues Appropriation from Saline County, Kansas (Note 4) Appropriation from City of Salina, Kansas (Note 4) Grants from the State Department of Health and Environment Fees for services Interest income Miscellaneous revenues Total Revenues Expenditures (Exhibit C) Excess (Deficit) of Revenues over Expenditures 1993 '1992 Actual Budget Actual Exhibit B Budget $ 199,159 $ 205,000 $ 197,574 199,159 274,000 274,000 267,212 267,212 776,632 546,995 691,259 480,995 778,143 345,000 638,953 300,500 18,253 20,000 18,577 17,000 24,566 10,000 29,262_ 5,000 2,070,753 1,400,995 1,842,837 1,269,866 1,989,781 1,600,425 1,706,495_ 1,408,547 80,972 (199,430) 136,342 (138,681) Fund Balance, January 1 575,781 200,000 439,439_ 148,000 Fund Balance, December 31 $ 656,753 $ 570 $ 575,781 $ 9,319 The accompanying notes are an integral part of these financial statements. -3- SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE Year Ended December 31, 1993 Federal Program CFDA Or Award Federal Grantor /Pass - Through Grantor /Program Title Number Amount MAJOR PROGRAMS U.S. Department of Agriculture Passed Through State of Kansas Department of Health and Environment Special Supplemental Food Program for Women, Infants, and Children - '92/'93 10.557 $ 466,589 Special Supplemental Food Program for Women, Infants, and Children - '93/'94 10.557 421,492 TOTAL MAJOR PROGRAMS OTHER FEDERAL ASSISTANCE U.S. Department of Health and Human Services Passed Through State of Kansas Department of Health and Environment Preventative Health and Health Services Block Grant Lay Home Visitor /Healthy Start Program - '92/'93 93.99'1 17,708 Lay Home Visitor /Healthy Start Program - '93/'94 93.9911 17,148 Maternal and Child Health Services Block Grant Child Health - '93/'94 93.994 8,500 Child Health Assessment - '92/'93 93.994 4,342 Child Health Assessment -'93/'94 93.994 4,342 Salina Outreach Clinic Services - '92/'93 93.994 9,150 Salina Outreach Clinic Services - '93/'94 93.994 9,150 Maternal and Infant Program - '92/'93 93.994 74,374 Maternal and Infant Program - '93/'94 93.994 78,912 Family Planning - Services - '92/'93 9 3.2 17 35,380 Family Planning - Services - '93/'94 9 3.2 17 35,380 Acquired Immunodeficiency Syndrome (AIDS) Activity AIDS Counseling and Testing Site Program - '92/'93 93.115 2,200 AIDS Counseling and Testing Site Program - '93/'94 93.115 3,538 Child Welfare Services Child Care Institutions Licensing - '92/'93 93.645 13,523 Child Care Institutions Licensing - '93/'94 93.645 13,523 TOTAL OTHER FEDERAL ASSISTANCE Totals (a) Includes $1,323 refunded to Kansas Department of Health and Environment (b) Includes $8,047 refunded to Kansas Department of Health and Environment SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas STATEMENTS OF EXPENDITURES AND COMPARISON WITH BUDGET Personal Services Salaries Social security Retirement Health insurance Unemployment insurance Professional services Contractual services Therapeutic devices and appliances Auditing Accounting Building and grounds repair Telephone Mileage Service contracts and equipment lease Insurance Expendable supplies Office supplies Office repair and maintenance Postage and express Books, dues and subscriptions Equipment maintenance and repair Gasoline and oil Clinical and medical supplies Chemicals Veterinary and medical services Animal maintenance Professional meetings Miscellaneous expense Unexpended grant funds returned Capital equipment Exhibit C 1993 1992 Actual Budget Actual Budget $ 1,133,403 $ 866,396 $ 959,108 $ 819,818 80,021 66,891 71,648 62,716 17,475 16,614 14,689 14,758 140,124 140,000 151,968 109,236 1,093 874 954- 819 279,692 195,000 218,813 130,000 - 250 - 1,000 7,680 7,500 7,424 7,500 57 500 122' 500 10,322 10,000 11,554 8,000 7,695 7,500 5,425 6,000 56,594 40,000 50,899 37,500 2,480 4,400 2,353 4,400 16,890 40,000 38,114 46,000 35,898 32,000 38,429 26,800 100 - 42 5,000 9,544 10,000 9,501 8,500 3,033 3,500 4,713 2,000 2,389 4,000 1,658 4,000 1,831 3,000 1,942 3,000 106,294 54,000 73,419 40,000 6,664 10,000 6,462 10,000 5,341 4,000 5,487 4,000 2,335 6,000 2,661 6,000 9,733 8,000 14,823 6,000 4,601 - 1,264 - 9,073 - - - 39,419 70,000 13,023 45,000 Total Expenditures $ 1,989,781 $ 1,600,425 $ 1,706,495 $ 1,408,547 The accompanying notes are an integral part of these financial statements. M SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas NOTES TO FINANCIAL STATEMENTS December 31, 1993 and 1992 1. Summary of Significant Accounting Policies A. Reporting Entity The Salina - Saline County Board of Health was formed on June 28, 195!5, 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 Commissioners, 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. This is the procedure by which resources are classified for accounting and reporting into funds established according to their nature and purposes. 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 prior or soon enough thereafter to be used to pay liabilities of the current period. Revenues from cost - reimbursement grarts are recognized in the period the expenditure is made. 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) Generally accepted accounting principles require that a general fixed assets account group be maintained. The accompanying financial statements do not conform with generally accepted accounting principles in that a general fixed assets account group is not included. The Board of Health has obtained a waiver from the Director of Accounts and Reports of the requirements of K.S.A. 75 -1120a as related to the preparation and maintenance of a general fixed assets account group. -5- 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) Reimbursements under the Medicare program are subject to adjustment after the end of the year, based upon audited "reasonable costs" incurred in providing the services. Estimated settlements receivable from or payable to Medicare are recognized in the year services are provided. Differences between estimated settlements and final settlements as determined by the Intermediary are recorded as an adjustment in the year settled. 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. 3. Cash and Investments Deposits - At December 31, 1993 and 1992, respectively, the carrying amount of the Board of Health's deposits were $612,490 and $455,496, and the bank balances were $651,566 and $519,064. The December 31, 1993 and 1992, bank balances were 100% insured by federal depository insurance or collateralized by securities provided by the depository financial institution. In accordance with Kansas statutes, the collateral securities were held under joint custody receipts issued by a third -party bank, which bank is independent of the depository financial institution. Investments - Kansas municipalities, such as the Salina - Saline County Board of Health, are authorized by Kansas statutes to invest cash balances generally in: (1) Temporary notes or no fund warrants issued by the investing governmental unit, (2) Time deposits, open accounts, (3) Time certificates of deposit, and (4) Repurchase agreements. Other investment options are available if eligible financial institutions cannot or will not make the investments described in (2) and (3) above available at interest rates equal to or greater than the statutory investment rate. The Board of Health had no such investments during the years 1993 and 1992. 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. Saline County, Kansas Regular tax appropriation City of Salina, Kansas Regular tax appropriation 1993 1992 IN 5. Grants from the State of Kansas Department of Health and Environment Agreements were in effect during 1993 and 1992 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, 1994. Unless specifically noted, the grants are payable 25% on or about July 1, and 12.5% on our 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. Federal Programs Child Health Program Matching funds are provided to furnish programs to promote optimum health for children. The current agreement provides that the Board of Health will receive $8,500. Maternal and Infant Program Matching funds are provided to furnish comprehensive health care for adolescent and other high risk mothers and their infants. The current agreement provides that the Board of Health will receive $78,912. 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 $35,380. 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 lip to age 5 years. The current agreement provides that the Board of Health will be reimbursed monthly for actual expenses up to an annual total of $421,492. Outreach Clinic Services Reimbursements are provided for coordination of Cardiac and Neurology Outreach Clinics at Salina. The current agreement provides that the Board of Health will be reimbursed quarterly for actual expenses up to an annual total of $10,675. Healthy Start/Home Visitor Program Matching funds are provided to furnish home and hospital visits by trained lay visitors to families with a newborn infant and to pregnant women. The current agreement provides that the Board of Health will receive $17,045. 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 $20 per AIDS test submitted to the State Department Lab payable quarterly, not to exceed $3,538 for the current contract period. -7- 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 $13,523 payable in quarterly amounts based on number of licenses issued. Child Health Assessment Funds are provided to furnish child health assessments at school entry for kindergartners and other first time school entrants. The current agreement provides that the Board of Health will receive $4,342. 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 seriices are available to the Saline County Community. The current agreement provides that the Board of Health will receive $35,668 payable in quarterly installments. 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 $4,662. Local Environmental Protection Program Funds are provided for the development of the Ellsworth County Sanitary Code. The current agreement provides that the Board of Health will receive $41,116. 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, 1993 and 1992. December 31, 1993 1992 Accounts Receivable Special Supplemental Food Program for Women, Infants, and Children $ 132,456 $ 95,391 Food Service Licensing Program 7,280 5,592 Outreach Clinic Services 2,538 2,175 Total Accounts Receivable 8 142.274 S 103.158 Deferred Income General Health Services - State Formula Grant $ 8,983 $ 9,167 Healthy Start/Home Visitor Program - 2,144 Child Care Licensing Program - 1,690 Total Deferred Income $ 8.983 S 13.001 53 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. Reimbursements under these programs are subject to adjustment after the end of the year, as discussed in Note 1 above. Accounts receivable at December 31, 1993 and 1992, include $46,998 and $68,269, respectively, for the estimated settlement of the annual Medicare cost statement. 7. Defined Benefit Pension Plan Substantially all full -time employees of the Board of Health participate in the Kansas Public Employees Retirement System ( "System "), a multiple - employer public employee retirement system. The payroll for employees covered by the System for the years 1993 and 1992 were $919,747 and $816,075, respectively. The total payroll was $1,133,403 and $959,108 for the years 1993 and 1992, respectively. Substantially all employees of the Board of Health are eligible to participate in the System after one year of employment. Employees who retire at or after age 65 or age 62 with ten years service credit or at any age when years of service plus age equal 85 "points" are entitled to a retirement benefit, payable monthly for life, equal to one percent of their final average salay for each year of "prior" service and 1.75 percent for each year of "participating" service. Final average salary is the employee's average salary over the higher of four years of credited service including add -ons such as accrued sick leave and vacation leave or a three year average without add -ons. For those hired July 1, 1993 or later, final average salary is a three year average with no ;add-ons. Benefits fully vest on reaching ten years of service. Vested employees may retire at age 55 and receive reduced retirement benefits. The system also provides death and disability benefits. Benefits are established by State statute. Covered employees are required by State statute to contribute four percent of their salary to the plan. The employer is required by the same statute to contribute the remaining amounts necessary to pay benefits when due. The contribution requirement for the years 1993 and 1992, respectively, were $54,265 and $47,932, which consisted of $17,475 and $14,689 from the employer and $36,790 and $33,243 from employees; these contributions represented 1.9% and 4% of covered payroll for 1993 and 1.8% and 4.1% of covered payroll for 1992. The "pension benefit obligation" is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases and step -rate benefits, estimated to be payable in the future as a result of employee service to date. The measure, which is the actuarial present value of credited projected benefits, is intended to help users assess the System's funding status on a going- concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among PERS and employers. The System does not make separate measurements of assets and pension benefit obligation for individual employers. The pension benefit obligation at June 30, 1993, for the System as a whole, determined through an actuarial valuation performed as of that date, was $5.28 billion. The System's net assets available for benefits on that date (valued at market) were estimated to be $4.96 billion, leaving an unfunded pension benefit obligation estimated at $320 million. Ten -year historical trend information showing the System's progress in accumulating sufficient assets to pay benefits when due is presented in the System's June 30, 1993, Comprehensive Annual Financial Report. 8. Compliance with Kansas Statutes The Board of Health's bank balances on January 31, 1993, exceeded the markE:t value of pledged securities and FDIC insurance coverage, and the Board of Health did not obtain a pledge of the depository's securities for such excess balance, which appears to be a violation of the requirement of K.S.A. 9 -1402. No other statutory violations were noted. 9. Subsequent Event On February 22, 1994 the Salina - Saline County Board of Health approved a bid of $348,660 to remodel the building at 236 -240 North Seventh Street, Salina, Kansas, to be used as the new facilities. -10- SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas SUPPLEMENTAL INFORMATION SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas Schedule 1 GRANTS FROM THE KANSAS STATE DEPARTMENT OF HEALTH AND ENVIRONMENT State Programs Child Care Licensing Program - 4,301 Food Service Licensing Program 12,104 16,208 General Health Services - State Formula Grant 36,300 36,522 AIDS Health Education /Risk Reduction Program 5,245 4,819 Local Environmental Protection Program 34,140_ 41,278 Total State Programs 87,789 103,128 Total Grants $ 776,632 $ 691,259 -11- 1993 1992 Federal Programs Maternal and Child Health Program $ - $ 4,185 Child Health Program 4,251 - Maternal and Infant Program 76,031 41,883 Family Planning Program 35,380 32,161 Women, Infants, and Children Supplemental Food Program 522,660 478,698 Outreach Clinic Services 9,875 7,713 Healthy Start/Home Visitor Program 17,156 14,741 AIDS Counseling and Testing Site Program 3,819 1,989 Child Care Licensing Program 14,859 6,761 Child Health Assessment Program 4,812_ - Total Federal Programs 688,843 588,131 State Programs Child Care Licensing Program - 4,301 Food Service Licensing Program 12,104 16,208 General Health Services - State Formula Grant 36,300 36,522 AIDS Health Education /Risk Reduction Program 5,245 4,819 Local Environmental Protection Program 34,140_ 41,278 Total State Programs 87,789 103,128 Total Grants $ 776,632 $ 691,259 -11- SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas FEES FOR SERVICES 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 Total Fees for Services 1993 $ 372,699 206,684 54,296 15,591 9,349 38,516 69,999 5,203 3,417 398 1,991 R Schedule 2 1992 318,801 198,845 22,307 10,568 11,593 36,218 36,420 4,201 $ 778,143 $ 638,953 -12- SALINA- SALINE COUNTY BOARD OF HEALTH Salina, Kansas INTERNAL CONTROL AND COMPLIANCE INFORMATION KENNEDY AND COE, LLC CERTIFIED PUBLIC ACCOUNTANTS HOME OFFICE: OFFICES IN P. O. BOX 1100 KANSAS SALINA, KANSAS 8740 NEBRASKA 2 -1100 OKLAHOMA 913-825-1561 COLORADO INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL. STRUCTURE 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 accompanying financial statements of Salina - Saline County Board of Health, for the year ended December 31, 1993, and have issued our report thereon dated May 26, 1994. We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget (OMB) Circular A -128, "Audits of State and Local Governments." Those standards and OMB Circular A -128 require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. In planning and performing our audit of the financial statements of Salina - Saline County Board of Health for the year ended December 31, 1993, we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control structure. The management of the Salina - Saline County Board of Health is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors, or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures in the following categories: Accounting Controls 1. Revenues /receipts 2. Expenditures /purchases /disbursements 3. Cash and investment balances 4. Financial reporting -13- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE AICPA DIVISION FOR CPA FIRMS For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as defined above. However, we noted certain matters involving the internal control structure and its operation that we have reported to the management of the Salina - Saline County Board of Health, in a separate letter dated May 26, 1994. This report is intended for the information of the Governing Board and management of the Salina - Saline County Board of Health, the State of Kansas Department of Health and Environment, the cognizant federal agency, and other applicable federal audit agencies. This restriction is not intended to limit the distribution of this report which, upon acceptance by the Salina - Saline County Board of Health, is a matter of public record. Salina, Kansas May 26, 1994 Respectfully submitted, Z J -14- KENNEDY AND CO E, LLC CERTIFIED PUBLIC ACCOUNTANTS HOME OFFICE: OFFICES IN P. O. BOX 1100 KANSAS NEBRASKA SALINA. KANSAS 8 7 402 -1 1 00 OKLAHOMA D13�2S1561 COLORADO INDEPENDENT AUDITORS' REPORT ON COMPLIANCE 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 the Salina - Saline County Board of Health for the year ended December 31, 1993, and have issued our report thereon dated May 26, 1994. We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and the provisions of Office of Management and Budget Circular A -128, "Audits of State and Local Governments." Those standards and OMB Circular A -128 require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Compliance with laws, regulations, contracts, and grants applicable to the Salina - Saline County Board of Health is the responsibility of the Board of Health's management. As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement, we performed tests of the Board of Health's compliance with certain provisions of laws, regulations, contracts and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. The results of our tests indicate that, with respect to the items tested, the Salina - Saline County Board of Health complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the Board of Health had not complied, in all material respects, with those provisions. We noted one instance of noncompliance, as disclosed in Note 8 to the financial statements, that does not result in misstatements in the financial statements. This report is intended for the information of the Governing Board and management of the Salina - Saline County Board of Health, the State of Kansas Department of Health and Environment, the cognizant federal agency, and other applicable federal audit agencies. This restriction is not intended to limit the distribution of this report which, upon acceptance by the Salina - Saline County Board of Health, is a matter of public record. Respectfully submitted, Salina, Kansas May 26, 1994 -15- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE AICPA DIVISION FOR CPA FIRMS KENNEDY AND COE, LLC CERTIFIED PUBLIC ACCOUNTANTS HOME OFFICE: OFFICES IN P. O. BOX 1100 KANSAS SALIVA, KANSAS 87x02 -1100 NEBRASKA 913825 -1561 OKLAHOMA COLORADO INDEPENDENT AUDITORS' REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS 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, for the year ended December 31, 1993, and have issued our report thereon dated May 26, 1994. We have also audited the Salina - Saline County Board of Health's compliance with requirements applicable to major federal financial assistance programs and have issued our report thereon dated May 26, 1994. We conducted our audits in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and Office of Management and Budget (OMB) Circular A -128, "Audits of State and Local Governments." Those standards and OMB Circular A -128 require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and about whether the Salina - Saline County Board of Health complied with laws and regulations, noncompliance with which would be material to a major federal financial assistance program. In planning and performing our audits for the year ended December 31, 1993, we considered the internal control structure of the Board of Health in order to determine our auditing procedures for the purpose of expressing our opinions on the Board of Health's financial statements and on its compliance with requirements applicable to major federal financial assistance programs and to report on the internal control structure in accordance with OMB Circular A -128. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to federal financial assistance programs. We have addressed internal control structure policies and procedures relevant to our audit of the financial statements in a separate report dated May 26, 1994. The management of the Salina - Saline County Board of Health is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles, and that federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors, irregularities, or instances of noncompliance -16- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE AICPA DIVISION FOR CPA FIRMS may nevertheless occur and not be detected. Also, projection of any evaluation the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering federal financial assistance programs in the following categories: Accounting Controls 1. Revenues /receipts 2. Expenditures /purchases /disbursements 3. Cash and investment balances 4. Financial reporting Administrative Controls General Requirements 1. Political activity 2. Civil Rights 3. Drug -free Workplace 4. Allowable Costs /Cost Principles Specific Requirements 1. Types of services 2. Eligibility 3. Matching 4. Reporting 5. Cost allocation 6. Special tests and provisions For all of the internal control structure categories listed above, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. During the year ended December 31, 1993, the Salina - Saline County Board of Health expended 66% of its total federal financial assistance under major federal financial assistance programs. We performed tests of controls, as required by OMB Circular A -128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with specific requirements, general requirements, and requirements governing claims for advances and reimbursements that are applicable to each of the Board of Health's major federal financial assistance programs, which are identified in the accompanying Schedule of Federal Financial Assistance. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be Hire material to a federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as defined above. However, we noted certain matters involving the internal control structure and its operation that we have reported to the management of the Salina - Saline County Board of Health, in a separate letter dated May 26, 1994. This report is intended for the information of the Governing Board and management of the Salina - Saline County Board of Health, the State of Kansas Department of Health and Environment, the cognizant federal agency, and other applicable federal audit agencies. This restriction is not intended to limit the distribution of this report which, upon acceptance by the Salina - Saline County Board of Health, is a matter of public record. Salina, Kansas May 26, 1994 Respectfully submitted, �1� '_� 0� 77_� IN K E N N E D Y AND C O E , L L C CERTIFIED PUBLIC ACCOUNTANTS HOME OFFICE: OFFICES IN P. O. BOX 1100 KANSAS SALINA. KANSAS 67402.1100 NEBRASKA 913- 825 -1561 OKLAHOMA COLORADO INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS To the Governing Board Salina - Saline County Board of Health Salina, Kansas: We have audited the financial statements of the Salina - Saline County Board of Health for the year ended December 31,1993, and have issued our report thereon dated May 26, 1994. We have audited the Salina - Saline County Board of Health's compliance with the requirements governing types of services allowed or unallowed; eligibility; reporting and special tests and provisions that are applicable to each of its major federal financial assistance programs, which are identified in the accompanying Schedule of Federal Financial Assistance, for the year ended December 31, 1993. The management of the Salina - Saline County Board of Health is responsible for the Board of Health's compliance with those requirements. Our responsibility is to express an opinion on compliance with those requirements based on our audit. We conducted our audit in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and Office of Management and Budget Circular A -128, "Audits of State and Local Governments." Those standards and OMB Circular A -128 require that we plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the Salina - Saline County Board of Health's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. The results of our audit procedures did not disclose any immaterial instances of noncompliance with the requirements referred to above. In our opinion, the Salina - Saline County Board of Health complied, in all material respects, with the requirements governing types of services allowed or unallowed; eligibility; reporting and special tests and provisions that are applicable to each of its major federal financial assistance programs for the year ended December 31, 1993. -19- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE A1CPA DIVISION FOR CPA FIRMS This report is intended for the information of the Governing Board and management of the Salina - Saline County Board of Health, the State of Kansas Department of Health and Environment, the cognizant federal agency, and other applicable federal audit agencies. This restriction is not intended to limit the distribution of this report, which, upon acceptance by the Salina - Saline County Board of Health, is a matter of public record. Respectfully submitted, Salina, Kansas May 26, 1994 -20- KENNEDY AND COE, LLC CERTIFIED PUBLIC ACCOUNTANTS HOME OFFICE: OFFICES IN P. O. BOX 1100 KANSAS SALINA. KANSAS 87402 -1100 NEBRASKA 913-82$ -1561 OKLAHOMA COLORADO INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH THE GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAMS To the Governing Board Salina - Saline County Board of Health Salina, Kansas: We have audited the financial statements of the Salina - Saline County Board of Health for the year ended December 31, 1993, and have issued our report thereon dated May 26, 1994. We have applied procedures to test the Salina - Saline County Board of Health's compliance with the following requirements applicable to its federal financial assistance programs, which are identified in the Schedule of Federal Financial Assistance, for the year ended December 31, 1993: political activity, civil rights, Drug -free Workplace Act, and allowable costs /cost principles. Our procedures were limited to the applicable procedures described in the Office of Management and Budget's "Compliance Supplement for Single Audits of State and Local Governments." Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the Salina - Saline County Board of Health's compliance with the requirements listed in the preceding paragraph. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the Salina - Saline County Board of Health had not complied, in all material respects, with those requirements. Also, the results of our procedures did not disclose any immaterial instances of noncompliance with those requirements. This report is intended for the information of the Governing Board and management of the Salina - Saline County Board of Health, the State of Kansas Department of Health and Environment, the cognizant federal agency, and other applicable federal audit agencies. This restriction is not intended to limit the distribution of this report, which, upon acceptance by the Salina- Saline County Board of Health, is a matter of public record. Respectfully submitted, Salina, Kansas May 26, 1994 J -21- MEMBERS OF: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SEC PRACTICE SECTION AND PRIVATE COMPANIES PRACTICE SECTION OF THE AICPA DIVISION FOR CPA FIRMS