Audit - 1973
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
REPORT ON EXAMINATION
December 31, 1973
KENNEDY AND COE
Certified Public Accountants
Salina - Kansas
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Exhibit A
Exhibi t B
Exhibit C
Exhibit D
Exhibit E
Exhibit F
Schedule 1
Schedule 2
Schedule 3
SALINE COUNTY-CI'fY BUILDING AUTHORITY
Salina, Kansas
INDEX
ACCOUNTANTS' OPINION
SUMMARY STATEMENT OF RECEIPTS, EXPENDITURES, AND BALANCES
AND COMPARISON OF CASH BALANCES WITH ENCUMBRANCES
STATEMENT OF RECEIPTS, DISBURSEMENTS, AND BALANCES OF
CASH, COMPOSITION OF ENDING CASH BALANCES.
INSURANCE AND FIDELITY BONDS IN FORCE
COMPARISON OF GROSS CASH BALANCES WITH DEPOSITORY SECURITY
INVESTMENTS
AUDIT ADJUSTMENTS
Statement of Receipts
Statement of Expenditures - General Operating Fund
Statement of Expenditures - Building Fund
ACCOUNTANTS' COMMENTS
Page
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11-15
Index
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
GOVERNING BOARD
Year Ended December 31, 1973
.
MEMBERS
.
(1)
(1)
(1)
(2)
Mr. Lauren Gray
Mr. James L. Martin
Mr. Wayne Lockard
Mrs. Norma Cooper
(2)
(3)
(4)
Mr. Jack Weisgerber
Mr. Russell Myers
Mr. R. Bruce Johnson
.
OFFICERS
.
Mr. Lauren Gray
Mr. Jack Weisgerber
Mrs. Norma Cooper
Mr. R. Bruce Johnson
Chairman
Vice-Chairman
Secretary
Treasurer
.
.
Representatives From:
(1) Board of County Commissioners
(2) Board of Commissioners of The City of Salina, Kansas
(3) Governing Board of Salina Unified School District #305
(4) Member at Large
.
.
.
.
.
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
SUMMARY STATEMENT OF RECEIPTS, EXPENDITURES, AND
BALANCES AND COMPARISON OF CASH BALANCES WITH ENCUMBRANCES
Year Ended December 3l, 1973
General
Operating
Fund
Unencumbered Balance Beginning of Year
Receipts - Schedule 1
Total Receipts and Beginning Balance
$ 4,201
115,599
119,800
Expenditures
General Operating Fund - Schedule 2
Building Fund - Schedule 3
104,892
Unencumbered Balance End of Year
l4,908
Represented By:
Cash in bank
Certificate of deposit
Total Cash
Deduct unpaid encumbrances
19,488
19,488
4,580
Totals
S 14.908
Exhibit A
Building
Fund
$ l,205
754 .."
1,959
625
1,334
l,390
7,944
9,334
8,000
u~
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
Exhibit B
STATEMENT OF RECEIPTS, DISBURSEMENTS, AND
BALANCES OF CASH, COMPOSITION OF ENDING CASH BALANCES
Year 1973
Cash Balance Beginning of Year
Cash receipts
Cash disbursements
General
Operating Building
Fund Fund
$ 9,054 $2l,205
115,599 754
(l05,l6S) (12,625)
19.488 9,334
Cash Balance End of Year
Available Cash
Cash in Bank
Planters State Bank, Salina, Kansas
Certificate of deposit
19,488
1,390
7.944
Total Available Cash
$ 19,488
$ 9,334
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
INSURANCE AND FIDELITY BONDS IN FORCE
December 3l, 1973
.Property
Coverage
All property located at
2l6-300 West Ash, Salina
Fire, lightning, extended coverage,
vandalism, and malicious mischief
Saline County-City Workmen's compensation
Building Authority employees Public liability
1961 Chevrolet pickup
Liabili ty
Bodily injury - Per person
Aggregate
Property damage
Medical payments
Uninsured motorists - Per person
Aggregate
Fidelity Bond
Treasurer
Exhibit C
Amount
$1,914,000
Statutory
100,000
50,000
150,000
25,000
l,OOO
10,000
20,000
5,000
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
Exhibit D
COMPARISON OF GROSS CASH BALANCES WITH
DEPOSITORY SECURITY
December 31, 1973
Gross Cash Balances
Cash in bank - General Operating Fund
- Bui ld ing Fund
Certificate of deposit - Building Fund
Planters State
Bank and
Trust Company,
Salina, Kansas
Deduct F.D.I.C. coverage
$25,053
l,389
7,944
34,386
20,000
Balance Securable by Collateral
l4,386
Security Required (70%)
10,070
Security Provided by Banks
U.S. Treasury Notes and General Obligation
Bonds of a Kansas municipality
$10,000
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SALINE COUNTY -CITY BUILDING AUTHORITY
Salina, Kansas
Exhibit E
INVESTMENTS
December 3l, 1973
There were no investmertts at December 3l, 1973, other than the certificate of
deposit classified as cash.
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SALINE COUNTY-CITY BUILDING AUTHORI1Y
Salina, Kansas
AUDIT ADJUSTMENTS
December 31, 1973
GENERAL OPERATING FUND
-1-
Outstanding encumbrances - General Fund
Repairs and maintenance
Janitor supplies
Utilities
To reverse outstanding encumbrances at
December 31, 1972, which were paid in 1973
-2-
Salaries and wages
Utilities
To reclassify salary expense extended to
wrong column in disbursements journal
-3-
Janitor supplies
Repairs and maintenance
Utilities
Insurance - property
Legal and accounting
Miscellaneous
Outstanding encumbrances - General Fund
To record outstanding encumbrances at
December 31, 1973
,', .
-4-
Equipment
Repairs and maintenance
Janitor supplies
Utilities
To reclassify expenditures
wrong account.
charged to the
-5-
Appropriations - Saline County
Appropriations - City of Salina
Reimbursements - Saline County
Reimbursements - City of Salina
To reclassify reimbursements credited to
appropriations in error
Debit
$4,853.24
2,003.10
95.14
838.47
l,787.l9
1,817.00
38.91
3.75
245.64
450.00
300.00
Exhibit F
Credit
$3,164.66
35.83
1,652.75
2,003.10
4,580.46
54 . 63
166.01
25.00
450.00
300.00
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
Schedule 1
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STATEMENT OF RECEIPTS
Year 1973
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General
Operating
Fund
Building
Fund
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Appropriations from Municipalities
Regular appropriations
Saline County
Saline County Treasurer
.
Saline County Welfare
Snack bar rental
City of Salina
Salina Unified School District #305
Total Regular Appropriations
$54,573
10,682
140
$
$ 65,395
20,470
12,870
98,735
4,125
1,050
900
6,075
104,810
4,800
4,000
1,894
95
754
10,789 754
$115 ,599 $ 754
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Maintenance Charges
Salina Public Library
Saline County
City of Salina
Total Maintenance Charges
Total Appropriations from Municipalities
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Other Receipts
Space rental - State of Kansas
Reimbursement from Building Fund of payment made
on sculpture
Proceeds from insurance claim for storm damage
Miscellaneous receipts
Interest
Total Other Receipts
Total Receipts
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
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Schedule 2
STATEMENT OF EXPENDITURES - GENERAL OPERATING FUND
Year 1973
(With comparative figures for the preceding year)
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Salaries and wages
Utilities
Janitor supplies
Repairs and maintenance
Equipment
Insurance
Legal and auditing
Payment on fountain sculpturè
Payments to Saline County for clerical services provided
Payroll taxes
Employees' group insurance and retirement
Miscellaneous
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Total General Operating Fund Expenditures
1973 1972
$ 49,410 $ 50,331
31,066 29,220
3,365 3,860
8,467 12,656
989 1,492
2,843 2,383
700 720
4,000
1,500
2,891 2,602
3,562 3,131
99 65
$104.892 $110.460
-9-
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
STATEMENT OF EXPENDITURES - BUILDING FUND
Year 1973
(With comparative figures for the preceding year)
Saline County-City Building Project Costs -
Waterproofing of building
Accounting and auditing fees
Total Building Fund Expenditures
1973
$590
35
$625
Schedule 3
1972
$ -
150
.tlíQ
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
ACCOUNTANTS' COMMENTS
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SALINE COUNTY-CITY BUILDING AUTHORITY
Salina, Kansas
HISTORY
The Saline County-City Building Authority was formed on March 22, 1965, under the
Authority of the Interlocal Cooperation Act of Kansas (K.S.A. l2-290l to 12-2907).
According to the creating instrument, the authority is a joint venture organized
by the 3 participating municipalities for the purpose of acquisition of land and
construction thereon of a building (including parking areas and related improve-
ments) to house and accommodate the county, city, and school district administrative
offices, the county and city courts, and such other offices as may be expedient; to
equip such building; and to operate and maintain the building and grounds so acquired.
The authority does not have tax levying powers, but derives its funds from the fol-
lowing municipalities which comprise the participating agencies of the authority.
Name of
Participating Agency
Number of
Directors on
Authority Board
Saline County
Ci ty of Salina
Salina Unified School District #305
3
2
1
Total
g
The Board of Directors of the authority is composed of 7 members, 6 of which are
appointed from the governing boards of the participating municipalities in the
ratio listed above, and 1 of which is selected at large by the 6 members.
DEPOSITORY SECURITY
At certain times during the months of October, November and December the security
pledged by the bank was insufficient to meet the statutory requirements of K.S.A.
9-l402. As of December 3l, 1973, additional security was also needed to meet the
requirements of K.S.A. 9-l402 as shown by Exhibit D. Sufficient security was
pledged from January 1 through September 30, 1973.
The following schedule shows the greatest additional amount needed in each month
to comply with statutory requirements.
October, 1973
November, 1973
December, 1973
$l,903
4,562
2,094
We recommend additional security from the bank be obtained.
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The securities pledged by the depository are held in escrow under a joint custody
receipt, and comply with statutory requirements as to type.
RECEIPTS
Cash receipts tickets were not issued for receipts totaling $23,320.18 in 1973.
recommend cash receipts tickets be issued for each receipt of monies.
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Receipts, as shown by Schedule 1, consist of regular appropriations from partici-
pating agencies to cover net operating costs of the building and other special
payments. The appropriations for net operating costs are to be borne by the
participating agencies in the ratio of the floor space occupied by each agency to
the total floor space so occupied as follows:
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64%
23%
13%
100%
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Saline County
City of Salina
Salina Unified School District #305
The schedule shown below summarizes the regular appropriations paid by the parti-
cipating municipalities to the General Operating Fund during 1973 and the position
of each agency as to the correct payment ratio at December 3l, 1973.
Saline City of Salina U.S.D.
County Salina #305
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Total
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Total cash received in 1973
on regular payments
Payments made in 1972 appli-
cable to 1973 appropriations
Snack Bar Receipts
December 1972 receipt,
applicable to 1973
Total Adjusted Payments
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Payments required according
to agreed ratios
Amount of overpayment on
regular payments
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Net Overpayment
Total
$65,395
$12,870
$ 98,735
$20,470
5,177
4,600
1,300
11,077
l50 150
70, 722 25,070 14,170 l09,962
69,760 25,070 l4,l70 109,000
962 962
$ 962 $ $ $ 962
The Building Authority entered into an agreement with the Saline County Commissioners
whereby Saline County financed the purchase of snack bar equipment. The purchase
price is to be repaid with snack bar rental income, including interest at 5 percent
per annum.
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However, on January 23, 1973 an agreement was reached with the operator of the
snack bar that no rental payments would be paid by the snack bar operator to the
Building Authority for the first six months of 1973. The $l40 payment which was
received during the year was the December 1972 rental payment. A similar agree-
ment was later made for the final six months of 1973. An agreement was also made
with the Saline County Commissioners that no interest would accrue on the unpaid
balance of the equipment purchase obligation during 1973. A summary of trans-
actions and balances under this contract is as follows:
Unpaid Balance December 31, 1972
Payments in 1973
Less interest at 5%
$7,895
$l40
l40
Unpaid Balance December 3l, 1973
$7.755
EXPENDITURES
Schedules 2 and 3 summarize the expenditures of the General Operating Fund and
Building Fund respectively.
The General Operating Fund paid $4,000 on a contract in 1972 for sculpture work
which had previously been encumbered by the Building Fund. During 1973 the
General Operating Fund was reimbursed for this payment, by the Building Fund.
We noted expenditures du~ing the period which appeared to be in violation of
statutory provisions. They were as follows:
1.
K.S.A. l2-l05b requires the approval of the officer or officers charged by
law to approve claims prior to payment thereof. Several payments were made
during the year which were not supported by itemized statements. Also we
noted several statements which were not approved by the proper officer
during 1973.
2.
Adequate records were not kept of funds encumbered and we could not deter-
mine if any violations of the Cash Basis Law, K.S.A. lO-ll12 occurred.
During our examination, we noticed numerous expenditures which were not
charged to the most appropriate expense account. In the future we rec-
ommend that all expenditures be reviewed more closely to insure that the
most appropriate expense account classification is used in each case.
INSURANCE AND FIDELITY BOND COVERAGE
Exhibit C shows the details relating to insurance and fidelity bond coverage.
Fidelity bonds were approved by the governing board.
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MINUTES OF BOARD MEETINGS
The Minutes of the Board Meetings were examined for matters pertaining to the audit.
Regular meetings were held monthly.
We noted that the minutes for 6 different months during the year were not signed
by both the Chairman and the Secretary. However, the minutes were subsequently
approved in the minutes for the following month. All other months were properly
approved and signed.
REQUIRED STATEMENTS
References
Comparison of Cash Balances with Encumbrances
Exhibit A
Classified Statement of Receipts, Disbursements, and
Balances of Cash and Composition of Ending Cash Balance
Exhibi t B
Comparison of Depository Security and Balances on Deposit
Exhibit D
Schedule of Investments
Exhibit E
Summary of Insurance Coverage
Exhibit C
Schedule of Fidelity Bonds of Officers
Exhibit C
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