HomeMy WebLinkAboutCountywide Law Enforcement 2016 Financial Statements
Financial Statements
As of and For the Year Ended June 30, 2016
Countywide Law Enforcement
District
Countywide Law Enforcement District
Table of Contents
June 30, 2016
Independent Auditor’s Report .................................................................................................................................... 1
Management Discussion and Analysis ...................................................................................................................... 4
Financial Statements
Statement of Net Position ...................................................................................................................................... 9
Statement of Activities ......................................................................................................................................... 10
Balance Sheet – General Fund ............................................................................................................................. 11
Statement of Revenues, Expenditures and Changes in Fund Balance – General Fund ....................................... 12
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balance of
Governmental Funds to the Statement of Activities ............................................................................................ 13
Notes to Financial Statements .............................................................................................................................. 14
Required Supplementary Information
Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – General Fund ....... 18
Other Supplementary Information
Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual –Reserve (Sub-
Fund of General Fund) ......................................................................................................................................... 19
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – General Fund and
Reserve Sub Fund ................................................................................................................................................ 20
Schedule of Property Tax Transactions ............................................................................................................... 21
Independent Auditor’s 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 ................................................................................................................................................................. 22
Audit Comments and Disclosures Required by State Regulations .......................................................................... 24
Independent Auditor’s Report Required by Oregon State Regulations ................................................................... 25
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1
Independent Auditor’s Report
The Deschutes County Commissioners
Countywide Law Enforcement District
Bend, Oregon
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and the general
fund of Countywide Law Enforcement District (the District), a component unit of the Deschutes County,
as of and for the year ended June 30, 2016, and the related notes to the financial statements, which
collectively comprise the District’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation
and fair presentation of the financial statements in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s
internal control. Accordingly, we express no such opinion. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of significant accounting estimates
made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
2
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and the general fund of the District, as of June
30, 2016, and the respective changes in financial position for the year then ended in accordance with
accounting principles generally accepted in the United States of America.
Emphasis of a Matter
As discussed in Note 1, the financial statements of the District are intended to present the financial
position and changes in financial position attributable to the District. They do not purport to, and do not
present fairly the financial positon of Deschutes County, Oregon as of June 30, 2016, and the changes in
its financial position for the year then ended in conformity with accounting principles generally accepted
in the United States of America. Our opinion has not been modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis and the schedule of revenues, expenditures and changes in fund balance – budget
and actual – general fund (budgetary schedule), as listed in the table of contents, be presented to
supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by the Governmental Accounting Standards Board, who considers it to be an
essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to management’s
discussion and analysis and the budgetary schedule in accordance with auditing standards generally
accepted in the United States of America, which consisted of inquiries of management about the methods
of preparing the information and comparing the information for consistency with management’s
responses to our inquiries, the basic financial statements, and other knowledge we obtained during our
audit of the basic financial statements. We do not express an opinion or provide any assurance on
management’s discussion and analysis or the budgetary schedule because the limited procedures do not
provide us with sufficient evidence to express an opinion or provide any assurance.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the District's basic financial statements. The budgetary schedule described above is the
responsibility of management and was derived from and relate directly to the underlying accounting and
other records used to prepare the basic financial statements. The budgetary schedule has been subjected to
the auditing procedures applied in the audit of the basic financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying accounting
and other records used to prepare the basic financial statements or to the basic financial statements
themselves, and other additional procedures in accordance with auditing standards generally accepted in
the United States of America. In our opinion, the budgetary schedule is fairly stated, in all material
respects, in relation to the basic financial statements as a whole.
3
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the District’s financial statements. The schedule of revenues, expenditures and changes in fund
balance – budget and actual – reserve (sub-fund of general fund), the combining statement of revenues,
expenditures and changes in fund balances - general fund and reserve sub-fund, and the schedule of
property tax transactions (supplementary information) are presented for purposes of additional analysis
and are not a required part of the financial statements. The supplementary information is the responsibility
of management and was derived from and relates directly to the underlying accounting and other records
used to prepare the basic financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and certain additional procedures,
including comparing and reconciling such information directly to the underlying accounting and other
records used to prepare the basic financial statements or to the basic financial statements themselves, and
other additional procedures in accordance with auditing standards generally accepted in the United States
of America. In our opinion, the supplementary information is fairly stated, in all material respects, in
relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated October 28,
2016 on our consideration of the District’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 that 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 internal control
over financial reporting or on compliance. That report is an integral part of an audit performed in
accordance with Government Auditing Standards in considering the District’s internal control over
financial reporting and compliance.
Report on Other Legal and Regulatory Requirements
In accordance with the Minimum Standards of Audits of Oregon Municipal Corporations, we have issued
our report dated October 28, 2016 on our consideration of the District’s compliance with certain
provisions of laws and regulations, including the provisions of Oregon Revised Statutes as specified in
Oregon Administrative Rules. The purpose of that report is to describe the scope of our testing of
compliance and the results of that testing and not to provide an opinion on compliance.
For Eide Bailly LLP
Boise, Idaho
October 28, 2016
4
Countywide Law Enforcement District
Management Discussion and Analysis
June 30, 2016
As management of Countywide Law Enforcement District (the District), we offer readers of the District's
financial statements this narrative overview and analysis of the financial activities of the District for the fiscal
year ended June 30, 2016.
Financial Highlights
The assets of Countywide Law Enforcement District exceeded its liabilities at June 30, 2016, by
$6,291,682, all of which is unrestricted.
As of June 30, 2016, Countywide Law Enforcement District's governmental fund reported an ending fund
balances of $5,840,997.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to Countywide Law Enforcement District's
basic financial statements. These basic financial statements comprise three components: 1) government-wide
financial statements; 2) fund financial statements; and 3) notes to the financial statements. This report also
contains other supplementary information in addition to the basic financial statements themselves.
Government-wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview of Countywide
Law Enforcement District's finances, in a manner similar to a private-sector business.
The Statement of Net Position presents information on all of Countywide Law Enforcement District's assets and
liabilities, with the difference between the two reported as Net Position. Over time, increases or decreases in Net
Position may serve as a useful indicator of whether the financial position of Countywide Law Enforcement
District is improving or deteriorating.
The Statement of Activities presents information showing how Countywide Law Enforcement District's Net
Position changed during the fiscal year ended June 30, 2016. Changes in Net Position are reported when the
underlying event giving rise to the change occurs, regardless of the timing of the related cash, or other financial
assets, flows. Thus, revenues and expenses are reported in this statement for some items, for example, property
taxes, that will result in cash flows in future fiscal periods.
Each of these government-wide financial statements, Statement of Net Position and Statement of Activities, show
the functions of Countywide Law Enforcement District that are supported primarily by taxes and
intergovernmental revenues (governmental activities). The governmental activity of Countywide Law
Enforcement District is public protection.
The government-wide financial statements can be found on pages 9-10 of this report.
5
Countywide Law Enforcement District
Management Discussion and Analysis
June 30, 2016
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated
for specific activities or objectives. Countywide Law Enforcement District, like other state and local government
entities, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
Each of the funds of Countywide Law Enforcement District is classified as a governmental fund.
Governmental funds Governmental funds are used to account for essentially the same functions as governmental
activities in the government-wide financial statements. However, unlike the government-wide financial
statements, governmental fund financial statements focus on near-term inflows and outflows of spendable
resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information
may be useful in evaluating a government's near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is
useful to compare the information presented for governmental funds with similar information presented for
governmental activities in the government-wide financial statements. By doing so, readers may better understand
the long-term impact of the government's near-term financing decisions. A reconciliation from the Governmental
Funds Balance Sheet to the Government-wide Statement of Net Position and a reconciliation from the
Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances to the Government-
wide Statement of Activities have been included in this report.
Countywide Law Enforcement District reported activity in one governmental fund during the fiscal year ended
June 30, 2016. Information on the General Fund and Sub-Fund are shown on the Combining Balance Sheet and in
the Combining Statement of Revenues, Expenditures and Changes in Fund Balances that are presented as Other
Supplementary Information.
Countywide Law Enforcement District adopts an annual budget for each of its funds. A budgetary comparison
statement has been provided for each of these funds to demonstrate compliance with the annual budget.
The Basic Governmental Fund Financial Statements can be found on pages 11-13 of this report.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the
government-wide and fund financial statements. The notes to the financial statements can be found on pages 14-
17 of this report.
Government-wide Financial Analysis
Net Position, at a specific point in time, serves as a useful indicator of an entity's financial position. In the case of
Countywide Law Enforcement District, assets exceed liabilities by $6,291,682 at June 30, 2016. All of the Net
Position may be used to meet the District's on-going obligations to citizens and creditors.
As of June 30, 2016, Countywide Law Enforcement District reports a positive balance in Net Position for the
government as a whole and for the governmental activities.
The District's Net Position increased by $414,551 during the year ended June 30, 2016.
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Countywide Law Enforcement District
Management Discussion and Analysis
June 30, 2016
A comparison of the summarized government-wide statements to the prior year is as follows:
June 30, 2016 June 30, 2015 Change
Assets
Cash and investments 5,657,210$ 5,204,323$ 452,887$
Property taxes receivable 496,693 507,285 (10,592)
Accounts receivable 171,444 198,975 (27,531)
Total assets 6,325,347 5,910,583 414,764
Liabilities
Accounts payable 65 - 65
Unearned revenue 33,600 33,452 148
Total liabilities 33,665 33,452 213
Net Position
Unrestricted 6,291,682 5,877,131 414,551
Total net position 6,291,682$ 5,877,131$ 414,551$
Statements of Net Position
Year Ended Year Ended
June 30, 2016 June 30, 2015 Change
Program revenues
Charges for services 705,576$ 720,364$ (14,788)$
Operating grants and contributions 2,520,051 2,485,617 34,434
General revenues -
Property taxes levied for general purposes 20,441,901 18,039,651 2,402,250
Earnings on investments 85,920 67,512 18,408
Total revenues 23,753,448 21,313,144 2,440,304
Expenses
Public safety 23,338,897 23,568,417 229,520
Change in Net Position 414,551 (2,255,273) 2,669,824
Net Position, Beginning of Year 5,877,131 8,132,404 (2,255,273)
Net Position, End of Year 6,291,682$ 5,877,131$ 414,551$
Statements of Activities
7
Countywide Law Enforcement District
Management Discussion and Analysis
June 30, 2016
Governmental Activities
Governmental activities, the only type of activity of Countywide Law Enforcement District, increased Net
Position by $414,551 during the fiscal year ended June 30, 2016. The payment made to Deschutes County
Sheriff's Office, pursuant to an inter-governmental agreement, exceeded tax revenues and payments received from
governmental agencies.
Financial Analysis of the District's Funds
Countywide Law Enforcement District uses fund accounting to ensure and demonstrate compliance with finance-
related legal requirements.
Governmental funds The focus of Countywide Law Enforcement District's governmental funds is to provide
information on near-term inflows, outflows and balances of spendable resources. Such information is useful in
assessing Countywide Law Enforcement District's financing requirements. In particular, unreserved fund balance
may serve as a useful measure of a government's net resources available for spending as of the end of the fiscal
year.
As of June 30, 2016, $5,840,997 is the reported combined ending fund balance for Countywide Law Enforcement
District's governmental fund.
One measure of liquidity is the relationship of both the unassigned balance to the Fund's total expenditures. The
fund balance as of June 30, 2016, for the General Fund is 22% of total General Fund Fiscal Year 2016 revenues.
The fund balance of the Countywide Law Enforcement District's General Fund increased by $1,047,547 during
the fiscal year ended June 30, 2016.
General Fund Budgetary Highlights
There were no differences between the Countywide Law Enforcement District’s General Fund and Sub-Fund
budgets as originally adopted and the final amended budget. Actual revenues exceeded estimated revenues by
$615,575. This is due to generally conservative estimates used for the Fiscal Year 2016 budget. Property tax
revenue exceeded the amount estimated by $305,203. The District contracts with Deschutes County for its
operational activities. The amount paid pursuant to the contract is based on the actual cost of providing such
services, $22,706,413 which is $4,948,411 less than the amount appropriated.
Capital Asset and Debt Administration
Capital Assets
Countywide Law Enforcement District owns no capital assets.
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Countywide Law Enforcement District
Management Discussion and Analysis
June 30, 2016
Long-term Debt
Countywide Law Enforcement District has no long-term debt; therefore, the District has not been separately rated
by any of the bond rating agencies.
Key Economic Factors and Budgets Information for the Future
The tax rate approved by the voters will allow the District to build sufficient reserves to finance its operations
without needing to issue tax anticipation notes.
Requests for Information
This financial report is designed to provide a general overview to those parties interested in Countywide Law
Enforcement District's finances. Questions concerning any of the information provided in this report or requests
for additional information should be addressed to Deschutes County Finance Department, PO Box 6005, Bend,
Oregon, 97708.
See Notes to Financial Statements 9
Countywide Law Enforcement District
Statement of Net Position
June 30, 2016
Primary
Government -
Governmental
Activities
Assets
Cash and investments 5,657,210$
Property taxes receivable 496,693
Accounts receivable 171,444
Total assets 6,325,347
Liabilities
Accounts payable 65
Unearned revenue 33,600
Total liabilities 33,665
Net Position
Unrestricted 6,291,682$
See Notes to Financial Statements 10
Countywide Law Enforcement District
Statement of Activities
Year Ended June 30, 2016
Primary
Government -
Governmental
Activities
Expenses
Public safety 23,338,897$
Program Revenues
Charges for services 705,576
Operating grants and contributions 2,520,051
Total program revenues 3,225,627
Net program expenses 20,113,270
General Revenues
Property taxes levied for general purposes 20,441,901
Earnings on investments 85,920
Total general revenues 20,527,821
Changes in Net Position 414,551
Net Position, Beginning of Year 5,877,131
Net Position, End of Year 6,291,682$
See Notes to Financial Statements 11
Countywide Law Enforcement District
Balance Sheet – General Fund
June 30, 2016
Assets
Cash and investments 5,657,210$
Property taxes receivable 496,693
Accounts receivable 171,444
Total assets 6,325,347$
Liabilities
Accounts payable 65$
Unearned revenue 33,600
Total liabilities 33,665
Deferred Inflow of Resources
Unavailable revenue - property taxes 450,685
Total deferred inflow of resources 450,685
Fund Balance
Assigned for future expenditures 625,118
Unassigned 5,215,879
Total fund balance 5,840,997
Total Liabilities, Deferred Inflow of Resources, and Fund Balance 6,325,347$
Fund Balance 5,840,997$
Amounts reported for governmental activities in the Statement of Net Position are different because:
Some of the District's taxes will be collected after year-end, but are not currently
available resources and, therefore, are deferred in the funds. 450,685
Net Position of Governmental Activities 6,291,682$
See Notes to Financial Statements 12
Countywide Law Enforcement District
Statement of Revenues, Expenditures and Changes in Fund Balance – General Fund
Year Ended June 30, 2016
Revenues
Taxes and assessments 20,444,516$
Fines, forfeitures and penalties 367,832
Interest and rents 85,920
Charges for services 287,632
Other 50,112
Intergovernmental revenues
Local 145,814
State 2,362,229
Federal 12,008
Total revenues 23,756,063
Expenditures
Public safety 23,338,897
Total expenditures 23,338,897
Net Change in Fund Balance 417,166
Fund Balance, Beginning of Year 5,423,831
Fund Balance, End of Year 5,840,997$
See Notes to Financial Statements 13
Countywide Law Enforcement District
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balance of Governmental Funds
to the Statement of Activities
Year Ended June 30, 2016
Net Change in Fund Balance - Total Governmental Fund $ 417,166
Amounts reported for governmental activities in the Statement of Activities are different because:
Property tax revenue is recognized under the modified accrual basis of
accounting only to the extent it has been collected within sixty days of year-end.
On the accrual basis Statement of Activities, such revenue is recognized
regardless of when collected. (2,615)
Changes in Net Position of Governmental Activities 414,551$
14
Countywide Law Enforcement District
Notes to Financial Statements
June 30, 2016
Note 1 - Organization and Summary of Significant Accounting Policies
The District
Countywide Law Enforcement District (the District), an ORS Chapter 451 municipal corporation of the State of
Oregon, was approved and created by election of the Deschutes County (the County) voters on November 7,
2006, for the purpose of providing a permanent source of funding for law enforcement services that are provided
to all County residents. The District entered into an intergovernmental agreement, April 16, 2007, with Deschutes
County whereby the County, through the Deschutes County Sheriff’s Office, is contracted to perform certain law
enforcement functions within its boundaries. The Deschutes County Board of Commissioners is the governing
body of the District.
Government-wide and Fund Financial Statements
The government-wide financial statements (i.e., the Statement of Net Position and the Statement of Activities)
report information on all of the activities of the District. Governmental activities, which normally are supported
by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a
significant extent on fees and charges for support. The District has no business-type activities or fiduciary funds.
The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment
are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or
segment. Program revenues include: 1) charges to customers who purchase, use, or directly benefit from goods,
services or privileges provided by a given function or segment; and 2) grants and contributions that are restricted
to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not
properly included among program revenues are reported instead as general revenues.
Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are prepared using the economic resources measurement focus and the
accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is
incurred. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items
are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. It is the
District's policy to first apply restricted resources when an expense is incurred for purposes for which both
restricted and unrestricted net position is available.
Governmental fund financial statements are reported using the current financial resources measurement focus and
the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and
available. Revenues are considered to be available when they are collectible within the current period or soon
enough thereafter to pay liabilities of the current period. For this purpose, the District considers revenues to be
available if they are collected within sixty days of the end of the current fiscal period. Revenues received after this
period are considered unavailable. Expenditures are recorded when a liability is incurred, as under accrual
accounting.
Property taxes associated with the current fiscal period are considered to be susceptible to accrual and so have
been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable
and available only when cash is received by the District.
As a general rule, the effect of any interfund activity has been eliminated from the government-wide financial
statements.
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Countywide Law Enforcement District
Notes to Financial Statements
June 30, 2016
The District reports the following governmental funds:
General Fund — The General Fund is utilized to account for the transactions of the District. Property
taxes and law enforcement contracts are its principal sources of revenue. Expenditures are for the
operation and administration of the District.
Reserve Sub-Fund — The Reserve Sub-Fund accumulates funds for acquisition of capital assets.
Transfers from the Operating Sub-Fund and interest are its principal sources of revenue. Expenditures are
for capital outlay of the District.
Budget Policy
The District meets the requirement of state law by preparing a budget for its fund and sub-fund. The budget is
prepared on the modified accrual basis of accounting. The resolution authorizing appropriations for each fund sets
the level by which expenditures cannot legally exceed appropriations. Materials & Services is the only budgetary
level of control established by resolution. The detailed budget document provides specific detailed information for
the above mentioned expenditure category. Unexpected additional resources may be added to the budget through
the use of a supplemental budget and appropriations resolution. Original and supplemental budgets may be
modified by the use of appropriation transfers between the levels of control. Appropriations lapse as of year-end.
Reporting Entity
The District's financial statements include the accounts of all District operations. The criteria for including
organizations as component units within the Districts reporting entity, as set forth in GASB 61, The Financial
Reporting Entity: Omnibus, include whether:
The organization is legally separate (can sue and be sued in its own name).
The District holds the corporate powers of the organization.
The District appoints a voting majority of the organizations’ board.
The District is able to impose its will on the organization.
The organization has the potential to impose a financial benefit/burden on the District.
There is a fiscal dependency by the organization on the District.
There were no specific agencies which required consideration under the criterion in the current fiscal year for
inclusion in the Districts reporting entity.
Under the above criterion, the District is includable as a component unit in the financial statements of Deschutes
County, since the District’s governing board is comprised of the Deschutes County Commissioners.
16
Countywide Law Enforcement District
Notes to Financial Statements
June 30, 2016
Cash and Investments
Cash and investments are comprised of funds held by the Deschutes County Treasurer, in the County's cash and
investment pool. The District’s cash and investments participate in this pool rather than specific, identifiable
securities. The District’s share of County pooled cash and investments can be drawn upon demand, and therefore,
the entire amount on deposit with the County is considered cash and cash equivalents. Interest earned on pooled
investments is allocated monthly based on the average daily balance of the District in relation to total investments
in the pool. It is not practical to determine the investment risk, collateral, or insurance coverage for the District’s
share of these pooled investments. This pool generally includes demand deposits, investments in the Oregon State
Treasurer's Local Government Investment Pool (LGIP), obligations of the United States Treasury and United
States Government agencies and instrumentalities, certain high-grade commercial paper and corporate bonds. This
policy is in accordance with ORS 294.035 which specifies the types of investments authorized for municipal
corporations.
State statutes authorize the County to invest in obligations of the U.S. Treasury, commercial paper, corporate
bonds, municipal bonds, banker’s acceptances, repurchase agreements, and the State Treasurer’s Local
Government Investment Pool (LGIP). Investments for the County, as well as for its component units, are reported
at fair value. The LGIP operates in accordance with appropriate state laws and regulations.
Information about the pooled cash and investments is included in the County’s annual financial report and may be
obtained by contacting the Deschutes County Finance Department, 1300 NW Wall Street, Suite 200, Bend,
Oregon, 97703.
Property Taxes/Unavailable Revenue
Property taxes are assessed on a July 1 - June 30 fiscal year basis. The taxes are levied as of July 1 based on
assessed values as of January 1. Property tax payments are due in three equal installments, on November 15,
February 15 and May 15. A discount of 3% is available if taxes are paid in full by November 15 and a discount of
2% on the unpaid balance is available if taxes are paid in full by February 15.
Property taxes attach as an enforceable lien July 1 and are considered delinquent if not paid by the following May
15. The Deschutes County Treasurer is the tax collection agent for the District. The District's 2016 fiscal year tax
levy was $21,097,417.
Tax revenue is considered available for expenditure upon receipt by the County, which serves as the intermediary
collecting agency. Uncollected property taxes are shown on the governmental balance sheet as receivables.
Collections within sixty days subsequent to year-end have been accrued and the remaining taxes receivable are
recorded as deferred revenue on the modified accrual basis of accounting since they are not deemed available to
finance operations of the current period.
Accounts Receivable
Receivables include amounts due from other governments for grant reimbursement and services provided to other
governmental agencies. All receivables are current and therefore due within one year. Allowances are reported
when accounts are proven to be uncollectible. Based on historical collections, all balances are deemed collectible,
therefore no allowance has been recorded as of June 30, 2016.
17
Countywide Law Enforcement District
Notes to Financial Statements
June 30, 2016
Fund Balances
The Governmental Accounting Standards Board (GASB) Statement No. 54, Fund Balance Reporting and
Governmental Fund Type Definitions (GASB 54), defines the different types of fund balances that a
governmental entity must use for financial reporting purposes.
GASB 54 requires the fund balance amounts to be properly reported within one of the fund balance categories
listed below:
1. Nonspendable-such as fund balance associated with inventories, prepaids, long-term loans and notes
receivable, and property held for resale (unless the proceeds are restricted, committed or assigned).
2. Restricted-fund balance category includes amounts that can be spent only for specific purposes stipulated
by constitution, external resource providers or through enabling legislation.
3. Committed-fund balance classification includes amounts that can be used only for the specific purposes
determined by a formal action of the District's governing board (the District’s highest level of decision-
making authority). Such constraint remains legally binding unless removed in the same manner.
4. Assigned-fund balances classification are intended to be used by the District for specific purposes but do
not meet the criteria to be classified as restricted or committed. Assignments are made by the County
Administrator based on the County Commissioner’s direction.
5. Unassigned-fund balance is the residual classification for the District’s general fund and includes all
spendable amounts not contained in the other classifications.
The District reduces restricted amounts first when expenditures are incurred for purposes for which both restricted
and unrestricted (committed, assigned or unassigned) amounts are available. The District reduces committed
amounts first, followed by assigned amounts and then unassigned amounts when expenditures are incurred for the
purpose for which amounts in any of those unrestricted fund balance classifications could be used.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions that effect certain reported amounts
and disclosures. Accordingly, actual results could differ from these estimates.
Note 2 - Cash and Investments
As of June 30, 2016, the District had a deposit of $5,657,210 with the Deschutes County Treasurer. All of the
District's deposits were adequately insured during the year.
Note 3 - Risk Management
In the agreement described in Note 1, Deschutes County covenants and agrees to defend, indemnify and hold and
save harmless the District and each of the District's officers, agents and employees, if any, from and against any
and all claims whatsoever that might arise against the District or any of its officers, agents or employees, if any,
by reason of any alleged act or failure to act or failure of Deschutes County to act.
Required Supplementary Information
June 30, 2016
Countywide Law Enforcement
District
18
Countywide Law Enforcement District
Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – General Fund
Budgetary Basis
Year Ended June 30, 2016
Variance With
Original Final Actual Final Budget
Revenues
Property taxes 20,139,313$ 20,139,313$ 20,444,516$ 305,203$
Fines, forfeitures and penalties 401,000 401,000 367,832 (33,168)
Interest and rents 40,000 40,000 83,817 43,817
Charges for services 180,272 180,272 287,632 107,360
Other 72,058 72,058 50,112 (21,946)
Intergovernmental
Local 118,225 118,225 145,814 27,589
State 2,187,517 2,187,517 2,362,229 174,712
Federal - - 12,008 12,008
Total revenues 23,138,385 23,138,385 23,753,960 615,575
Expenditures
Materials and services 27,654,824 27,654,824 22,706,413 4,948,411
Total expenditures 27,654,824 27,654,824 22,706,413 4,948,411
Other financing sources (uses)
Transfers out (100,000) (100,000) - 100,000
Net Change in Fund Balance (4,616,439) (4,616,439) 1,047,547 5,663,986
Fund Balance, Beginning of Year 4,616,439 4,616,439 4,793,450 177,011
Fund Balance, End of Year -$ -$ 5,840,997$ 5,840,997$
Budgeted Amounts
Other Supplementary Information
June 30, 2016
Countywide Law Enforcement
District
19
Countywide Law Enforcement District
Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual –Reserve (Sub-Fund of
General Fund)
Budgetary Basis
Year Ended June 30, 2016
Variance With
Original Final Actual Final Budget
Revenues
Investment earnings 3,705$ 3,705$ 2,103$ (1,602)$
Total revenues 3,705 3,705 2,103 (1,602)
Expenditures
Materials and services 733,118 733,118 632,484 100,634
Total expenditures 733,118 733,118 632,484 100,634
Other financing sources (uses)
Transfers in 100,000 100,000 - (100,000)
Net Change in Fund Balance (629,413) (629,413) (630,381) (968)
Fund Balance, Beginning of Year 629,413 629,413 630,381 968
Fund Balance, End of Year -$ -$ -$ -$
Budgeted Amounts
20
Countywide Law Enforcement District
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – General Fund and Reserve Sub
Fund
Year Ended June 30, 2016
Reserve
General Fund Sub-Fund Total
Revenues
Taxes and assessments 20,444,516$ -$ 20,444,516$
Fines, forfeitures and penalties 367,832 - 367,832
Interest and rents 83,817 2,103 85,920
Charges for services 287,632 - 287,632
Other 50,112 - 50,112
Intergovernmental revenues
Local 145,814 - 145,814
State 2,362,229 - 2,362,229
Federal 12,008 - 12,008
Total revenues 23,753,960 2,103 23,756,063
Expenditures
Public Safety 22,706,413 632,484 23,338,897
Total expenditures 22,706,413 632,484 23,338,897
Excess (Deficiency) of Revenues over Expenditures 1,047,547 (630,381) 417,166
Net Change in Fund Balances 1,047,547 (630,381) 417,166
Fund Balance, Beginning of Year 4,793,450 630,381 5,423,831
Fund Balance, End of Year 5,840,997$ -$ 5,840,997$
21
Countywide Law Enforcement District
Schedule of Property Tax Transactions
Year Ended June 30, 2016
Beginning Taxes
Balance and Interest Receivable
2016 Levy Adjustments (Discounts) Collections June 30, 2016
21,097,417$ (191,261)$ (519,463)$ 20,079,835$ 306,858$
295,216 (1,770) 15,736 198,089 111,093
113,090 (1,554) 13,595 74,910 50,221
59,709 (1,700) 14,478 56,377 16,110
21,922 (1,575) 6,566 22,494 4,419
6,415 (1,717) 1,134 3,051 2,781
10,933 (8,595) 1,743 (1,130) 5,211
Totals 21,604,702$ (208,172)$ (466,211)$ 20,433,626 496,693$
Land Sale Revenue 18,868
Adjustments for Accruals
(53,986)
46,008
Modified accrual basis tax revenue 20,444,516$
June 30, 2015
June 30, 2016
Prior
2010-2011
Tax Year
2014-2015
2013-2014
2012-2013
2011-2012
2015-2016
www.eidebailly.com
877 W. Main St., Ste. 800 | Boise, ID 83702-5858 | T 208.344.7150 | F 208.344.7435 | EOE
22
Independent Auditor’s 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 Deschutes County Commissioners
Countywide Law Enforcement District
Bend, Oregon
We have audited, in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States, the financial statements of the governmental
activities and the general fund of Countywide Law Enforcement District (the District) as of and for the
year ended June 30, 2016, and the related notes to the financial statements, which collectively comprise
the District’s basic financial statements, and have issued our report thereon dated October 28, 2016.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the District's internal
control over financial reporting (internal control) to determine the audit procedures that are appropriate in
the circumstances 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 District’s internal control. Accordingly, we
do not express an opinion on the effectiveness of the District’s internal control.
A deficiency in internal control 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 and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination
of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement
of the District’s financial statements will not be prevented, or detected and corrected on a timely basis. A
significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less
severe than a material weakness, yet important enough to merit attention by those charged with
governance.
Our consideration of internal control over financial reporting was for the limited purpose described in the
first paragraph of this section and was not designed to identify all deficiencies in internal control over
financial reporting that might be material weaknesses or significant deficiencies. Given these limitations,
during our audit we did not identify any deficiencies in internal control that we consider to be material
weaknesses. However, material weaknesses may exist that have not yet been identified.
23
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the District's financial statements are free from
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 or other matters that are required to be
reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the District’s internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the District’s internal control and compliance.
Accordingly, this communication is not suitable for any other purpose.
Boise, Idaho
October 28, 2016
24
Countywide Law Enforcement District
Audit Comments and Disclosures Required by State Regulations
June 30, 2016
Audit Comments and Disclosures Required by State Regulations
Oregon Administrative Rules 162-010-0000 through 162-010-0320 of the Minimum Standards for Audits of
Oregon Municipal Corporations, prescribed by the Secretary of State in cooperation with the Oregon State Board
of Accountancy, enumerate the financial statements, schedules, comments, and disclosures required in audit
reports. The required statements and schedules are set forth in the preceding sections of this report. Required
comments and disclosures related to the audit of such statements and schedules are set forth in the following
pages.
www.eidebailly.com
877 W. Main St., Ste. 800 | Boise, ID 83702-5858 | T 208.344.7150 | F 208.344.7435 | EOE
25
Independent Auditor’s Report Required by Oregon State Regulations
To Deschutes County Commissioners
Countywide Law Enforcement District
Bend, Oregon
We have audited the basic financial statements of Countywide Law Enforcement District (the District) as
of and for the year ended June 30, 2016, and have issued our report thereon dated October 28, 2016. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to the financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether the District’s financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grants, including provisions of Oregon Revised Statutes as specified in Oregon
Administrative Rules 162-010-0000 through 162-010-0320 of the Minimum Standards for Audits of
Oregon Municipal Corporations, noncompliance with which could have a direct and material effect on the
determination of financial statements 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.
We performed procedures to the extent we considered necessary to address the required comments and
disclosures which included, but were not limited to the following:
Instances of Non-
Compliance Identified
Preface Not Applicable
Definitions Not Applicable
General Requirements None Noted
Contracts None Noted
Financial Statements None Noted
Required Supplementary Information (RSI) None Noted
Supplementary Financial Information None Noted
Schedule of Revenues, Expenditures / Expenses, and Changes in Fund None Noted
Balances / Net Position, Budget and Actual (Each Fund)
Schedule of Accountability for Independently Elected Officials Not Applicable
Other Financial or Statistical Information Not Applicable
Independent Auditor's Review of Fiscal Affairs None Noted
162-010-0130
OAR
162-010-0000
162-010-0010
162-010-0020
162-010-0050
162-010-0115
162-010-0120
Section
162-010-0030
162-010-0140
162-010-0190
162-010-0200
26
Instances of Non-
Compliance Identified
Accounting Records and Internal Control None Noted
Public Fund Deposits None Noted
Indebtedness Not Applicable
Budget None Noted
Insurance and Fidelity Bonds None Noted
Programs Funded from Outside Sources Not Applicable
Highway Funds Not Applicable
Investments None Noted
Public Contracts and Purchasing Not Applicable
State School Fund Not Applicable
Public Charter Schools Not Applicable
Other Comments and Disclosures Not Applicable
Section
162-010-0230
162-010-0240
OAR
162-010-0310
162-010-0320
162-010-0315
162-010-0316
162-010-0250
162-010-0260
162-010-0270
162-010-0280
162-010-0295
162-010-0300
In connection with our testing nothing came to our attention that caused us to believe the District was not
in substantial compliance with certain provisions of laws, regulations, contracts, and grants, including
provisions of Oregon Revised Statutes as specified in Oregon Administrative Rules 162-010-0000
through 162-010-0320 of the Minimum Standards for Audits of Oregon Municipal Corporations.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the District’s internal control over financial
reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the
financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s
internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness
of the District’s internal control over financial reporting.
A deficiency in internal control 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 and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination
of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement
of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A
significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less
severe than a material weakness, yet important enough to merit attention by those charged with
governance.
Our consideration of internal control over financial reporting was for the limited purpose described in the
first paragraph of this section and was not designed to identify all deficiencies in internal control over
financial reporting that might be material weaknesses or significant deficiencies. Given these limitations,
during our audit we did not identify any deficiencies in internal control that we consider to be material
weaknesses. However, material weaknesses may exist that have not yet been identified.
27
This report is intended solely for the information and use of the Deschutes County Commissioners and
management of Countywide Law Enforcement District and the Oregon Secretary of State and is not
intended to be and should not be used by anyone other than these parties.
For Eide Bailly LLP
Boise Idaho
October 28, 2016