HomeMy WebLinkAboutFY 2015 Rural Law Enforcement District Financial Statements
As of and For the Year Ended June 30, 2015
Rural Law Enforcement District
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Rural Law Enforcement District
Table of Contents
June 30, 2015
IndependentAuditor's Report.................................................................................................................................... 1
Management's Discussion and Analysis....................................................................................................................4
Financial Statements
Statementof Net Position......................................................................................................................................9
Statementof Activities......................................................................................................................................... 10
BalanceSheet—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
Notesto Financial Statements.............................................................................................................................. 14
Required Supplementary Information
Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual- General Fund......... 18
Notes to Required Supplementary Information................................................................................................... 19
Other Supplementary Information
Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual Reserve (Sub-
Fundof General Fund).........................................................................................................................................20
Combining Balance Sheet—General Fund and Reserve Sub-Fund.....................................................................21
Combining Statement of Revenues, Expenditures and Changes in Fund Balances—General Fund and
ReserveSub-Fund................................................................................................................................................22
Schedule of Property Tax Transactions...............................................................................................................23
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 Accardance with Government
AuditingStandards...................................................................................................................................................24
Audit Comments and Disclosures Required by State Regulations..........................................................................26
Independent Auditor's Report Required by Oregon State Regulations...................................................................27
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Independent Auditor's Report
The Deschutes County Commissioners
Rural Law Enforcement District
Bend, Oregon
Report on the Financial Statements
We have audited the accompanying�nancial statements of the governmental activities and the general
fund of Rural Law Enforcement District(the District), a component unit of the Deschutes County, as of
and for the year ended June 30, 2015, 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.
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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, 2015, 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.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis and schedule of revenues, expenditures, and changes in fund balances—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.
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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, combining balance sheet and combining stateinent of revenues,
expenditures and changes in fund balances for the General Fund and reserve sub-fund(combining
statements) and the schedule of property tax transactions are presented for purposes of additional analysis
and are not a required part of the financial statements. The schedule of revenues, expenditures, and
changes in fund balance—budget and actual—reserve, combining statements and schedule of property tax
transactions are the responsibility of management and were derived from and relates directly to the
underlying accounting and other records used to prepare the basic financial statements. Such inforination
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, schedule of revenues, expenditures,
and changes in fund balance—budget and actual—reserve, combining statements and schedule of
property tax transactions are 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 November 02,
2015 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 ofAudits of Oregon Municipal Corporations, we have issued
our report dated November 02, 2015 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 coinpliance.
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For Eide Bailly LLP
Boise, Idaho
November 02, 2015
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Rural Law Enforcement District
Management's Discussion and Analysis
June 30, 2015
As management of Rural 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, 2015.
Financial Highlights
• The assets of Rural Law Enforcement District exceeded its liabilities at 7une 30, 2015,by $4,907,508, all
of which is unrestricted.
• As of June 30, 2015, Rural Law Enforcement District's governinental funds reported combined ending
fund balances of$4,689,408.
• As of June 30, 2015,the unassigned fund balance in the General Fund was $3,202,194, or 25%, of total
General Fund Fiscal Year 2015 revenues.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to Rural 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 stateinents. 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 Rural Law
Enforcement District's finances, in a manner similar to a private-sector business.
The Statement of Net Position presents information on all of Rural 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 Rural Law Enforcement District is
improving or deteriorating.
The Statement of Activities presents information showing how Rural Law Enforcement District's Net Position
changed during the fiscal year ended June 30, 2015. 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 6nancial statements, Statement of Net Position and Statement of Activities, show
the functions of Rural Law Enforcement District that are supported primarily by taxes and intergovernmental
revenues (governmental activities). The governmental activity of Rural Law Enforcement District is public
protection.
The government-wide financial stateinents can be found on pages 9-10 of this report.
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Rural Law Enforcement District
Management's Discussion and Analysis
June 30, 2015
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. Rural Law Enforcement District, like other state and local government
entities,uses fund accounting to ensure and demonstrate compliance with finance-related lega] requirei�nents.
Each of the Funds of Rural Law Enforcement District is classified as a governmental fund.
Governmental funds. Governmental funds are used to account for essentially the same functions as gove�nmental
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 siinilar 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.
Rural Law Enforcement District reported activity in one governmental fund during the fiscal year ended June 30,
2015. Information on the General Fund and Sub-Fund are shown on the Combining Balance Sheet and in the
Combining Schedule of Revenues, Expenditures and Changes in Fund Balances that are presented as Other
Supplementary Information.
Rural Law Enforcement District adopts an annual budget for each of its funds. A budgetary comparison statement
has been provided for each to 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, serve as a useful indicator of an entity's financial position. In the case of
Rural Law Enforcement District, assets exceed liabilities by$4,907,508 at June 30, 2015. All of the Net Position
may be used to meet the District's on-going obligations to citizens and creditors.
As of June 30, 2015,Rural Law Enforcement District reports a positive balance in Net Position for the
government as a whole and for the governmental activities.
Rural Law Enforcement District's Net Position increased by$158,450 during the year ended June 30, 2015.
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Rural Law Enforcement District
Management's Discussion and Analysis
June 30, 2015
A comparison of the summarized government-wide statements to the prior year is as follows:
Statements of Net Position
June 30, 2015 June 30, 2014 Change
Assets
Cash and investments $ 4,475,648 $ 4,26],325 $ 214,323
Property taxes receivable 244,269 298,221 (53,952)
Accounts receivable 187,591 189,512 (1,921)
Total assets 4,907,508 4,749,058 158,450
Net Position
Unrestricted 4,907,508 4,749,058 158,450
Total net position $ 4,907,508 $ 4,749,058 $ 158,450
Statements of Activities
Year Ended Year Ended
June 30, 2015 June 30, 2014 Chan�e
Program Revenues
Charges for services $ 186,182 $ 208,355 $ (22,173)
Operating grants and contributions 4,198,492 4,045,375 153,117
General Revenues
Property taxes levied for general purposes 8,601,394 8,182,960 418,434
Earnings on investments 44,716 30,867 13,849
Total revenues 13,030,784 12,467,557 563,227
Expenses
Public safety 12,872,334 12,398,716 473,618
Changes in Net Position 158,450 68,841 89,609
Net Position, Beginning of Year 4,749,058 4,680,217 68,841
Net Position, End of Year $ 4,907,508 $ 4,749,058 $ 158,450
Governmental Activities
Governmental activities increased Net Position by$158,450 during the fiscal year ended June 30, 2015. Tax
revenues and payments received from governmental agencies exceeded the payment made to Deschutes County
Sheriff's Office,pursuant to an inter-governmental agreeinent. The Rural Law Enforcement District has no
business-type activities.
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Rural Law Enforcement District
Management's Discussion and Analysis
June 30, 2015
Financial Analysis of the District's Funds
Rural Law Enfarcement District uses fund accounting to ensure and demonstrate compliance with finance-related
legal requirements.
Governmental fund. The focus of Rural Law Enforcement District's governmental fund is to provide information
on near-term inflows, outflows and balances of spendable resources. Such information is useful in assessing Rural
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, 2015, $4,689,408 is the reported a combined ending fund balance for Rural Law Enforcement
District's governmental fund.
As of June 30, 2015,the fund balance of Rural Law Enforcement District's General Fund is $3,202,194, all
unassigned. One measure of liquidity is the relationship of both the unassigned balance to the Fund's total
revenues. The fund balance as of June 30, 2015, for the General Fund is 25% of total its General Fund Fiscal Year
2015 revenues. The reinainder of the governmental fund balance, composed of the Reserve Sub-Fund fund
balance,is $1,487,214, and is intended to be used far future capital asset replacement.
The fund balance of the Rural Law Enforcement District's General Fund increased by$91,607 during the fiscal
year ended June 30, 2015. The fund balance of the Reserve Sub-Fund increased by $ll 1,185 during the fiscal
year ended June 30, 2015.
General Fund Budgetary Highlights
There were no differences between the Rural Law Enforcement District's General Fund and Sub-Fund budgets as
originally adopted and the final amended budget. Actual revenues exceeded estimated revenues by$316,360.
Property tax revenue exceeded the amount estimated by $203,884. 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, $12,752,334,which is $2,196,192 less than the amount appropriated. Appropriations in the Reserve
sub-fund were $1,481,000. As there were no expenditures in FY 2015, a significant"budget-to-actual" variance is
reported.
Capital Asset and Debt Administration
Capital Assets
Rural Law Enforcement District owns no capital assets.
Long-term Debt
Rural Law Enforcement District has no long-term debt; therefore the District and bas 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.
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Rural Law Enforcement District
Management's Discussion and Analysis
June 30, 2015
Requests for Information
This financial report is designed to provide a general overview to those parties interested in Rural 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.
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Rural Law Enforcement District
Statement of Net Position
June 30, 2015
Assets
Cash and investments $ 4,475,648
Property taxes receivable 244,269
Accounts receivable 187,591
Total assets 4,907,508
Net Position
Unrestricted 4,907,508
Total net position $ 4,907,508
See Notes to Financial Statements 9
Rural Law Enforcement District
Statement of Activities
Year Ended June 30, 2015
Expenses
Public safety $ 12,872,334
Total expenses 12,872,334
Program Revenues
Charges for services 186,182
Operating grants and contributions 4,198,492
Total program revenues 4,384,674
Net program expenses 8,487,660
General Revenues
Property taxes levied for general purposes 8,601,394
Earnings on investments 44,716
Total general revenues 8,646,l 10
Changes in Net Position 158,450
Net Position, Beginning of Year 4,749,058
Net Position,End of Year $ 4,907,508
See Notes to Financial Statements 10
Rural Law Enforcement District
Balance Sheet—General Fund
June 30, 2015
Assets
Cash and investments $ 4,475,648
Property taxes receivable 244,269
Accounts receivable 187,591
Total assets $ 4,907,508
Deferred Inflow of Resources
Unavailable revenue -property taxes $ 218,100
Total deferred inflow ofresources 218,100
Fund Balance
Assigned for future expenditures 1,487,214
Unassigned 3,202,194
Total fund balance 4,689,408
Total Deferred Inflow of Resources and Fund Balance $ 4,907,508
Fund Balance $ 4,689,408
Amounts reported for governmental activities in the statement of net position is 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. 218,100
Net position of governmental activities $ 4,907,508
See Notes to Financial Statements 11
Rural Law Enforcement District
Statement of Revenues, Expenditures and Changes in Fund Balance—General Fund
Year Ended June 30, 2015
Revenues
Taxes and assessments $ 8,645,736
Fines, forfeitures and penalties 154,368
Interest 44,716
Charges for services 10,553
Contributions and donations 17,030
Other 21,261
Intergovernmental revenues
Local 3,786,530
State 250,390
Federal 144,542
Total revenues 13,075,126
Expenditures
Public safety 12,872,334
Total expenditures 12,872,334
Change in Fund Balance 202,792
Fund Balance, Beginning of Year 4,486,616
Fund Balance, End of Year $ 4,689,408
See Notes to Financial Statements 12
Rural 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 30,2015
Net change in fund balances -total governmental funds $ 202,792
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. (44,342)
Change in net position of governmental activities $ 158,450
See Notes to Financial Statements 13
Rural Law Enforcement District
Notes to Financial Statements
June 30, 2015
Note 1 - Organization and Summary of Significant Accounting Policies
The District
Rural Law Enforceinent 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 patrol services in those portions of Deschutes County not
served by city or special service district law enforcement departments. 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 ar 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.
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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Rural Law Enforcement District
Notes to Financial Statements
June 30, 2015
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 Fund accumulates funds for acquisition of capital assets. Transfers
from the General 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 funds. The budget is prepared on the
modified accrual basis of accounting. The resolution authorizing appropriations for each sub-fund sets the 1eve1
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 District's 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 arganization.
• 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 District's 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.
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Rural Law Enforcement District
Notes to Financial Statements
June 30, 2015
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 cominercial 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, corparate
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 I 5. The Deschutes County
Treasurer is the tax collection agent for the District. The District's 2015 fiscal year tax levy was $8,381,815. 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 reinaining 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, 2015.
Fund Balances
The Governmental Accounting Standards Board(GASB)has issued Statement No. 54, Fund Balance Reporting
and Gove�nmental Fund Type Definitions(GASB 54), which defines the different types of fund balances that a
governmental entity must use for financial reporting purposes.
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Rural Law Enforcement District
Notes to Financial Statements
June 30, 2015
GASB 54 requires the fund balance amounts to be properly reported within one of the fund balance categories
listed below:
1. Nons�endable 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. Unassi f�fund balance is the residual classification for the District's general fund and includes a11
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, 2015,the District had a deposit of$4,475,648 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 ar employees, if any,
by reason of any alleged act or failure to act or failure of Deschutes County to act.
17
Required Supplementary Information
June 30, 2015
Rural Law Enforcement District
www. debaill� .com
Rural Law Enforcement District
Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual - General Fund
Budgetary Basis
Year Ended June 30, 2015
Budget Amounts Actual Variance with
Original Final Amounts Final Budget
Revenues
Properry taxes $ 8,441,852 $ 8,441,852 $ 8,645,736 $ 203,884
Fines, forfeitures and penalties 150,500 150,500 154,368 3,868
Interest 21,000 21,000 33,531 12,531
Charges for services 22,000 22,000 10,553 (11,447)
Contributions and donations - - 17,030 17,030
Other 26,000 26,000 21,261 (4,739)
Intergovernmental
Local 3,620,314 3,620,314 3,786,530 166,216
State 314,600 314,600 250,390 (64,210)
Federal 155,500 155,500 144,542 (10,958)
Total revenues 12,751,766 12,751,766 13,063,941 312,175
Expenditures
Materials and services 15,068,526 15,068,526 12,872,334 2,196,192
Total expenditures 15,068,526 15,068,526 12,872,334 2,196,192
Excess (deficiency) of revenues
over expenditures (2,316,760) (2,316,760) 191,607 2,508,367
Otber financing uses
Transfers out (100,000) (100,000) (100,000) -
Net Change in Fund Balance (2,416,760) (2,416,760) 91,607 2,508,367
Fund Balance, Beginning of Year 2,416,760 2,416,760 3,ll0,587 693,827
Fund Balance, End of Year $ - $ - 3,202,194 $ 3,202,194
Adjustments to generally accepted accounting principles
(US GAAP)basis:
Rural Law Enforcement Reserve Fund 1,487,214
Fund Balance -US GAAP Basis $ 4,689,408
See Notes to Required Supplementary Information 18
Rural Law Enforcement District
Notes to Required Supplementary Information
June 30, 2015
Note 1 - Adjustments from Budgetary Basis of Accounting to GAAP
The District has a reserve fund maintained for budgetary purposes that does not meet the definition of Special
Revenue Funds for GAAP reporting purposes. At year-end,the ending fund balance for this fund is combined
with the General Fund.
19
Other Supplementary Information
June 30, 2015
Rural Law Enforcement District
www. debaill� .com
Rural Law Enforcement District
Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual Reserve (Sub-Fund of
General Fund)
Budgetary Basis
Year Ended June 30,2015
Budgeted Amounts Actual Variance with
Original Final Amounts Final Budget
Revenues
Interest $ 7,000 $ 7,000 $ 11,185 $ 4,185
Total revenues 7,000 7,000 11,185 4,185
Expenditures
Materials and services 100 100 - 100
Capital outlay 1,480,900 1,480,900 - 1,480,900
Total expenditures 1,481,000 1,481,000 - 1,481,000
Excess (deficiencv) of revenues
over expenditures (1,474,000) (1,474,000) 11,185 1,485,185
Other financing sources
Transfers In 100,000 100,000 100,000 -
Net Change in Fund Balance (1,374,000) (1,374,000) 111,185 1,485,185
Fund Balance, Beginning ofYear 1,374,000 1,374,000 1,376,029 2,029
Fund Balance, End of Year $ - $ - $ 1,487,214 $ 1,487,214
20
Rural Law Enforcement District
Combining Balance Sheet—General Fund and Reserve Sub-Fund
June 30, 2015
General Reserve
Fund Sub-Fund Total
Assets
Cash and investments $ 2,988,434 $ ],487,214 $ 4,475,648
Property taxes receivable 244,269 - 244,269
Accounts receivable 187,59] - 187,591
Total assets $ 3,420,294 $ 1,487,214 $ 4,907,508
Liabilities
Deferred Inflow of Resources
Unavailable revenue-property taxes $ 218,100 $ - $ 218,100
Totalliabilities 218,100 - 218,100
Fund Balances
Assigned for future expenditures - 1,487,214 1,487,214
Unassigned 3,202,194 - 3,202,194
Total fund balances 3,202,194 1,487,214 4,689,408
Total deferred inflow of resources and
fund balances $ 3,420,294 $ 1,487,214 $ 4,907,508
21
Rural Law Enforcement District
Combining Statement of Revenues, Expenditures and Changes in Fund Balances—General Fund and Reserve
Sub-Fund
Year Ended June 30, 2015
General Reserve
Fund Sub-Fund Total
Revenues
Property taxes $ 8,645,736 $ - $ 8,645,736
Fines, forfeitures and penalties 154,368 - 154,368
Interest 33,531 11,185 44,716
Charges for services 10,553 - 10,553
Contributions and donations 17,030 - 17,030
Other 21,261 - 21,261
Intergovernmental
Local 3,786,530 - 3,786,530
State 250,390 - 250,390
Federal 144,542 - 144,542
Total revenues 13,063,941 ]1,185 13,075,126
Expenditures
Materials and services 12,872,334 - 12,872,334
Total expenditures 12,872,334 - 12,872,334
Excess of Revenues over Expenditures 191,607 11,185 202,792
Other Financing Sources (Uses)
Intra-fund
Transfers in - 100,000 100,000
Transfers out (100,000) - (100,000)
Total other financing sources (uses) (100,000) 100,000 -
Net Change in Fund Balances 91,607 111,185 202,792
Fund Balances, Beginning of Year 3,110,587 1,376,029 4,486,616
Fund Balances, End of Year $ 3,202,194 $ ],487,214 $ 4,689,408
22
Rural Law Enforcement District
Schedule of Property Tax Transactions
Year Ended June 30, 2015
Beginning Taxes
Balance and Interest Receivable
Tax Year 2015 Levy Adjustments (Discounts) Collections June 30, 2015
2014-2015 $ 8,810,611 $ (31,559) $ (217,989) $ 8,420,326 $ 140,737
2013-2014 162,510 (2,624) 9,304 115,087 54,103
2012-2013 71,794 (239) 9,464 51,949 29,070
2011-2012 4],172 (260) 10,492 40,377 1],027
2010-2011 13,892 (129) 4,493 15,063 3,193
Prior 8,853 (294) 1,552 3,972 6,139
Totals $ 9,108,832 $ (35,105) $ (182,684) 8,646,774 $ 244,269
Land sales 8,573
Adjustments for Accruals
June 30, 2014 (35,779)
June 30, 2015 26,168
Modified accrual basis tax revenue $ 8,645,736
23
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CP�4s�.�Uti1NES5.AnVI5t�R5
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 Aucliting Standards
To the Deschutes County Commissioners
Rural 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 Rural Law Enforcement District(tbe District) as of and for the year
ended June 30, 2015, and the related notes to the financial statements,which collectively comprise the
District's basic financial statements, and have issued our report thereon dated November 02, 2015.
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 defzciency 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, ar 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.
www.eidebailly.com 24
877 W.Main St.,Ste.800 � Boise,ID 83702-5858 � T 208.344.7150 I. F 208.344.7435 � EOE
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
con�rol or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing StandaYds in considering the District's internal control and compliance.
Accordingly,this communication is not suitable for any other purpose.
� � �
Boise, Idaho
November 02, 2015
25
Rural Law Enforcement District
Audit Comments and Disclosures Required by State Regulations
June 30, 2015
Audit Comments and Disclosures Required by State Regulations
Oregon Administrative Rules 162-010-0000 through l 62-010-0320 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.
26
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CP�4s�.�Uti1NES5.AnVI5t�R5
Independent Auditor's Report Required by Oregon State Regulations
To Deschutes County Commissioners
Rural Law Enforcement District
Bend, Oregon
We have audited the basic financial statements of Rural Law Enforcement District(the District) as of and
for the year ended June 30, 2015, and have issued our report thereon dated November 02, 2015. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the provisions of the Minimum Standards of Audits of Oregon Municipal Corporations,
prescribed by the Secretary of State. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the basic financial statements are free from material misstatement.
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, as set forth below, noncompliance with
which could have a direct and material effect on the determination of financial statements amounts:
Instances of Non-
OAR Section Compliance Identified
162-010-0000 Preface Not Applicable
162-010-0010 Definirions Not Applicable
162-010-0020 General Requirements None noted
162-010-0030 Conh-acts None noted
162-010-0050 Financial SYatements None noYed
l 62-010-0115 Required Supplementary information(RSI) None noted
162-010-0120 Supplementary Financial Information None noted
162-010-0130 Schedule of Revenues,Expenditures/E�penses,and Changes in Fund None noted
Balances/Net Position,Budget and Actual(Each Fund)
162-010-0140 Schedule of Accountability for Independently Elected Officials Not Applicable
]62-010-0150 Schedule of Property Tax Transactions or Acreage Assessments None noted
162-010-0190 Other Financial or Statistica]Infarmation Not Applicable
162-010-0200 Independent Auditor's Review of Fiscal Affairs None noted
162-010-0230 Accounting Records and Internal Control None noted
162-010-0240 Public Fund Deposits None noted
162-010-0250 Indebtedness Not Applicable
l 62-010-0260 Budget None noted
162-010-0270 Insurance and Fidelity Bonds None noted
162-010-0280 Programs Funded fi-om Outside Sources Not Applicable
162-010-0295 Highway Funds Not Applicable
162-010-0300 Investments None noted
162-010-0310 Public Contracts and Purchasing Not Applicable
162-010-0315 State School Fund Not Applicable
162-010-0316 Public Charter Schools Not Applicable
162-010-0320 Other Comments and Disclosures Not Applicable
www.�idebcilly.com 27
877 W.Main St.,Ste.800 � Boise,ID 83702-5858 � T 208.344.7150 I. F 208.344.7435 � EOE
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 test disclosed no instances of
noncompliance that are required to be reported under Minimum Standards for Audits of Oregon
Municipal Corporations,prescribed by the Secretary of State.
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 financia] 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 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.
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
Minimum Standards for Audits of Oregon Municipal Corporations,prescribed by the Secretary of State,
in considering the District's internal control and compliance. Accordingly, this communication is not
suitable for any other purpose.
�
For Eide Bailly LLP
Boise Idaho
November 02, 2015
28