«MARVIN MEMORIAL LIBRARY RICHLAND COUNTY, OHIO FINANCIAL STATEMENTS (AUDITED) FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014 LESLIE HAINES, FISCAL ...»
MARVIN MEMORIAL LIBRARY
RICHLAND COUNTY, OHIO
FOR THE YEARS ENDED
DECEMBER 31, 2015 AND 2014
LESLIE HAINES, FISCAL OFFICER
Board of Trustees
Marvin Memorial Library
29 W. Whitney Avenue
Shelby, Ohio 44875
We have reviewed the Independent Auditor’s Report of the Marvin Memorial Library, Richland County, prepared by Julian & Grube, Inc., for the audit period January 1, 2014 through December 31, 2015. Based upon this review, we have accepted these reports in lieu of the audit required by Section 117.11, Revised Code. The Auditor of State did not audit the accompanying financial statements and, accordingly, we are unable to express, and do not express an opinion on them.
Our review was made in reference to the applicable sections of legislative criteria, as reflected by the Ohio Constitution, and the Revised Code, policies, procedures and guidelines of the Auditor of State, regulations and grant requirements. The Marvin Memorial Library is responsible for compliance with these laws and regulations.
Dave Yost Auditor of State June 8, 2016 88 East Broad Street, Fifth Floor, Columbus, Ohio 43215‐3506 Phone: 614‐466‐4514 or 800‐282‐0370 Fax: 614‐466‐4490 www.ohioauditor.gov This page intentionally left blank.
MARVIN MEMORIAL LIBRARY
RICHLAND COUNTY, OHIO
TABLE OF CONTENTSIndependent Auditor’s Report
Combined Statement of Receipts, Disbursements and Changes in Fund Balances (Cash Basis) - All Governmental Fund Types For the Year Ended December 31, 2015
Statement of Receipts, Disbursements and Changes in Fund Balances (Cash Basis) - Proprietary Fund Type For the Year Ended December 31, 2015
Combined Statement of Receipts, Disbursements and Changes in Fund Balances (Cash Basis) - All Governmental Fund Types For the Year Ended December 31, 2014
Notes to the Financial Statements
Independent Auditor’s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Required by Government Aud
Marvin Memorial Library Richland County 29 W. Whitney Avenue Shelby, Ohio 44875
To the Board of Trustees:
Report on the Financial Statements We have audited the accompanying financial statements of the cash balances, receipts and disbursements by fund type, and related notes of the Marvin Memorial Library, Richland County, Ohio, as of and for the years ended December 31, 2015 and 2014.
Management's Responsibility for the Financial Statements Management is responsible for preparing and fairly presenting these financial statements in accordance with the financial reporting provisions Ohio Revised Code Section 117.38 and Ohio Administrative Code Section 117-2D) permit; this responsibility includes designing, implementing and maintaining internal control relevant to preparing and fairly presenting financial statements free from material misstatement, whether due to fraud or error.
Our responsibility is to opine on these financial statements based on our audit. We audited in accordance with auditing standards generally accepted in the United States of America and the financial audit standards in the Comptroller General of the United States’ Government Auditing Standards. Those standards require us to plan and perform the audit to reasonably assure the financial statements are free from material misstatement.
An audit requires obtaining evidence about financial statement amounts and disclosures. The procedures selected depend on our judgment, including assessing the risks of material financial statement misstatement, whether due to fraud or error. In assessing those risks, we consider internal control relevant to the Marvin Memorial Library's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not to the extent needed to opine on the effectiveness of the Marvin Memorial Library's internal control. Accordingly, we express no opinion. An audit also includes evaluating the appropriateness of management’s accounting policies and the reasonableness of their significant accounting estimates, as well as our evaluation of the overall financial statement presentation.
We believe the audit evidence we obtained is sufficient and appropriate to support our audit opinions.
Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles As described in Note 1 of the financial statements, the Marvin Memorial Library prepared these financial statements using the accounting basis permitted by the financial reporting provisions of Ohio Revised Code Section 117.38 and Ohio Administrative Code Section 117-2-03(D), which is an accounting basis other than accounting principles generally accepted in the United States of America (GAAP), to satisfy these requirements.
Although the effects on the financial statements of the variances between the regulatory accounting basis and GAAP are not reasonably determinable, we presume they are material.
Independent Auditor’s Report Page Two Though the Marvin Memorial Library does not intend these statements to conform to GAAP, auditing standards generally accepted in the United States of America require us to include an adverse opinion on GAAP. However, the adverse opinion does not imply the amounts reported are materially misstated under the accounting basis Ohio Revised Code Section 117.38 and Ohio Administrative Code Section 117-2-03(D) permit. Our opinion on this accounting basis is in the Opinion on Regulatory Basis of Accounting paragraph below.
Adverse Opinion on U.S. Generally Accepted Accounting Principles
In our opinion, because of the significance of the matter discussed in the Basis for Adverse Opinion on U.S.
Generally Accepted Accounting Principles paragraph, the financial statements referred to above do not present fairly, in accordance with accounting principles generally accepted in the United States of America, the financial position of the Marvin Memorial Library as of December 31, 2015 and 2014, or changes in financial position or cash flows (2015) thereof for the years then ended.
Opinion on Regulatory Basis of Accounting
In our opinion, the financial statements referred to above present fairly, in all material respects, the combined cash balances of the Marvin Memorial Library, Richland County as of December 31, 2015 and 2014, and its combined cash receipts and disbursements for the years then ended in accordance with the financial reporting provisions Ohio Revised Code Section 117.38 and Ohio Administrative Code Section 117-2-03(D) permit, described in Note 1.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated April 8, 2016, on our consideration of the Marvin Memorial Library’s internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. That report describes the scope of our internal control testing over financial reporting and compliance, and the results of that testing, and does not opine 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 Marvin Memorial Library’s internal control over financial reporting and compliance.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESA. Description of the Entity Marvin Memorial Library, Richland County, Ohio, (the “Library”) was organized as a school District public library in 1925 under the laws of the State of Ohio. The Library has its own Board of Trustees of seven members, all of whom are appointed by the Board of Education of Shelby City School District. Appointments are for seven-year terms and members serve without compensation. Under Ohio statutes, the Library is a body politic and corporate capable of suing and being sued, contracting, acquiring, holding, possessing, and disposing of real property, and of exercising such other powers and privileges conferred upon it by law. The Library also determines and operates under its own budget. Control and management of the Library is governed by sections 3375.33 to 3375.39 of the Ohio Revised Code with the administration of the day-to-day operations of the Library being the responsibility of the Director and financial accountability being that of the Fiscal Officer. The Library provides the community with a wide variety of resources for education and entertainment.
The Library is fiscally independent of the Board of Education, although Shelby City School’s Board of Education serves in a ministerial capacity as the taxing authority for the Library. The determination to request approval of a tax levy, the role and purpose(s) of the levy, are discretionary decisions made solely by the Library’s Board of Trustees. Once those decisions are made, the Board of Education must put the levy on the ballot. There is no potential for the Library to provide a financial benefit to or impose a financial burden on the Board of Education.
Under the provisions of Statements No. 14, No. 39, and No. 61 of the Government Accounting Standards Board, “the Library is considered to be a related organization of the school district.” Component units are legally separate organizations for which the Library is financially accountable. The Library is financially accountable for an organization if the Library appoints a voting majority of the organization's governing board and (1) the Library is able to significantly influence the programs or services performed or provided by the organization; or (2) the Library is legally entitled to or can otherwise access the organization's resources; the Library is legally obligated or has otherwise assumed the responsibility to finance the deficits of, or provide financial support to, the organization; or the Library is obligated for the debt of the organization.
The Library is also financially accountable for any organizations for which the Library approves the budget, the issuance of debt or the levying of taxes. Component units also include legally separate, tax-exempt entities whose resources are for the direct benefit of the Library, are accessible to the Library and are significant in amount to the Library. The Library has no component units.
The Library’s management believes these financial statements present all activities for which the Library is financially accountable.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) B. Accounting Basis These financial statements follow the accounting basis permitted by the financial reporting provisions of Ohio Revised Code Section 117.38 and Ohio Administrative Code Section 117-2D). The basis is similar to the cash receipts and disbursements accounting basis. The Library recognizes receipts when received in cash rather than when earned, and recognizes disbursements when paid rather than when a liability is incurred. Budgetary presentations report budgetary expenditures when a commitment is made (i.e., when an encumbrance is approved).
These statements include adequate disclosure of material matters, as the financial reporting provisions of Ohio Revised Code Section 117-2-03(D) permit.
C. Deposits and Investments The Library’s accounting basis includes investments as assets. This basis does not record disbursements for investment purchases or receipts for investment sales. The basis records gains or losses at the time of sale as receipts and disbursements, respectively.
The Library’s common stock is valued at fair value when donated.
D. Fund Accounting The Library uses fund accounting to segregate cash and investments that are restricted as to use.
The Library classifies its funds into the following types:
These funds account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects.
The Library had the following significant Special Revenue Funds:
Wood Memorial Fund - The use of the Wood Memorial Fund shall be limited to landscaping, furniture and audiovisual materials.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) Williams Memorial Fund - Williams Memorial Fund accounts for dividends received from the donated common stock and interest received from certificates of deposit. The use of the Williams Memorial Fund shall be limited to the purchase of reference materials and selected works in the fields of scientific development and invention, including audio visuals, electronic media, and new technologies.
This fund accounts for and reports financial resources that are restricted, committed or assigned to expenditure for capital outlays, including the acquisition or construction of capital
facilities and other capital assets. The Library had the following Capital Projects Fund:
Building and Repair Fund - The use of the Building and Repair Fund shall be limited to major planned expenditures or building repair expenditures which are submitted to the Board if the amount exceeds $5,000.
This fund accounts for operations that are similar to private business enterprises where management intends to recover the significant costs of providing certain goods or services
through user charges. The Library had the following Enterprise Fund: