«MARVIN MEMORIAL LIBRARY RICHLAND COUNTY, OHIO FINANCIAL STATEMENTS (AUDITED) FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014 LESLIE HAINES, FISCAL ...»
Enterprise Fund - The use of the Enterprise Fund shall be limited to receipts and disbursements associated with four rental units of a property located at 36 N. Gamble Street, Shelby, Ohio that is owned by the Library.
E. Budgetary Process The Board of Trustees must annually approve appropriation measures and subsequent amendments. Unencumbered appropriations lapse at year end. Budgetary expenditures, that is, disbursements and encumbrances, may not exceed appropriations at the legal level of control, the object level within each fund.
F. Fund Balance Fund balance is divided into five classifications based primarily on the extent to which the Library must observe constraints imposed upon the use of its governmental-fund resources. The
classifications are as follows:
Fund balance is restricted when constraints placed on the use of resources are either externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or is imposed by law through constitutional provisions.
Trustees can commit amounts via formal action (resolution). The Library must adhere to these commitments unless the Trustees amend the resolution. Committed fund balance also incorporates contractual obligations to the extent that existing resources in the fund have been specifically committed to satisfy contractual requirements.
Assigned fund balances are intended for specific purposes but do not meet the criteria to be classified as restricted or committed. Governmental funds other than the general fund report all fund balances as assigned unless they are restricted or committed. In the general fund, assigned amounts represent intended uses established by Library Trustees or a Library official delegated that authority by resolution, or by State Statute.
Unassigned fund balance is the residual classification for the general fund and includes amounts not included in the other classifications. In other governmental funds, the unassigned classification is used only to report a deficit balance.
The Library applies restricted resources first when expenditures are incurred for purposes for which either restricted or unrestricted (committed, assigned, and unassigned) amounts are available. Similarly, within unrestricted fund balance, committed amounts are reduced first followed by assigned, and then unassigned amounts when expenditures are incurred for purposes for which amounts in any of the unrestricted fund balance classifications could be used.
G. Property, Plant and Equipment The Library records disbursements for acquisitions of property, plant, and equipment when paid.
The accompanying financial statements do not report these items as assets.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued) H. Accumulated Leave In certain circumstances, such as upon leaving employment, employees are entitled to cash payments for unused leave. The financial statements do not include a liability for unpaid leave.
NOTE 2 - EQUITY IN POOLED CASH AND INVESTMENTS
Deposits: Deposits are insured by the Federal Depository Insurance Corporation.
Investments: The stock certificates are held in a safe deposit box in the name of the Library.
NOTE 4 - GRANTS-IN-AID RECEIPTS The primary source of revenue for Ohio public libraries is the Public Library Fund (PLF). The State allocates PLF to each county based on the total tax revenue credited to the State’s general revenue fund during the preceding month. This method of distribution is called the “percentage of revenue” method. This method was not used for August 2011 through June 2013. During that 23 month period PLF received a designated percentage of the dollar amounts received by the fund during the corresponding month of the fiscal year 2011 “base-year” period. Effective July 2013 the statutory allocation method reverted to the “percentage of revenue” method for PLF distribution. The fund received an amount equal to a specified percentage of the amount of GRF tax revenue received during the previous month. Beginning with the July 2013 distribution the “statutory allocation method” was implemented. The calendar year 2013 entitlements were used in the computation as the basis of each county’s allocation percentage. Those percentages were used through December
2013. In December 2013 the actual calendar year entitlement was computed. Any difference was adjusted evenly to the PLF distributions from January-June 2014. In calendar year 2014 the statutory entitlement computation method continued. Estimated entitlement figures were issued to County Auditors in July 2013, December 2013 and June 2014. The actual 2014 entitlements will be computed in December 2014. The difference between the estimate and actual will be adjusted evenly in the PLF distributions made from January-June 2015. The State Public Library Fund (PLF) percentage was 1.66% of the total General Revenue Fund (GRF) tax receipts.
The Library collected no property taxes in 2014 or 2015.
NOTE 5 - DEBT The Shelby City School District serves as the taxing authority in a ministerial function, and can issue tax related debt on behalf of the Library. The determination to request approval of a tax levy, the rate, and the purpose are discretionary decisions made solely by the Library’s Board of Trustees. The Library has no debt.
NOTE 6 - RETIREMENT SYSTEM
The Library’s employees belong to the Ohio Public Employees Retirement System (OPERS).
OPERS is a cost-sharing, multiple-employer plan. The Ohio Revised Code prescribes this plan’s benefits, which include post-retirement healthcare, and survivor and disability benefits.
The Ohio Revised Code also prescribes contribution rates. For 2014 and 2015, members contributed 10% of their gross salaries and the Library contributed an amount equal to 14% of participants’ gross salaries. The Library has paid all contributions required through December 31, 2015.
NOTE 7 - RISK MANAGEMENT The Library belongs to the Ohio Plan Risk Management, Inc. (OPRM) - formerly known as the Ohio Government Risk Management Plan, (the "Plan"), a non-assessable, unincorporated non-profit association providing a formalized, jointly administered self-insurance risk management program and other administrative services to Ohio governments (“Members”). The Plan is legally separate from its member governments.
Pursuant to Section 2744.081 of the Ohio Revised Code, the plan provides property, liability, errors and omissions, law enforcement, automobile, excess liability, crime, surety and bond, inland marine and other coverages to its members sold through fourteen appointed independent agents in the State of Ohio.
OPRM coverage programs are developed specific to each member’s risk management needs and the related premiums for coverage are determined through the application of uniform underwriting criteria addressing the member’s exposure to loss, except OPRM retains 41.5% (effective November 1, 2011) of the premium and losses on the first $250,000 casualty treaty and 10% of the first $1,000,000 property treaty. Effective November 1, 2012 (and through October 2014) the plan increased its retention to 50% of the first $250,000 casualty treaty. The Plan’s property retention remained unchanged from prior years. This change was made to balance the reinsurance market conditions. Members are only responsible for their self-retention (deductible) amounts, which vary from member to member. OPRM had 774 and 783 members as of December 31, 2013 and 2014 respectively.
Plan members are responsible to notify the Plan of their intent to renew coverage by their renewal date. If a member chooses not to renew with the Plan, they have no other financial obligation to the Plan, but still need to promptly notify the Plan of any potential claims occurring during their membership period. The former member’s covered claims, which occurred during their membership period, remain the responsibility of the Plan.
Settlement amounts did not exceed insurance coverage for the past three fiscal years.
NOTE 8 - SUBSEQUENT EVENTS The Library passed a 1.75 mil levy in May 2015, with collections beginning in 2016.
Independent Auditor’s Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Required by Government Auditing Standards Marvin Memorial Library Richland County 29 W. Whitney Avenue Shelby, Ohio 44875
To the Board of Trustees:
We have audited, in accordance with auditing standards generally accepted in the United States and the Comptroller General of the United States’ Government Auditing Standards, the financial statements of the cash balances, receipts, and disbursements by fund type of the Marvin Memorial Library, Richland County, Ohio as of and for the years ended December 31, 2015 and 2014, and the related notes to the financial statements and have issued our report thereon dated April 8, 2016, wherein we noted the Marvin Memorial Library followed financial reporting provisions Ohio Revised Code Section 117.38 and Ohio Administrative Code Section 117-2-03(D) permit.
Internal Control Over Financial Reporting
As part of our financial statement audit, we considered the Marvin Memorial Library’s internal control over financial reporting (internal control) to determine the audit procedures appropriate in the circumstances to the extent necessary to support our opinions on the financial statements, but not to the extent necessary to opine on the effectiveness of the Marvin Memorial Library’s internal control. Accordingly, we have not opined on it.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, when performing their assigned functions, to prevent, or detect and timely correct misstatements. A material weakness is a deficiency, or a combination of internal control deficiencies resulting in a reasonable possibility that internal control will not prevent or detect and timely correct a material misstatement of the Marvin Memorial Library’s financial statements. 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 was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, we did not identify any deficiencies in internal control that we consider material weaknesses. However, unidentified material weaknesses may exist.
Board of Trustees Marvin Memorial Library Compliance and Other Matters As part of reasonably assuring whether the Marvin Memorial Library’s financial statements are free of material misstatement, we tested its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could directly and materially affect the determination of financial statement amounts.
However, opining on compliance with those provisions was not an objective of our audit and accordingly, we do not express an opinion. The results of our tests disclosed no instances of noncompliance or other matters we must report under Government Auditing Standards.
Purpose of this Report
This report only describes the scope of our internal control and compliance testing and our testing results, and does not opine on the effectiveness of the Marvin Memorial Library’s internal control or on compliance. This report is an integral part of an audit performed under Government Auditing Standards in considering the Marvin Memorial Library’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Julian & Grube, Inc.
April 8, 2016
CLERK’S CERTIFICATION This is a true and correct copy of the report which is required to be filed in the Office of the Auditor of State pursuant to Section 117.26, Revised Code, and which is filed in Columbus, Ohio.