alexandria regional port authority - louisiana · presentation. we believe that our audit provides...

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Alexandria Regional Port Authority

Alexandria, Louisiana

April 30, 2009

Under provisions of state law, this report is a public document. Acopy of the report has been submitted to the entity and other appropriate public officials. The report is available for public inspection at the Baton Rouge office ofthe LegislativeAuditor and, where appropriate, at the office of the parish clerk of court.

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Alexandria Regional Port Authority

April 30, 2009

Table of Contents

Exhibit Page Independent Auditor's Report 1-2

Required Supplemental Information 3 Management's Discussion and Analysis 4-7

Basic Financial Statements 8 Statement of Net Assets A 9 Statement of Revenues, Expenses, and

Changes in Net Assets B 10 Statement of Cash Flows C 11

Notes to Basic Financial Statements 12-19

Other Report Required by Govemment Auditing Standards 20

Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Govemment Auditing Standards 21-23

Schedule of Findings and Responses 24

Management's Schedule of Prior Audit Findings 25

PAYNE, MOORE & HERRLNGTON, LLP

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Independent Auditor's Report

Board of Commissioners Alexandria Regional Port Authority

We have audited the accompanying basic financial statements of the business-type activities of the Alexandria Regional Port Authority, Alexandria, Louisiana, as of and for the year ended April 30, 2009, as listed in the table of contents. These financial statements are the responsibility of the Alexandria Regional Port Authority's management. Our responsibility is to express an opinion 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 Govemment Auditing Standards, issued bythe Comptroller General ofthe United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also Includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the business-type activities of the Alexandria Regional Port Authority as of April 30, 2009, and the respective changes in financial position, and its cash flows thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America.

In accordance with Govemment Auditing Standards, we have also issued our report dated September 22, 2009, on our consideration of the Alexandria Regional Port Authority'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 the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standands and should be considered in assessing the results of our audit.

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The management's discussion and analysis on pages 4 through 7 is not a required part of the basic financial statements but is supplementary information required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it.

Required Supplemental Information

Management's Discussion and Analysis

Alexandria Regional Port Authority April 30, 2009


Our discussion and analysis of the Alexandria Regional Port Authority's (the Authority) financial performance provides an overview of the Authority's financial activities for the fiscal year ended April 30, 2009. Please read in conjunction with the Authority's basic financial statements, which begin on page 8.

Financial Highlights

• The Authority's net assets decreased by $10,030 or (0.07)% during the year ended April 30, 2009.

Using this Annual Report

This annual report consists of Management's Discussion and Analysis, the basic financial statements, and notes to the financial statements. Management's Discussion and Analysis provides a narrative of the Authority's financial performance and activities for the year ended April 30, 2009. The basic financial statements provide readers with a broad overview of the Authority's finances, in a manner similar to a private-sector business. The notes provide additional information that is essential to a full understanding of the data provided in the basic financial statements.

The basic financial statements consist of three statements:

• The Statement of Net Assets presents information on alt of the Authority's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the Authority is improving or deteriorating.

• The Statement of Revenues, Expenses, and Changes in Net Assets presents information showing how the Authority's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underiying event giving rise to the change occurs, regardless of the timing of related cash flows. Certain revenues and expenses are reported in this statement that will result In cash flows In future periods.

• The Statement of Cash Flows presents information showing how the Authority's cash changed during the most recent fiscal year. It shows the sources and uses of cash.



Financial Analysis ofthe Authority as a Whole

A summary of net assets is presented below.

Table 1 Net Assets

$

S_

2009 488,540 $

13.154,228 13,642,768

87,191 90.607

177,798

13,154,228 310.742

13,464.970 $

2008 657,155

13,130.843 13,787,998

230,732 82,266

312,998

13,130,843 344,157

13,475.000

% Chanqe (25.66)%

0.18% (1.05)%

(62.21)% 10.14%

(43.20)%

0.18% (9.71)% (0.07)%

Current and other assets Capital assets, net of depreciation

Total Assets

Current liabilities Noncurrent liabilities

Total Liabilities

Invested In capital assets Unrestricted net assets

Total Net Assets

Invested In capital assets represent the Authority's long-term Investment In capital assets, net of accumulated depreciation, and is not available for current operations.

A summary of changes in net assets is presented below.

Operating revenues (Charges for services, leases, and other)

Non-operating revenue (Government subsidies and Interest Income)

Total Revenues

Operating expenses Depreciation Other

Total Expenses

Capital contributions

Change in net assets

Table 2 Changes in Net Assets

:her) $

ncome)

S _

2009

532,847 $

7.223 540,070

322,411 538.845

. 861.256

311,156

n0.030^ S

2008

525,780

54.265 580,045

269,241 640.848 910.089

2,245,406

1,915,362

% Chanqe

1.34%

(86.69)% (6.89)%

19.75% (15.92)% (5.37)%

(86.14)%

noo.52%^



Capital Assets

At April 30, 2009 and 2008, the Authority had $16,276,090 and $15,930,295 respectively. Invested In capital assets. Including land and improvements, roads, port facilities, and furniture, fixtures, and equipment Additions to capital assets during the year ended April 30, 2009, consisted of land of $101,640, Port facilities of $5,500, and construction in progress of $238,656 for a total of $345,796.

Non-Current Liabilities

The Authority's non-current liabilities consisting of accrued compensated absences for vacation and sick leave for a total of $61,836, a deferred lease revenue of $12,771 and a deposit held from leases of $16,000. These liabilities increased by $8,341 during the fiscal year, from $82,266 at the beginning of the year to $90,607 at the end of the year.

Other Currently Known Facts, Decisions, or Conditions

It is very difficult to project from year to year the profitability of the Port due to a majority of the income that reflects profitability is thru-put fees. The lease income and grants provide the basis for the operating expenses.

Where appropriate, the tenants share the bulk of the maintenance except for replacement of the capital assets.

in management's opinion, the substantial cash balance that the Port has acquired will be maintained under present operating projections, except for cash injection for capital expenditures.

Contacting the Authority's Financial Management

This financial report is designed to provide a general overviewof the Authority's accountability forthe money it receives. If you have questions about this report or need additional financial information, contact the Alexandria Regional Port Authority's office at 600 Port Road, Alexandria, Louisiana.

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8

Alexandria Regional Port Authority Statement of Net Assets

April 30, 2009

Exhibit A

Assets Current Assets

Cash Investments Accounts receivable Other assets Prepaid expenses

Total Current Assets

134,038 279,424 65,986 2,403 6,162

488.013

Noncurrent Assets Deposits Capital assets

Nondepreciable Land and improvements Construction-in-progress

Depreciable Other capital assets, net of accumulated depreciation

527

3,343,132 238,656

9,572.440

Total Noncurrent Assets Total Assets

13,154,755

13,642,768

Liabilities Current Liabilities

Accounts payable Payroll related payables

Total Current Liabilities

86,665 526

87,191

Noncurrent Liabilities Compensated absences Defened lease revenue Deposits held from leases

Total Noncurrent Liabilities Total Liabilities

Net Assets Invested in capital assets Unrestricted

61,836 12,771 16,000 90_.607

177,798

13,154,228 310.742

Total Net Assets $ 13,464,970

The accompanying notes are an integral part of the financial statements.

Alexandria Regional Port Authority Statement of Revenues, Expenses, and Changes in Net Assets

For the Year Ended April 30, 2009

Exhibit B

Operating Revenues Lease revenue Charges for services Other Income

Total Operating Revenues

Operating Expenses Depreciation Contract labor Contributions Salaries and wages Insurance Port maintenance and operating Office operating cost Port marketing Travel Hospitalization Retirement Auditing Auto expense Payroll taxes Membership and dues Offloading and uploading charges Legal Miscellaneous

Total Operating Expenses

Operating Loss

Non-Operating Revenues Interest Income

Total Non-Operating Revenues

Income (Loss) Before Contributions

Capital Contributions

Change in Net Assets

Net Assets - Beginning of Year

Net Assets - End of Year


10

136,877 375,465

20,505 532.847

322,411 12,200

500 165,207 51,161 44,519 24,096 31,244 19,374 21,697 14.758 9,276

11,700 13,261 7,641

99,220 12,278

713 861,256

(328,409)

7.223 7,223

(321,186)

311,156

(10,030)

13,475,000

$ 13,464,970

Alexandria Regional Port Authority Statement of Cash Flows


Exhibit C

Cash Flows from Operating Activities Received from operations $ 736,362 Payments for payroll and related expenses (172,010) Payments for goods and services (486,388)

Net Cash Provided by Operating Activities 77,964

Cash Flows from Capital and Related Financing Activities Purchase of fixed assets and construction (244,156) Capital contributions 209,516

Net Cash Used in Capital and Related Financing Activities (34,640)

Cash Flow from Investing Activities Interest income 7,223 Redemption of investments 341,867 Purchase of investments (398,777)

Net Cash Used in Investing Activities (49,687)

Decrease in Cash (6,363)

Cash, Beginning of Year 140,401

Cash, End of Year $ 134.038

Reconciliation of Operating Loss to Net Cash Provided by Operating Activities

Operating loss $ (328,409) Adjustments to reconcile operating loss to net cash used

in operating activities. Depreciation 322,411 Changes in assets and liabilities:

Accounts receivable 221,921 Accounts payable (143.757) Prepaid expenses (3,845) Payroll related payables 216 Accrued vacation and sick leave 6,242 Other assets 1,086 Deferred revenue from lease payments 2,099

Net Cash Provided by Operating Activities $ 77,964

Noncash Capital and Related Financing Activities:

Land in the amount of $101,640 was acquired through capital contributions

from the Red River Waterway District,


11

Notes to Basic Financial Statements

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1. Organization and Significant Accounting Policies

The Alexandria Regional Port Authority, created by Act 1987, No. 440 ofthe Legislature of the State of Louisiana, is a political subdivision ofthe State. Its territorial limits are concurrent with that ofthe municipal limits of the City of Alexandria. The Authority is governed by a board of commissioners, composed of up to eight members, who serve without compensation. The City of Alexandria appoints five members of the board, and the parishes of Rapides, Grant, and Avoyelles each appoint one member.

The financial statements ofthe Alexandria Regional Port Authority ("Authority") have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant ofthe Authority's accounting policies are described below.

Reporting Entity

GASB Statement No. 14, The Reporting Entity, as amended, established criteria for determining the governmental reporting entity and component units that should be included within the reporting entity. Under provisions of this Statement, the Authority Is considered a primary government, since it is a special purpose government that is legally separate and Is fiscally independent of other state or local governments. As used in GASB Statement No. 14, fiscally independent means that the Authority may, without the approval or consent of another governmental entity, determine or modify its own budget, levy its own taxes or set rates or charges, and issue bonded debt. Based upon these same criteria, the Authority has no component units.

Basis of Presentation

The financial statements of the Authority have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units. These principles require a statement of net assets, a statement of revenues, expenses and changes in net assets, and a statement of cash flows. It requires the classification of net assets into three components - invested In capital assets, net of related debt; restricted; and unrestricted. These classifications are defined as follows:

• Invested in capital assets, net of related debt: This component of net assets consists of capital assets, net of accumulated depreciation, and reduced by the outstanding balances of bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction or Improvement of those assets. The Authority has no debt attributable to Its capital assets.

• Restricted net assets: This component of net assets consists of constraints Imposed by creditors (such as through debt covenants), contributors, laws or regulations of other governments, or through constitutional provisions or enabling legislation. The Authority has no restricted net assets.

• Unrestricted net assets: This component of net assets consists of net assets that do not meet the definition of "restricted" or "Invested In capital assets, net of related debt."

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Fund Accounting

The accounts of the Authority are organized on the basis of an enterprise fund. Enterprise funds are used to account for operations that are financed and operated in a manner similar to private business enterprises - where the intent of the governing body is that the costs (expenses, including depreciation) of providing goods and services to the general public on a continuing basis be financed primarily through user charges or where the governing body has decided that periodic determination of revenues earned, expenses Incurred, and/or net income Is appropriate for capital maintenance, public policy, management control, accountability, or other purposes.

Basis of Accounting

The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. Enterprise funds follow GAAP prescribed by the Governmental Accounting Standards Board and Financial Accounting Standards Board's Standards issued prior to November 30, 1989. Enterprise funds are accounted for on a flow of economic measurement focus. With this measurement focus, all assets and liabilities associated with the operation of these funds are Included on the balance sheet. The operating statement presents increases (revenues) and decreases (expenses) in total net assets.

The accrual basis of accounting Is utilized by enterprise funds. Under this method, revenues are recorded when earned and expenses are recorded at the time liabilities are Incurred.

Enterprise funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods In connection with Its principal ongoing operations. The principal operating revenues of the Authority are charges for services and lease revenue. Operating expenses include costs of providing services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are report:ed as non-operating revenues and expenses.

Cash

Cash includes amounts In demand deposits as wel! as short-term investments with a maturity date within three months of the date acquired by the government.

Investments

The Authority may invest in United States bonds, treasury notes, or time certificates of deposit of any bank domiciled or having a branch office in the State of Louisiana, investments as stipulated in state law, or any other federally Insured Investment. Certificates of deposit that have a maturity date of more than three months are classified as investments.

Capital Assets

Al! purchased capital assets are stated at cost. Public domain (infrastructure) capital assets consisting of roads, bridges, drainage system, and similar Items are capitalized.

The capitalization threshold for assets is set at $500. Donated capital assets are valued at their estimated fair market value on the date received. Depreciation of all exhaustible capital assets Is charged against operations. Depreciation is computed over the estimated useful lives ranging from 5 to 50 years using the straight-line method.

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Deferred Revenue

The Port may report deferred revenue on its statement of net assets. Deferred revenues arise when the District receives resources before It has a legal claim to them. In subsequent periods, when the Port has a legal claim to the resources, the liability for deferred revenue is removed from the statement of net assets and revenue Is recognized.

Compensated Absences

Vested or accumulated vacation and sick leave are recorded as expenses and liabilities as the benefits accrue to employees. No liability is recorded for compensated absences that relate to future services or that are contingent on a specific event that Is outside the control ofthe employer and employees.

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 affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from those estimates.

2. Cash and Investments

Under state law, the Authority may deposit funds with a fiscal agent bank organized under the laws of the State of Louisiana, the laws of any other state in the Union, or the laws of the United States.

At year-end, the carrying amount of the Authority's deposits was $413,462, and bank balances were $504,071. A summary of cash and cash equivalents and investments is presented below:

Cash $ 134,038 Investments - certificates of deposit 279,424

$ 413,462

These deposits are stated at cost, which approximates market. Under state law, these deposits (or the resulting bank balances) must be secured by federal deposit insurance or the pledge of securities owned by the fiscal agent bank. The market value ofthe pledged securities plus the federal deposit insurance must at all times equal the amount of deposit with the fiscal agent

Custodial credit risk Is the risk that In the event of a bank failure, the Authority's deposits may not be returned. As of April 30, 2009, the Authority's bank balance of $504,071 was not exposed to custodial credit risk in that $413,552 was Insured and $90,519 was collateralized by securities held bythe pledging banks in the Authority's name.

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3. Capital Assets

Capital assets not being depreciated Land and improvements Construction in progress

Totals Capital assets being depreciated

Other capital assets Infrastnjcture-roads Office equipment Port facilities Furniture and fixtures Equipment

Totals Accumulated depreciation

Infrastructure-roads Office equipment Port facilities Fumiture and fixtures Equipment

Totals Other Assets, Net of Depreciation

Net Capital Assets

Balance 05/01/08

$ 3,241,492 -

3,241,492

325,125 7,415

12,027,064 9,141

320,058 12,688,803

(124,572) (6,408)

(2,554,368) (8.954)

(105.150) (2.799,452) 9.889.351

$13,130,843

Additions

$ 101,640 238,656 340,296

--

5,500 --

5,500

(6,622) (202)

(300,764) (165)

(14,658)' (322,411)

(316.911) $ 23,385

Adjustment/ Retirements

$

$

---

------

--------

Balance 04/30/09

$ 3,343,132 238.656

3,581,788

325,125 7,415

12,032,564 9,141

320,058 12,694,303

(131,194) (6,610)

(2,855,132) (9,119)

(119,808) (3,121,863) 9.572,440

$ 13,154,228

Depreciation expense Included In the financial statements for the fiscal year Is $322,411.

Capital assets are depreciated using the straight- line method over the following estimated useful lives:

Infrastructure - roads Port facilities Furniture and fixtures Equipment

Compensated Absences

Compensated absences

5. Retirement Plan Contribution

Beginning Balance Additions

$ 55,594 $ 6,242 Reductions $

50 years 40 years

7 years 5-40 years

Ending Balance

61,836

The Authority's policy is to deposit directly into an investment account ten percent (10%) of gross salary for its employees as a retirement benefit unless otherwise approved bythe Board of Commissioners.

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6. Lease and Commitments

On September 1, 1998, the Authority entered into a lease agreement with Terral Riverservice, Inc. to lease a bulk cargo facility from the Authority. The term of the lease was for five years expiring August 31, 2003, with the option of renewal at the end of the five year lease terms (another five year term for an additional nine (9) five (5) year options). Under the terms of the original lease agreement, Terral Riverservice agreed to pay an annual rental of $118,000 payable on a quarterly basis; provided however, that In consideration for advances made by Terral Riverservice, Inc., they shall be due a credit of $20,000 each year for ten years or until the balance Is paid In full. In the event the lease Is not renewed, any remaining balance ofthe credit is forfeited by Terral Riverservice, Inc.

On September 1, 2008, Terral Riverservice, Inc. exercised their option to renew the lease for an additional five years expiring on August 31, 2013.

On or about September 1, 2004, and in connection with the new dome construction project, Terral Riverservice, Inc. advanced an additional $200,000 to the Authority (bringing the balance to $280,000). Under the terms of the amended lease agreement, Terral Riverservice agreed to pay a recalculated annual rental of $120,700, payable on a quarteriy basis; provided however, that In consideration for additional advances made by Terral Riverservice, Inc., they shall be due a credit of $28,000 each year for a period of ten (10) years or until the balance Is paid In full. In the event the lease is not renewed, any remaining balance ofthe credit is forfeited by Terral Riverservice, Inc.

Provided this lease agreement is still In full force and effect and provided Terral Riverservice, Inc. shall not be in uncorrected default of this agreement at the end of the primary term or any extension of this agreement, Terral Riverservice, Inc. shall have the option to extend this lease agreement for seven additional consecutive terms of five years each.

Terral Riverservice, Inc. agreed to pay all taxes or any other governmental charges, utilities, and Insurance. Terral Riverservice, Inc. also agreed to maintain and repair leased property and keep it in good condition.

Current annual rental (through August 31, 2009) Is comprised of the following:

Annual lease for cargo facility $ 118,000 4% of $912,000 36,480 CPl average 3,540 Annual credit for construction advance (28,000)

$ 130,020

Minimum future rental payments to be received by the Authority under the present lease are as follows:

Fiscal Year End Gross Credit _ Net 4/30/2010 4/30/2011 4/30/2012 4/30/2013 4/30/2014

$ 694.481 $ 121,334 $ 573,147

17

$ 158,749 159.579 160,191 161,794 54.168

$ 28,000 ; 28,000

28,000 28,000 9.334

^ 130,749 131,579

132,191 133,794 44.834



Effective September 1,2013, assuming the lease agreement is extended, the annual iease payments will be recalculated to Include and Increase equal to the average Consumer Price Index (CPl) forthe last five years. It Is expected that the lease payments will increase, but not materially, over the current minimum future rental payment as indicated above.

The Authority entered into a lease agreement with Port Asset Acquisition, LLC (PAAL) to lease the Liquids Offloading Facility (LOF). The term ofthe lease was for five years expiring February 15, 2013, with the option of renewal at the end of the five year lease terms (another five year term for an additional seven five year options). Under the terms of the original lease agreement, PAAL agreed to pay an annual rental of $32,000 payable on a quarterly basis. The effective date of this agreement was February 15,2008 and the first year's rent payment Is waived In return for PAAL performing maintenance and upgrading ofthe LOF.

Minimum future rental payments to be received by the Authority under the present lease are as follows:

Fiscal Year End 4/30/2010 $ 32,000 4/30/2011 32.000 4/30/2012 32,000 4/30/2013 26,667

$ 122,667

Effective February 15, 2013, assuming the lease agreement is extended, the annual lease payments will be recalculated to Include and Increase equal, but not to exceed five percent, the average Consumer Price Index (CPl) for the last five years, it Is expected that the lease payments will Increase, but not materially, over the current minimum future rental payment as Indicated above.

7. Non-cash Capital and Related Financing Activity

On June 11, 2008, the Red River Watenvay District (Watenway District) transferred to the Port, In a non-cash capital and related financing activity, one hundred thirty-two acres of land with a fair value of $101,640. In the event that the Port abandons its plans to use the property in conjunction with Its port operation, or in the event the operations ofthe Port are terminated, or in the event the Port desires to sell or transfer the property to any person or entity, the WatenA^ay District shall have the right, but not the obligation, to reacquire the property and any improvements of any type located thereon from the Port at no cost.

As further consideration for this transfer, the Port agrees that it may not sell or transfer the property without the consent of the Watenway District. If the Watenway District consents to the Port transferring the property, and decides not to reacquire the property, the Port shall pay the Waterway Commission seventy-five percent ofthe sales proceeds, net of customary closing cost.

8. Risk Management

The Authority is exposed to various risks of loss related to torts, theft or damage and destruction of assets, errors and omissions, Injuries to employees, and natural disasters. The Authority carries commercial insurance as coverage for such occurrences except errors and omissions. The Authority covers all other losses, claims, settlements, and judgments, If any. Claim expenditures and liabilities are reported when It is probable that a loss has occurred and the amount of the loss can be reasonably estimated. No claim expenditures or liabilities are reported in the accompanying financial statements.

18



9. Commitments

The Authority negotiated a contract to build office facilities and cost of the construction project totals $465,616. The project will be funded through reimbursements from Red River Waterway Commission of $300,000, State of Louisiana Facility Planning and Control of $98,000 and the balance will be paid by the Authority. The Red River Watenway Commission reimbursed $161,355, $48,670 included in accounts receivable, and State of Louisiana Facility Planning and Control reimbursed $48,661, $17,316 included In accounts receivable, through April 30, 2009.

10. Concentration

For the fiscal year ended April 30,2009, ninety-four and fifteen hundredths percent (94.15%) of lease revenue was received from one customer and eighty-four and fifty-five hundredths percent (84.55%) of charges for services were received from two customers.

19

Other Report Required by Govemment Auditing Standards

20

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

21

PAYNE. MOORE & HERRINGTON, LLP

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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

Board of Commissioners Alexandria Regional Port Authority Alexandria, Louisiana

We have audited the financial statements of the business-type activities of the Alexandria Regional Port Authority, Alexandria, Louisiana, as of and forthe year ended April 30, 2009, and have issued our report thereon dated September 22, 2009. 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 Govemment Auditing Standards, issued by the Comptroller General of the United States.

Internal Control Over Financial Reporting

In planning and performing our audit, we considered the Alexandria Regional Port Authority'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 Alexandria Regional Port Authority's Internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness ofthe Alexandria Regional Port Authority's Internal control over financial reporting.

A control deficiency 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 misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the Alexandria Regional Port Authority's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Alexandria Regional Port Authority's financial statements that is more than Inconsequential will not be prevented or detected by the Alexandria Regional Port Authority's Internal control.

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A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the Alexandria Regional Port Authority's internal control.

Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above.

Compliance and Other Matter

As part of obtaining reasonable assurance about whether the Authority's financial statements are free of 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 Govemment Auditing Standards.

This report is intended solely for the information and use of management and the Board of Commissioners, state awarding agencies, and the Legislative Auditor's office ofthe State of Louisiana and is not Intended to be and should not be used by anyone other than these specified parties. However, under Louisiana Revised Statute 24:513, this report is in fact a public document

:ert

September 22, 2009

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Alexandria Regional Port Authority Schedule of Fmdings and Responses


Section I - Summary of Auditor's Results

Finandai Statements

Financial Statements

Type of auditor's report issued:

Internal control over financial reporting: Material weakness(es) Identified? Control deficiency(ies) identified not considered

to be material weaknesses?

Noncompliance material to the financial statements?

!\Aanagement's Corrective Action Plan

f^anagement's Summary Schedule of Prior Audit Findings

Memorandum of Recommendations and Other Comments

Federal Awards

Unqualified

Yes X

Yes X

Yes X

Not applicable

See Attached

None Issued

Not applicable

No

None reported

No

Section II - Financial Statement Findings

Not applicable.

Section III - Federal Award Findings and Questioned Costs

Not applicable.

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Alexandria Regional Port Authority Management's Schedule of Prior Audit Findings

Year Ended April 30, 2009

Finding 2008-01 Financial Statement Preparation

Condition and Context The Authority does not have personnel with the technical accounting expertise to prepare GAAP financial statements Including footnote disclosures.

Current Status: Resolved.

Finding 2008-02 Employer Paid Retirement

Condition and Context: During the current period, the Authority occasionally paid directly to an employee a retirement benefit and these amounts were not Included on the employees' W-2. Such payments constituting wages are subject to social security, Medicare, federal unemployment taxes, and Income tax withholding.


Finding 2008-03 Contractor Payments for Iniury

Condition and Context: A worker's compensation claim was filed In order for the Individual to receive compensation during the period he was out of work. It appears the Authority provided additional compensation to the contractor in excess ofthe amount paid by workman's compensation Insurance. This type of compensation without a formal written agreement or other evidence of a legal liability established may constitute a gift of public funds and In violation ofthe Louisiana Constitution Article Vll, Section 14.


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alexandria regional port authority - louisiana · presentation. we believe that our audit provides...

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