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EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTS COUPEE, AND

WEST BATON ROUGE, LOUISIANA

Annual Financial StatementsYear Ended June 30, 2004

Under provisions of state law, this report is a publicdocument Acopy of the report has been submitted tothe entity and other appropriate public officials. Thereport is available for public inspection at the BatonRouge office of the Legislative Auditor and, whereappropriate, at the office of the parish clerk of court.

Release Date .1 \

TABLE OF CONTENTSPAGE

INDEPENDENT AUDITOR'S REPORT 4

BASIC FINANCIAL STATEMENTS

Government-Wide Financial Statements:

Statement of Net Assets 6

Statement of Activities 7

Fund Financial Statements:

Balance Sheet 9

Reconciliation of the Governmental Funds Balance Sheet ToThe Government-Wide Financial Statements of Net Assets 10

Statement of Revenues, Expenditures, and Changes inFund Balances 11

Reconciliation of the Statement of Revenues, Expendituresand Changes in Fund Balances of Governmental Funds tothe Statement of Activities 12

Notes to Financial Statements 13

SUPPLEMENTARY INFORMATION REQUIRED BY GASB STATEMENT 34

Budgetary Comparison Schedule - Judicial Expense Fund 30

Budgetary Comparison Schedule - Probation Fund 31

Budgetary Comparison Schedule - Hearing Officer Funds 32

Schedule of Non-Major Funds 33

OTHER SUPPLEMENTARY INFORMATION

Report on Compliance and on Internal Control over FinancialReporting Based on an Audit of Financial StatementsPerformed In Accordance with Government Auditing Standards 35

Schedule of Prior Years Findings 37

Schedule of Current Years Findings 38

Corrective Action Plan 39

Member */ Jflfffl/yl ( ' */ )p I/* lip MemberAmerican Insitute CPAs -4^l//M*W W* J~S\rY+++\t Louisiana Society CPAs

7829 BLUEBONNET BLVD.BATON ROUGE, LA 70810

(225) 767-7829

REPORT OF INDEPENDENT ACCOUNTANT

Septebmer 10, 2004

Honorable JudgesEighteenth Judicial District CourtParishes of Iberville, Pointe Coupee, and West Baton Rouge, Louisiana

I have audited the accompanying basic financial statements of theEighteenth Judicial District Court, as of and for the year ended June30, 2004, as listed in the Table of Contents. These basic financialstatements are the responsibility of the Eighteenth Judicial DistrictCourt's management. My responsibility is to express an opinion ofthese basic financial statements based on my audit.

I conducted my audit in accordance with auditing standards generallyaccepted in the United States of America and the standards applicableto financial audits contained in Government Auditing Standards, issuedby the Comptroller General of the United States. Those standardsrequire that I plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of materialmisstatement. An audit includes examining, on a test basis, evidencesupporting the amounts and disclosures in the financial statements. Anaudit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluating theoverall financial statement presentation. I believe that my auditprovided a reasonable basis for my opinion.

In my opinion, the basic financial statements referred to above presentfairly, in all material respects, the financial position of theEighteenth Judicial District Court as of June 30, 2004, and the resultsof its operations for the year then ended in conformity with accountingprinciples generally accepted in the United States of America.

As described in Note 1, the Eighteenth Judicial District Court hasimplemented a new financial reporting model, as required by theprovisions of GASB Statement No. 34, Basic Financial Statements-andManagement's Discussion and Analvsis-For State and Local Governments,as of June 30, 2004.

The budgetary information on page 30, is not a required part of thebasic financial statements but are supplementary information requiredby the Governmental Accounting Standards Board. I have applied certainlimited procedures, which consisted principally of inquires ofmanagement regarding the methods of measurement and presentation of thesupplementary information. However, I did not audit the informationand express no opinion on it.

The Eighteenth Judicial District Court has not presented Management'sDiscussion and Analysis that accounting principles generally accepted inthe United States has determined is necessary to supplement, althoughnot required to be part of, the basic financial statements.

In accordance with Government Auditing Standards, I have also issued areport dated September 10, 2004, on our consideration of EighteenthJudicial District Court's internal control over financial reporting andour tests of its compliance with laws, regulations, contracts andgrants. That report is an integral part of an audit performed inaccordance with Governmental Auditing Standards and should be read inconjunction with this report in considering the results of my audit.

GOVERNMENT WIDE FINANCIAL STATEMENTS

GOVERNMENT WIDE STATEMENT OF NET ASSETS

EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILL, POINTE COUPEE AND WEST BATON ROUGE

JUNE 30, 2004

ASSETS:CashCash-Certificate of DepositsAccounts ReceivableDepositCapital assets, net of accumulated depreciation

Total Assets

LIABILITIES AND FUND BALANCES:

LIABILITIES:

Accounts Payable

Payroll Taxes Payable

Deferred Revenue

Escrow

Compensated Absences

Total Liabilities

FUND BALANCES:

Invested in Capital Assets, net of debt

Unreserved-Undesignated

Total Fund Balance

Total Liabilities and Fund Balances

GOVERNMETAL

ACTIVITIES

$229,847651,74522,344

23069.030

973,196

$5,278

921

16,758

125,380

7,112

155,449

69,030

748,717

817,747

973,196

The accompanying notes are an integral part of this statement.

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FUND FINANCIAL STATEMENTS

BALANCE SHEETGOVERNMENTAL FUNDS

EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTE COUPEE AND WEST

JUNE 30, 2004

NON

ASSETS:CashCash-Certificate of DepositAccounts ReceivalbeDue From Other FundsDeposits

Total Assets

LIABILITIES AND FUND BALANCES:

LIABILITIES:

Accounts Payable

Payroll Taxes Payable

Due To Olher Funds

Deferred Revenue

Escrow

Compensated Absences

Total Liabilities

FUND BALANCES:

Unreserved-Undesignated

Total Fund Balance

Total Liabilities and Fund Balances

Judicial

Expense

$180,6000

22,3440

230

203,174

$2,781

700

92.978

0

0

0

96,459

106,715

106,715

203,174

PROBATION

$32,489651 ,745

079,687

0

763,921

$2,497

221

0

0

125,380

0

128,098

635,823

635,823

763,921

HEARING

OFFICER

$0

00

13,2910

13,291

$0

0

0

0

0

0

0

13,291

13,291

13,291

MAJOR

FUNDS

$16,7580

000

16,758

$0

0

0

16,758

0

0

16,758

0

0

16,758

TOTAL

$229,847651,74522,34492,978

230

997,144

$5,278

921

92,978

16,758

125,380

0

241,315

755,829

755,829

997,144

The accompanying notes are an integral part of this statement.

RECONCILIATION OF TOTAL GOVERNMENTAL FUND BALANCETO THE GOVERNMENT-WIDE FINANCIAL STATEMENT OF NET ASSETS

EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTS COUPEE AND WEST BATON ROUGE, LOUISIANA

JUNE 30, 2004

Amounts reported for governmental activities in theStatement of Net Assets are different because:

Total Governmental Fund Balance $755,829

Capital assets used in governmental activities arenot financial resources and therefore are notreported in the funds 69,030

Some expense reported in the statement of activitiessuch as compensated absences, do not require theuse of current financial resources and thereforeare not reported as expenditures in government funds:Compensated Absences (7,112)

Net Assets of Governmental Activities 817,747

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT.

10

STATEMENT OF REVENUES. EXPENDITURES. AND CHANGES IN FUND BALANCESGOVERNMENTAL FUNDS

EIGHTEENTH JUDICIAL DISTRICT COURTPARISH OF IBERVILLE, POINTE COUPEE AND WESTJune 30, 2004

JUDICIALEXPENSE PROBATION

REVENUEIntergovernmentalFines

Interest Income

Other Income

EXPENDITURES

PUBLIC SAFETY

CURRENT

Salaries

Fringe

Travel

Operating Services

Operating Supplies

Other

Fines & Restitution

Capital Outlay

EXCESS OF REVENUE OVER

(UNDER) EXPENDITURES

FUND BALANCE, BEGINNING

FUND BALANCE, END

$362,7150

2,8700

365,585

255,69837,90817,51961,107

14300

1,316

373,891

(8,106)

114,821

106,715

$0671,021

5,0790

676,100

159,37418.0329,725

97,63213,452

0434,85721,221

754,293

(78,193)

723,175

644,982

BATON ROUGENON-

HEARING MAJOROFFICER FUNDS

$149,455000

149,455

81,96227,485

1,09316,6923,236

1500

5,546

136,164

13,291

0

13,291

$37,5840

1920

37,776

25,8001,974

7476,252

30600

2,69737,776

0

37,844

37,844

TOTAL

$549,754671,021

8,1410

1,228,916

522,83485,39929,084

181,68317,137

150434,857

30,7801,301,924

(73,008)

837,996

764,988

The accompanying notes are and integral part of this statement.

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RECONCILIATION OF STATEMENT OF REVENUES, EXPENDITURES AND CHANGES INFUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES

EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTE COUPEE AND WEST BATON ROUGE, LOUISIANA

FOR THE YEAR ENDED JUNE 30, 2004

Amounts reported for governmental activities in thestatement of activities are different because:

Net Change in Fund Balances-Total Governmental Funds $(73,008)

Governmental funds report capital outlays as expenditures.However, in the statement of activities, the cost ofthose assets is allocated over their estimated usefullives as depreciation expense. This is the amount bywhich capital outlays exceeded depreciation in thecurrent period. (6,155)

Repayment of notes payable is an expenditure in thegovernmental funds, but the repayment reduces long-term liablilities in ths statement of net assets. -0-

Some expense reported in the statement of activitiessuch as compensated absences, do not require the useof current financial resources and therefore are notreported as expenditures in governmental funds. (7,112)

Changes in Net Assets of Governmental Activities (86,275)

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT

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NOTES TO FINANCIAL STATEMENTSFOR THE YEAR ENDED JUNE 30, 2004

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

INTRODUCTIONThe General Fund (Judicial Expense Fund) for the Eighteenth JudicialDistrict Court was created by LSA-RS 13:991-996. In general, thecreating statutes provide that the judges of the district may levycourt costs for operations of the courts. The amount of the courtcost to be levied in civil and criminal cases is determined by themajority of the judges in the district. The amount of cost leviedcannot exceed the amount established by the creating statute. Courtcosts are normally collected by the clerk of court and the sheriff,remitted to the judges, and deposited to the judicial expense fund.Expenditures from the fund are determined by the majority of thejudges. Expenditures normally include materials and supplies, lawlibrary and salaries of those individuals appointed by the judges.The judges may appoint law clerks, court reporters, secretaries,clerks, research clerks, administrative staff and other personnel asdeemed necessary. The salaries of the judges cannot be paid from thejudicial expense fund.

The Special Revenue Fund {Probation Fund) of the Eighteenth JudicialDistrict was established in 1989 after the Louisiana Legislaturedecided in Code of Criminal Procedure Article 894 A(l) that theDepartment of Probation and Parole would no longer superviseprobation in misdemeanor cases. Article 894 A (1) also authorizedthe Court to place the defendant on probation with a "probationoffice" designated by the Court upon such conditions as the Courtmay fix. The Probation Fund was established as the designatedprobation office. Article 895 1 (C) of the Code of Criminal Procedureprovides for a monthly probation fee of $20 to be paid to the agencyproviding supervision. The funds received by the Probation Fund arethe $20 per month supervision fee and as a condition fixed by theCourt.

The Judicial District encompasses the parishes of Iberville, PointeCoupee and West Baton Rouge, Louisiana. There are four judges whoare independently elected by the people.

B. REPORTING ENTITYBased on the criteria set forth in GASB Statement 14, theEighteenth Judicial District Court is not a component unit ofanother primary government nor does it have any component unitswhich are related to it. In addition, based on criteria setforth in GASB Codification Section 2100, the Eighteenth JudicialDistrict Court has presented its financial statements as aprimary government, because it is a special-purpose governmentthat has a separately elected governing body, is legallyseparate, and is fiscally independent of other state and localgovernments.

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NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

As used in GASB Statement 14, the term fiscally independent meansthat the Eighteenth Judicial District Court may, without approvalor consent of another government entity, determine or modify itsown budget, levy its own taxes or set rates or changes, and issuebonded debt.

Accordingly, the Eighteenth Judicial District Court is viewed asbeing fiscally independent for purposes of applying the reportingentity criteria of GASB Statement 14.

c. Presentation of Statements;The Eighteenth Judicial District Court's statements are preparedin accordance with accounting principles generally accepted(GAAP) in the United States of America as applicable togovernmental entities. The Governmental Accounting StandardsBoard (GASB) is responsible for establising GAAP for state andlocal governments through its pronouncements (Statements andInterpretations). Governments are also required to follow thepronouncements of the Financial Accounting Standard Board (FASB)issued through November 30, 1989 (when appliable) that do notconflict with or contradict GASB pronouncements.

The Eighteenth Judicial District Court has the option to applyFASB pronouncements issued after that date to its business-typeactivities and enterprise funds; however, the EighteenthJudicial District Court has chosen not to do so because it doesnot have any business-type activities or enterprise funds. Themore significant accounting policies established in GAAP and usedby the Eighteenth Judicial District Court are discussed below.

In June 1999, the Governmental Acccounting Standards Board (GASB)unanimously approved Statement No. 34, Basic FinancialStatements-and Management's Discussion and Analvsis-for State andLocal Governments. Certain of the significant changes in thestatement include the following:

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EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTS COUPEE AND WKST BATON ROUGE, LOUISIANA



For the first time the financial statements include:

A Management Discussion and Analysis (MD&A) sectionproviding an analysis of the Eighteenth JudicialDistrict Court's overall financial position and resultsof operations.

Governmental-Wide Financial statements prepared usingfull accrual accounting for all of the EighteenthJudicial District Court's activities.

A change in the fund financial statements to focus on themajor funds.

These and other changes are reflected in the accompanyingfinancial statements {including notes to financial statements).The Eighteenth Judicial District Court has elected to implementthe general provisions of the GASB Statement 34 in the currentyear.

d. Basic Financial Statements - Government-Wide StatementsThe Eighteenth Judicial District Court's basic financialstatements include both Government-Wide (reporting the EighteenthJudicial District Court as a whole) and fund financial statements(reporting the Eighteenth Judicial District Court's major funds).Both the Government-Wide and Fund Financial Statements categorizeprimary activities as either governmental or business type. TheEighteenth Judicial District Court's functions and programs havebeen classified as governmental activities. The EighteenthJudicial District Court does not have any business-typeactivities, fiduciary funds, or any component units that arefiduciary in nature. Accordingly, the Government-Wide financialstatements do not include any of these activities or funds.

In the Government-Wide Statement of Net Assets, the governmentaltype activities column (a) is presented on a consolidated basisby column, (b) and is reported on a full accrual, economicresource basis, which recognizes all long-term assets andreceivables as well as long-term debt and obligations. TheEighteenth Judicial District Court's net assets are reported inthree parts -invested in capital assets, net of related debt;restricted net assets; and unrestricted net assets.

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EIGHTEKNTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTS COUPEE AND WEST BATON ROUGE, LOUISIANA



Invested in capital assets, net of related debt consists ofcapital assets including restricted capital assets, net ofaccumulated depreciation and reduced by the outstanding balancesof any bonds, mortgages, notes, or other borrowings that areattributable to the acquisition, construction, or improvement ofthose capital assets. Restricted net assets consist of netassets with constraints placed on the use either by (1) externalgroups such as creditors, grantors, contributiors, or laws orregualations of other governments; or (2) law throughconstitiutional provisions or enabling legislation. Unrestrictednet assets include all other net assets that do not meet thedefinition of "restricted" of "invested in capital assets, net ofrelated debt."

The Government-Wide Statement of Activities reports both thegross net cost of each of the Eighteenth Judicial District Court's functions and significant programs. Many functions andprograms are supported by general government revenues likeintergovernmental revenues, and unrestricted investment income,particularly if the function or program has a net cost. TheStatement of Activities begins by presenting gross direct andindirect expenses that include depreciation, and then reduces theexpenses by related program revenues, such as operating andcapital grants and contributions, to derive the net cost of eachfunction or program. Program revenues must be directlyassociated with the function or program to be used directlyoffset its cost. Operating grants include operating-specific anddiscretionary (either operating or capital) grants, while thecapital grants column reflects capital-specific grants. TheEighteenth Judicial District Court did not receive any capital-specific grants this year.

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The Eighteenth Judicial District Court allocates its indirectcosts among various functions an programs in accordance withCircular A-87. The Statement of Activities shows this allocationin a separate column labled "indirect cost allocation." Inaddition, GOEA provided grant funds to help the EighteenthJudicial District Court pay for a portion of its indirect costs.As a result, only the indirect costs in excess of the GOEA fundsare allocated to the Eighteenth Judicial District Court's otherfunctions and programs.

The Government-Wide Statements focus upon the Eighteenth JudicialDistrict Court's ability to sustain operations and the change inits net assets resulting from the current year's activities.

e. Basic Financial Statements - Fund Financial StatementsThe financial transactions of the Eighteenth Judicial DistrictCourt are reported in individual funds in the Fund FinancialStatements. The operations of each fund are accounted for with aseparate set of self-balancing accountsthat comprise its assets, liabilities, equity, revenues andexpenditures. Resources are allocated to and accounted for inindividual funds based upon the purpose for which they are to bespent and the means by which spending activities are controlled.The various funds are reported by generic classification withinthe financial statements.

The Eighteenth Judicial District Court uses governmental fundtypes. The focus of the governmental funds' measurement (in thefund statements) is on determination of financial position andchanges in financial position (sources, uses, and balances offinancial resources) rather than on net income. An additionalemphasis is placed on major funds within the governmental fundtypes. A fund is considered major if it is the primary operatingfund of the Eighteenth Judicial District Court or if its totalassets, liabilities, revenues or expenditures are at least 10% ofthe corresponding total for all funds of that category or type.

Governmental fund equity is called the fund balance. Fundbalance is further classified as reserved and unreserved, withunreserved being further split into designated and undesignated.Reserved means that the fund balance is not available forexpenditure because resources have already been expended (but notconsumed), or a legally restriction has been placed on certainassets that makes them only available to meet future obligations.

17




Designated fund balances result when manangement tentatively setsaside or earmarks certain resources to expend in a designatedmanner. In contrast to reserved fund balances, designatedamounts can be changed at the discretion of management.

The following is a description of the governmental funds of theEighteenth Judicial District Court:

General Fund (Judicial Expense Fund) is the general operatingfund of the Eighteenth Judicial District Court. It is used toaccount for all financial resources except those required to beaccounted for in another fund.

Special Revenue Funds are used to account for the proceeds ofspecific revenue sources that are legally restricted toexpenditures for specific purposes.

The Eighteenth Judicial District Court has established serveralspecial revenue funds. The following is a breif description ofeach special revenue fund's purpose:

MAJOR SPECIAL REVENUE FUNDS

Probation Fund is used to account for funds, which are used toadminister the 18th Judicial District Court's ProbationDepartment.

Fins Fund is used to account for funds provided by theState of Louisiana Judicial Branch.

Hearing Officer is used to account for the funds to administerthe Family Court, Divorce matters, child protection, andproperty matters.

NON-MAJOR SPECIAL REVENUE FUNDS

Fins Fund is used to account for funds provided by theState of Louisiana Judicial Branch to administer juvenileprograms.

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EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE. POINTS COUPEE AND WEST BATON ROUGE, LOUISIANA


f. Measurement Focus and Basis of Accounting

Basis of accounting refers to when revenues orexpenditures/expenses are recognized in the accounts and reportedin the financial statements. It relates to the timing of themeasurements made regardless of the measurement focus applied.

1. Accrual Basis - Government-Wide Financial Statements (GWFS)The Statement of Net Assets and the Statement of Activitiesdisplay information about the Eighteenth Judicial DistrictCourt as a whole. Both of these statements have been preparedusing the economic measurement focus and the accrual basis ofaccounting. Revenues, expenses, gains, losses, assets andliabilities resulting from exchange or exchange-liketransactions are recognized when the exchange takes place.

2. Modified Accrual Basis - Fund Financial Statements (FFS)The accounting and financial reporting treatment applied to afund is determined by its measurement focus. Governmentalfunds types use the flow of current financial resourcesmeasurement focus and the modified accrual basis of accounting.Under the modified accrual basis of accounting, revenues arerecorded when susceptible to accrual (i.e. when they becomeboth measurable and available). "Measurable" means the amountof the transaction can be determined and available meanscollectible within the current period or soon enough thereafterto pay liabilities of the current period. The EighteenthJudicial District Court considers all revenues "available" ifthey are collected within 60 days after year end. Expendituresare generally recorded under modified accrual basis ofaccounting when the related liability in incurred. Theexceptions to this general rule are that (1) unmaturedprincipal and interest on long-term debt, if any, are recordedwhen due, and (2) claims and judgements and compensatedabsences are recorded as expenditures when paid expendableavailable financial resource resources.

g. Interfund Activities

Interfund activity is reported as either loans or transfers.Loans between funds are reported as interfund receivables andpayables as appropriate and are subject to elimination uponconsolidation. All other interfund transactions are treated astransfers. Transfers represent a permanent rellocation ofresurces between funds. Transfers between funds are nettedagainst one another as part of the reconcilaiton of the change infund balances in the fund financial statements to the change innet assets in the Government-wide Financial Statements.

19



h. Cash and Cash Equivalents

Cash includes amounts in demand deposits, interest-bearing demanddeposits, and petty cash. Cash equivalent include amounts intime deposits and those investments with orginal maturities of 90days or less. Cash and cash equivalents are reported at theircarrying amounts that equal their fair values.

i. Prepaid Expenses/ExpendituresPrepaid expenses include amounts paid for services in advance.These are shown as assets on the Government-Wide Statement of NetAssets. In the Fund Financial Statements, the EighteenthJudicial District Court has elected not to include amounts paidfor future services as expenditures until those services areconsumed to comply with the cost reimbursement terms of grantagreements. As a result, the prepaid expenditures are shown asan asset on the balance sheet of the Fund Financial Statementsuntil they are consumed. In addition, a corresponding amount ofthe fund balance of the General Fund has been reserved to reflectthe amount of fund balance not currently available forexpenditure.

j- Capital AssetsThe accounting and reporting treatement applied to the capitalassets associated with a fund are determined by its measurementfocus. Capital assets are long-lived assets that have beenpurchased or acquired with an original cost of at lease $1000 andthat have an estimated useful life of greater than one year.When purchased or acquired, these assets are recorded as capitalassets in the Government-Wide Statement of Net Assets. Incontrast, in the Fund Financial Statements, capital assets arerecorded as expenditures of the fund that provide the resourcesto acquire the assets. If the asset purchased, it is recorded inthe books at it cost. If the asset was donated, when it isrecorded at its estimated fair market value at the date ofdonation.

For capital assets recorded in the Government-Wide FinancialStatements, depreciation is computed and recorded using thestraight-line method for the asset's estimated useful life. Theestimated useful lives of the various classes of depreciablecapital assets are as follows:

Equipment 5-7 YearsVehicles 5 YearsComputers 3 Years

20



j. Capital Assets (Continued)

Salvage values have not been established by management whencalculating how much of an asset's cost needs to be depreciatedexcept for vehicles. For that category of capital asset,management has used 10% of the vehicle's initial cost as asalvage value estimate.

Depreciation is not computed or recorded on capital assets forpurposes of the Fund Financial Statements.

The Eighteenth Judicial District Court's policies for vacationtime permit employees to accumulate earned but unused vacationleave. Accordingly, a liability for the unpaid vacation leavehas been recorded in the Government-Wide Statements. Managementhas estimated the current and long-term portions of thisliability based on historical trends. The amount accrued as thecompesated absence liability was determined using the number ofvested vacation hours for each employee multiplied by theemployee's wage rate in effect at the end of the year. An amountis added to this total for social security and medicare taxes.In contrast, the governmental funds in the Fund FinancialStatements report only compensated absence liabilities that arepayable from expendable available financial recources to theextent that the liablities mature (or come due for payment).Vacation leave does not come due for payment until an employeemakes a request to use it or terminates employment with theOrganiziation. Accordingly, no amounts have been accrued as fundliabilities as the year-end in the Fund Financial Statements.The differences in the methods of accruing compensated absencescreates a reconciling item between the Fund and Government-WideFinancial Statement presentations.

The Eighteenth Judicial District Court's sick leave policy doesnot provide for the veating of sick leave thereby requiring theemployee to be paid for any unused leave upon termination ofemployment. Accordingly, no amounts have been accrued as unpaidcompensated absencse in the Government-Wide Financal Statementsrelative to sick leave.

21



m. MANAGEMENT'S USE OF ESTIMATES

The preparation of financial statements in conformity withgenerally accepted accounting principles requires management tomake estimates and assumptions that affect certain reportedamounts and disclosures. Accordingly, actual results may differfrom those estimates.

n. Elimination and Reclassifications:

In the process of aggregating data for the Statement of NetAssets and the Statement of Activities, some amounts reported asinterfund activity and balances in the funds were eliminated orreclassified. Interfund receivables and payables were eliminatedto minimize the "grossing up" effect on assets and liabilitieswithin the governmental activities column.

o. Deferred Revenue:

The Eighteenth Judicial District Court reports deferred revenueson its Statement of Net Assets and on the balance sheet of theFund Financial Statements. Deferred Revenues arise when theEighteenth Judicial District Court receives resources before ithas a legal claim to them, as when grant monies are receivedbefore the occurrence of qualifying expenditures. In subsequentperiods, when the Eighteenth Judicial District Court has a legalclaim to the resources, the liability for deferred revenue isremoved from the combined balance sheet and the revenue isrecognized.

NOTE 2 - REVENUE RECOGNITION

Revenues are recorded in the Government-Wide Statements when theyare earned under the accrual basis of accounting.

Revenues are recorded in the Fund Financial Statements governmentalusing the modified accrual basis of accounting. In applying thesusceptible to accrual concept using this basis of accounting,intergovernmental grant revenues, program service fees, and interestincome are usually both measurable and available. However, thetiming and amounts of the receipts of public support andmiscellaneous revenues are often difficult to measure; thereforethey are recorded as revenue in the period received.

22

FOR THE YEAR ENDED JUNE 30, 2004

NOTE 3 - CASH AND CASH EQUIVALENTS

At June 30, 2004, the Eighteenth Judicial District Court has cash andcash equivalent (book balances) totaling $881,592 ($229,847 cash +$651,745 certificates of deposit).

These deposits are stated at cost, which approximates market. Understate law, these deposits (or the resulting bank balances) must besecured by federal deposit insurance or the pledge of securitiesowned by the fiscal agent bank. The market value of the pledgedsecurities plus the federal deposit insurance must at all times equalthe amount on deposit with the fiscal agent. These securities areheld in the name of the pledging fiscal agent bank in a holding orcustodial bank that is mutually acceptable to both parties. AtJune 30, 2004, the Eighteenth Judicial District Court had $885,986 indeposits (collected bank balances).

These deposits are insured from risk by $476,372 of federal depositinsurance and $398,502 of pledged securities held by the custodialbank in the name of the fiscal agent bank (GASB Category 3), leaving$11,112 at risk.

Even though the pledged securities are considered uncollateralized(Category 3) under the provisions of GASB Statement No. 3, R.S.39:1229 imposes a statutory requirement on the custodial bank toadvertise and. sell the pledge securities within 10 days of beingnotified by the Eighteenth Judicial District Court that the fiscalagent has failed to pay deposited funds upon demand.

NOTE 4 - RECEIVABLES AND PAYABLES

A. A Summary of Receivables at year end follows.-

CLASS OF RECEIVABLES JUDICIAL EXPENSE

Intergovernmental $22,344

Accounts receivable are written-off under the direct write-offmethod whereby bad debts are recorded when a receivable is deemeduncollectible. If they are subsequently collected they arerecorded as miscellaneous income. The direct charge-off method isnot a material departure from GAAP as it approximates thevaluation method.

23



NOTE 5 - CAPITAL ASSETS

Capital assets and depreciation activity as of and for the yearended June 30, 2004, is as follows:

Governmental

EquipmentVehicles

ActivitiesBalance6-30-03

$109,95198,823

Additions

$20,783-0-

Deletions

-0--0-

Balance6-30-04

$130,73498,823

Subtotal 208,774 20,783 -0- 229,557

Accumulated Depreciation:Equipment 63,261 20,523 -0- 83,784Vehicles 60,331 16,412 -0- 76,743

Subtotal 123,592 36,935 -0- 160,527

Net Capital Assets 85,182 (16,152) -0- 69,030

Depreciation was charged to governmental activities as follows:

Judicial Expense Fund $3,248Probat ion Fund 32,291Fins Fund 1,396Hearing Officer Fund -0-

Total governmental activities depreciation expense 36,935

NOTE 6 - DEFERRED REVENUE

The Eighteenth Judicial District Court reports deferred revenueson its Statement of Net Assets and on the balance sheet of theFund Financial Statements. Deferred Revenues arise when theEighteenth Judicial District Court receives resources before ithas a legal claim to them, as when grant monies are receivedbefore the occurrence of qualifying expenditures.

Deferred Grants at year-end comprises of:

Deferred Fins Fund Grant $16,758

24

EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTE COUPEE AND WEST BATON ROUGE, LOUISIANA


NOTE 7 - ESCROW

The Eighteenth Judicial District Court reports escrow on itsStatement of Net Assets and on the balance sheet of the FundFinancial Statements. Escrow arise when the Eighteenth JudicialDistrict Court Probation Fund receives recevenue for anothergovernmental agency but has not remitted it yet.

NOTE 8 - PENSION PLAN AND RETIREMENT COMMITMENTS

JUDICIAL EXPENSE FUNDPlan Description.Substantially all Eighteenth Judicial District Court's JudicialExpense employees are members of the Louisiana State Employees'Retirement System of Louisiana ("LASERS"), a multiple-employer,public employee retirement system (PERS), controlled and administeredby a separate board of trustees. All permanent Eighteenth JudicialDistrict Court employees working at least 28 hours a week who arepaid wholly or in part from state funds and all elected stateofficials are eligible to participate in the LASERS.

Under the Plan, employees who retire at or after age 60 with at least10 years of credited service, at or after age 55 with 25 years ofcredited service, or at any age with at least 30 years of creditedservice are entitled to a retirement benefit, payable monthly forlife, equal to 2.5 % times the number of years of creditable servicetimes the average compensation, plus $300 annually. The System alsoprovides death and disability benefits. Benefits are established bystate statute.

The System issues an annual publicly available financial report thatincludes financial statements and required supplementary informationfor the System. That report may be obtained by writing to theLouisiana State Employee's Retirement System; P.O. BOX 44213;Baton Rouge, Louisiana 70809, or by calling (225) 922-0600.

Funding PolicyUnder the Plan, members are required by state statute to contribute7.5 percent of their annual covered salary and the EighteenthJudicial District Court is required to contribute at an actuariallydetermined rate. The current rate is 7.5 % of annual coveredpayroll. Contributions to the System also include 15.8 percentcontriubuted by the 18th Judicial District Court Judicial ExpenseFund. The contribution requirements of plan members and theEighteenth Judicial District Court are established and may be amendedby state statute.

25



NOTE 8 - PENSION PLAN AND RETIREMENT COMMITMENTS (Continued)

As provided by Louisiana Revised Statute 11:103, the employercontributions are determined by actuarial valuation and are subjectto change each year based on the results of the valuation for theprior fiscal year. The Eighteenth Judicial District Court'scontributions to the System under Plan A for the years ended June 30,2004, 2003, and 2002, were $16,858, $16,587, and $13,332,respectively, equal to the required contributions for each year.

PROBATION FUNDPlan Description.Substantially all Eighteenth Judicial District Court's Probationemployees are members of the Parochial Employees' Retirement Systemof Louisiana ("System"), a multiple-employer, public employeeretirement system (PERS), controlled and administered by a separateboard of trustees. The System is composed of two distinct plans.Plan A and Plan B, with separate assets and separate benefitprovisions. All employees of the Eighteenth Judicial District Courtare members of Plan A. All permanent Eighteenth Judicial DistrictCourt employees working at least 28 hours a week who are paid whollyor in part from parish funds and all elected parish officials areeligible to participate in the System.

Under Plan A, employees who retire at or after age 60 with at least10 years of credited service, at or after age 55 with 25 years ofcredited service, or at any age with at least 30 years of creditedservice are entitled to a retirement benefit, payable monthly forlife, equal to 3 per cent of their final-average salary for each yearof creditable service. However, for most employees who were membersof the supplemental plan only prior to January 1, 1980, the benefitis equal to one per cent of final average salary plus $24 for eachyear of supplemental plan only service earned prior to January 1,1980. Final-average salary is the employee's averagesalary over the 36 consecutive or joined months that produce thehighest average. Employees who terminate with at least the amount ofcredited service stated above and do not withdraw their employeecontributions may retire at the ages specified above and receive thebenefit accrued to their date of termination. The System alsoprovides death and disability benefits. Benefits are established bystate statute.The System issues an annual publicly available financial report thatincludes financial statements and required supplementary informationfor the System. That report may be obtained by writing to theParochial Employee's Retirement System, Post Office Box 14619, BatonRouge, Louisiana 70898-4619, or by calling (225) 928-1361.

26



NOTE 8 - PENSION PLAN AND RETIREMENT COMMITMENTS (Continued)

Funding PolicyUnder Plan A, members are required by state statute to contribute 9.5percent of their annual covered salary and the Eighteenth JudicialDistrict Court is required to contribute at an actuarially determinedrate. The current rate is 5.5 % of annual covered payroll.Contributions to the System also include one-fourth of 1 % of thetaxes shown to be collectible by the tax rolls of each parish, exceptOrleans and East Baton Rouge Parishes. These tax dollars are dividedbetween Plan A and Plan B, based proportionately on the salaries ofthe active members of each plan. The contribution requirements ofplan members and the Eighteenth Judicial District Court areestablished and may be amended by state statute.

As provided by Louisiana Revised Statute 11:103, the employercontributions are determined by actuarial valuation and are subjectto change each year based on the results of the valuation for theprior fiscal year. The Eighteenth Judicial District Court'scontributions to the System under Plan A for the years ended June 30,2004, 2003, and 2002, were $14,966, $26,135, and $24,736,respectively, equal to the required contributions for each year.

NOTE 9 - POST-RETIREMENT BENEFITS

The Eighteenth Judicial District Court does not offer any post-retirement benefits.

NOTE 10 - COMPENSATED ABSENCES

At June 30, 2004, employees of the Eighteenth Judicial District Courthave accumulated and vested $7,112 of employee leave benefits, whichwas computed in accordance with GASB Codification Section C60. Ofthis amount, all is recorded as an obligation of the General Fund.

NOTE 11 - LITIGATION AND CLAIMS

As of June 30, 2004, there was no litigation pending against theEighteenth Judicial District Court, nor was the Eighteenth JudicialDistrict Court aware of any unasserted claims.

No claims or litigation costs were incurred in the current year.

27



NOTE 12 - COMPENSATION PAID TO BOARD MEMBERS

In compliance with the Eighteenth Judicial District Court Law ofLouisiana (Act 36 of 1926), no compensation is paid to any member ofthe Board of Control.

NOTE 13 - RISK MANAGEMENT

The Eighteenth Judicial District Court is exposed to various risks ofloss related to torts, theft of, damage of and destruction of assets;errors and omissions and natural disasters for which the EighteenthJudicial District Court carries commercial insurance. There have been nosignificant reductions in coverage from prior year and settlements havenot exceeded coverage in the past three years.

28

REQUIRED SUPPLEMENTAL INFORMATION

29

EIGHTEENTH JUDICIAL DISTRICT COURTPARISH OF IBERVILLE, POINTE COUPEE AND WEST BATON ROUGEBUDGETARY COMPARISON SCHEDULE -JUDICIAL EXPENSE FUNDFOR THE YEAR ENDED JUNE 30, 2004

REVENUES:intergovernmentalMiscellaneousInvestment Income

Total Revenues

EXPENDITURES:Current

PersonnelFringeTravelOperating ServicesOperating SuppliesOther

Capita! OutlayTotal Expenditures

Excess (Deficiency) Of RevenueOver Expenditures

FUND BALANCE, Beginning

FUND BALANCE, Ending

BUDGET AMOUNTSORIGINAL

$431,9000

5,000436,900

276,80049,80012,50094,3002,000

5001,000

436,900

0

114821

114,821

FINAL

$431,9000

5,000436,900

276,80049,80012,50094,3002,000

5001,000

436,900

0

114,821

114,821

ACTUALAMOUNTS

GAAPBASIS

$362,7150

2,870365,585

255,69837,90817,51961,107

1430

1,316373,691

(8,106)

114,821

106,715

VARIANCEFINAL BUDGET

FAVORABLE(UNFAVORABLE)

($69,185)0

(2,130)(71,315)

21,10211,892(5,019)33,193

1,857500

(316)63,209

(8,106)

0

(8,106)

30

EIGHTEENTH JUDICIAL DISTRICT COURTPARISH OF IBERVILLE, POINTE COUPEE AND WEST BATON ROUGEBUDGETARY COMPARISON SCHEDULE - PROBATION FUNDFOR THE YEAR ENDED JUNE 30, 2004

REVENUES:IntergovernmentalFines

Investment IncomeTotal Revenues


PersonnelFringeTravelOperating ServicesOperating SuppliesFines & Restitution

Capital OutlayTotal Expenditures





$0274,800

0274,800

147,00043,00010,00055,00017,300

02,500

274,800

0

723175

723,175

FINAL

$0274,800

0274,800

147,00043,00010,00055,00017,300

02,500

274,800

0

723,175

723,175

ACTUALAMOUNTS

GAAPBASIS

$0671,021

5,079676,100

159,37418,0329,725

97,63213,452

434,85721,221

754,293

(78,193)

723,175

644,982



$0396,221

5,079401,300

(12,374)24,968

275(42,632)

3,848(434,857)(18,721)

(479,493)

(78,193)

0

(78,193)

31

EIGHTEENTH JUDICIAL DISTRICT COURTPARISH OF IBERVILLE, POINTE COUPEE AND WEST BATON ROUGEBUDGETARY COMPARISON SCHEDULE - HEARING OFFICER FUNDFOR THE YEAR ENDED JUNE 30, 2004

REVENUES:IntergovernmentalFinesInvestment Income

Total Revenues


PersonnelFringeTravelOperating ServicesOperating SuppliesOther

Capital OutfayTotal Expenditures





$145,00000

145,000

84,00021,2002,500

25,5004,500

5006,000

144,200

800

0

800

FINAL

$145,00000

145,000

84,00021,2002,500

25,5004,500

5000,000

144,200

800

0

800

ACTUALAMOUNTS

GAAPBASIS

$149,45500

149,455

81,96227,485

1,09316,6923,236

1505,546

136,164

13,291

0

13,291



$4,45500

4,455

2,038(6,285)1,4078,8081,264

350454

8,036

12,491

0

12,491

32

SCHEDULE OF NON-MAJOR SPECIAL REVENUE FUNDS

EIGHTEENTH JUDICIAL DISTRICT COURTPARISHES OF IBERVILLE, POINTE COUPEE AND WEST BATON ROUGE, LOUISIANAJune 30, 2004

FINSFUND

REVENUEIntergovernmental $37,584Investment Income 192

37.776EXPENDITURESPUBLIC SAFETYCURRENTSalaries 25,800Fringe 1,974Travel 747Operating Services 6,252Operating Supplies 306

CAPITAL OUTLAY 2,697

37,776EXCESS OF REVENUE OVER(UNDER) EXPENDITURES 0

FUND BALANCE, BEGINNING

FUND BALANCE, END

33

OTHER SUPPLEMENTAL INFORMATION

34

Member , ™ . .American InsButeCPAs Z ^» Z^ K Louisiana Society CPAs

7829 BLUEBONNET BLVD.BATON ROUGE, u\ 70810

(225) 767-7829

REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTINGBASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

September 10, 2004

To the Board of ControlEighteenth Judicial District CourtPort Allen, Louisiana

I have audited the financial statements of the Eighteenth JudicialDistrict Court as of and for the year ended June 30, 2004, and have issuedmy report thereon dated September 10, 2004. I conducted my audit inaccordance with generally accepted auditing standards and the standardsapplicable to financial audits contained in Government AuditingStandards, issued by the Comptroller General of the United States-

COMPLIANCEAs part of obtaining reasonable assurance about whether EighteenthJudicial District Court's financial statements are free of materialmisstatement, I performed tests of its compliance with certain provisionsof laws, regulations, contracts, and grants, noncompliance with whichcould have a direct and material effect on the determination of financialstatement amounts. However, providing an opinion on compliance with thoseprovisions was not an objective of my audit and, accordingly, I do notexpress such an opinion. The results of my tests disclosed an instancesof noncompliance that is required to be reported under Government AuditingStandards.

INTERNAL CONTROL OVER FINANCIAL REPORTINGIn planning and performing my audit, I considered Eighteenth JudicialDistrict Court's internal control over financial reporting in order todetermine my auditing procedures for the purpose of expressing myopinion on the financial statements and not to provide assurance on theinternal control over financial reporting. However, I noted certainmatters involving the internal control over financial reporting and itsoperations that I consider to be reportable conditions. Reportableconditions involve matters coming to my attention relating tosignificant deficiencies in the design or operation of the internalcontrol over financial reporting that, in my judgement, could adverselyaffect its ability to record, process, summarize and report financialdata consistent with the assertions of management in the financialstatements. Reportable conditions are described in the accompanyingschedule of findings.

35

A material weakness is a condition in which the design or operation ofone or more of the internal control components does not reduce to arelatively low level the risk that misstatements in amounts that wouldbe material in relation to the financial statements being audited mayoccur and not be detected within a timely period by employees in thenormal course of performing their assigned functions. I noted nomatters involving the internal control over financial reporting and itsoperation that we consider to be material weaknesses.

This report is intended solely for the information and use ofmanagement, board members, and federal awarding agencies, pass-throughentities, and state Legislative Auditor and is not intended to be andshould not be used by anyone other than these specified parties.

Under Louisiana Revised Statutes 24:513, this report is distributed by theLegislative Auditor as a public document.

3S


SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGSFOR THE YEAR ENDED June 30, 2004

PLANNEDFISCAL YEAR CORRECTIVEFINDING CORRECTIVE ACTION/PARTIAL

REF INITIALLY ACTION TAKEN CORRECTIVENO. OCCURRED DESCRIPTION OF FINDING (YES,NO,PARTIALLY) ACTION TAKEN

NONE

37


SUMMARY SCHEDULE OF CURRENT YEAR'S FINDINGSFOR THE YEAR ENDED June 30, 2004

REPORTABLE CONDITION: The Eighteenth Jucicial District had $11,112 incash that was at risk of loss because it was not insured or pledged.

CRITERIA: Under state law, all bank deposits must be (1) secured byfederal deposit insurance or by the pledge of securities owned by thefiscal agent bank, or (2) invested exclusively in instruments backedby the U.S. government.

CAUSE: One bank did not increase it's pledges as interest was earned.

EFFECT: $11,112 as at risk of loss.

RECOMMENDATION: The Court should pledge or move the the unsecured cash

MANAGEMENT RESPONSE: On July 7, 2004, the bank has pledged anadditional $50,000 to secure the cash.

38


CORRECTIVE ACTION PLANYEAR ENDED JUNE 30, 2004

REFNO.

DESCRIPTIONOF FINDING

CORRECTIVEACTIONPLANNED

NAME OFCONTACTPERSON

ANTICIPATEDCOMPLETION

DATE

1. $11,112 Cash AtRisk of Loss

The Bank HasPledged $50,000.

Bobby Stanley 7-07-04

* * * *

39

Documents

Eighteenth Judicial District Judicial Expense Fundapp.lla.la.gov/PublicReports.nsf/86256EA9004C005986256F54005A7BE8/... · The Eighteenth Judicial District Court has not presented