Baton Rouge Arts Council audit 2013

7/21/2019 Baton Rouge Arts Council audit 2013

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Baton Rouge Louisiana

FINANCIAL REPORT

un

50

2013


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TS

COUNCIL OF GREATER BATON

ROUGE INC.

Baton Rouge, Louisiana

TAB LE OF C ONTENTS

June 30, 2013

INDEPENDENT AUDITORS* RE PO RT

FINANCIAL STATEiMENTS

Statement o f Financial Position

Statement of Activities

Statement of Cash Flow s

Notes to Financial Statem ents

SPEC IAL INDEPENDENT AUDITOR S R EPOR T S

Intemal Control over Financial Reporting and on Comp liance

and Other Matters Based on an Audit of Financial Statements

Performed in Accordance with Government Auditing Stan dard s 14

SCHEDULE OF FINDINGS AND RESPONS ES 16

SCHEDULE OF PRIOR YEAR FINDINGS AND RESPONSES 17

SUPPLEMENTARY INFORM ATION Schedule

Combining Schedule of Financial Position 1 IS

Comb ining Schedule of Activities 2 19

Exhibit

A

B

C

D

Page

1

3

4

5

6


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Ccnilied Pdilic Accountants Business Advisors

IN D EPEN D EN T A U D ITO R S' R EPO R T

Board of Directors

Arts Council of Greater Baton Rouge, Inc.


We have audited the accompanying statement of financial position of the ARTS COUNCIL OF

GR EA TE R BAT ON RO UG E, INC . (a non-profit corporation) (the Council) as of June 30, 2013 , and

the related statements of activities and cash flows for the year then ended, and the related notes to the

financial statements.

Management's Responsibili ty for the Financial Statements

Management is responsible for the preparation and fair presentation of these fmancial statements in

accordance with accounting principles generally accepted in the United States of America; this

responsibility includes the design, implementation, and maintenance of intemal control relevant to the

preparation and fair presentation of fmancial statements that are free irom material misstatement,

whether due to fiaud or error.

Auditor 's Responsibili ty

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 Government Auditing Standa rds,

issued by the Comptroller General of the United States. Those standards require that we plan and

perform the audit to obtain reasonable assurance about whether the fmancial statements are free fi-om

material misstatement. The prior year summarized com parative information h as been derived fi'om the

Council's 2012 financial statements and, in our report dated October 15, 2012, we expressed an

unqualified opinion on those financial statements.

An audit involves perfomiing procedures to obtain audit evidence about the amoun ts and disclosures in

the financial statements. The procedures selected depend on the auditor's judgm ent, including the

assessment of the risks of material misstatement of the financial statements, whether due to fraud or

error. In making those risk assessments, the auditor considers intemal control relevant to the entity's

preparation and fair presentation of the fmancial statements to design audit procedures that are

appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness

of the entity's intemal control. Accordingly, we express no such opinion. An audit also include

evaluating the appropriateness of accounting policies used and the reasonableness of significant

accounting estimates made by management, as well as evaluating the overall presentation of the


6811 Jdfcison Highway Baton Rouge. LA 708 06 (225) 927-6 811 Facsimile (225) 932-000 0

1404 5. Bumiidr Avenue Gonzales, LA 70737 (225} 647-6811


4/21

We believe that the audit evidence we have obtained is sufficient and app ropriate to provide a basis for

our audit opinion.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the

financial position ofthe ART S CO UN CIL OF G RE AT ER BATO N R OU GE , INC. as of June 30,

2013,

and the changes in its net assets and its cash flows for the year then ended in conformity with

accounting principles generally accepted in the United States of Am erica.

Other Matter

Our audit was conducted for the purpose of forming an opinion on the financial statements as a who le.

The combining schedule of financial position and com bining schedule of activities on pages 18 and 19

are presented for pu rposes of add idonal analysis and is not a required part of the financial statements.

Such information is the responsibility of m anagement and was derived fi om and relates directly to the

underlying accounting and other records used to prepare the financial statements. The information has

been subjected to the auditing procedures applied in the audit of the financial statements and certain

additional procedures, including comparing and reconciling such information directly to the underlying

accounting and other records used to prepare the financial statements or to the financial statements

themselves, and other additional procedures in accordance with auditing standards generally accepted

in the United S tates of America. In our opin ion, the information is fairly stated in all material respects

in relation to the fmancial statements as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued a report dated October 24,

2013,

on our consideration of the ARTS COUNCIL OF GREATER BATON ROUGE, INC.'s

intemal control over financial repo rting and our tests of tscompliance 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 intemal control over financial reporting and compliance and the

results of that testing and not to provide an opinion on the intemal control overfin ncieilreporting or

on compliance. That report is an integral part of our audit performed in accordance with Government

Auditing Standard s and should be co nsidered in assessing the results of our audit.

fa j l / JHC

Certified Public Accountants


October 24, 2013


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Exhibit A

A R T S C O U N C I L O F G R E A T E R B A T O N R O U G E , IN C .


STATEMENT OF FINANCIAL POSITION

CURRENT ASSETS

Cash and cash equivalents

Certificates of deposit

Receivables:

CFA Cam paign, net

Grants and other

Related party

Prepaid expenses and other

Total current assets

EQUIPMENT, net

Total assets

June 30, 2013

(with comparative amounts for 2012)

ASSETS

s

2013

1 223 236

254,543

216,256

349,510

25,000

1,056

2 069 601

20.920

2 090 521

s

2012

1 135 733

243,664

212,417

443,074

-

27,802

2 062 690

22,694

2 085.384

LIAB ILITIES AND NET ASSETS

CURRENT LIABILITIES

Accounts payable

Due to grant recipients

Accrued expenses and other liabilities

Deferred revenues

Total current liabilities

NET ASSETS

Unrestricted

Temporarily restricted

Total net assets

Total liabilities and net assets

54,189

324,045

18,539

381,406

778,179

1.044 626

267,716

1 312 342

2 090 521

:

S 22,217

304,033

78,523

439,578

844,351

982,396

258,637

1 241 033

B

2 085 384

The accompanying notes

t

financial statements

are an integral part of this statement.

3


6/21

Exhibit B

ARTS COUNCILOFGREATER BATONROUG E, INC.


STATEMENT OF ACTIVITIES

For the year ended June

30

2013

(with comparative amounts for 2012)

SUPPORT, REVENUES, AND

RECLASSIFICATIONS

Contributions

CFA CampaignandWorkplace Giving

Fund Raisers/Gifts

In-kind facilityuse

Membership

Unrestricted

176,310

85,000

47,365

Temporarily

Restricted

426,272

92,798

-

-

Tota

2013

E 426,272

269,108

85,000

47,365

s

2012

411,150

301,514

85,000

65,430

Grants and Contractual Services

Municipal/parish

State of Louisiana

Community Fund for the Arts

School System and other

Other

Interest

Special events, net of expenses

Community School

Miscellaneous

Net assets released from restrictions

Total support, revenues and reclassifications

EXPENSES

Programs and development

Grants to CFA - recipient organizations

Genera and administrative

Total expenses

Change in net assets

NET ASSETS

Beginning of period

End of period

308,675

181,904

279,676

85,763

67,591

614,934

12,287

147,918

46,101

64,019

509,991

780,316

1,703,925

828,395

324,045

489,255

1.641,695

62,230

982,396

1,044,626

519,070

^

-

-

-

.

-

-

-

509,991)

509,991)

9,079

_

-

-

9,079

258,637

S 267.716

827,745

181,904

279,676

85,763

67,591

614,934

12,287

147,918

46,101

64,019

-

270,325

1,713,004

828,395

324.045

489,255

1.641.695

71,309

1.241,033

S 1,312,342

863,094

193,801

405,407

79,197

34,244

712,649

15,915

164.658

66,357

56,387

-

303,317

[,879,060

1,017,621

288.723

635,497

1,941.841

62,781)

1.303,814

1,241,033

The accompanying notes to financial statements

are an integral part of this statement.

4


7/21

A R T S C O U N C I L O F G R E A T E R B A T O N R O U G E , IN C .


STATEMENT OF CASH FLOWS

Exhibit C

For the year ended June 30, 2013

(with

comparative amounts for 2012

CASH FLOWS FROM OPERATING ACTIVITIES

Change in net assets

Adjustments for non-cash items:

Depreciation

Change in allowance for uncollectible pledges

Changes in operating assets and liabilities:

Receivables, prepaid expenses, and other assets

Accounts payable and other liabilities

Net cash provided (used) by operating ac tivities

CASH FLOWS FROM EWESTING ACTIVITIES

Purchase of fixe d assets

Loan to related party


Net cash provided (used) by investing activities

2 13

16,254

(3.751)

(25,000)

(28,751)

2012

71,309 3

5 525

6 700

98,892

(66,172)

; (62,781)

4,199

(6,696)

(263,401)

268,066

(60,613)

(2,504)

37,086

134,582

Net increase in cash

CASH AND CASH EQUIVAL ENTS

Beginning of year

End of year

87,503

1 135 733

73,969

1 061 764

1 223 236

1 135 733

The accompanying notes to financial statements

areanintegral part of this statement.

5


8/21

Exhibit D

ARTS COUNCIL OF GREATER BATON ROUGE, INC.

Baton Roug e, Louisiana

NOT E S T O FINANC IAL ST AT E M E NT S

NOTE 1 - SUMM ARY OF SIGNIFICANT ACCO UNTING POL ICIES

Nature of activities

The A rts Council of Greater Baton Rou ge, Inc. (the Council) was founded in 1973 to serve

the City of Baton Rouge, East Baton Rouge Parish and surrounding parishes. The m ission

of the Coun cil is to enhance the q uality of life of the community through the arts. In

addition, the Council conducts an annual united fund drive for participating arts

organizations and receives significant funding from govemment agencies.

Basis of presentation

The financial statements of the Council have been prepared on the accrual basis. The

significant accoimting policies are described below to enhance the usefulness of the


The Council reports information regarding its financial position and activities according to

three classes of net assets: imrestricted net assets, temporarily restricted net assets, and

permanently restricted net assets. The Council does not have permanently restricted net

assets.

The statement of activities presents exp enses of the Co unc il s operations functionally by

program services, grants, and general and administrative.

The financial statements include certain prior-year summarized comparative information

in total but not by net asset class. Such information does not include sufficient detail to

constitute a presentation in conformity with generally accepted accounting principles.

Accordingly, such infomiation shou ld be read in conjunction with the Cou ncil s financial

statements for the year ended June 30, 2012, from which the summarized information

was derived.

Estimates

The preparation of financial statements in conformity with generally accepted accounting

principles 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 ofthe financial statem ents and the reported amounts of revenues and

expenses during the reporting period. Estimates are used primarily when accounting for

the allowance for uncollectible pledges, prepaid assets, depreciation, deferred revenues

and in-kind revenue. Actual results could differ from those estimates.


9/21

Exhibit D

Continued)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOU NTING POLICIES CONTINUED)

Cash aod cash equivalents

The Council considers all highly liquid investments, money market fimds and certificates

of deposit with a maturity of three months or less at the date of acquisition to be cash

equivalents.


Financial Accou nting Standards Board FASB ) Accoimting Standards Codification, ASC

820),

establishes a framework for measuring fair value which provides a fair value

hierarchy that prioritizes the inputs sources of pricing information) to valuation techniques

used to measu re fair value. The highest priority is given to unadjusted quoted prices in

active mark ets for identical assets or liabilities level 1 measurem ent) and the lowest

priority to unobservable inputs level 3 measurem ents). The three levels of the fair value

hierarchy under ASC 820 are described as follows:

Level 1 - Unadjusted quoted prices for identical assets or liabilities in active markets that

the Plan h as the ability to access.

Level 2 - Inputs including :

Quoted prices for similar assets or liabilities in active markets;

Quoted price s for identical or similar assets or liabilities in inactive mark ets;

Inputs other than quoted prices that are observable for the asset or liability;

Inputs that are derived principally from or corroborated by observable market data by

correlation or other means.

If the asset or liability has a specified contractual) term , the level 2 input must be

observable for substantially the full term ofthe asset or liability.

Level 3 ~ Inputs that are imobservable and significant to the fair value measurement.

Certificates of deposit are recorded at cost^ which approximates fair market value using

level 2 in puts.

Promises to give

The Council reports contributions received as unrestricted, temporarily restricted, or

permanently restricted support depending on the existence and/or nature of any donor

restrictions.

Contributions are recognized when the donor makes a promise to give to the Council that

is, in substance, unconditional. Donor-restricted contriburions are reported as increases in

temporarily restricted net assets and, when a restriction expires, temporarily restricted net

assets are reclassified to unrestricted net asse ts.


10/21

Exhibit 0

(Continued)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOU NTING POLIC IES (CONTINUED)

Allowance for uncoUectible pledges

An allowance for uncollectible pledges is recorded based on prior years' experience and

man agem ent's analysis of specific pledg es. At June 30, 201 3, the allowance for

uncollectible pledges was 15,000. To the extent that amoimts reserved are collected, the

subsequent year's commitment to participating arts organizations is increased.

The Council does not require collateral on its receivables. At June 30, 2013, receivables

outstandmg for longer than 90 days totaled S247,059. These receivables relate to

govemm ent grant ftmding and a private grant that is to be paid over tw o years.

Grant recognition

Grants that represent exchange transactions are recorded as a receivable when the grant is

formally committed. Grants committed at year end which are applicable to the subsequent

fiscal period are included in grants receivable and deferred income. Furthermore, the

Council is advanced fimds from govemmental agencies. Such advances are recorded as

deferred income until eamed .

The Council receives grants which apply to programs whose duration extends into the

subsequent year. Revenue is recognized on these grants each fiscal year based on a ratio of

expenses incurred during the year to the total projected expenses of the program. At June

30,

the unexpended portion of the grant is deferred. In the case of grants received for

general operations that apply to a designated time period, income is recognized on a pro-

rata basis. Grants that represent contributed support are recognized in the same maimer as

promises to give.

Equipment and leasehold improvements

Equipment and leasehold improvem ents are recorded at cost. Depreciation of equipment

and leasehold improvements is compu ted using the straight-line m ethod over the estimated

useful lives ofthe assets.

Vacation leave

Vacation leave is eamed at varying rates for two to three weeks per year depending oo

length of service. A m aximum of ten days of unused vacation leave can be carried over at

December31 . Accordingly, amounts related to such vacation leave have been accrued.

(continued)


11/21

Exhibit D

(Continued)

NOTE I - SUMMA RY OF SIGNIFICANT ACCOUN TING POLIC IES (CONT INUED)

Temporarily restricted net assets

During 20 13 , change s in temporarily restricted net assets were as follows:

CFA Campaign

Contributed support grants:

Old South Baton Rouge

Arts Education

Sunday in the Park

East Baton Rouge City Parish

Spanish Town - Arts

Pennington Foundation

Crespo Award

Richardson Dufor Scholarship

From the Flame

FFA Sun Umbrellas

Derek E. Gordon Memorial Fund

Community School- Amerigroup

Beginning of

Year

84,466

50,000

40,000

44,000

25,000

3 200

2,087

150

3,190

3 i04

1,940

-

1,500

174,171

258,637

Increases

S 426,272

-

-

17,500

45,000

3 500

1,663

5 000

-

-

-

20,135

-

92.798

519,070

Decreases

(418,457)

-

(40,000)

(44,000)

-

(3,200)

(2.087)

-

(747)

-

-

-

(1,500)

(91,534)

S (509,991)

Remaining

Net Assets

92,281

50,000

-

17,500

70,000

3 500

1,663

5,150

2,443

3,104

1,940

20,135

-

175,435

267,716

The contributions generated above are designated to fund operations of participating arts

organizations or have restrictions as stipulated in the grant agreement. When the related

purpose restriction is satisfied, these temporarily restricted net assets are reclassified to

uiu-estricted net assets and reported in the statement of activities as net assets released from

restrictions.

Tax-exempt status

The Council is a non-profit organization and is exempt from federal income taxes under

Section 501(c)(3) ofthe Intemal Revenue Code. The Council follows FASB ASC 740-10,

Accounting fo r Uncertainty in Income T axes. Management believes it has no m aterial

uncertain tax positions and, accordingly, has not recognized a liability for any

imrecognized tax benefits. The C ounc il's open audit periods are 2010 through 201 3.

Contractual services

The Council contracts with local municipalities and school systems to provide educational

services and cultural development to residents and school children, organizations and the

community. The Council records contractual services as receivables at the time the

services are provided to the recipients.

9


12/21

Exhibit D

(Continued)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOU NTING PO LICIE S (CONTINUED)

Fair value of financial instruments

The carrying value of receivables, accoimts payable, accmed expenses, and deferred

revenue approximates fair value due to the short-term maturity of these instruments. None

ofth e financial instruments are held for trading piupose s.

Donated facilities and furniture

The Coimcil utilizes, without charge, certain premises owned by the City-Parish

govemm ent. The annual fair rental value ofth e prem ises, and the ftimiture and utilities, is

estimated to be 85,000 which is reflected in the financial statemen ts as in-kind facility

use.

In-kind services

Material in-kind items used in the Council's special events are recorded as revenue and

expense at the time the items are received, which is normally the time they are placed into

service. For the year ended June 30, 201 3, the Council recognized approximately 35,416

from donated services, which has been included in special events and gifts.

A substantial number of unpaid volunteers have made a significant contribution of their

time to develop the Council's programs, principally in fimd raising activifies, educational

projects, operations, and board participarion. The value of this donated time is not

reflected in these statements since such services do not meet the requirements for

recognition under generally accepted accountm g principles.

NOTE 2 - CER TIFICAT ES O F DEPOSIT

At June 30, 2013, the Council held certificates of deposits (CD's) with a market value of

254,543. Interest earnings are reinvested into the CD and therefore fair market value

equals the cost ofthe investment.

NOTE 3 - EQ UIPMENT

Equipment of 175,005 h as an estimated service life of three to five years with

accumulated depreciafion o f 154,085 and a net value of 20,920 at June 30, 201 3.

Depreciation expen se was 5,525 for 20 13 .

NOTE 4 - RETI REMEN T PLAN

The Council offers retirement benefits through simple individual retirement accounts for

eligible employees electing to establish the account. The Council provides matching

contributions of

3%

of eligible compensation. Participants arefii yvested in contributions

made to dieir individual retirement account. During 2013, the Council contributed 9,457.

1


13/21

Exhibit D

(Continued)

NOTE 5 GRANTS TO PARTICIPATING AGE NCIES

Certain donors designate contributions for specific arts organizations, which are accounted

for as agency ftmds and, accordingly, are not recognized as income or expenses. The

remaining contributions, which are undesignated, are allocated to arts organizations based

on a formula determined by the board. For the year ended June 3 0, 2013, grant allocafions

were designated to the following participating arts organizations:

Arts Council of Greater Baton Rouge

Louisiana Arts and Science Museum

Baton Rouge Symphony

Emerging /Merit Fund

Manship Theatre

Baton Rouge Little Theater

Swine Palace

Baton Rouge Ballet Theater

Foundation for Historical Louisiana

Of Moving Colors

Magnolia Mound

Playmakers of Baton Rouge

WRKF Public Radio

Baton Rouge Gallery

Tourgee DeBose National Piano Competition

Louisiana Sinfonietta

82,530

35,094

32,669

23,300

20,970

22,877

15,786

21,583

23,062

6,836

4.536

12,986

8,358

4,486

4,486

4,486

324,045

NOTE 6 - CONCE NTRA TIONS OF CREDIT RISK

Financial instruments which subject the Council to concentrations of credit risk consist

primarily of cash, cash eq uivalents, and certificates of deposit. The Cou ncil typically

maintains these balances in local banks that may, at times, exceed the FDIC limits.

Concentrafions of credit risk for receivables are generally diversified due to the large

number of entities and individuals com posing the Co unc il s programs and donor base.

The Council solicits a majority of fimds from individual and corporate contributors in the

Baton Rouge area. The C ouncil also receives grants

irom

he City of Baton Rouge and the

State of Louisiana, which are significant.

II


14/21

Exhibit D

(Continued)

NOTE

7

REL TED

PARTY

TR NS CTION

The Council entered into an agreement with the new executive director that provided an

advance of 25,000 for assistance -with relocation expenses. The amoimt will be

reclassified as compensation after 12 months of employment. At June 30, 2013, the

amount was recorded as a related party receivable.

NOTE 8 - SUBSEQUENT EVENTS

In preparing the financial statements, the Council has evaluated events and transactions

for potential recognifion or disclosure through the date of the auditor's report, which was

the date the financial statements were available to be issued.

2


15/21

Special Independent Auditors Reports

TS

COUNCIL OF GREATER BATON

ROUGE

INC.


June 30, 2013

13


16/21

Ce ra fid Public Accountants * Biuiness Advison

R EPO R T O N IN TER N A L C O N TR O L O V ER FIN A N C IA L R EPO R T IN G

AND ON COM PLIAN CE AND OTHE R MA TTE RS BASED ON AN AUDIT

O F FIN A N C IA L STA TEMEN TS PE R FO R M ED IN A C C O R D A N C E WITH

GOVERNMENT AUDITING STANDARDS

Board of Directors

Arts Council of Greater Baton Rou ge, Inc.


We have audited, in accordance with the auditing standards generally accepted in the United States of

America and the standards applicable to financials audits contained in Government Auditing Standa rds,

issued by the Comptroller General ofthe United States, the financial statements of ARTS COUNCIL

OF G RE AT ER BA TO N R OU GE , I N C (a non-profit organization) (the Council), which comprise

the statements of financial position as of June 30 , 2013 and the related statements o f activities and cash

flows for the year then ended and the related notes to the fmancial statements, and have issued our

reports thereon dated Octob er 24, 2013.

Inte ma l Control over Financial R eport ing

In planning and performing our audit of the financial statements, we considered the Council s intemal

control over financial reporthig (intemal co ntrol) to determine the audit procedures that are appropriate

in the circumstances 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 Co unc il s intem al control.

Accordingly, we do not express an opinion on the effectiveness ofth e Co unc il s intemal con trol.

A deficiency in internal contro\ exists when the design or operation of a control does not allow

management or employees, in the normal course of performing their assigned lunctions, to prevent, or

detect and correct misstatem ents on a timely basis. A ma terial w eakness is a significant deficiency, or

combination of deficiencies, in intemal c ontrol such that there is a reasonable possibility that a m aterial

misstatement o fth e entity s financial statements will not be prevented, or detected and corrected on a

timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in intemal

control that is less severe than a material weakness, yet important enough to merit attention by those

charged with governance.

Our considerafion of interned control over financial reporting was for the limited purpose described in

the preceding paragraph and was not designed to idenfify all deficiencies in intemal control over

financial reporting that might be deficiencies, significant deficiencies, or material weaknesses.

Therefore, there can be no assurance that all deficiencies, significant deficiencies, or material

weaknesses have been identified. We did identify certain deficiencies in intemal control, described in

the accompany schedule of findings and respon ses that we consider to be significant deficiencies. See

2013-1 and 2013-2.

14

6S11 Jdfereon Mi dw ay Baton Rouge, LA 70S0 6 (225) 927-6811 Facsimile: (225) 932-00 00

1404 S. Bum sideA venue - Gonzales, LA 70737 (225) 647-6811


17/21

Compliance and O ther Ma tters

As part of obtaining reasonable assurance about whether the Council s financial statements are ft eeof

material misstatement, we performed tests of its compliance with certain provisions of laws,

regulations, contracts and gran ts, noncompliance with wh ich could have a direct and m aterial effect on

the determination of fmancial 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 o pinion.

The results of oin tests disclosed instances of noncompliance that are required to be reported under

Government Auditing Standards and which are described in the accompanying schedule of findings

and responses as item 2013 -2.

Arts Council of Gr eate r Baton Rou ge, Inc. s Response to F indings

The Coimcirs responses to the fmdings identified in our audit is described in the accompanying

schedule findings and responses. The C oun cil s responses w ere not subjected to the auditing

procedures applied in the audit of the financial statements and , accordingly, we express no opinion on

them.

Purpo se of this Re por t

The purpose of this report is solely to describe the scope of our testing of intemal control and

compliance and the results of that testing, and not provide an opinion on the effectiveness of the

Cou ncil s intemal control or on c omp liance. This report is an integral part of an audit performed in

accordance with Govem ment Auditing Standards in considering the Asse ssor s intem al control and

compliance. Accordingly, this communication is no suitable for any other purpose.

This report is intended for the informafion of the Board of Directors, management, state and federal

granting agencies, and the Louisiana Legislative Auditor and is not intended to be and should not be

used by anyone other than these specified parties. Under Lo uisiana Revised Statute 24 :513, this report

is distributed by the L ouisiana Legislative Auditor as a public document.

1 ^

r i J ^ ^ ^

Certified Public Accountants

TU ^


October 24, 2013

15


18/21

RTS COUNCIL OF

GREATER BATONROUGE INC.


SCHE DULE O F FINDINGS AND RESP ONSES

For the year ended Jun e 30, 2013

A) SUMMARY OF AUDIT RESULTS

B) FINDINGS - FINANCIAL STATEM ENT AUDIT

2013-1 PREPARA TION OF FINANCIAL ST ATEM ENT S

Observation: The Council relies on its auditors to assist in adjusting the books and in the preparation

of extemal financial statements and related disclosures. Under U.S. generally accepted auditing

standards, we cannot be considered part ofth e Co unc il s intemal control structure. The design of th e

intemal control stmcture does not otherwise include procedures to prevent or detect a material

misstatement in the external financial statements.

Recommendation: Since management is satisfied with using its auditing firm to prepare extemal

financial statements, no change is recomm ended. How ever, this matter will continue to be reported.

M ana gem ent s corre ctive action pla n: Management intends to continue using the auditing firm to

prepare the extemal financial statements and related footnote disclosures.

2013-2 GRANT DOCUMENTATION

Observation: During our review of documentation required to be maintained by grant agreements, one

re-grant contract wnth a recipient organizafion had been revised to include different docum entation

requirements than other recipient organizations. In this circumstance, a general ledger detail was

provided to substantiate S8,152 of printing costs for the related project. The original contract required

source documents including invoices and proof of payment. Upon further inquiry, these source

documents were obtained fi om the recipient organizafion. Addifionally, tw o other grant files did not

contain the recipient organ ization s re-grant contract.

Recommendation: The grant documentation requirement should be strictly adhered to.

M anag em ent s corre ctive action plan : During 2013 , there was tumover in the grant director position,

which resuhed in inconsistent documentafion administrafion; however, management will emphasize

the importance of strict adherence to the policy of obtaining required documentation as specified in the

grant agreement.

6


19/21

RTS COUNCIL OF

GREATER BATONROUGE, INC

Baton Rouge Louisiana

SCHEDULE OF PRIOR YEAR FINDINGS AND RESPONSES

For the year ended June 30 2012

2012-1 PREPARA TION O F FINANCIAL STATEM ENTS

This finding has been reclassified as 2013-1.

17


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Schedule I

ARTS COUNCIL OF GREATER BATON ROUGE, ES C


COMB INING SCHEDULE OF FINANCIAL POSITION

June 30, 2013

ASSETS

CURRENT ASSETS

Cash and cash equivalents


Receivables:

CFA Cam paign, net

Grants and other

Related party

Prepaid expenses

Total current assets

EQUIPM ENT, net

Total assets

Arts Council

Community

Funds for

the Arts

Total

1 022 326

200,910

1 223 236

254,543 - 254,543

349,510

25,000

1,056

1,652,435

20,920

1,673,355

216,256

417,166

417,166

216,256

349,510

25,000

1,056

2,069,601

20,920

2,090,521

LIABILITIES AND NET ASSETS

CURRENT LIABILITIES

Accounts payable

Due to grant recipients

Accmed expenses and other liabilities

Deferred revenues

Total current liabilities

NET ASSETS

Unrestricted

Temporarily restricted

Total net assets

Total liabilities and net assets

54,189

-

17,699

381.406

453,294

1,044,626

175,435

1,220,061

1,673,355

_

-

324,045

840

-

324,885

92,281

92.281

417,166

54,189

324,045

18,539

381.406

778.179

1,044,626

267,716

1,312,342

2,090,521

See Independent Auditors' Report

t


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hedule2

RTS COUNCIL OFGREATER BATON

ROUGE

INC.


CO M BI N I N G SCH E D U L E O F A CT I V I T I E S

For the year ended June 30 ,201 3

SUPPORT AND REVENUES

Contr ibutions

CFA Campaign and Workplace Giving

Fund Raisers/Gifts

In-kind facility use

Membership

Grants and Contractual Services

Municipal/parish

State of Louisiana

Community Fund for the Arts

School System and other

Other

Interest

Special events, net of expenses

Community School

Miscellaneous

Total support and revenues

EXPENSES

Programs and development

Grants to CFA - recipient o rganizations

General and administrative

Tota expenses

Change tn net assets

NET ASSETS

Beginning of period

End of period

Arts Council

$

269,108

85,000

47,365

401,473

181,904

279,676

85,763

67,591

614,934

12,287

147,918

46,101

64,019

270,325

1 286 732

828,395

-

394,843

1 223 238

Communi ty

Funds for

the Arts

$ 426,272

-

426,272

_

-

-

-

-

-

-

-

-

426,272

_

324,045

94,412

418,457

Total

S 426,272

269,108

85,000

47,365

327,745

181,904

279,676

85,763

67,591

614,934

12^87

147,918

46,101

64,019

270,325

1 713 004

828,395

324,045

489,255

1 641.695

63,494

1 156 567

7,815

84,466

71,309

1 241 033

$

1 220 061

$ 92,281 S

1 312 342

See Independent Auditors' Report

Baton Rouge Arts Council audit 2013

Documents

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