THE ARC OF MOREHOUSEapp.lla.la.gov/PublicReports.nsf/70DD7576469E0A2E86257CA60061… · The Arc of...

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THE ARC OF MOREHOUSE

Financial Statements For the Years Ended June 30,2013 and 2012

Under provisions of state law, this report is a public document Acopy of the report has been submitted to the entity and other appropnate public offtcrals The report IS available for public inspection at the Baton Rouge office of the Legislative Auditor and v /here appropnate, at the office of the pansh clerk of court

Release Date M A R 2 6 2014

THE ARC OF MOREHOUSE

FOR THE YEARS ENDED JUNE 30,2013 and 2012

TABLE OF CONTENTS

Page

Independent Auditors' Report 1

FINANCIAL STATEMENTS

Statements of Financial Position 4

Statements of Activities 5

Statements of Functional Expenses For the Year Ended June 30,2013 6

For the Year Ended June 30, 2012 7

Statements of Cash Flows 8

Notes to Financial Statements 9 SUPPLEMENTAL SCHEDULES

Combimng Schedules of Financial Position June 30,2013 15 June 30,2012 16

Combining Schedules of Activities For the Year Ended June 30, 2013 17 For the Year Ended June 30, 2012 18

REPORT REQUIRED BY GOVERNMENT AUDITING STANDARDS

Report on Intemal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance With Government Auditing Standards 20

Schedule of Fmdings and Responses 22

I UFFEY, HUFFMAN, RAGSDME & SOIGNIER

John L Luffey. MBA. CPA (1963-2002) Franas I Huffman. CPA Philip A Ragsdale, CPA David Ray Soignier. CPA. MBA. CGMA

(A PROFESSIONAL ACCOUNTING CORPORATION)

CERTIFIED PUBLIC ACCOUNTANTS

John Herman. CPA Lynn Andfies, CPA, CGMA Esther Atteberry, CPA Lon Woodard. MBA, CPA. CGMA. CFTP

INDEPENDENT AUDITORS' REPORT

Board of Directors The Arc of Morehouse Bastrop, Louisiana

Report on the Financial Statements

We have audited the accompanying financial statements of The Arc of Morehouse (a nonprofit organization, the Association), which comprise the statements of fmancial position as of June 30, 2013 and 2012, and the related statements of activities, functional expenses, and cash flows for the years then ended, and the related notes to the financial statements.

Management's ResponsibUityfor the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accoimting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of intemal control relevant to the preparation and fair presentation of financial statements that are fi*ee from matenal misstatement, whether due to fraud or error.

A uditors' Responsibility

Our responsibility is to express opinions on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe Umted States. Those standards reqiure that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement

An audit involves performing procedures to obtam audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment ofthe risks of material misstatement ofthe fmancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers intemal control relevant to the entity's preparation and f^ presentation ofthe financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness ofthe entity's intemal control Accordingly, we express no such opinioa An audit also

1100 North 18th Street Monroe, Louisiana 71201 Tel (318)387-2672 • Fax (318)322-8866 • Website www afullservtcecpafirm com

MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors The Arc of Morehouse

includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation ofthe financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of The Arc of Morehouse as of June 30,2013 and 2012, and the changes in its net assets and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Other Matter

Our audit was conducted for the purpose of forming an opinion on the financial statements as a whole The schedules of financial position and schedules of activities on pa^es 15 -18 are presented for purposes of additional analysis and are not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the fmancial statements. The information has been subjected to the auditmg procedures applied in the audits ofthe financial statements and certain additional procedures, mcluding 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 States of America. In our opinion, the infonnation is fairly stated m all material respects m relation to the financial statements as a whole.

Other Reporting Required by Government Auditing Standards

In accordance with Govemment Auditing Standardsy we have also issued our report dated January 13,2014, on our consideration ofthe Association's iatemal 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 intemal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on intemal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Govemment Auditing Standards in considering the Association's intemal control over financial reporting and compliance.

(A Professional Accounting Corporation) January 13,2014

FINANOAL STATEMENTS

T H E A R C O F M O R E H O U S E

STATEMENTS O F FINANCIAL POSITION

June 30,2013 June 30,2012

ASSETS

Cash and Cash Equivalents 480,761 $

LIABILITIES AND NET ASSETS

492,144

Accounts Receivable Services (net of allowance for doubtful accounts of $9,384 and $0, respectively) Other

Prepaid Expenses Fixed Assets Accumidated Depreciation

TOTAL ASSETS $

^ ^ , / u - ^

307,118 720

16,919 1,060,545 (707,241)

1,212.605 $

i V 1 , V / V

198,385 1,434

14,273 996,492

(656,401)

1,147,397

Liabilities Accounts Payable Accmed Payroll and Taxes Other Accmed Liabilities

Total Liabilities

10,745 $ 36,735 5,518

8,883 41,180 5.398

52,998 55,461

Net Assets Unrestricted

Total Net Assets

TOTAL LIABILITIES AND IVET ASSETS

1,159,607 1,159,607

1,091,936 1,091,936

$ 1,212,605 $ 1,147,397

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

4

THE ARC OF MOREHOUSE STATEMENTS OF ACTIVITIES

Support, Revenue and Gains Intergovemmental Revenue Program Receipts United Way Donations Memberships Interest Miscellaneous

Total Support, Revenue and Gains

Expenses Program Services

Adult Habilitation Contract Services Supported Living East Morehouse Commumty Home Crossett Road Community Home

Total of Program Services

Supporting Services

General and Administrative

Total Expenses

Loss on Disposal of Assets

Increase in Net Assets

Net Assets at Beginning ofYear

NET ASSETS AT END OF YEAR

Year Ended June 30,

2013

1.616,649 $

299,778

1,181

2.616

720 3.578

1.081

2012

1,690,722

276,211

1.491

487 808

3.226

22,987

1.925,603

1,483,277

1,857,932

67,671

1,091,936

1,995,932

255,757 117.045

583,435

237,328

289,712

250,823

128,480

672,651

256,443

287,898

1,596,295

374,655 391,985

1,988,280

15831

7,069

1,084,867

$ 1,159,607 $ 1,091,936


5

THE ARC OF MOREHOUSE STATEMENTS OF FUNCTIONAL EXPENSES

For tbe Year Ended June 30,2013

Salanes Payroll Taxes and Fnnge Benefits

Total Salanes and Related Expenses

Bad Debts Consultants Data Processing Dues and Subscriptions Food and Client Needs Insurance Maintenance Office Postage

Professional Fees Public Awareness Supplies Taxes and Licenses Telephone Training Transportation Travel and Conventions l/tilities

Total

Depreciation

TOTAL FUNCTIONAL EXPENSES

Adult Habilitadon (Day) Program

$ 128,220 $ 16,650

144,870

4,535 ---.

20,665 10,218

190 --

4,581 11,253

1,468 21

•

33,740 1,934 7,493

240,968

14,789

$ 255,757 $

Prog

Contract Services

100,852 $ 3,644

104,496

.

---

736 1,280

31

10,502

117,045

.

U7.045 $

ram Services

Supported LWing

474,816 $ 54,261

529,077

4,849 4,500

--

13,178 4,234

7 941

-1,146

-67

6,540 --

3,751 6.236

. 574,526

8,909

583,435 $

Residential Services East

Moreliouse

109,063 $ 14,087

123,150

. 7,034

--

25,447 6,543 5,253

354 25

--

399 1,797

921 46,889

3,281 1,292 5,835

228,220

9.108

237,328 $

Crossett Road

133.466 $ 16,499

149,965

.

7.195 --

34,909 6.048 5,614

65 --

158 569

2,336 817

63,707 4,799

297 6,051

282,530

7.182

289,712 $

Total Program Services

946,417 $ 105,141

1,051,558

9,384 18,729

•• -

74,270 38,770 21,123

1,550 25

1,146 4,739

22.790 12,141

1,759 110,596 45,571 9.759

19,379 1,443,289

39.988

l,483;i77 $

Supportive Services


187,257 $ 42,752

230,009

.

• 7.337

10,799 »

27,449 16,007 13.021

1,969 17,044 15,878 2.932

594 11,848

-1,603

733 6,580

363,803

10,852

374,655 $

Total

1.133,674 147,893

1,281,567

9.384 18,729 7,337

10,799 74,270 66,219 37,130 14,571 1,994

18,190 20,617 25,722 12.735 13,607

110.596 47.174 10,492 25,959

1.807,092

50.840

1,857,932


THE ARC OF MOREHOUSE STATEMENTS OF FUNCTIONAL EXPENSES

For the Year Ended June 30,2012

Salaries Payroll Taxes and Fringe Benefits

Total Salaries and Related Expenses

Consultants DataProcessmg Dues and Subscriptions Food and Client Needs Insurance Maintenance Office Postage Professional Fees Public Awareness Supplies Taxes and Licenses Telephone Training Transportation Travel and ConvenUons Utilities

Total

Depreciation

TOTAL FUNCTIONAL EXPENSES

Adult Habilitation (Day) Program

$ 140,856 $ 15,927

156.783

.

. --

19,883 9,892

71 -.

1,527 4,501 1,227 1,018

-34,991

1,952 7,727

239.572

11.251

$ 250.823 $

Program Services

Contract Services

113.308 $ 5.626

118.934

.

--

1,009 1,616

-----

6,921 ------

128,480

.

128,480 $

Supported Living

567,685 $ 59,047

626,732

4,125 . -

4.856 9,567

721 118

6 --

474 9,494

339 -

5.346 5.046

-666.824

5,827

672.651 $


Morehouse

122.763 $ 14,792

137,555

6,592 239

-29,991

7,538 4,019

15 22

-834 823

1,854 1.149

44.601 5,389 1,606 5,771

247,998

8,445

256,443 $

Crossett Road

134,319 $ 16.256

150.575

6.608 239

-35.901 7,260 4.456

15 21

-

833 405

2,089 1,106

60.483 5,912

559 5.895

282,357

5.541

287.898 $


1.078,931 $ 111,648

1,190.579

17,325 478

-71,757 45,864 19,088

219 49

-3.194

13,124 14.664 3,612

105.084 51,638

9.163 19393

1.565.231

31.064

1.596.295 $

Supportive Services


194.474 $ 42.537

237.011

.

6,806 11.996

-16,691 13.146 12,671 2,221

20,676 8.792

17,425 2,594

11,900 -

691 3,270 6,183

372,073

19.912

391,985 $

Total

1,273,405 154,185

1.427,590

17.325 7.284

11,996 71,757 62,555 32,234 12,890 2,270

20,676 11,986 30,549 17,258 15,512

105,084 52,329 12.433 25.576

1,937.304

50.976

1.988,280


THE ARC OF MOREHOUSE STATEMENTS OF CASH FLOWS

Years Ended June 30,

Cash Flows From Operating Activities Increase in Net Assets Adjustments to Reconcile Change in Net Assets

to Net Cash Provided by Operating Activities. Depreciation Loss on Disposal of Assets Changes in Assets and Liabilities:

Accounts Receivable Prepaids and Other Current Assets Accounts Payable Accrued Payroll and Taxes Other Accrued Liabilities

Net Cash Provided by Operating Activities

Cash Flows From Investing Activities Sales (Purchases) of Investments, Net Additions to Property and Equipment

2013

$ 67,671 $

50,840 -

(108,019) (2,646) 1,862

(4,445) 120

5,383

47^87 (64,053)

2012

7,069

50,976 583

29,628 210

60 (45,456)

(206) 42,864

47,512 (33,443)

Net Cash Provided (Used) by Investing Activities

Net Increase (Decrease) in Cash and Cash Equivalents

Beginning Cash and Cash Equivalents

ENDING CASH AND CASH EQUIVALENTS

(16,766)

(11,383)

14,069

56,933

492,144 435,211

$ 480,761 $ 492,144


8

THE ARC OF MOREHOUSE NOTES TO FINANCIAL STATEMENTS

JUNE 30,2013

Note 1 - Description of Organization

The Arc of Morehouse (the Association) is a nonprofit voluntary health and welfare association chartered in 1955 to promote the general welfare of mentally retarded persons residing in Morehouse Pansh.

Note 2 - Summary of Significant Accounting Policies

A Financial Statement Presentation

In accordance with the Financial Accounting Standards Board Accounting Standards Codification (FASB ASC) 958-205, the Association is requured to report mformation regarding its financial position and activities according to three classes of net assets (unrestncted net assets, temporarily restricted net assets, and permanently restncted net assets) based upon the existence or absence of donor-imposed restrictions The Association has not received any contnbutions with donor-imposed restrictions that would result in permanently restncted net assets.

The Association has also adopted FASB ASC 958-605. '"Not For Profit Entities-Revenue Recognition." In accordance with FASB ASC 958-605, contributions received are recorded as unrestricted, temporarilyrestncted, or pennanently restricted support depending on the existence or nature of any donor restnctions. At June 30, 2013 and 2012, the Association received no contributions which were either temporarily or permanently restricted.

Donations are considered to be available for unrestncted use unless specifically restncted by the donor. Restricted contributions received dunng the year whose restnctions are met in the same reporting period are treated as unrestricted contributions. The Association's policy is to first apply restncted resources when an expense is incurred for which both restricted and unrestncted net position is available.

B Basis of Accounting

The financial statements have been prepared on the accrual basis of accounting, whereby revenues are recognized when eamed and expenses are recognized when the related liabilities are incurred

C Cash, Cash Equivalents, and Investments

The Association considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.


JUNE 30,2013

The Association's investments at June 30, 2013 and 2012 consisted entirely of certificates of deposit with matunties greater than three months. The certificates are reported at cost which approximates fair market value.

D. Accounts Receivable and Allowance for Doubtful Accounts

All accounts receivable are shown net of allowance for doubtfiil accounts Allowance for doubtfiil accounts is evaluated penodically and is based on age of outstanding accounts receivable and experience with customers

E Fixed Assets

Fixed assets are recorded at actual or historical cost. Donated assets are recorded at fair market value on the date of donation. Maintenance and repairs of property and equipment are charged to operations and major improvements are capitalized. The Association has a policy to capitalize fixed assets costing more than $500. Upon retirement, sale or other disposition of property and equipment, the cost and accumulated depreciation are eliminated fi-om the accoimts and the gain or loss is included in operations.

Depreciation of buildings and equipment is computed by the straight-hne method over the following estimated service lives

Years Bmldings and Improvements 15-30 Fumiture and Equipment 5-10 Vehicles 3-5

F Allocation and Functional Expenses

The costs of providing vanous programs and other activities have been summarized on a fimctional basis in the Statement of Activities and m tihe Statement of Funcfciona] Expenses. Accordingly, certain costs have been allocated among the programs and supporting services benefited Expenses that can be identified with a specific program and support service are allocated directly according to their natural expenditure classification Other expenses that are common to several functions are allocated by vanous statistical bases. The Association records its expenses m several ways: direct, indirect, and shared. Direct costs are the total costs of direct support where staff is paid for only that program. Indirect costs are of two types. Level I indirect costs are salary expenses of an employee whose activities are shared between more than one program in the same department Level II indirect costs are salary expenses shared between more than one department Shared expenses represent the Supporbng Services costs

10


JUNE 30,2013

G Programs

The Association's principal programs and primary fimding sources are:

Adult Habilitation (Day Program) - The Adult Habilitation funds are used to train clients in vocational and prevocational activities and supportive services.

Contract Services - Contract Services income is derived fix)m services performed by clients which include janitonal and other contracts.

Supported Living - Supported Living income is received from the Louisiana Department of Health and Hospitals. This program, similar to the Residential Services, helps the individual clients becomemore independent byproviding support and trainmg in their residences within the community.

Residential Services - Residential Services income is received firom the Louisiana Department of Health and Hospitals. Clients pay a pro-rata share ofthe costs based on their income. This program provides clients with a home environment within the community and helps them become more independent citizens.

H Tax-Exempt Status

The Association is exempt fix)m income tax under Section 501(c)(3) ofthe Intemal Revenue Code (the Code) and, therefore, has no provision for Federal income taxes Contnbutions to the Association are tax deductible within the limitations prescribed by the Code. The Association is subject to income tax examinations by the Intemal Revenue Service and the Louisiana Department of Revenue; however, there are currently no examinations in progress for any tax penods The Association is subject to income tax examinations for the years ended June 30,2010,2011,2012 and 2013.

/ Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

J Reclassifications

Minor reclassifications have been made to the pnor year financial statements to make them comparable to the current year presentation

K Subsequent Events

Subsequent events have been evaluated through January 13, 2014 and it has been

11


JUNE 30,2013

determined that no significant events have occurred for disclosure. January 13,2014 is the date that the financial statements were available to be issued

Note 3 ' Fixed Assets

Fixed assets consisted ofthe following

Depreciable Assets Buildings Equipment Vehicles Improvements

Total depreciable assets Less: Accumulated depreciation

Net depreciable assets Nondepreciable Assets

Land Constmction In Progress

Total nondepreciable assets

Total fixed assets

June 30, 2013

$ 558,385 150,005 250,950 84,985

1.044,325 (707,241) 337,084

16,220 -

16,220

$ 353.304

June 30,2012

$ 481.293 139,054 250.950 81,975

953,272 (656,401) 296,871

16,220 27,000 43,220

$ 340,091

Depreciation charged to expense in 2013 and 2012 is $50,840 and $50,976, respectively

Note 4 - Unused Letter of Credit

Per Louisiana Department of Health and Hospitals Guidelines^ the Association maintains a $50,000 line of credit at a local bank for operational use, if needed. The Ime of credit caries a vanable mterest rate based on the Wall Street Journal Prime Rate The Association did now borrow fi-om the line of credit in either the years ended June 30,2013 or 2012.

Note 5 - Concentrations and Uncertainties

Certain financial instruments potentially subject the Association to concentration of credit risk. These financial instruments consist primanly of cash and cash equivalents. The Association maintains its cash in various bank deposit accounts, which at times may exceed federally insured limits. The Association has not experienced any losses in such accounts. At June 30,2013, no bank deposits exceeded the federal insured limits.

The Association receives approximately 84% of total revenue and support from various state agencies. Federal and state budget cuts have resulted in decreased revenues for the

12


JUNE 30, 2013

Association in the current year and it is likely that addiUonal cuts will be made in subsequent penods.

Note 6 ~ Retirement Plan

The Association contnbutes to an Amencan Funds 403(b) retirement plan at a rate based on term of service and contingent upon agency funds being available. The Association will match up to 50% of a participant's contribution not to exceed 6% ofthe employee's annual salary. All full-time employees are eligible to participate. Matching contnbutions made by the Association for the years ended June 30, 2013 and 2012 were $1,301 and $1,351, respectively

13

SUPPLEMENTAL SCHEDULES

14

THE ARC OF MOREHOUSE COMBINING SCHEDULES OF FINANCIAL POSITION

ASSETS

Cash and Cash Equivalents Investments Accounts Receivable Prepaid Expenses Due From Other Funds Fixed Assets Accumulated Depreciation

TOTAL ASSETS

Local Fund

$ 140,485 53,674

11,494 1,829,044 1,060,545 (707,241)

$ 2.388,001


$ - $

56,148 1,055

384,644

$ 441.847 $

1

Program

Contract Services

29,008 109

13,120 164

5,182

47,583

June 30,2013 Services

$

S

1 z

Supported Living

145,919 $

151,489 2,194

276,457

576,059 $


Morehouse

1,574

47,122 747

68,012

117,455

$

$

Crossett Road

163,775 $

39,959 1,265

476,087

681,086 $

Total

480,761 53,783

307,838 16,919

3,039,426 1,060,545 (707,241)

4,252,031

LIABILITIES AND NET ASSETS

Current Liabilities Accounts Payable Accrued Payroll and Taxes Accrued Liabilities Due to Other Funds

Total Current Liabilities

77 $ 5,043

237 2,076,801

1,354 $ 5,724

-92,849

1,015 $ 2,498

-8.414

2,396 $ 13,845

-512,007

2,146 $ 4,532 2,294

49,872

3,757 $ 5,093 2.987

299.483

10.745 36,735 5,518

3.039.426 2,082,158 99.927 11,927 528,248 58,844 311,320 3.092,424

Net assets Unrestncted

Total Net Assets 305,843 305.843

341.920 341,920

35,656 35.656

47.811 47.811

58,611 58.611

369.766 1,159,607 369.766 1,159,607

TOTAL LIABILITIES AND NET ASSETS $ 2,388.001 $ 441,847 $ 47.583 $ 576,059 $ 117,455 $ 681,086 S 4,252,031

15

THE ARC OF MOREHOUSE COMBINING SCHEDULES OF FINANCIAL POSITION

ASSETS

Cash and Cash Equivalents Investments Accounts Receivable Prepaid Expenses Due From Other Funds Fixed Assets Accumulated Depreciation

TOTAL ASSETS

Local Fund

$ 111,111 101,070

-14,048

1.809.073 996,492

(656.401)

$ 2,375,393


$ - $ -

31,601 -

412,455 --

$ 444.056 $

1

Program

Contract Services

50,920 -

6,549 -

5.176 --

62,645

June 30,2012 Services

$

$

Supported Living

258.732 -

83,623 -

276,888 --

619.243

$

$ •


Morehouse

-28.420

-75,856

--

104,276

$

$

Crossett Road

71.381 -

49,626 225

479,511 --

600,743

$

$

Total

492,144 101.070 199,819 14,273

3.058,959 996,492

(656,401)

4,206.356

LL^BILITIES AND NET ASSETS

Current LiabiUties Accounts Payable Accrued Payroll and Taxes Accmed Liabihties Due to Other Funds

Total Cunent Liabihties

119 $ 7.976

236 2,013,725 2,022,056

1.350 $ 5,120

• 146,502 152,972

774 $ 2,471

-8.411

11.656

1,916 $ 17.294

-519.782 538.992

2.086 $ 3.723 2.245

62,708 70,762

2.638 $ 4.596 2,917

307.831 317,982

8,883 41,180

5,398 3,058,959 3,114,420

Net assets Unrestricted

Total Net Assets 353.337 353.337

291,084 291,084

50,989 50,989

80,251 80,251

33,514 282,761 1.091,936 33.514 282,761 1,091.936

TOTAL LIABILITIES AND NET ASSETS $ 2.375,393 $ 444,056 $ 62,645 $ 619,243 $ 104,276 $ 600,743 $ 4,206,356

16


COMBINING SCHEDULES O F ACTIVITIES


Revenues and Other Support Intergovenunental Revenue Program Receipts Umted Way CTonations Memberships Interest Miscellaneous

Total Revenues and Other Support

Local Fund

$ ---

720 3,469

35 4.224

Adult Habihtation (Day) Froeram

S 268.588 $ 110.596

631 200

--_

380,015

Froeram

Contract Services

-98.030

550 1.816

-109

1.046 101,551

Services

, .

S

-

Supported LivlnE

682,758 --

200 ---

682,958


Morehouse

$ 275,575 40,003

-200

---

' 315,778

Crossett Road

$ 389.728 $ 51,149

-200

---

441.077

Total

1,616,649 299.778

I.I81 2,616

720 3.578 1.081

1,925,603


Adult Habilitation Contract Services Supported Living East Morehouse Community Home Crossett Road Community Home


Management and General

Total Expenses Before Depreciation

Depreciation

Total Expenses

Increase (Decrease) in Net Assets

Other Sources (Uses) Transfers In Transfers Out

Total Other Sources

Increase (Decrease) la Net Assets

Net Assets at Beginning ofYear

NET ASSETS AT E^a) OF YEAR

-

2,152

2.152

2.152

331,164

331.164

331,164

17,495

348.659

117,045

117.045

117,045

117.045

715.862

715.862

715,862

13.150

729,012

287,735

287,735

287,735

10.894

298,629

353.134 353.134

353,134

9,301

362,435

331.164 117.045 715,862 287,735 353,134

1.804.940

2,152

1,807,092

50,840

1.857,932

2.072 3U56 (15,494) (46.054) 17.149 78,642 67,671

32,939 (82.505) (49,566)

(47.494)

353.337

305.843 S

24,367 (4.887) 19,480

50.836

291.084

341.92U S

513

, (352;

161

(15,333) 50.989

35,656 $

27,322 (13,7081 13.614

(32.440)

80.251

47.811 $

22,794 (14,846)

7,948

25.097

33,514

58,611 S

19.479 (11,116)

8,363

87,005

282.761

369.766 J

127,414 (127,414)

67,671

1.091.936

1,159,607

17


C O M B I N I N G SCHEDULES O F ACTIVITIES


Revenues and Other Support Intergovemmental Revenue Program Receipts United Way Donations Memberships Interest Miscellaneous

Total Revenues and Other Support

Local Fund

5 --

50 808

3,226 21.633 25,717

Adult HabUitation (Day) Prosram

S 302,916 $ 105,084

1,491 437

--8

409,936

ProKram

Contract Services

-83.929

-. --

1.266 85,195

Services

S

Supported UvinR

722.951 --. ---

722,951


Morehouse

S 263,620 36,408

-

. -5

300,033

$

Crossett Road

401.235 S 50.790

75 452,100

Total

1,690,722 276,211

1.491 487 808

3,226 22,987

1.995,932


Adult Habilitation Contract Services Supported Uving East Morehouse Community Home Crossett Road Commum^ Home


Management and General

Total Expenses Before Depreciation

Depreciation

Total Expenses

Increase (Decrease) In Net Assets

Other Sources (Uses) Transfers In Trans&rs Out Loss On Disposal

Total Other Sources

Increase (Decrease) m Net Assets

Net Assets at Beginning of Year

NET ASSETS AT END OF YEAR

-

17.588

17.588

17,588

320,749

320.749

320.749

15,811

336,560

128,480

128,480

128,480

128.480

810,675

810.675

810,675

13,907

824.582

308,083

308,083

308,083

11,820

319.903

351.729 351,729

351,729

9.438

361.167

320.749 128,480 810,675 308,083 351.729

1,919.716

17,588

1,937,304

50.976

1,988.280

8.129 73,376 (43,285) (101,631) (19,870) 90.933 7.652

19,168 (35.538)

(583) (16.953)

(8.824)

362.161

353.337 S

388 (U,6I4)

(11,226)

62.150

228.934

291.084 $

513 (161)

352

(42.933)

93,922

50.989 J _

14,010 (1,409)

12.601

(89,030)

169.281

80,251 5

11,847 P41)

11.506

(8,364)

41,878

33.514 $

9,108 (5.971)

3,137

94,070

188.691

282,761 S

55.034 (55.034)

(583) (583)

7.069

1.084,867

1.091.936

18

REPORT REQUIRED BY GOVERNMENT AUDITING STANDARDS

19

I UFFEY, HUFFMAN, RAGSDAIE & SOIGNIER

JohnL Luffey, MBA. CPA (1963-2002) Francis 1 Huffman, CPA Philip A Ragsdale, CPA David Ray Soignier, CPA, MBA, CGMA

(A PROFESSIONAL ACCOUNTING CORPORATION)

CERTIFIED PUBLIC ACCOUNTANTS

John Herman. CPA Lynn Arwlnes, CPA, CGMA Esther Atteberry, CPA Lon Woodard, MBA, C:PA, CGMA. CITP

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 Directors The Arc of Morehouse Bastrop, Louisiana

We have audited, in accordance with the auditing standards generally accepted m the United States of America and the standards applicable to fmancial audits contained in Government Auditing Standards issued by the Comptroller General ofthe United States, the financial statements of The Arc of Morehouse (a nonprofit organization, the Association), which comprise the statement of financial position as of June 30, 2013, and the related statements of activities, cash flows, and functional expenses for the year then ended, and the related notes to the financial statements, and have issued our report thereon dated January 13,2014

Intemal Control Over Financial Reporting

In pknning and performing our audit ofthe financial statements, we considered the Association's intemal control over financial reporting (intemal control) 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 opmion on the effectiveness ofthe Association's intemal control. Accordingly, we do not express an opinion on the effectiveness ofthe Association's mtemal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performmg their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the 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 ment attention by those charged with govemance

1100 North 18th Street Monroe. Louisiana 71201 Tel (318)387-2672 • Fax (318)322-8866 • Website wwwafullservicecpaftrmcom

MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

Page 20

The Arc of Morehouse Bastrop, Louisiana

Our consideration of intemal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies m intemal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified However, we consider the deficiency descnbed as 13-01 in the accompanying schedule of findings and responses to be a matenal weakness

Compliance and Other Matters

As part of obtaining reasonable assurance about whether the Association's financial statements are firee firom material misstatement, we performed tests of its comphance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and matenal 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 opinion The results of our tests disclosed an instance of noncompliance or other matters that are required to be reported under Government Auditing Standards and which are described in the accompanymg schedule of findings and responses as items 13-02.

Association's Response to Findings

The Association's responses to the findings identified m our audit are described in the accompanying schedule of findmgs and responses. The Association's responses were not subjected to the auditing procedures applied in the audit ofthe financial statements and, accordingly, we express no opinion on it

Purpose of this Report

The purpose of this report is solely to descnbe the scope of our testing of intemal control and compliance and the results of that testing, and not to provide an opmion on the effectiveness ofthe organization's mtemal control or on compliance. This report is an integral part of an audit perfonned m accordance with Govemment Auditing Standards in considering the orgarazation's intemal control and compliance. Accordingly, this communication is not smtable for any other purpose.

This report is mtended solely for the mformation and use of management ofthe Arc of Morehouse, Its Board of Directors, others within the entity, other entities granting funds to the Association, and the Legislative Auditor for the State of Louisiana and is not intended to be and should not be used by anyone other than these specified parties. Under Louisiana Revised Statute 24:513, this report is distnbuted by the Legislative Auditor as a public document

(A Professional Accounting Corporation) January 13,2014

21

The Arc of Morehouse Bastrop, Louisiana

Schedule of Findings and Responses For the Year Ended June 30,2013

13-01 Deficiencies in Medicaid billings and collections

Finding:

A sound system of intemal control includes the maintenance of staff of a proper size and expertise to execute their functions in an accurate and timely manner However, during the year ended June 30, 2013, the Arc of Morehouse (the Association) lost its primary employee m charge of Medicaid biUmg A suitable replacement could not be immediately found and the remaining office staff was unable to keep pace with the billing process. As a result, several months of Medicaid billings remained unprocessed or in suspense at June 30,2013 and in the subsequent period. The failure to address the billing and collection process could adversely affect the Association's operations and could potentially cause amounts owed to become uncollectible.

Recommendation:

We recommend that the Association maintain staff of a sufficient size and expertise to address Medicaid billings and collections in a timely manner.

Management's Corrective Action Plan:

The Arc of Morehouse has hired an employee who is experienced in Medicaid billing procedures. We have also purchased a new billing software package which more seamlessly integrates with the Medicaid system and offers technical support for times when issues arise

13-02 Financial statements not filed timely

Finding:

Louisiana Revised Statute 24:513 requires that the Association prepare and submit its audited financial statements to the Louisiana Legislative Auditor no later than six months after the end ofthe most recent fiscal year. Due to delays associated with deficiencies in Medicaid billings and collections, as presented in finding 13-01, the audited financial statements were not able to be submitted within the time frame prescnbed by law. Not submitting the audited financial statements timely could result in the loss of federal and/or state funding

Recommendation:

We recommend that the Association maintain proper procedures such as to allow the submission of audited financial statements in the prescribed time penod.

Management's Corrective Action Plan:

In the future, we will maintain procedures to allow the submission of audited financial statements in the prescnbed time

22

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