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CLERK, CIVIL DISTRICT COURT FOR THE PARISH OF ORLF.ANS

SALARY FUND

ANNUAL FINANCIAL STATEMENTS

YEAR ENDED .HINF. : n lOHR

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

Release Date duM-

Clerk, Civil District Court for the Parish of Orleans

Management's Discussion and Analysis Year Ended June 30,2008

TABLE OF CONTENTS

Page Management's Discussion and Analysis 3-8

Independent Auditor's Report 9

Financial Statements:

Govemment-Wide Financial Statements: Statement of Net Assets 10 Statement of Activities 11

Fund Financial Statements: Balance Sheet - Govemmental Fund 12 Reconciliation of the Balance Sheet - Govemmental Fund to the Statement of Net Assets 13 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Fund 14 Reconciliation ofthe Statement of Revenues, Expenditures, and Changes in Fund Balance -

Govemmental Fund to the Statement of Activities 15 Notes to Financial Statements 16-25

Required Supplementary Information:

Budgetary Comparison Schedule - General Fund 27

Reports Required by GAO:

Schedule of Findings and Questioned Costs 29

Independent Auditor's Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of Basic Financial Statements Performed in Accordance with Government Auditing Standards 31-32


Management's Discussion and Analysis Year Ended June 30, 2008

MANAGEMENT'S DISCUSSION AND ANALYSIS

Management's discussion and analysis (MD&A) of the Clerk, Civil District Court for the Parish of Orleans (the Clerk) fmancial performance is designed to provide an overview ofthe financial activities as of and for the fiscal year ended June 30, 2008. This information should be read in conjimction with the basic fmancial statements and the accompanying notes to the financial statements.

OVERVIEW OF THE FINANCIAL STATEMENTS

The MD&A is required infonnation that provides an overview ofthe Clerk's basic financial statements and financial activities. Our auditor has provided assurance in his independent auditor's report that the basic fmancial statements are fairly stated in all material aspects. A user of this report should read the independent auditor's report carefully to ascertain the level of assurance being provided on these reports.

This annual report consists of a series of financial statements. The Clerk's basic financial statements consist ofthe followmg components: Government-Wide Financial Statements and Fund Financial Statements.

Government-Wide Financial Statements

The Statement of Net Assets reflects the fmancial position ofthe Clerk's office. The unrestricted fund balance for the Salary.Fund, as reflected in this statement consists of fiands available for future spending to meet the needs ofthe Clerk's Office.

The Statement of Activities reflects the changes in net assets. Net assets, the difference between assets and liabilities, is one way to measure the financial health of an entity. Over time increases or decreases in net assets are one indicator of whether an entity's financial health is improving or deteriorating.

The Statement of Net Assets and the Statement of Activities report information on the Clerk of Court as a whole and about its activities m a way that shows the overall financial health ofthe office. These statements include all assets and liabilities using the accrual basis of accounting, which is similar to the accounting used by most private sector companies. All of the current year's revenues and expenses are taken into accomit regardless of when cash is received or paid.

Fund Financial Statements

Fund financial statements report detailed information on several distmct and separate funds maintained by the Clerk's office. Some funds are estabhshed as mandated by State laws.

The Clerk of Court uses govemmental funds for basic services. Govemmental fimds focus on how money flows into and out of the operating accounts and reflect the balances left at year-end that are available for spendhig. These funds are reported under the modified accmal accounting method, which measxires cash and all other financial assets that can readily be converted to cash.



Fund Financial Statements (continued)

The govemmental fund statements provide a detailed short-term view ofthe general govemment operations and the basic services it provides. Govemmental fund infonnation helps you detennine whether there are more or fewer fmancial resources that can be spent in tlie near fiiture to finance the Clerk of Court's programs.

FINANCIAL HIGHLIGHTS

The financial statements provide details ofthe current year's operations:

As of June 30, 2008, the Clerk, Civil District Court for the Parish of Orleans maintained an Unrestricted Fund balance of $3,525,580 representing the portion available to maintain the continuing obligations to citizens. Unrestricted Net Assets represents the net balance of all types of assets accumulated by the Clerk in excess of the amount invested in "capital assets" and any "restricted assets". Restricted assets are those that are constrained by creditors, grantors, contributors, or by laws and regulations. As of June 30, 2008, the Clerk did not have "restricted assets".

Total assets as of June 30, 2008 were $ 3,968,940 and total liabihties were $ 443,360. In accordance with statutory requirements, the Clerk has no bonded indebtedness or long-tenn notes.

The most significant continuing revenue sources for govenmiental activities were court filing fees.

The Statement of Net Assets and the Statement of Activities reports only one type of activity ~ govemmental activities. All of the basic judicial services are reported as this type. Court filing fee charges to the public finance most of these services.

ORLEANS PAiaSH CLERK OF COURT AS A WHOLE

Because the Registry ofthe Court Agency Fund is on a calendar yeai" basis and is reported in a separate audit report, only the Salary Fund is included in this discussion and analyses.

FINANCIAL ANALYSIS OF THE CLERK OF COURT AS A WHOLE (GWFS)

The Statement of Net Assets and the Statement of Activities report only one type of activity - govemmental activities. Most of the basic judicial services are reported as this type. Fees charged to tlie public finance all of these activities.


Management's Discussion and Analysis Year Ended June 30,2008

Our analysis below focuses on the net assets ofthe governmental-type activities;

Condensed Statement of Net Assets

Total Net Assets 3,525,580 1,877,668 $ 1,647,912

Total

Current and Other Assets Capital Assets Total Assets

Current Liabilities Long Term Liabilities Total Liabihties

Unrestricted

2008

$ 3,931,865 $ 37,075

3,968,940

443,360

443,360

3,525,580

2007

2,014,617 $

2,014,617

136,949

136,949

1,877,668

Dollar Change

1,917,248 37,075

1,954,323

306,411

306,411

1,647,912

Percent Change

95% 100% 97%

224% %

224%

88%

88%

The Clerk's net assets increased by $1,647,912 as a result of this years operations. Tlie increase in current assets was mainly in cash used for expenses for govemmental activities. The increase of $37,075 in capital assets was due to purchased furniture and equipment. Unrestricted net assets—the part of net assets tliat can be used to finance day-to-day operations without constraints established by debt covenants, enabling legislation, or other legal requirements—increased as a result of this years operations. Tlie balance in net assets represents the accumulated results of all past years' operations.

Condensed Statement of Activities

End of Year $ 3,525,581 1,877,668 $ 1,647,913

Total

Total Program Expense Total Program Revenues Net Program Income

General Revenues Change in Net Assets

Net Assets: Beginning ofthe yeai-

2008

$ (3,403,063) $ 4,952,358 1,549,295

98,618 1,647,913

1,877,668

2007

(2,895,200) $ 4,704,069 1,808,869

41,985 1,850,854

26,814

Dollar Change

(507,863) 248,289

(259,574)

56,633 (202,941)

1,850,854

Percent Change

18% 5%

-14%

135% 11%

6903% 87%

The Clerk's total revenues for fhe year in governmental activities were $5,050,976 ($4,952,358 in program revenues and $98,618 in general revenues). The total cost of all programs and services was $3,403,063.



FINANCIAL ANALYSIS OF THE CLERK OF COURT'S SALARY FUND

As noted earher, the Clerk uses funds to control and manage money for particular puiposes. However, only the Salary Fund is included in this report. Analyzing these funds helps to determine whether the Clerk is using her resources in a responsible manner and maintaining the financial integiity ofthe office.

The Salary Fimd reported a fund balance increase of $ 1,647,913.

Condensed Statement of Revenues, Expenditures and Changes in Fund Balances Total

Dollar Percent 2008 2007 Change Change

Total Revenues $ 5,050,976 $ 4,746,054 304,922 6%

Expenditures: Current Capital Outlay Total Expenditures

Excess (Deficiency) Other Financing Sources Net Change in Fund Balance

Fund Balance: Beginning of the year

3,403,063 37,075

3,440,138

1,610,838

1,610,838

1,877,668

2,895,200

2,895.200

1,850,854

1,850,854

26,814

507,863 37,075

544,938

(240,016)

(240,016)

1,850,854

100% 19%

(13)%

(13)%

6903% End of Year $ 3,488,506 1,877,668 $ 1,610,838 86%

SALA31Y FUND BUDGETARY HIGHLIGHTS

The Clerk, Civil District Court for the Parish of Orleans' budget was proposed and made available for pubhc inspection by the Orleans Parish Civil Judicial Expense Fund. The Judicial Expense Fund's fiscal year is on a calendar year basis. Therefore, the fiscal year June 30, 2008 budget figures for the Clerk, Civil District Court for the Paiish of Orleans were obtained fi-om tlie calendar yeai' 2007 Orleans Parish Civil Judicial Expense Fund budget.


A comparison ofthe budget to actual amounts follows:

Revenues

Original Budget


Actual

Variance Favorable

(Unfavorable)

Fees, charges, and commissions for services: Fees for recording legal documents Fees for copies of documents Miscellaneous Use of money and property - interest eamings

4,050,100 $

1,000

4,725,145 $ 225,837

1,376 98,618

675,045 225,837

376 98,618

Total Revenues $ 4,051,100 $ 5,050,976 $ 999,876

Expenditures

General government: Personnel services and related

benefits Operating services Travel and other charges Capital Outiay

1,758,320 $ 488,854

2,683,688 $ 717,334 2,041 37,075

(925,368) (228,480) (2,041)

(37,075)

Total Expenditures $ 2,247,174 $ 3,440,138 $ (1,192,964)

Excess revenues (expenditures)

Fund balance at beginning of year

1,803,926

1,877,668

1,610,838

1,877,668

(193,088)

Fund balance at end of vear (193,088)

The favorable variance of $999,876 in the fees for recording legal documents is due to an increase in the number of fdings as the City contmues to reboimd firom Hurricane Katrina. It was offset by the unfavorable increase of $1,155,889 in related personnel and operating expenses.

The unfavorable variance of $37,075 in capital outiays expense is due to the purchase of office fiimiture and equipment needed during the implementation of Act 621.


Management's Discussion and Analysis ^ Year Ended June 30, 2008

CAPITAL ASSETS

The Clerk's investment in capital assets, net of accimiulated depreciation, for govemmental activities as of June 30, 2008 was $31,046.

Computer Software $ 15,150 Equipment 4,295 Furniture & Fixtures 17,220 Total Cost 37,075 Accumulated Depreciation 6,029 Net Capital Assets 31,046 Depreciation Expense ^ _ ^ 6,029

LONG TERM OBLIGATIONS

Clerks of Court are not allowed to incur long-term indebtedness for bonds or notes payable; therefore, the Clerk had no long-term debt outstanding.

The Clerk entered into three long term lease comrmtments for warehouse space used for file storage. All three ofthe leases expire May 31,2010. Monthly payments under the leases total $21,312.50.

ECONOMIC FACTORS AFFECTING OPERATIONS

The Clerk of Court's Office is primarily fmanced by filing fees charged to the public and costs for services rendered. The setting of these fees and costs is regulated by the Louisiana Revised Statutes which gives the Judges ofthe Civil District Court authority to set fees. The Clerk has no authority or discretion in setting fees.

CONTACTING FINANCIAL MANAGEMENT

This financial report is designed to provide a general overview ofthe Clerk, Civil District Court for the Parish of Orleans' finances and to show the Clerkof Court's accomitability for the money it receives. If you have questions about this report or need additional infonnation, contact the Honorable Dale N. Atkins, Clerk, Civil District Court for the Parish of Orleans, New Orleans. La. 70112 at phone number (504)-592-3472.

SAGONA, BOURG, LEE, MATTHEW & Co. , L.L.C. v\'|fi C E R T I F I E D P U B L I C A C C O U N T A N T S & C O N S U L T A N T S

& CO

Independent Auditor's Report

Honorable Dale N. Atkins CLERK, CIVIL DISTRICT COURT FOR THE PARISH OF ORLEANS New Orleans, Louisiana

We have audited the accompanying financial statements of the Salary Fund of the Clerk, Civil District Court for the Parish of Orleans as of and for the year ended June 30, 2008, as listed in the table of contents. These basic fmancial statements are the responsibility of the management of the Clerk, Civil District Court for the Parish of Odeans. Our responsibility is to express an opinion on these basic financial statements based on our audit.

We conducted our audit in accordance with auditing standai'ds generally accepted in the United States and Government Auditing Standards, issued by the Comptroller General ofthe United States. Those standards require that we plan and:perform the audit to obtain reasonable assurance about whether the fmancial statements are free of material misstatement.-" An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basic fmancial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall basic financial statement presentation. We beheve that our audit provides a reasonable basis for oui- opinion.

As discussed in Note 1, the financial statements present only the activities ofthe Salary Fund of the Clerk, Civil District Court for the Parish of Orieans and do not purport to and do not present fairly the financial position ofthe Clerk, Civil District Court for the Parish of Orleans and the changes in its fmancial position, as of June 30. 2008 in confonnity with accounting principles generally accepted in the United States of America.

In our opinion, the basic fmancial statements referred to above present fakly, in all material respects the financial position ofthe-. Salary Fund ofthe Clerk, Civil District Court for the Parish of Orleans as of June 30, 2008, and the results of its operations aiid its changes in fund balances for the year then ended in conformity with accounting principles generally accepted in the United States.

The Management's Discussion and Analysis and other required supplementary information, as hsted in the foregoing table of contents are not a rcquii-ed part of the basic financial statements but are supplementary information requii-ed by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiiies of management regarding the methods of measm-ement and presentation of the required supplementary infonnation. However, we did not audit the information and express no opmion on it.

In accordance with Government Auditing Standards, we have also issued om' report dated December 29,2008, on our consideration of the Clerk, Civil District Court for the Parish of Orleans' mtemal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and gmnts. That report is an integral report of an audit performed m accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.

^Xe^^- '^ , /^ '^ , % i ' , ( ^ y ^ l ^ ' ^ j ^ ^

Certified PubHc Accountants December 28, 2008

650 PoYDRAS STREET • SUITE 1200 " NEW ORLEANS, LA 70130 • 504.274.0200 • FAX: 504.274.0201 » www.sblmcpa.com MEMBER: AMERICAN INSTITUTE OF CPAS & SOCIETY OF LOUISIANA CPAS

http://www.sblmcpa.com


Statement of Net Assets June 30, 2008

Assets

Salary Fund

Cash and cash equivalents Receivables Prepaid expenses Capital assets, net of accumulated depreciation

3,904.122 16,178 11,565 31,046

Total Assets 3,962,911

Liabilities

Accounts payable Accmed payroll liabilities Due to Judicial Expense Fund

81,974 201,808 219,028

Total Liabihties 502,810

Net Assets

Invested in capital assets Unrestricted

31,046 3,429,055

Total Net Assets 3,460,101

Total Liabihties and Net Assets $ 3,962,911

See notes to financial statements

10


Statement of Activities June 30, 2008

Expenses

General govemment: Personnel services and related benefits Operating services

Salary Fund

$ 2,696,229 725,404

Total Expenses 3,421,633

Program Revenues

Fees, charges, and commissions for services; Fees for filing legal documents Fees for copies of documents and facshniles Miscellaneous fees

Net Assets

Change in Net Assets

Beginning of year

4,725,145 225.837

1,376

Total Program Revenues

General Revenues

Interest eamings

Total General Revenues

4,952,358

98.618

98,618

1,629,343

1,830,758

End of year $ 3,460,101 See notes to financial statements

11


Assets

Cash and cash equivalents Receivables Prepaid expenses

Balance Sheet - Govemmental Fund June 30, 2008

Salary Fund

3.904,122 16,178 1L565

Total Assets 3,931,865

Liabilities

Accounts payable Accrued payroll liabilities Due to Judicial Expense Fund

81,974 142,357 219,028

Total Liabilities 443,359

Fund Equity

Fund balance - unreserved and undesignated 3,488,506

Total Liabihties and Fund Equity _$ 3^931,865 See notes to financial statements

12


Reconcihation ofthe Balance Sheet - Govemmental Fund To die Statement of Net Assets

June 30, 2008

Total fund balance - govemmental fund (fund financial statements) $ 3,488,506

Amounts reported for govemmental activities in the statement of net assets (govemment-wide financial statements) are different because:

Capital assets used in govemmental activities are not financial resources and therefore are not reported in the funds 31,046

Accmed compensated absences are not recorded on hand fmancials (59,451) because they are not due and payable at June 30, 2008

Total net assets (government-wide financial statements) S 3,460,101 1 — g — • M H M M I I ' MMMII — • • - • • • • • • - — - I m - ^ — n - l


13


Statement of Revenues, Expenditures and Changes in Fund Balance - Govemmental Fund

Year Ended June 30, 2008

Revenues

Fees, charges, and commissions for services: Fees for filing legal documents Fees for copies of documents and facsimiles Miscellaneous

Interest eamings

4,725,145 225,837

1,376 98,618

Total Revenues 5,050,976

Expenditures

General govemment: Personnel services and related benefits Operating services

2,683,688 719,375

Total Current Expenditures

Capital Outlay

Total Expenditures

Excess of revenues over expenditures


3,403,063

37,075

3,449,064

1,610.838

1,877.668

Fund balance at end of year $ 3,488,506 See notes to financial statements

14


Reconcihation ofthe Statement of Revenues, Expenditures, and Changes in Fmid Balance -Govemmental Fmid to tlie Statement of Activities

Year Ended June 30,2008

Net change in fund balance (fund financial statements) $ 1,610,838

Amounts reported for govemmental activities in the statement of activities, (govemment-wide fmancial statements) are different because:

Current year increase in compensated absences are not recorded on fimd fmancials because they are not due and payable in the current year. (12,541)

Govemmental funds report capital outlays as expenditures in the individual fund. Govemmental activities report depreciation expense to allocate the cost of those capital assets over the estimated useful lives ofthe asset.

Capital asset purchases capitalized 37,075 Depreciation expense (6,029)

31,046

Changes in net assets (govemment-wide fmancial statements) S 1,629,343


15


Notes to Financial Statements Year Ended June 30, 2008

INTRODUCTION

As provided by Article V, Section 28 ofthe Louisiana Constitution of 1974, the Clerk of Court serves as the ex-officio notary public, tlie recorder of court filings, and other acts, and has other duties and powers provided by law. The Clerk of Court is elected for a four-yeai' term.

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation - The accompanying financial statements of the Salary Fimd of the Clerk, Civil District Court for the Parish of Orleans have been prepared in confonnity with generally accepted accounting principles (GAAP) as applied to govemmental units. The Govemmental Accounting Standards Board (GASB) is the accepted standard-setting body for estabhshing govemmental accounting and financial reporting principles. The accompan3ting basic fmancial statements have been prepared in conformity with GASB, Statement 34, Basic Financial Statements - and Management's Discussion and Analysis - for State and

, Local Governments.

Reporting entitv - Govemmental Accoimting Standards Board Statement No. 14, The Financial Reporting Entity, (GASB 14) as amended by GASB 39 estabhshes standards for defining and reporting on the financial entity. The focal point for identifying the financial reporting entity is the primary govemment, which is considered to be any state govemment or general purpose local govemment or a special purpose govemment that has a separately elected goveming body, is legally separate, and is fiscally independent of other state and local governments.

On June 23, 2006, Act 621 ofthe 2006 regular legislative session was signed mto law. Prior to the passage of Act 621, the Clerk, Civil District Court for the Parish of Orleans was a component unit ofthe Orleans Parish Judicial Expense Fund because ofthe Clerk's fiscal dependence on the Judicial Expense Fund. However, Act 621 established the Clerk's Salary Fund and specified tiiat it will be funded by 60% ofthe filing fees collected by the Clerk. As such, the Clerk is no longer fiscally dependent on the Judicial Expense Fund, and is now a discrete govemmental financial reporting entity under the GASB standards.

Fund accounting - The Clerk of Court uses funds and account groups to report on its financial position and the results of its operations. Fund accountmg is designed to demonstrate legal compliance and to aid financial management by segregatuig transactions relating to certain govemment fimctions or activities.

A fund is a separate accounting entity with a self-balancing set of accounts. On the other hand, an account group is a financial reportmg device designed to provide accountabihty for certain assets and liabihties that are not recorded in the funds because they do not directly affect net expendable available financial resources.

Funds of the clerk of court are classified into two categories: governmental (Salary Fund) and fiduciary (Agency Fund). These funds are described as follows:

(Continued)

16



1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - f Contmued)

Salarv Fund

The Salary Fund, as provided by Louisiana Revised Statute 13:751.4, is the principal fund ofthe Clerk of Court and accounts for the operations ofthe Clerk's office. The various fees and charges due to the Clerk's office are accounted for in this fund. General operatuig expenditures are paid firom this fimd.

Agencv Fund

The Registry of Court Agency Fund, as provided by Louisiana Revised Statute 13:1305, accounts for assets held as an agent for others. Agency funds are custodial m nature (assets equal liabihties) and do not involve measurement of results of operations.

Basis of accounting - Fund Fmancial Statements (FFS) - The amounts reflected in the Balance Sheet and Statement of Revenues, Expenditures and Changes in Fund Balance - Govemmental Fund (FFS), are accounted for using a current financial resources measurement focus. With tins measurement focus, only current assets and current liabihties are generally included on the balance sheet. Tlie statement of revenues, expenditures, and changes in fimd balance reports on the sources (i.e., revenues and other financing sources) and uses (i.e., expenditures and other financing uses) of current financial resources. This approach is then reconciled, through adjustment, to a govemment-wide view of operations.

The amounts reflected in these statements (FFS), use the modified accrual basis of accounting. Under tiie modified accmal basis of accounting, revenues are recognized when susceptible to accmal (i.e., when they become both measurable and available). Measurable means the amount ofthe transaction can be determined and available means coUectible within the current period or soon enough thereafter to pay habilities of the current period. The govenmiental funds use tlie following practices in recording revenues and expenditures:

Revenues

Filing fees are recorded in the year ui which they are eamed. Interest income on investments is recorded when the investments have matured and fhe income is available. Substantially all other revenues are recorded when received.

Expenditures

Expenditures are generally recorded under the modified accrual basis of accounting when the related fund liabihty is incurred.

Basis of accoimting - Govemment-Wide Fmancial Statements (GWFS) - The Statement of Net Assets and the Statenient of Activities (GWFS) display infonnation about the Clerk, Civil District Court for the Parish of Orleans as a whole. These statements include all the financial activities of the Clerk, Civil District Court for the Parish of Orleans. Mormation contamed in these statements reflects the economic resources measurement focus and the accmal basis of accounting.

(Continued)

17



1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - rContmued)

Revenues, expenses, gams, losses, assets and liabilities resulting fi"om exchange or exchange-like transactions are recognized when fhe exchange occurs (regardless of when cash is received or disbursed). Revenues, expenses, gains, losses, assets and habilities resulting fi*om nonexchange transactions are recognized in accordance with the requirements of GASB Statement No. 33, Accounting and Financial Reporting for Nonexchange Transactions.

Program Revenues

Program revenues included in the Statement of Activities are derived durectly fi-om users as a fee for services; program revenues reduce the cost of tiie function to be fmanced firom general revenues.

Reconciliations

On pages 11 and 13 are the reconcihations ofthe items reflected in the fund financial statements to the govemment-wide financial statements.

Budget practices - The Clerk, Civil District Court for the Parish of Orleans' budget was proposed and made available for public inspection by the Orleans Parish Civil Judicial Expense Fund. The Judicial Expense Fund's fiscal year is on a calendar year basis. Therefore, the fiscal year June 30, 2008 budget figures for the Clerk, Civil District Court for the Parish of Orleans were obtamed fi-om the calendar year 2007 budget ofthe Orleans Parish Civil Judicial Expense Fund. Commencing with fiscal year end June 30, 2009, the Clerk Civil District Court for the Parish of Orleans adopted her own discreet budget separate fi-om the Orleans Parish Civfl District. Judicial Expense Fund.

Formal budget integration (within the accounting records) is employed as a management control device. Budget amounts kicluded in the accompanying financial statements include the original adopted budget and all subsequent amendments.

Cash and cash equivalents - Cash includes amounts in demand deposits, interest bearing demand deposits, and money market accounts. Cash equivalents include amounts in time deposits and those investments with original maturities of 90 days or less. Under state law, the Clerk of Court may deposit funds in demand deposits, interest bearing demand deposits, money market accounts, or time deposits with state banks organized under Louisiana law and national banks having their principal offices in Louisiana.

Uncollectible accounts receivable - The Clerk of Court uses the allowance method to account for uncollectible accounts receivable. The allowance for uncollectible accounts is based on prior years experience and management's analysis of possible bad debts. Bad debt recoveries are charged against the allowance account as realized. The Clerk of Court considers all accounts receivable at June 30, 2008 to be fully collectible. Accordingly, no allowance for uncollectible accounts is required.

Capital assets - Capital assets are capitalized at historical cost or estimated cost if historical cost is not available. Donated assets are recorded as capital assets at their estimated fair market value at the date of donation. The Clerk maintains a threshold level of $500 or more for capitalizing capital assets.

(Continued)

IS



L SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - TContinued^

Capital assets are recorded in their Statement of Net Assets and Statement of Activities. Since surplus assets are sold for an immaterial amount when declared as no longer needed for public purposes, no salvage value is taken into consideration for depreciation purposes. All capital assets, other than land, are depreciated using the straight-line method over the following useful lives:

Description Office Equipment Furniture & Fixtures Automobiles Leasehold Improvements

Estimated Lives

5 years 5 years 5 years

20 years

Compensated absences - Employees ofthe Clerk of Court's office earn fi-om 1 to 4 weeks vacation leave per year based on years of service. The vacation time accmes on an employment anniversary date basis and must be used in the following year of service, otherwise it is forfeited. The accmed accumulated leave which had been unused by employees at June 30, 2008 has been included in fhe govemment - wide financial statements.

Fund equity - Reserves represent those portions of fund equity not appropriable for expenditure or are legally segregated for a specific fiiture use. Designated fimd balances represent tentative plans for future use of financial resources. All ofthe Clerk's fund equity was un-reserved and im-designated as of June 30,2008.

Use of estimates - The preparation of financial statements m conformity with generally accepted accounting principles requhes management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of tiie fmancial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ fi:om those estimates.

2. REGISTRY OF COURT FUND OMISSION

The Registiy of Court Agency Fund is on a calendar year basis and was audited by other auditors who issued an unqualified opinion dated June 6, 2008 on its financial statements as of December 31, 2007. Since the Registry of Court Agency Fund is on a different fiscal year than the Salary Fund and was audited by other auditors, it is not included in the audit ofthe Salary Fund.

(Continued)

19



3. CASH AND CASH EOUIVALENTS

At June 30, 2008, the Clerk of Court has cash and cash equivalents (book balances) totaling $ 3,904,122 as follows:

Salary Fund

Checkmg accounts $ 3,904.122

The deposits are stated at cost, which approximates market. Under state law, the deposits (or the resultmg bank balances) must be secured by federal deposit msurance or the pledge of securities owned by the fiscal agent bank. The market value of the pledged securities plus the federal deposit insurance must at aU times equal the amount on deposit with the fiscal agent bank. These securities are held in the name ofthe pledging fiscal agent bank in a holdmg or custodial bank that is mutually acceptable to both parties. At June 30, 2008, the clerk has $ 4,226,071 in deposits (collected bank balances). These deposits are secured fix)m risk by $ 4,058,131 of federal deposit msurance and pledged securities held by the custodial bank ui tiie name of the fiscal agent bank (GASB Category 3) witii a par value of $ 3,559,096 and a market value of $ 3,558.131 at June 30, 2008.

Even thougli the pledged securities are not considered collateral under the provisions of GASB Statement 3 (Category 3), Louisiana Revised Statute 39:1229 unposes a statutory requirement on the custodial bank to advertise and sell the pledged securities within 10 days of beuig notified by the Clerk of Court that the fiscal agent has failed to pay deposited fimds upon demand.

4. RECEIVABLES

The receivables of $ 16,178 at June 30,2008, are for court filing fees. $2,512 of nsf checks are past due ninety days or more at June 30,2008.

5. DUE TO JUDICIAL EXPENSE FUND

During fiscal year ended June 30, 2008, the Clerk's filing fees were deposited into the Clerk's bank account and 40% of those fees were disbursed by the Clerk to the Orleans Parish Civfl Judicial Expense Fund at the close of each montii. Employee Benefits are paid by the Judicial Expense Fund and billed back to the Clerk each month. As of June 30,2008, the Clerk had a net balance due to the Judicial Expense Fund of $ 219,028. Such amount is represented as Due to Judicial Expense Fund on the Clerk's financial statements.

(Continued)

20



6. PENSION PLAN

Plan Description. Substantially all employees of the Clerk, Civil District Court for the Parish of Orleans are members of the Louisiana Clerks of Court Retirement and Relief Fund (System), a multiple-employer (cost-sharing), public employee retirement system (PERS). controlled and administered by a separate board of tmstees. The system provides retirement, survivor, disability and terminated benefits to plan members and beneficiaries.

Funding Policy. All full-time employees earning at least $500 per month who are under the age of 60 at the time of original employment are required to participate in the System. Employees who rethe at or after age 55 with at least 12 years of credited service are entitled to an annual retirement benefit, payable monthly for life, equal to 3 percent of their final-average salary for each year of credited service, not to exceed 100 percent of their final-average salary. Final-average salary is the employee's average salary over the 36 consecutive or joined months that produce the highest average. Final average salary for employees commencing employment on or after October 1, 2006 is the employee's average salary over 60 consecutive months. Employees who teiminate with at least 12 years of service and do not withdraw their employee contributions may retire at or after age 55 and receive the full benefit accmed to their date of termination. The System also provides death and disability benefits. Benefits are established by state statute. Contributions to the System include one-fourth of one percent (one-half of one percent for Orleans Parish) of the taxes shown to be collectible by the tax rolls of each parish. State statute requires covered employees to contribute a percentage of their salaries to the System. As provided by Louisiana Revised Statute 11:103, the employer's contributions are determined by actuarial valuation and are subject to change each year based on the results of the valuation for the prior fiscal year.

Annual Pension Cost. For 2008, the Clerk's annual pension cost of $229,662 agreed with the Clerk's required contribution of $229,662; The required contribution was determined as part ofthe June 30, 2006 actuarial valuation. The actuarial assumptions included an 8% investment rate of retum (net of administrative expenses) and a projected salary increase of 6% per year.

(Continued)

21



6. PENSION PLAN - (Continued)

Requhed supplemental infomiation - Schedule of Fundmg Program of PERS

Actuarial Valuation

Date

06/30/2005 06/30/2006 06/30/2007

Actuarial Value of Assets

(a)

241,537,822 288,606,478 325,278,452

Actuarial Accmed Liability (AAL)-Entry

Age(b)

322,897,404 371,386,765 409,351,418

Unfunded AAL

(UAAL) (b-a)

81,359,582 82,780,287 84,072,966

Funded Ratio (a^)

75% 78% 80%

Covered Payrofl

(c)

73,542,403 70,935,731 78,384,249

UAAL as a Percentage

Of Covered Payroll (b-a)/(c)

111% 117% 107%

The following provides certaui additional disclosures for the Clerk and the retirement system:

Clerk, Civfl Distiict Court for the Parish of Orleans

Total current-year payroll

Total current-year covered payroll - employer Total current-year covered payroll - employees

(excluding DROP wages)

Actuarially required contribution: DoUar amount

Year Ended June 30, 2008

$ 2,126,945

1,954.569 1,563,371

343,965

Percentage of total actuarially required contribution of all participating employers and employees 2.24%

(Contmued)

22



Required by Statute

Notes to Fmancial Statements Year Ended June 30, 2008

Actual Contribution

Contributions:

Employees Employer

8.25% 11.75%

136,795 229.662

8.25% 11.75%

136,795 229,662

20.00% $ 366,457 20.00% $ 366,457

Actuarial information about the System for its most recent year available, the year ended June 30, 2006, is presented below.

Louisiana Clerks of Court Retirement and Relief Fund

Estimated payroll for current year

Actuarially required contributions: Actuarially required contribution for dedicated taxes:

Dollar amount Percent of estimated payrofl

Actuarially required contribution for employers and employees: Dollar amount Percent of estimated payroll

Total actuarially requned contribution: DoUar amount Percent of esthnated payrofl

Net assets, fair value

Pension benefit obligation _ _ ^

$ 80,630,791

$ 6,142,133 7.61%

$ 9,196,784 11.4%

S 15,338,917 19.02%

S 348,448,803

$ 412,269,047

Unfunded benefit obhgation $

(Conthiued)

23


Notes to Financial Statements ^ Year Ended June 30, 2008


The pension benefit obhgation is a standardized measure ofthe present value of pension benefits, adjusted for the effects of projected salary increases and step-rated benefits, estimated to be payable in the future as a result of employee service to date. The measure, which is the actuarial present value of credited projected benefits, is intended to help users assess the System's funding status on a going-conceni basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among PERS and employers. The System does not make separate measurements of assets and pension benefit obligations for individual employers.

Historical trend information showing the System's progress m accumulatmg sufficient assets to pay benefits when due is presented in the System's comprehensive annual financial report. That report may be obtained by writing to the Louisiana Clerks of Court Retirement and ReHef Fund, 11745 Bricksome Avenue, Suite B-1, Baton Rouge, Louisiana 70816, or by caUmg (225) 293-1162.

The Clerk, Civil District Court for the Parish of Orleans does not guarantee the benefits granted by the System.

7. OTHER POST-EMPLOYMENT BENEFflS

The Clerk, Civil District Court for the Parish of Orleans provides certain continuing healtli care and life insurance benefits for retired employees. Substantiafly afl ofthe Clerk's employees become eligible for these benefits if they reach normal retirement age while working for the Clerk of Court. These benefits for rethees and similar benefits for active employees are provided through an insurance company whose monthly premiums are paid jointiy by tiie employees and the Clerk of Court. The Clerk of Court recognizes the cost of providing these benefits (the Clerk's portion of the premiums) as an expenditure when the monthly premiums ai*e due. The cost of such premiums borne by the Clerk of Court amounted to $171,348 or 2008, These benefits are provided m accordance with the provisions ofthe Louisiana Clerks of Court Retirement and Relief System in which the Clerk, Civil District Court for the Parish of Orleans office participates as described in note 6.

(Continued)

24



8. CAPITAL ASSETS

A schedule of changes in capital assets follows:

Equipment Accumulated Depreciation

Balance 6/30/07

--

$ Additions

37,075 6,029

Disposals --

Balance 6/30/08

$ 37,075 6,029

Capital Assets, Net 31,046 S 31,046

9, FACILITIES, FURNTIURE, FIXTURES AND EOUIPMENT OWNED BY OTHER ENTIIIES

The office space occupied by the Clerk, Civil District Court for the Parish of Orleans is owned by the City of New Orleans, which is statutorily required to provide office space for the Clerk.

10. COMMITTMENTS

The Clerk of Court entered into three long term lease agreements for warehouse space used for file storage. All three ofthe leases expire May 31, 2010. Monthly payments under the leases are $7,500 and $10,062 and $3,750.

Future minimum lease payments under tiie temis ofthe leases are as follows:

FYE June 30,2009 FYE June 30, 2010

TOTAL

255,750 211,938

$467,688

25

CLERK CrVIL DISTRICT COURT FORTHE PARISH OF ORLEANS

REOUIRED SUPPLEMENTARY INFORMATION

YEAR ENDED JUNE 30,2008


Budgetary Comparison Schedule - General Fund Year Ended June 30,2008

Revenues

Fees, charges, and commissions for services: Fees for filing legal documents Fees for copies of docmnents Misceflaneous Interest Eamings

$

Original Budget

4,050,100 $

1,000

Actual

4,725,145 225,837

1,376 98,618

Variance Favorable

(Unfavorable)

675,045 225,837

376 98,618

Total Revenues $ 4,051,100 $ 5,050,976 $ 999,876

Expenditures

General government: Persoimel services and related

benefits $ Operating services Travel and other charges Disaster losses, recovery and remediation costs

1,758,320 $ 488,854

2,683,688 $ 717,334

2,041 37,075

(925,368) (228,480)

(2,041) (37,075)

Total Expenditures $ 2,247,174 $ 3,403,063 $ (1,192,964)

Excess revenues (expenditures)


1,610,838

1,877,668

(193,088)

Fund balance at end of year $ 3,488,506 (193,088) See notes to fmancial statements

11

CLERK. CIVIL DISTRICT COURT FOR THE PARISH OF ORLEANS

REPORTS REOUIRED BY GAO



Schedule of Fmdings and Questioned Costs Year Ended June 30, 2008

We have audited the basic fmancial statements of the Salary Fund of the Clerk, Civil District Court for the Parish of Orleans as of and for the year ended Jime 30, 2008 and have issued our report thereon dated December 29, 2008. We. conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Govemment Auditing Standards, issued by the Comptroller General of tiie United States. Our audit of the financial statements as of June 30, 2008 resuUed in an unqualified opinion.

Section I Summary of Auditor's Reports

a. Report on Intemal Control and Compliance Material to the Financial Statements

intemal Control: Material Weaknesses Yes X No, Significant Deficiencies Yes X No

Compliance:

Compliance Issues Material to Financial Statements Yes X No

b. Federal Awards - Reports not required; no federal funds expended during the year.

c. Identification of Maj or Programs - None

Section II Financial Statement Findings - N o matters were reported

Section HI Federal Award Findings and Questioned Costs - None

29

CLERK CIVIL DISTRICT COURT FORTHEPARIvSH OF ORLEANS

INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON

AN AUDIT OF BASIC FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENTA UDITING STANDARDS


SM SAGONA, BOURG, LEE, MATTHEW & Co. , L.L.C. C E R T I F I E D P U B L I C A C C O U N T A N T S & C O N S U L T A N T S

& CO

Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Basic Financial Statements Performed in Accordance with Government Auditing Standards

Honorable Dale N. Atkins CLERIC, CIVD. DISTRICT COURT FOR THE PARISH OF OKLEANS New Orleans, Louisiana

We have audited the basic financial statements ofthe Salary Fund ofthe Clerk, Civil District Court for the Parish of Odeans (the Clerk) as of and for the year ended June 30, 2008, and have issued our report thereon dated December 28, 2008. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in the Govemment Auditing Standards, issued by the Comptrofler General ofthe United States.

Compliance

As part of obtaining reasonable assurance about whether the Clerk's fmancial statements are fi-ee of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The resuhs of our tests disclosed no instances of noncomphance that are required to be reported under Government Auditing Standards.

Intemal Control Over Financial Reporting

hi planning and performing our audit of the financial statements of the salary fimd, m accordance with auditing standards generally accepted in the United States of America, we considered tiie Clerk's mtemal control over financial reporting (intemal control) as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Clerk's intemal control. Accordingly, we do not express an opinion on the effectiveness ofthe Clerk's intemal conti-ol. A control deficiency 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 misstatements on a timely basis. A significant deficiency is a control deficiency, or a combination of control deficiencies, tiiat adversely affects the entity's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement ofthe entity's financial statements that is more than mconsequential will not be prevented or detected by the entity's intemal control.

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

650 PoYDRAS STREET • SUITE 1200 • N E W ORLEANS, LA 70130 • 504.274.0200 • FAX: 504.274.0201 " www.sblmcpa.com MEMBER: AMERICAN INSTITUTE OF CPAS SC SOCIETY OF LOUISIANA CPAS

http://www.sblmcpa.com

Our consideration of intemal control was for the limited purpose described in the first paragraph and would not necessarily identify aU deficiencies m internal control that might be significant deficiencies or material weaknesses. However, we did not identify any deficiencies in intemal control that we consider to be material weaknesses, as defmed above.

This report is mtended for the information and use of management and the legislative auditor. However, this report is a matter of public record and its distribution is not limited.

. ^ ^ ^ :i^^/n^ttL^^^-j LLc Certified Pubhc Accountants December 29,2008

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