HomeMy WebLinkAboutRes 04-17 Approving the Comprehensive Annual Financial Report Year Ending September 30, 2003TOWN OF WESTLAKE
RESOLUTION NO. 04-17
A RESOLUTION OF THE BOARD OF ALDERMEN OF THE TOWN OF
WESTLAKE, T EXAS AP PROVING T HE AN NUAL AU DIT F OR T HE Y EAR
ENDED SEPTEMBER 30, 2003 PREPARED BY WEAVER AND TIDWELL,
L.L.P.
BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE TOWN OF
WESTLAKE, TEXAS:
SECTION 1: That the Board of Aldermen of the Town of Westlake does hereby
Approve the annual audit for the year ended September 30, 2003 prepared by Weaver and
Tidwell, L.L.P..
SECTION 2: That this Resolution shall become effective upon the date of its
passage.
PASSED AND APPROVED ON THE 12" DAY OF APRIL 2004.
Scott Bradley, Mayor
ATTEST:
ing Crosswy, Town Se Lary Trent Petty, Town W6ager
APPROVED AS TO FORM:
L. Canton L , o Attorney
TOWN OF WESTLAKE, TEXAS
COMMUNICATION
OF
INTERNAL CONTROL STRUCTURE
RELATED MATTERS NOTED IN THE AUDIT
YEAR ENDED SEPTEMBER 30, 2003
April 12, 2004
WEAVER
Segregation of Duties
TIDWELL,
To the Board of Aldermen
L.L.P.
TOWN OF WESTLAKE, TEXAS
CERTIFIED PUBLIC
segregation of duties. Although the size of the Town's accounting staff prohibits
ACCOUNTANTS
AND CONSULTANTS
In planning and performing our audit of the general purpose financial statements of the
Town of Westlake, Texas for the year ended September 30, 2003, we considered the
Town's internal control in order to determine our auditing procedures for the purpose of
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expressing an opinion on the general purpose financial statements and not to provide
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assurance on internal control.
Our consideration. of the internal control would not necessarily disclose all matters in the
internal control that might be material weaknesses under standards established by the
American Institute of Certified Public Accountants.. A material weakness is a condition in
which the design or operation of one or more of the internal control components does not
reduce to a relatively low level the risk that misstatements caused by error or fraud in
amounts that would be material in relation to the financial statements being audited may
occur and not be detected within a timely period by employees in the normal course of
performing their assigned functions. However, we noted no matters involving the internal
control and its operation that we consider to be material weaknesses as defined above.
However, during our audit we became aware of several matters that are opportunities for
strengthening internal controls and operating efficiency. This letter summarizes our
comments and suggestions concerning those matters. This letter does not affect our
report dated February 20, 2004, on the general purpose financial statements of the Town
of Westlake, Texas.
Segregation of Duties
Internal controls are designed to safeguard assets and to assist in detecting losses from
fraud or error. A fundamental concept in an effective system of internal control is the
segregation of duties. Although the size of the Town's accounting staff prohibits
complete adherence to this concept, we believe that the following practices could be
implemented to improve existing internal control without impairing efficiency:
• Mail should be opened by personnel not having access to cash receipts or
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accounts receivable records. Cash receipts could be listed and the deposit
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prepared by this person. The cash receipts list, supplemented by remittance
ee
12.221 ;VIr a Drii�<,
advices, could be forwarded to the accounting staff for postings to the general
s,rd11400
ledger and accounts receivable.
Dallas. Texas 75251-3280
972.490.1970
}' 9%z.?02.8331
• The custody of checks after signature and before mailing should be handled by
personnel independent of all payable, disbursing, cash and general ledger
FORT WORTH
functions.
1600 W`e,r S,vonb Srrerr
sura- '00
• Bank reconciliations should be prepared by personnel who do not participate in
puri tiV'orrh, leaar :6102-2506
the receipt or disbursement of cash.
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F SI%.429.55= 6
• The personnel responsible for the accounts payable function should be
,NINW.AEAVE RAN DTIDINE LL.COI„I
independent of purchasing, disbursing and general ledger functions.
AN INDEPENDENT Ivl EhdBER OF
BAKER TILLY
INTERNATIONAL
Town of Westlake, Texas
April 12, 2004
Page Two
Accounting Policies and Procedures Manual
An important element of effective system of internal controls is accounting policies and
procedures. These may be included as part of comprehensive manual that identifies the
Town's administrative, accounting, business, contractual, financial, legal, operating,
payroll, personnel, and programmatic functions. The accounting policy and procedures
manual is an important means of establishing an effective control environment and
should be strictly adhered to by the Town personnel. A sound accounting policy and
procedures manual can provide numerous benefits including:
• Providing internal controls and safeguards;
• Providing timely reporting on the status of funds, and
• Allowing systematic disbursements to maximize available funds.
We noted that the Town has adopted or was in the process of adopting policies and
procedures relating to the following functions:
• Depository procedures, check writing authority, and investment fund transfer
authority;
• Authorized depository institutions;
• Asset capitalization thresholds;
• Personnel manual, including job descriptions, vacation, hiring, evaluating,
promoting and termination policies; and
• Records retention.
Town of Westlake, Texas
April 12, 2003
Page Three
Accounting Policies and Procedures Manual — continued
We recommend that the Town adopt effective accounting policy and procedures manual
that include, but not be limited to the following discussions:
• The budgeting process including preparation, amendment, and board approval;
• The accounting reports prepared for management and the Board of Aldermen;
• The review and approval of the annual financial report by the Board of Aldermen;
• The issuance and appropriate use of credit and/or debit cards including the
reimbursement process and approval of expenditures;
• The control and confidentiality of accounting, business, contractual, financial,
legal, operating, payroll, personnel, and program records;
• The release of accounting, business, contractual, financial, legal, operating,
payroll, personnel, and program records to the general public pursuant to open
records statutes;
The duties performed by administrative and business office personnel with
particular emphasis on the segregation of key responsibilities and duties;
• The personnel andlor officials authorized to initiate, approve, and record
transactions;
• The procedures to be followed for the different accounting, business, contractual,
financial, legal, operating, payroll, personnel, and programmatic transactions
conducted on behalf of the Town by employees of the Town and its component
units.
• The Town's chart of accounts and fund structure;
• The Town's purchasing functions with an emphasis on compliance with state and
federal statutes and regulations;
• The type of documents required for disbursement of funds;
• Conflict of interest procedures; and
• Disaster recovery plan.
The Town's Board of Aldermen should review and approve the contents of the
accounting policy and procedures manual, including amendments. The accounting policy
and procedures manual should be periodically reviewed and updated, as necessary, to
ensure that its contents comply with applicable state and federal statues and regulations.
Town officials should ensure that personnel adhere to the accounting policies and
procedures manual.
Town of Westlake, Texas
April 12, 2004
Page Four
Public Funds Investment Act
Chapter 2256, Public Funds Investment, of the Government Code Title 10, General
Government contains requirements that apply to various aspects of investment activities
including:
A written investment policy reviewed and approved at least annually. The
investment policies should address certain investment objectives, authorized
investments, and investment officers should be named;
• The written investment policy should be presented and acknowledged by any
individual or agent seeking to sell the Town an authorized investment;
Reports should be reviewed and approved by the Board of Aldermen at least
quarterly. The reports should include a description of the investment position of
the entity on the date of the report, the signature of each designated investment
officer, a summary of each pooled fund group that states beginning market value,
additions and changes, ending market value and accrued interest, the book value
of each separately invested asset at the beginning and end of the reporting
period by the type of assets and fund type invested, the maturity of each invested
asset, the account of fund for which each investment was acquired, and a
statement on the compliance of the investment portfolio of the institution as it
relates to the investment policy;
• Training of investment officers. Investment officers must attend at least one 10
hours of instruction relating to investment responsibilities approved by the Board
of Aldermen within 12 months after assuming duties and once every 2 years
thereafter; and
• Audit requirements
We recommend that the Town adopt an investment policy that contain all the relevant
provisions in Government Code §22.56, and further designate an investment officer.
Improve the Check Signing Procedures
The Town has recently developed a practice of using plate signatures on all checks
drawn on the principal bank accounts. It is generally true that checks requiring manual
signatures are subject to more careful scrutiny and thereby cash is controlled more
closely. We noted that the signature plate is currently left in the printer when it was not in
use and left unattended.
We recommend that manual signatures be used on all checks other than those disbursed
from a bank account operated on an imprest basis. 'Further, we recommend that the
signature plate be kept in the custody of the authorized check signers.
Town of Westlake, Texas
April 12, 2004
Page Five
Debt Service Payments
In February 2002 and June 2003, the Town issued combination tax and limited pledge
revenue certificates of obligation maturing in 2032 for the purpose of financing the
acquisition, construction and installation of facilities for educational, economic development,
cultural and civic improvements. Currently, the debt service payments required on these
certificates are paid from the capital projects fund. Use of a capital projects fund is
generally necessary when construction of capital assets is financed with long-term debt or
restricted resources. In such situations, capital projects funds are used to demonstrate that
the capital expenditures comply with those provisions. A particular capital project fund is
only used during the period of the asset's acquisition or construction. The construction of
the facility is expected to be complete in fiscal year ended 2004. Accordingly, we
recommend that debt service payments be made from the general fund or a debt service
fund which is generally utilized to account for the accumulation of resources for, and the
payment of, general long-term debt principal and interest.
Additionally, in an agreement for design, construction and purchase of the West Pump
Station and the Dove Road Water Main between the Town and Hillwood Services, L.P., we
noted a requirement for the Town to create a utility debt service fund in connection with the
repayment of the project's construction cost. The Town agreed to deposit debt service
revenue of $.25 per 1000 gallons of usage collected by Town residents in this debt service
fund. Furthermore, debt service revenue shall be allocated between Hillwood service area
and Town service area by 52% and 48%, respectively and deposited into two separate debt
service funds that will result in debt service revenue to pay the respective share of the
construction cost. We recommend that the Town establish utility debt service funds in
accordance with the requirements of this agreement.
Changes in Governmental Reporting Model
The Governmental Accounting Standards Board (GASB) issued its revolutionary new
reporting model in June 1999. The new model dramatically changes the presentation of
governments' external financial statements. In the GASB's view, the objective of the new
model is to enhance the clarity and usefulness of government financial statements to the
citizenry, oversight bodies, investors and creditors. It will substantially affect the City's
financial data accumulation and financial statement presentation processes. Some of the
key aspects of the changes follow:
Management's Discussion and Analysis MD&A — A comprehensive MD&A
will now be included as required supplementary information. The MD&A will
introduce the financial statements by presenting an analysis of the
government's financial performance for the year and its financial position at
year-end. The MD&A will be in addition to the transmittal letter currently
required for Government Finance Officers Association (GFOA) award
candidates, such as your City.
Town of Westlake, Texas
April 12, 2004
Page Six
Changes in Governmental Reporting Model — continued
Government -Wide Reporting — The City will be required to report financial
operations and net assets, not only at the fund perspective for governmental
activities, but will also have to prepare statements at the government -wide level.
This level will distinguish between government and business type activities. All
information at the government -wide level will be reported using the economic
resources measurement focus and accrual basis of accounting, as proprietary
funds do under the current model. Fiduciary activities will be excluded from the
government -wide level of reporting. General government fixed assets, including
infrastructure, and long-term liabilities of the government will need to be
reported with all other governmental assets and liabilities.
Statement of Activities — Governments will now be required to use a "net
program cost" format for the government -wide statements instead of a
traditional operating statement. This new format groups revenues and
expenses by functional categories. The purpose of the new statement is to
inform readers about the cost of specific functions and the extent to which
they are financed with program revenues or general revenues of the
government. Governments will have the option of reporting both direct and
indirect program costs. Depreciation expense will now generally be reflected
as a cost in the statement of activities.
Fund Level Reporting — Fund level financial statements will still be required and
will provide information about the City's fund types, including fiduciary funds and
blended component units. General capital assets and general long-term
liabilities will only be reported at the government -wide level. Fund level
reporting will continue to focus on fiscal accountability and reflect the flows and
balances of current financial resources. The modified accrual basis of
accounting will continue to be used at the fund level, except for proprietary
funds, which would continue reporting based on economic resources and the
accrual method of accounting. A reconciliation between the fund and the
government -wide statements will be required on the face of the fund
statements. Finally, proprietary fund cash flow statements must be
presented using the direct method.
Presentation of Budgetary Information — The standard requires budgetary
statements for the general fund and certain other governmental funds as
required supplementary information. The original adopted budget of the City as
well as the final revised budget must be presented. Actual results on a
budgetary basis will need to be reconciled to the GAAP (generally accepted
accounting principles) basis on the face of the statements.
The effective date of the new pronouncement will require implementation by the Town for its
year ending September 30, 2004. The magnitude of these changes and the time required to
prepare for implementation should not be underestimated. We recommend that the Town
begin to look at its systems and processes to ensure that the required information will be
available to ensure timely implementation.
Town of Westlake, Texas
April 12, 2004
Page Seven
The preceding comments and recommendations are intended solely for the information
and use of the audit committee, management, and others within the organization and
should not be used by anyone other than these specified parties.
We will review the status of these comments during our next audit engagement. We
have already discussed many of these comments and suggestions with various Town
personnel, and we will be pleased to discuss them in further detail at your convenience,
to perform any additional study of these matters, or to assist you in implementing the
recommendations.
Sincerely,
WEAVER AND TIDWELL, L.L.P.
Dallas, Texas
April 12, 2004
TOWN OF WESTLAKE, TEXAS
FINANCIAL STATEMENTS
YEAR ENDED SEPTEMBER 30, 2003
TOWN OF WESTLAKE, TEXAS
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003
Table of Contents
IndependentAuditor's Report..................................................................................................
General Purpose Financial Statements
Combined Balance Sheet — All Fund Types, Account Groups
and Discretely Presented Component Units.....................................................................
Combined Statement of Revenues, Expenditures and Changes
in Fund Balances — All Governmental Fund Types and Discretely
......... 1
.... I... 2
PresentedComponent Units........................................................................................................ 4
Statement of Revenues, Expenditures and Changes
in Fund Balance — Budget and Actual — General Fund ....................................
Statement of Revenues, Expenses and Changes in
Retained Earnings — Enterprise Fund...............................................................
Statement of Cash Flows — Enterprise Fund .......................................................
Notes to the Financial Statements.......................................................................
Combining Financial Statements
Special Revenue Funds
........................ 5
6
........................ 7
........................ 8
Combining Balance Sheet — Special Revenue Funds .....................................................
Combining Statement of Revenues, Expenditures, and Changes
in Fund Balance — Special Revenue Funds.................................................................
Discretely Presented Component Units
Combining Balance Sheet — Component Units................................................................
Combining Statement of Revenues, Expenditures, and Changes
in Fund Balance — Component Units............................................................................
33
34
....... 36
......... 37
INDEPENDENT AUDITOR'S REPORT
WEAVER
TIDWELL
Suite 1400
To the Honorable Mayor
r r_' �'
and Board of Aldermen
CERTIFIED PUBLIC
TOWN OF WESTLAKE, TEXAS
ACCOUNTANTS
AND CONSULTANTS
Dallas, Texas
We have audited the accompanying general purpose financial statements of the Town of
Westlake, Texas, as of and for the year ended September 30, 2003, as listed in the table
of contents. These general purpose financial statements are the responsibility of Town of
Westlake, Texas management. Our responsibility is to express an opinion on these
general purpose financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the
United States of America. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the general purpose financial statements are
free of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the general purpose financial statements. An
audit also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall general purpose financial
statement presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the general purpose financial statements referred to above present fairly,
in all material respects, the financial position of the Town of Westlake, Texas, as of
September 30, 2003, and the results of its operations and cash flows of its proprietary
fund type for the year then ended in conformity with accounting principles generally
accepted in the United States of America.
Our audit was performed for the purpose of forming an opinion on the general purpose
financial statements taken as a whole. The combining special revenue fund and
component unit financial statements listed in the table of contents are presented for the
purpose of additional analysis and are not a required part of the general purpose financial
statements. Such additional information has been subjected to the auditing procedures
applied in the audit of the general purpose financial statements and, in our opinion, is
fairly stated, in all material respects, in relation to the general purpose financial
statements taken as a whole.
DALLAS
Three Forest JDry
12221 Merit Chive
Suite 1400
Dallas, 7esru75251-2280
WEAVER AND TIDWELL, L.L.F.
972.490.1970
F 972.70 2.8321
Dallas, Texas
FORT WORT„
February 20, 2004
1600 West Seventh Street
Slate 300
1440
Frere Worth, Teams 76102-2506
81;.332.7905
F 817.129.5936
WW W. WEAVERANDTIDW ELL.COM
AN INDEPENDENT MEMBER OF
BAKER TILLN
INTERNATIONAL
Totals
Memorandum
Account Groups Only
General General
Fixed Lang -Term Primary
Assets Debt Government
$ $ $ 6,672,047 $
648,323
14,955
2,056,175
10,306
23,115,323
23,135
161,043
37,628,729
248,778
70,618
534,626
19,097,417 19,097,417 19,097,417
$ 23,115,323 $ 19,097,417 $ 57,168,152 $ 3,192,948 $ 70,361,100
$ $ $ 2,608,158 $
Totals
2,621,556
Memorandum
Only
Component
Reporting
Units
Entity
1,479,084 $
8,151,131
411,792
1,060,115
704,860
14,955
2,058,175
704,860
704,860
1,708,050
10,305
442,284
442,284
25,000
25,000
838,766
23,135
161,043
129,928
129,928
161,043
37,628,729
248,778
264,683
70,618
264,683
534,626
19,097,417 19,097,417 19,097,417
$ 23,115,323 $ 19,097,417 $ 57,168,152 $ 3,192,948 $ 70,361,100
$ $ $ 2,608,158 $
13,398 $
2,621,556
43,760
43,760
2,053,927
2,053,927
10,306
10,306
704,860
704,860
4,679,944
4,679,944
287,417 1, 708, 050
1,708,050
442,284
442,284
838,766
838,766
18,810,000 18,810,000
18,810,000
161,043
161,043
129,928
129,928
264,683
264,683
19,097,417 32,003,119
465,986
32,469,107
7,434,289
7,434,289
23,115,323 23,115,323
23,115,323
(280,425)
(280,425)
585,207
585,207
2,748,579
2,748,579
2,715,594
2,715,594
1,562,060
11,366
1,573,426
23,115,323 35,165,033
2,726,960
37,891,993
$ 23,115,323 $ 19,097,417 $ 67,168,152 $ 3,192,948 $ 70,361,100
3
TOWN OF W ESTLAKE, TEXAS
COMBINED STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
BUDGET AND ACTUAL - GENERAL FUND
YEAR ENDED SEPTEMBER 30, 2003
OTHER FINANCING SOURCES (USES)
Operating transfers in
135,000
General Fund
(135,000)
Net other financing sources (uses)
135,000
Variance
Excess (deficiency) of revenues and other sources over
Favorable
expenditures and other uses
Budget
Actual
(Unfavorable)
REVENUES:
1,700,025
1,700,025
Taxes
551,015
551,015
Sales $
900,000
$ 1,193,030 $
293,030
Mixed beverages
10,000
8,263
(1,737)
Hotel occupancy
Franchise
287,102
299,803
12,701
State program revenues
Federal program revenues
209,000
211,413
2,413
Interest income
31,267
24,169
(7,098)
Building permits and fees
421,100
508,154
87,054
Fines and penalties
493,420
546,375
54,955
Other miscellaneous income
2,250
15,099
13,849
Total revenues
2,354,139
2,809,306
455,167
Expenditures
General government and administration
783,475
1,015,674
(232,199)
Public safety
1,270,640
1,282,112
(11,472)
Cultural and recreational
12,700
14,043
(1,343)
Economic development
17,600
56,832
(39,232)
Pubic works
90,000
68,979
21,021
Protective inspection
44,000
187,922
(143,922)
Visitor services
Instruction and instructional -related services �JL
Instructional and school leadership
Support services - non -student based
}
Capital outlay
844,009
3,062,424
826,536
3,452,098
17,473
(389,674)
Total expenditures
Excess (deficiency) of revenues over expenditures
(708,285)
(642,792)
65,493
OTHER FINANCING SOURCES (USES)
Operating transfers in
135,000
(135,000)
Net other financing sources (uses)
135,000
(135,000)
Excess (deficiency) of revenues and other sources over
expenditures and other uses
(573,285)
(642,792)
(69,507)
Fund balance at beginning of year, as previously stated
1,700,025
1,700,025
Prior period adjustments
551,015
551,015
Fund balance at the beginning of the year, restated
2,251,040
2,251,040
Fund balance at end of year
$ 1,677,755
$ 1,608,248
$ (69,5071
The accompanying notes are
an integral part of this statement.
5
TOWN OF WESTLAKE, TEXAS
STATEMENT OF CASH FLOWS
ENTERPRISE FUND
YEAR ENDED SEPTEMBER 30, 2003
CASH FLOWS FROM OPERATING ACTIVITIES:
Operating loss
$ (290,399)
Adjustments to reconcile operating loss to net
cash provided by operating activities:
(110,362)
Depreciation and amortization
451,331
Changes in operating assets and liabilities:
9,50a
Receivables
54,955
Accounts payable
229,631
Customer deposits payable
5,450
Deferred revenue
157,362
Net cash provided by operating activities 608,330
CASH FLOW FROM NONCAPITAL FINANCING
ACTIVITIES:
Net interfund borrowings 23,751
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:
Principal paid on debt
(110,362)
Interest paid on debt
(126,353)
Purchase of property and equipment8(
9,50a
Net cash used in capital and related financing activities
(326,224)
Net increase in cash
and cash equivalents 305,857
Cash and cash equivalents at the
beginning of the year 104,531
Cash and cash equivalents at the
end of the year $ 410,388
NONCASH CAPITAL AND RELATED FINANCING
ACTIVITIES:
Due to component unit for capital expenditures $ 316,034
RECONCILIATION OF TOTAL CASH AND CASH EQUIVALENTS:
Cash and cash equivalents $ 366,628
Restricted cash and cash equivalents 43,760
Total cash and cash equivalents $ 410,388
The accompanying notes are
an integral part of this statement.
7
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies — continued
Component Units
Discretely Presented
Lone Star Public Facilities Corporation is a Texas non-profit corporation that acts on behalf of
the Town to further the public purposes under the Public Facilities Corporation Act, as it's
duly constituted authority and instrumentality. The board of directors, appointed by the
Town's governing body, is comprised of seven members of whom five must be members of
the Town's governing body.
Westlake 4A Corporation is a Texas non-profit industrial development corporation under the
Development Corporation Act of 1979 formed to promote economic development within the
Town and the State of Texas in order to eliminate unemployment and underemployment, and
to promote and encourage employment and the public welfare of, for, and on behalf of the
Town by using the proceeds of a sales and use tax for the promotion and development of
new and expanded business enterprises and any other lawful activities as defined and
permitted under Section 4A of the Act. The board of directors is composed of five persons
appointed by the Town's governing body.
Westlake 4B Corporation is a Texas non-profit industrial corporation under the Development
Corporation Act of 1979 formed to promote economic development within the Town and the
State of Texas in order to eliminate unemployment and underemployment, and to promote
and encourage employment and the public welfare of, for, and on behalf of the Town by
developing, implementing, financing, and providing one or more projects defined and
permitted under Section 4B of the Act. The board of directors is composed of seven persons
appointed by the members of the Town's governing board. Four of the members of the board
of directors are members of the Town's governing board.
Blended
Westlake Academy ("Academy") is a Texas non-profit Corporation that acts on behalf of the
Town to acquire a charter, under Chapter 12, Subchapter D of the Education Code, provide
education services and acquire, finance, and operate educational facilities. The board
consists of seven directors and is appointed by the Town's governing body. Currently all the
members of the board of directors are members of the Town's governing body. The
Academy's year end is August 31.
Related Organizations
The governing body of the Town is responsible for appointing a voting majority of the board
members, but is not financially accountable for the Texas Housing Corporation, the Texas
Housing Corporation — San Marcus Project, the Texas Housing Corporation — Denton Project, the
Texas Housing Corporation — MSU Project, and the Westlake Academy Foundation.
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies - continued
Fiduciary Fund Types
Fiduciary funds are used to account for assets held by the Town in a trustee capacity or as
an agent for other governmental units and/or other funds. The following are the fiduciary fund
types maintained by the Town:
Agency Funds — To account for assets held by the Town in a trustee capacity or as an
agent for individuals, private organizations, other governments and/or other funds.
Agency funds are purely custodial (assets equal liabilities) and thus do not involve
measurements of results of operations. The Town has a custodial relationship with the
Historical Board and Tree City USA Advisory Committee. As of September 30, 2003, the
Town did not have custody of any assets owned by these groups.
Account Groups
Account groups are used to establish accounting control and accountability for the Town's
general fixed assets and general long-term liabilities. The following are the account groups
maintained by the Town:
General Fixed Assets Account Group — To account for all fixed assets of the Town other
than those accounted for in proprietary funds. Significant net interest expense during
construction of assets is capitalized.
General Long -Term Debt Account Group — To account for all unmatured long-term
liabilities of the Town other than those accounted for in proprietary funds.
Measurement Focus/Basis of Accounting
Measurement focus refers to what is being measured. Basis of accounting refers to when
revenues and expenditures are recognized in the accounts and reported in the financial
statements. Basis of accounting relates to the timing of the measurement made, regardless of
the measurement focus applied.
Under the modified accrual basis of accounting, revenues are recognized when susceptible to
accrual (i.e., when they become both measurable and available). "Measurable" means the
amount of the transaction can be determined and "available" means collectible within the current
period or soon enough thereafter to be used to pay liabilities of the current period. A sixty-day
availability period is used for recognition of all governmental fund revenues. Expenditures are
recorded when the related fund liability is incurred, except for unmatured interest on general long-
term debt which is recognized when due and compensated absences and claims and judgments,
which are recorded when payable from current available financial resources.
The revenues susceptible to accrual are sales taxes, hotellmotel taxes, franchise fees, special
assessments, building permits and fees, and interest income. Investment earnings are recorded
when earned, because they are both measurable and available.
The accrual basis of accounting is used in proprietary fund types. The accrual basis of
accounting recognizes revenues when earned. Expenses are recorded when incurred.
11
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies - continued
Capital Assets
General Fixed Assets Account Group
Fixed assets used in governmental fund type operations are accounted for in the general
fixed assets account group, rather than in governmental funds. Public domain
("infrastructure") general fixed assets including roads, bridges, curbs and gutters, streets and
sidewalks, drainage systems and lighting systems are not capitalized along with other
general fixed assets for reporting purposes. Interest costs are not capitalized in the cost of
construction fixed assets. No depreciation has been provided on general fixed assets.
All fixed assets are valued at historical cost or estimated historical cost if actual historical cost
is not available. Donated assets are valued at their fair market value on the date donated.
Assets capitalized have an original cost of $5,000 or more and over three years of life.
Proprietary Fund Types
Property, plant, and equipment owned by the proprietary fund is recorded at cost or, if
contributed property, at their estimated fair value at time of contribution. Repairs and
maintenance are recorded as expenses, and renewals and betterments are capitalized.
Assets capitalized have an original cost of $5,000 or more and over three years of fife.
Depreciation has been calculated on each class of depreciable property using the straight-
line method. Estimated useful lives are as follows:
Water and sewer system 10-50 years
Machinery and equipment 5-10 years
Improvements 20 years
Compensated Absences
The Town's policy allows employees to earn 10 days of vacation per year of employment. After
completion of five years of service, 15 days per year are earned. After completion of 10 years of
service, 20 days per year are earned. No accumulated, unused sick time is payable upon
termination or retirement.
Reserved and Designated Fund Equity
Reserved fund balances are not appropriable
specific future use. Designated fund balances
financial resources utilization in a future period.
Total Columns (Memorandum Only)
for expenditure or are legally segregated for a
are established to indicate tentative plans for
Total columns on the combined financial statements are captioned "memorandum only" to
indicate that they are presented only to facilitate financial analysis. Data in these columns does
not present financial position, results of operations, or changes in cash flows in conformity with
generally accepted accounting principles. Inter -fund eliminations, if applicable, have not been
made in the aggregation of this data; therefore, it is not comparable to a consolidation.
13
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 2. Deposits and Investments - continued
During the year ended September 30, 2003, the Town had investments with TexPool. TexPool, a
public funds investment pool created by the Treasurer of the State of Texas acting by and through the
Texas Treasury Safekeeping Trust Company, is empowered to invest funds and acts as custodian of
investments purchased with local investment funds. These investments are not required to be
categorized because the investor is not issued securities, but rather it owns an undivided beneficial
interest in the assets of the respective funds. The fair value of the position in TexPool is the same as
the value of the pool shares.
On September 1, 1989, local government investment pools became authorized investments for the
majority of public entities in Texas. The Interlocal Cooperation Act was amended by the 71St Texas
Legislature to facilitate the creation of local government investment pools in Texas. This act permits
the creation of investment pools to which a majority of political subdivisions (local governments) may
delegate, by contract, the authority to make investments purchased with local investment funds and
to hold legal title as custodian of the investments. TexPool was organized to conform with the
Interlocal Cooperation Act, Chapter 791 of the Texas Government Code, and the Public Funds
Investment Act, Chapter 2256 of the Texas Government Code.
At September 30, 2003, the Town's investments included investment pools in the name of the Town
or its agent in the Town's name. The Town's investments were as follows:
Primary Government
Carrying Fair
Amount Value
Investments:
Government Pool $ 6,133,871 $ 6,133,871
Cash 786,954 786,954
Total cash and investments $ 6.920.825 $ 6,920.825
Reconciliation of total cash and investments at September 30, 2003 are as follows:
Cash and cash equivalents $ 6,672,047
Restricted cash and investments 248.778
$ 6.920 825
The Town's entire cash deposits in the bank of $967,886 on September 30, 2003, were covered by
federal depository insurance or by collateral held by the Town's agent in the Town's name.
Component Units
Carrying Fair
Amount Value
Investments:
Government Pool $ 1,476,916 $ 1,476,916
Cash 2,168 2,168
Total cash and investments $ 1,479.084 $ 1.479.084
The component unit's entire cash deposits in the bank of $4,188 on September 30, 2003 were
covered by federal depository insurance or by collateral held by the component unit's agent in the
component unit's name.
15
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 4. Changes in General Fixed Assets - continued
A summary of proprietary fund type property, plant and equipment at September 30, 2003 follows:
Improvements
Machinery and equipment
Construction in progress
Less accumulated depreciation
Total
Note 5. Restricted Assets
General Fund
Total
Proprietary
Funds
$11,845,131
3,346,423
405,543
15,597,097
1,083.691
514,513.406
Restricted assets represent amounts received from surrounding towns, businesses, and residents
that will benefit from the construction of FM 1938 in the amount of $2,389 as of September 30,
2003.
Funds received from an individual of approximately $75,000 are held to pay for construction of a
trail for the benefit of the Town.
The Municipal Court collected $89,209 on top of traditional citation revenue, which is restricted to
fund court security and technology.
The remaining portion of the restricted cash in the general fund represents amounts collected for
lot development fees of $38,420 that are payable.
Proprietary Fund
Within the proprietary funds, $43,760 of the fund represents customer deposits received for water
and sewer usage that are refundable upon termination of service.
Note 6. Interlocal Agreement with Trophy Club/Westlake Department of Public Safety
On April 24, 2000, the Town approved an interlocal agreement with the Trophy Club/Westlake
Department of Public Safety ("DPS"), which called for the Town of Westlake to participate in the
financing of an emergency vehicle for the DPS. The Town recorded a note receivable of $125,000
based on the terms of the interlocal agreement.
The Agreement calls for eight principal and interest payments to the Town, with interest calculated at
stated rate of interest of 6.75% simple interest.
17
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 7. General Long -Term Debt — continued
Debt service requirements of certificates of obligation to be retired from governmental funds are as
follows:
On August 10, 1998 the Town entered into an economic development agreement with Fidelity Texas
Limited Partnership ("Fidelity") which provided that Fidelity will receive a rebate of one percent of local
sales taxes collected by the Town and paid by Fidelity. The agreement provided that the rebate will be
paid to Fidelity within thirty days of each calendar quarter from the sales taxes received by the Town. On
November 13, 2000, the agreement was amended to allow for a payment schedule of fifteen annual equal
installments for sales tax rebate due and payable to Fidelity. The amount due will not bear interest. The
loan is discounted to present value and amortized over the life of the loan using the effective interest
method.
Debt service requirements for deferred rebates to be retired from governmental funds are as follows:
Amount of Schedule Requirements
_
Fiscal Year Ended
Total
September 30
Principal_
Interest
Requirements
2004
$
$ 1,003,993
$ 1,003,993
2005
1,755
1,027,804
1,027,804
2006
350,000
1,027,804
1,377,804
2007
370,000
1,011,354
1,381,354
2008
380,000
993,249
1,373,249
2009-2013
2,205,000
4,647,477
6,852,477
2014-2018
2,795,000
3,975,621
6,770,621
2019-2023
3,555,000
3,128,564
6,683,564
2024 —2028
4,570,000
2,053,225
6,623,225
2029 —2032
4,585,000
650.950
5235_.950
Total
$ 18.810.000
$ j9520_041
38,330.041
On August 10, 1998 the Town entered into an economic development agreement with Fidelity Texas
Limited Partnership ("Fidelity") which provided that Fidelity will receive a rebate of one percent of local
sales taxes collected by the Town and paid by Fidelity. The agreement provided that the rebate will be
paid to Fidelity within thirty days of each calendar quarter from the sales taxes received by the Town. On
November 13, 2000, the agreement was amended to allow for a payment schedule of fifteen annual equal
installments for sales tax rebate due and payable to Fidelity. The amount due will not bear interest. The
loan is discounted to present value and amortized over the life of the loan using the effective interest
method.
Debt service requirements for deferred rebates to be retired from governmental funds are as follows:
The Certificates of Obligations, Series 2002 and 2003 require the Town to provide certain updated
financial information and operating data to certain information vendors annually, as permitted by SEC
Rule 15c2-12 (the "Rule"). The issuer will provide the updated information to each nationally
recognized municipal securities information repository ("NRMSIR") and to any state information
depository ("SID") that is designated by the State of Texas and approved by the staff of the United
States Securities and Exchange Commission (the "SEC').
19
Amount of Schedule Requirements
Fiscal Year Ended
Total
September 30.4_
Principal
Discount
Requirements
2004
$
$
$
2005
1,755
34,003
35,758
2006
19,333
16,425
35,758
2007
20,444
15,314
35,758
2008
21,620
14,138
35,758
2009-2013
128,239
50,552
178,791
2014-2016
96,026
11.249
107,275
Total
L28
141,681
$ 4219—M
The Certificates of Obligations, Series 2002 and 2003 require the Town to provide certain updated
financial information and operating data to certain information vendors annually, as permitted by SEC
Rule 15c2-12 (the "Rule"). The issuer will provide the updated information to each nationally
recognized municipal securities information repository ("NRMSIR") and to any state information
depository ("SID") that is designated by the State of Texas and approved by the staff of the United
States Securities and Exchange Commission (the "SEC').
19
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 8. Proprietary Long -Term Debt— continued
The schedule of future payments by the Town under these agreements is as follows;
Note 9. Deferred Revenue
Deferred revenue in the proprietary fund of $264,683 relates to the collection of the entire amount due
on a 25 and 20 year lease with Verizon Southwest and AT&T Local Network Services, respectively
for use of the Town's ductbank.
Note 10. Commitments and Contingencies
Lease Obligations
The Town has commitments relative to municipal services, and contractual relationships
concerning certain utilities and public safety resources, which are normal in its ongoing activity.
Non -cancelable obligations consist of a lease of Town office space and agreements for services
at September 30, 2003.
Minimum lease payments and contractual obligations under these non -cancelable leases and
agreements as of September 30, 2003 are as follows.,
Fiscal Year End,
Amount of Schedule Requirements
September 30,
Fiscal Year Ended
2004
$ 19,929
Total
September 30,
Principal
Interest
Requirements
2004
$ 513,729
$ 1,190,217
$ 1,703,946
2005
192,601
355,201
547,802
2006
205,759
342,350
548,109
2007
219,613
328,623
548,236
2008
234,195
313,734
547,929
2009-2013
1,434,037
1,311,084
2,745,121
2014-2018
1,990,783
770,386
2,761,169
2019-2021
_ 1,309,860
_ 119,080
1,940
Total
$ 6.100,577
5 4.730,675
$ 10.831.252
Note 9. Deferred Revenue
Deferred revenue in the proprietary fund of $264,683 relates to the collection of the entire amount due
on a 25 and 20 year lease with Verizon Southwest and AT&T Local Network Services, respectively
for use of the Town's ductbank.
Note 10. Commitments and Contingencies
Lease Obligations
The Town has commitments relative to municipal services, and contractual relationships
concerning certain utilities and public safety resources, which are normal in its ongoing activity.
Non -cancelable obligations consist of a lease of Town office space and agreements for services
at September 30, 2003.
Minimum lease payments and contractual obligations under these non -cancelable leases and
agreements as of September 30, 2003 are as follows.,
Fiscal Year End,
September 30,
Amount
2004
$ 19,929
2005
8,030
2006
5,539
2007
885
Total 34333
Rental expenditures in 2003 were $80,165.
21
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 11. Federal and State Program Revenues — continued
Sources of federal and state program revenues for the year ended September 30, 2003, were as
follows:
General Westlake
Source CFDA # Fund Academy Total
Federal program revenues:
Federal Emergency Management Agency 83.554 $ 211,413 $ $ 211,413
U.S. Department of Education — passed
through State Department of Education 84.22A 99,885 99.885
State program revenues:
State Department of Education
Note 12. Excess of Expenditures over Appropriations
General Fund
$ 211.413 99 885 $ 311.298
NIA $5� 3.309&_53_3QD
Excess of expenditures over appropriations are a result of unanticipated expenditures including
audit costs, costs associated with personnel and planning for the Westlake Academy and
unanticipated litigation.
Note 13. Retirement Plan
Plan Description
Beginning in the 2002 fiscal year, the Town provides pension benefits for all of its full-time
employees through a non-traditional, joint contributory, hybrid defined contribution plan in the
statewide Texas Municipal Retirement System ('TMRS"), one of 774 administered by TMRS, an
agent multiple -employer public employee retirement system.
Benefits depend upon the sum of the employee's contributions to the plan, with interest, and the
City -financed monetary credits, with interest. At the date the plan began, the Town granted
monetary credits for service rendered before the plan began of a theoretical amount equal to two
times what would have been contributed by the employee, with interest, prior to establishment of
the plan. Monetary credits for service since the plan began are a percent (100%, 150% or 200%)
of the employee's accumulated contributions. In addition, the Town can grant, as often as
annually, another type of monetary credit referred to as updated service credit which is a
theoretical amount which, when added to the employee's accumulated contributions and the
monetary credits for service since the plan began, would be the total monetary credits and
employee contributions accumulated with interest if the current employee contribution rate and
Town matching percent had always been in existence and if the employee's salary had always
been the average of his/her salary in the fast three years that are one year before the effective
date. At retirement, the benefit is calculated as if the sum of the employee's accumulated
contributions with interest and the employer -financed monetary credits with interest were used to
purchase an annuity.
23
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 14. Discretely Presented Component Units
Discretely presented component units are activities that are legally separate from the Town, but for
which the Town is financially accountable. A financial summary of the discretely presented
component units follows:
Lone Star
Public Westlake Westlake
Facility 4A Development
Corporation Corporation Corporation
Assets and Other Debits
Current assets
Due from primary government
Inter -component unit receivable
Advances receivable from
primary government
Total assets and other debits
Liabilities Fund EquitV and Other Credits
Current liabilities
Due to primary government
Inter -component unit receivable
Total liabilities
Fund balance
Total liabilities, fund equity and other credits
Revenues
Expenditures and other financing uses
Economic development
Capital outlay
Operating transfers to primary government
Total expenditures and other financing uses
Excess of revenues over expenditures
$ 11,366 $ 1,091,301 $ 813,209
388,826 316,034
442,284
129,928
$ 11.3661 4�, 80,127_ $ 1.701,455
$ $ $ 13,398
10,306
442,284
442.284 23,704
11,366 1,037,843 1,677,751
$ 11.366 1.480,12Z $ 1.701,455
25
$ 181 $ 612,453 $ 600,819
215,641 6,000
37,345
(1,990,755) (1,155,91
(1.737,769) (1.149,912)
$ 181 $ 359.467 S. 594.819
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 15. InterFund Balances and Transactions — continued
Fund
Primary Government
General Fund
Westlake 4B Corporation
Component Units
Westlake 4B Corporation
Due from Due to
Comoonent Units Primary Government
$ 10,306 $
General Fund 10,306
0 306 $ 306
These balances represent advances from the component units for operations and capital
expenditures.
(3) Receivable and payable balances between the component units consist of the following at
September 30, 2003:
Component Unit
Westlake 46 Corporation
Westlake 4A Corporation
Westlake 4A Corporation
Westlake 4B Corporation
Due from Other Due to Other
Component Unit Component Unit
442,284 $
442,284
$ 442.284 $ 442.284
This balance represents advances between the component units for capital expenditures.
(4) Interfund advances and loan consist of the following at September 30, 2003:
Due from Due to
Fund Other Funds Other Funds
General Fund
Utility Fund $ 161,043
Utility Fund
General Fund
$ 161,043
These balances represent advances for capital expenditures.
27
E1
161,043
161 043
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 16. Water Purchase and Wastewater Treatment Contracts
The Town has a contract with the City of Fort Worth, Texas to purchase water when the Town does
not have and cannot provide economically and within a reasonable period of time, any other source of
water supply, fully adequate to meet its present and/or future needs or potential emergency needs.
Under the contract, the Town may obtain from the City of Fort Worth a supply of potable water at a
reasonable rate based on water usage. The rate charges are subject to minimum annual contract
payments. Water expense for the year ended September 30, 2003, was $261,095.
Note 17. Self -Insurance
As established by the Texas Labor Code Section 504.016 in order to deal with potential liabilities, the
Town contracts with the Texas Municipal League to participate in a self-insured retention program
("SIR"), which is accounted for within the general fund. Claims in excess of the self-insured retention
amounts are covered through third -party limited -coverage insurance policies. The Town is self-
insured with excess coverage in these areas (a) workers' compensation liability with no limit on each
occurrence with no annual aggregate; (b) general liability with a $3,000,000 and a $2,000,000 limited
on each occurrence for limits on liability and sudden events involving pollution, respectively with an
annual aggregate of $6,000,000; (c) law enforcement liability with a $3,000,000 limit on each
occurrence with an annual aggregate of $6,000,000; (d) errors and omissions liability with a
$3,000,000 limit for each wrongful act with an annual aggregate of $6,000,000; and (e) automobile
liability with a $3,000,000 limit on each occurrence.
Note 18. Contingent Liabilities
Various claims and lawsuits are pending against the Town. In the opinion of Town management,
after consultation with legal counsel, the potential loss on all claims and lawsuits will not materially
effect the Town's financial position.
Note 19. Related Party Transactions
On September 30, 2003, the Town entered into a three-year agreement with Petty and Associates,
Inc. for Mr. Trent Petty to render services to the Town as its Town Manager. The agreement requires
the Town to make annual payments to Petty and Associates in the amount of $152,410 per year,
effective October 1, 2003. Annually, the Town's governing body will review the annual compensation
due to Petty and Associates for services and may increase, but not decrease, the annual
compensation provided under the agreement.
Future payments under this agreement as of September 30, 2003 are as follows:
Fiscal Year End Payment
September 30, Amount
2004 $ 152,410
2005 152,410
2006 152.410
Total $ 457,230
The Westlake Academy Foundation was incorporated on May 15, 2003. The Westlake 4A
Corporation provided an advance of $25,000 for start up costs.
29
TOWN OF WESTLAKE, TEXAS
NOTES TO FINANCIAL STATEMENTS
Note 21. Prior Period Adjustment— continued
Enterprise Fund — continued
Management also identified an unrecorded liability relating to an interlocal agreement with the
City of Southlake discussed in Note 10 of $90,456. Additionally, the partial cost of a water
line and pump station was improperly recorded as contributed capital, which was funded by a
limited pledge contractual obligation. To properly record this transaction, contributed capital
was reduced by $3,408,325. The $515,652 reduction in retained earnings represents
accrued interest and deprecation expense provided on the water line and pump station. An
unrecorded liability between to the Town and the Trinity Regional Authority discussed in Note
10 was also identified. The outstanding liability relating to this agreement at September 30,
2002 was $56,727. The net effect of properly recording these amounts is to reduce
contributed capital and retained earnings by $3,408,325 and $681,818, respectively.
General Fixed Assets/Long-Terra Debt Accounts Groups
During fiscal year 2003, management identified fixed assets and related long term debt
relating to an overhead storage tank improperly recorded in the general fixed assets and
general long term debt account groups when it should have been recorded in the enterprise
fund. The net effect of this error was a $1,466,000 decrease in investment in fixed assets
and $1,433,960 decrease in amount to be provided for long-term debt. In the prior year, the
Town issued a $1,475,400 note to purchase land. Neither the asset nor the liability was
recorded. In the prior year there was an unrecorded liability of $373,231 relating to an
economic development agreement with Fidelity as discussed in Note 8.
Component Units
Westlake 4A Corporation
In the prior year, the Town determined that the Westlake 4A Corporation be presented as a
blended component unit. In the current year the corporation was evaluated under GASB
Statement No 14, The Financial Reporting Entity, as amended by GASB Statement No. 39,
Determining Whether Certain Organizations are Component Units. It was determined that
the corporation should have been presented as a discretely presented component unit.
Additionally, an accrual of sales tax of $ 50,970 was inadvertently excluded in prior year's
financial statements. The net effect of properly recording these amounts is to increase fund
balance by $2,669,132.
Westlake 4B Corporation
In the prior year, the Town determined that the Westlake 4B Corporation be presented as a
blended component unit. In the current year the corporation was evaluated under GASB
Statement No 14, The Financial Reporting Entity, as amended by GASB Statement No. 39,
Determining Whether Certain Organizations are Component Units. It was determined that
the corporation should have been presented as a discretely presented component unit.
Additionally, an accrual of sales tax of $ 50,970 was inadvertently excluded in prior year's
financial statements. Finally, in the prior year, interest of $78,012 was improperly accrued for
the overhead storage tank in the Westlake 4B Corporation, when it is an enterprise fund
expense. The net effect of properly recording this amount is to increase fund balance by
$2,238,844.
31
ASSETS AND OTHER DEBITS:
Cash and cash equivalents
Receivables
Due from other funds
Prepaid items
Total assets
LIABILITIES, FUND EQUITY AND
OTHER CREDITS:
Liabilities
Accounts payable
Due to other funds
Total liabilities
Fund balance
Reserved to promote tourism
Unreserved and undesignated
Total fund balance
Total liabilities, fund equity and other
credits
TOWN OF WESTLAKE, TEXAS
COMBINING BALANCE SHEET
SPECIAL REVENUE FUNDS
SEPTEMBER 30, 2003
Visitor's
Association
Westlake
Academy
General
$ 571,058 $ 68,218 $
53,309
14,149
23,135
Westlake
Academy
Federal
Program Totals
$ 639,276
9,885 63,194
14,149
23,135
$ 585,207 $ 144,662 $ 9,885 $ 739,754
$ $ 22,869 $ $ 22,869
167,981 9,885 177,866
190,850 9,885 200,735
585,207 585,207
46,188) (46,188)
585,207 (46,188) 539,019
$ 585,207 $ 144,662 $ 9,885 $ 739,754
33
COMPONENT KNITS
Lone Star Public Facilities Corporation — a legally separate Texas non-profit corporation that acts on
behalf of the Town to further the public purposes under the Public Facilities Corporation Act.
Westlake 4A Corporation — a legally separate Texas nonprofit industrial corporation under the
Development Corporation Act of 1979 formed to promote economic development within the Town in
order to eliminate unemployment and underemployment, and to promote and encourage employment
and the public welfare of, for, and on behalf of the Town by using the proceeds of a sales and use tax
for the promotion and development of new and expended business enterprises and other lawful
activities as defined and permitted under section 4A of the Act.
Westlake 4B Corporation — a legally separate Texas non-profit industrial corporation under the
Development Corporation Act of 1979 formed to promote economic development within the Town in
order to eliminate unemployment and underemployment, and to promote and encourage employment
and the public welfare of, for, and on behalf of the Town by developing, implementing, financing, and
providing one or more projects defined and permitted under Section 4B of the Act.
35
TOWN OF WESTLAKE, TEXAS
COMBINING STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE
COMPONENT UNITS
YEAR ENDED SEPTEMBER 30, 2003
Lone Star
37
Public
Westlake
Westlake
Facility
4A
4B
Corporation
Corporation
Corporation
Totals
REVENUES:
Sales taxes
$
$ 596,500
$ 596,500 $
1,193,000
Interest income
181
15,953
3,745
19,879
Miscellaneous
574
574
Total revenues
181
612,453
600,819
1,213,453
EXPENDITURES:
Economic development
215,641
6,000
221,641
Capital outlay
37,345
37,345
Total expenditures
252,986
6,000
258,986
Excess (deficiency) of revenues over
expenditures
181
359,467
594,819
954,467
OTHER FINANCING SOURCES (USES):
Operating transfers to primary government
(1,990,756)
{1,155,912)
3,146,668
Total other financing sources (uses)
(1,990,756)
(1,155,912)
(3,146,668)
Excess (deficiency) of revenues and other
sources over expenditures and other uses
181
(1,631,289)
(561,093)
(2,192,201)
Fund balance at beginning of year, as
previously stated
11,185
11,185
Prior period adjustments
2,669,132
2,238,844
4,907,976
Fund balances at end of year
$ 11,366
$ 1,037,843
$ 1,677,751 $
2,726,960
37