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Fiscal Year 2006krOA,O CLERK OF COURT Financial nt Page Independent Auditors' Report ------------------ ---------------- 2 - 3 BASIC FINANCIAL STATEMENTS Balance Sheet - Governmental Funds 4 Statement of Revenues, Expenditures and Changes In Fund Balance - Governmental Funds 5 Statement of Fiduciary Assets and Liabilities - Agency Fund ---- -------------------------- -------- 6 Notes to Financial Statements ------------------------------------------- 7-11 REQUIRED SUPPLEMENTARY INFORMATION Schedule of Revenues and Expenditures - Budget to Actual - General Fund ---- -- ----------------------------------------------------- 12 Schedule of Revenues and Expenditures — Budget to Actual — Special Revenue Court Related Fund 13 Schedule of Revenues and Expenditures — Budget to Actual — Special Revenue Records Modernization Fund 14 ------------------------- SUPPLEMENTARY INFORMATION Statement of Changes in Assets and Liabilities - AgencyFund .................................. ----------------------------------------------------------------------------- 15 SUPPLEMENTARY INDEPENDENT AUDITORS' REPORTS Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards ----------- --- ---------- ------------------ 16-17 To the Honorable Danny L. Kolhage, Clerk of the Circuit Court of Monroe County, Florida: 111 am Soo I r OWN Pf contents. These financial statements are the responsibility of the Clerk's management. OW responsibility is to express opinions on these financial statements based on our audit. States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. As discussed in of complying with Section 218.39(2), Florida Statutes, and Chapter 10.550, Rules of the Auditc t General -Local Governmental Entity Audits, and are not intended to be a complete presentat! I of the financial position of Monroe Coun�y, Florida, and the results of its operations and th i cash flows of its proprietary funds in conformity with accounting principles generally accepted 1 the United States of America. lo N It'll Z��17ZPTOFTHOV COFISlUel-aBO[Ill Lne UUMS iriterric-F70trui Mier firldriv-1al uttporung ano our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. K The budgetary comparison schedules on pages 12-14 are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted primarily of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and we express no opinion on it. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Clerk's basic financial statements. The accompanying statement of changes in assets and liabes - agency fund is presented for purposes of addonal analysis and is not a required part of the basic financial statements. This statement has been subjected to the aung procedures applied by us in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. This report is intended solely for the'information and use of management and applicable state agencies, and is not intended to be and should not be used by anyone other than these speced parties. NUMM-= F F- 5 D F-I Jim 0 M II a 0 Balance Sheet Governmental Funds September 1 2006 Major Funds Court Records General Related Modernization Fund Fund Fund Tatais ASSETS Assets Cash and cash equivalents $ 1,162,622 $ 1,016,418 $ 1,301,990 $ 3,481,030 Due from Board of County Commissioners 57,011 - - 57,011 Due from other governments 28,237 - 28,237 Total assets$ 1,219,633 $ 1,044,655 $ 1,301, 90 $ 3,666,278 LIABILMIES Liabilities Accounts payable and accrued liabilities $ 95,986 $ 149,340 $ 50,776 $ 296,102 Due to Board of County Commissioners 1,086,870 566,872 1,653,742 Due to Florida Department of Revenue 308,257 308,257 Deferred revenue 20,186 20,186 Deposits 36,777 - 36,777 Total liabil 1,219,633 .1,044,655 50,776 2,315,064 Fund balances 1,251,214 1®251,214 Total liabilities and fund balances $ 1,219,633 $ 1,044,655 $ 1,301,990 3,56 ®278 The notes to the financial statements are an integral part of this statement 4 Revenues Intergovernmental Charges for services Board of County Commissioners Others Fines and forfeitures Interest income Miscellaneous Expenditures Current General government Salaries and benefits Operating expenditures Capital outlay Total expenditures Excess of revenues over expenditures Other financing uses Principal Interest Transfer to Board of County Commissioners Transfer to Florida Department of Revenue uses over revenues and other uses Fund balances, and of year MONROE COUNTY, FLORIDA CLERK OF THE CIRCUIT COURT Governmental Funds Year Ended September 30, 2006 Major Funds Court Records General Related Modernization Fund Fund Fund ToWs - $ 694,068 $ $ 694,068 2,369,059 943,479 3,312,538 1,456,920 1,777,073 462,090 3,696,083 1,248,352 1,248,352 229,754 18 46,716 276,488 10,768 4,450 4,500 19,718 4,066,501 4,667,440 513,306 9,247-247 �. I �' 2,451,278 3,653,199 - 6,104,477 546,229 190,758 302,975 1,039,962 11,196 1,968 148,959 162,123 3,008,703 3,845,925 451,934 7,306,562 1,057,798 821,515 61,372 1,940,685 - - (209,849) (209,849) (13,376) (13,376) (1,057,798) (513,258) (1,571,056) (308,267) (308,257), (1,057,798) (821,515) (223,225) (2,102538) The notes to the financial statements are an integral part of this statement. 5 (161,853) (161,853) $ 1,251,214 $ 1,251,214 MONROE COUNTY, FLORIDA CLERK OF THE CIRCUIT COURT Agency Fund September 30, 2006 Cash and cash equivalents Due from others kfurur-= RM-liff M Due to others Due to other govemmental agencies The notes to the financial statements V. an integral part of this statement. 6 2,301,091 129,185 1,365,403 3,795,679 =1 Fjj=LUL=j�jM=- I RePorfing Entity - The Monroe County, Florida Clerk of the Circuit Court (the "Clerk") is a separately elected county official established pursuant to the Constitution of the State ol Florida. The Clerk's financial statements do not purport to reflect the financial position or the results of operations of Monroe County, Florida (the "County") taken as a whole. Entity status for financial reporfing purposes is governed by Statement No. 14 and No. 39 of the Governmental Accounting Standards Board (GASB). Although the Clerk's Office is operationally autonomous, it does not hold sufficient corporate powers of its own to be considered a legally separate entity for financial reporting purposes. Therefore, the Clerk is reported as a part of the primary government of the County. Description of Funds - The accounting records are organized for reporting purposes on the basis of three governmental funds and a fiduciary fund. General Fund - The General Fund is a governmental fund used to account for all revenues and expenditures applicable to the general operations of the Clerk that are not required legally or by accounting principles generally accepted in the United States of America to be accounted for in another fund. 01401 [--TO tz400 IIIWE &MI WZIP LGIU--D&ISIVItt loin 41010i;IZIN 101411iml IIQ - I I a ON- arlu eXpenEATIM UT UUM-anudons. Any elcebb MEM 07--T�Iku texple-nomme o either the Florida Department of Revenue by January I for the preceding county fiscal year or the Monroe County Board of County Commissioners (the "Board"), depending on where the funds originated. Fiduciary Fund - The Fiduciary fund of the Clerk is an Agency Fund, which is used to ,-.ccount for assets held by the Clerk as agent. 0111014111,0 - -1 gold 1- 0 h Z 61111111 =!, I - 0 1 Zy ==I- 7 The General Fund and the Special Revenue Funds are governmental funds which use thf current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized when measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the govemment considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, expenditures related to compensated absences and claims and judgments are recorded only when payment is due. The Clerk reports the General Fund, Court Related Fund and the Records Modernization Fund as major governmental funds and the Agency Fund as a fiduciary fund type. The Agency Fund is custodial in nature and does not involve measurement of results of operations. The Clerk's operations have been reorganized, since July 1, 2004, to be segregated between court related and non -court related activities as defined by Article V. Any excess of court related revenue over court related expenditures is reflected as a liability to either the Florida Department of Revenue or the Board, depending on the source of the original funding. Any excess of non -court related revenue over non court -related expenditures is reflected as a liability to the Board. Budgetary Requirements - Expenditures are controlled by appropriations in accordance with the budget requirements set forth in the Florida Statutes. The budget is prepared on a basis consistent with accounting principles generally accepted in the United States of America. Cash and Cash Equivalents — The Clerk's cash and cash equivalents consist of demand deposits and highly liquid investments with maturities of 90 days or less when purchased. Included are investments in the State Board of Administration Local Surplus Investment Pool Trust Fund ("SBA"), a W-like investment pool stated at share price, which is substantially the same as fair value. Capital Assets - Tangible personal property used by the Clerk's operations are recorded governmental fund types as expenditures at the time assets are received and a liability i- incurred. Purchased assets are capitalized at historical cost in the government -wide financl statements of the County. In addition, the County provides administrative office space a certain other expenditures used by the Clerk at no charge. Compensated Absences - The Clerk permits employees to accumulate earned but unus vacation and sick pay benefits. Related long-term obligations, amounting to $536,906 September 30, 2006, are included in the government -wide financial statements of the County,11 0 Tom =; V-7-T-71 Min =.. Deferred Revenue — The Clerk reports as deferred revenue bond forfeitures that have not yet been recognized as revenue in accordance with Section 903.28, Florida Statutes. This Section requires the recognition of revenue over a two-year period. Amounts are reduced by any reinstatement of bond amounts by court order. Lei 1 if rz I I I r- I lrz I 1 [74"1 ILZI OM I (ZIS a; I I I LOR I a tRIM;LIMRr� IN LZ-N1"LkMOi6R I IMO I I I L-74 a I Lei I I W-7M I I I I Aote 2 - Deposits and Investments As of September 30, 2006, the Clerk has the following deposits and investments: Demand Deposits $ 5,547,911 Local Government Surplus Trust Fund 1722471 Total cash and cash equivalents S-=LZZQ=- Demand and time deposits are fully insured by the Federal Deposit Insurance Corporation or are covered by the State of Florida collateral pool, a multiple institution pool with the ability to assess its members for collateral if a member institution falls. Florida Statutes authorize investments in certificates of deposit, savings accounts, the Local Government Surplus Funds Trust Fund administered by the Florida State Board of Administration, money market funds, direct obligations of the U.S. Treasury, and federal agencies and instrumentaes and I nterg ovem mental Investment Pools that are authorized pursuant to the Florida Interlocal Cooperation Act, as provided in Section 163.01, Florida Statutes. The Local Government Surplus Funds Trust Fund is not rated as to credit quality risks. The Local Government Surplus Funds Trust Fund is the only investment used by the Clerk this year. Note 3 - Retirement system Plan Description — The Clerk's employees participate in the Florida Retirement System ("FIRS"), administered by the Florida Department of Administration. Employees elect to participate in either the defined benefit plan ("Pension Plan"), a cost sharing, multiple -employer, defined benefit retirement plan, or the defined contribution plan (investment Plan) under the FIRS. As a general rule, membership in the FRS is compulsory for all employees working in a regularly established position for a state agency, county government, district school board, state university, community college, or a participating city or special district within the State of Florida. The FIRS provides retirement and disability benefits, annual cost -of -living adjustments, and death benefits to Plan members and beneficiaries. Benefits are established by Chapter 121, Florida Statutes, and Chapter 60S, Florida Administrative Code. Amendments to the law can be made only by an act of the Florida Legislature. Benefits under the Pension Plan are computed on the basis of age, average final compensation, and service credit. Regular class employees who retire at or after age 62 with 6 years of credited service or 30 years of service regardless of age are entitled to a retirement 1 The Clerk is exposed to various risks of loss related to tort; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The Clerk participates in the coverage provided by the Board of County Commissioners of Monroe County Workers' Compensation, Group Insurance, and Risk Management internal service funds. Under these programs, the Worker's Compensation Fund provides $1,000,000 coverage per claim for regular employees. Risk Management has a $5,000,000 excess insurance policy for general liability claims with a $100,000 self -insured retention, and building property damage is covered for the actual value of the building with a deductible between $100,000 and $250,000. Deductibles for windstorm and flood vary by location. Monroe County purchases commercial insurance for claims in excess of coverage provided by the funds and for all other risks of loss. Settled claims have not exceeded this commercial coverage in any of the past three years. The Clark makes payments to the Worker's Compensation, Group Insura ' nce and Risk Management Funds based on estimates of the amounts needed to pay prior and current year claims. .9r1T 111119MM --- -Marggf7w d,=11W %acipadlizus 0 1 - IV leased assets capitalized, less payments since the inception of the lease discounted at the implicit rate of interest in the lease. The future minimum debt reductions under capitalized leases consist of the following at September 30, 2006: Fiscal year ending September 30, 2007 $ 111,613 Amounts representing interest Amounts associated with leases payable are reported in the government -wide statement of net assets of the County, rather than on the Clerk's financial statements. Operaffng Leases - The Clerk leases various office equipment under cancelable arrangements 2ccounted for as operating leases. Total lease expense was $86,072 for the year ended September 30, 2006. MUM= The Clerk is a party from time to time in various lawsuits and other claims incidental to th(-. ordinary course of its operation, some of which are covered by the County's self-insura program. While the results of litigation cannot be predicted with certainty, management believes the final outcome of such litigation will not have a material adverse effect on the Clerk's financial position. 11 0 1 IP a I i — w 1111111�� Ill Ill A a r ! ! ! I ! ' E� CLERK OF ! General Fund Year Ended September 30, 2006 General Fund Variance Original Final Positive Budget Budget Actual (Negative) Revenues Charges for services Board of County Commissioners $ 2,580,231 $ 2,580,231 $ 2,369,059 $ (211,172) Others 1,050,000 1,050,000 1,456,920 406,920 Interest income 9,754 229.764 Miscellaneous LL '10,768 10,788 Total revenues 3,630,31 3,630,231 4,066,501 436,270 Expenditures Current General government Clerk recording 52,25 552,295 514,599 37,696 Clerk information systems 678,546 678,546 536,201 142,345 Clerk finance 1,419,964 1,419,964 1,415,586 4,378 Internal audit 229,556 229,556 154,133 75,423 Tourist tax audit 187,851 187,851 169,932 17,919 Non -court administration 109,783 109,783 102,875 6,908 Non -court records management 122,216 122,215 115,377 6,838 Total expenditures 3,300,210 3,30,210 3,0 ,703 291,07 Excess of revenues over expenditures 330,021 330,021 1,057,798 727,777 Other financing uses Contingency (330,021) (330,021) - 330,021 Transfer to Board of County Commiss loners (1,0 7,798) (1,057,798) Total other financing uses (330,021) (330,021) (1,057,798) (727,777) Net change in fund balance Fund balance, beginning of year Fund balance, and of year 12 MONROE COUNTY, FLORIDA CLERK OF THE CIRCUIT COURT ss�'S�Wle 1rf-Pr----&2e Special Revenue Court Related Fund Year Ended September 30,2006 Revenues Intergovernmental Charges for services Board of County Commissioners Others Fines and forfeitures Interest income Miscellaneous i - �'- - = Expenditures Current General government Clerk administration Clark records management Clerk jury management Clerk circuit court criminal Clerk circuit court civil Clerk circuit court family Clerk circuit court juvenile Clerk circuit court probate Clerk county court criminal Clerk county court civil Clerk county court traffic Total expenditures Excess of revenues over expenditures Other financing uses Contingency Transfer to Board of County Commissioners Transfer W Florida Department of Revenue Total other financing uses Not change In fund balance Fund balance, beginning of year Fund balance, and of year 957,225 957,225 943,479 (13,746) 1,720,498 1,673,189 1,777,073 103,884 1,247,982 1,263,982 1,248,352 (15,630) 18 18 4,450 4,450 4,132,148 4,578,148 4,667,440 89,292 310,034 310,034 291,396 18,638 345,143 345,143 323,965 21,178 141,964 94,484 84,836 9,649 820,340 811,840 758,109 53,731 389,437 389,437 361,127 28,310 117,359 125,859 123,744 2,115 154,666 162,666 162,361 305 67,774 98,254 98,261 3 700,987 658,987 614,579 44,408 309,906 301,9D6 272,937 28,969 700,616 759,616 754,621 4,995 4,058,226 4,058,226 3,W$,925 212,301 73,922 519,922 821,515 301,593 13 Revenues Charges for services Others Interest Income Miscellaneous Total revenues Expenditures Current General govemment Mademization trust Total expenditures Excess of revenues over (under) expenditures Other financing uses Contingency Principal Interest Total other financing uses Net change in fund balance Fund balance, beginning of year Fund balance, and of year MONROE COUNTY, FLORIDA CLERK OF THE CIRCUIT COURT Special Revenue Records Modernization Fund Year Ended September 30, 2006 Special Revenue Records Modernization Fund Variance Original Final Positive Budget- Budget Actual (Negative) 564,000 $ 564,000 $ 462,090 $ (101,910) 10,000 10,000 46,716 36,716 - - 4,500 4,500 574,000 574,000 513,306 (60,694) 841,500 1,149,275 451,934 697,341 841,500 1,149,275 451,934 697,341 (267,500) (575,275) 61,372 636,647 (93,500) (152,500) 152,500 (209,849) (209,849) (13,376) (13,376) - (93,5DD) (375,725) (223,225) 152,500 (361,000) (951,000) (161,853) 709,147 1,413,067 1,413,067 1,413,067 1,052,067 462,067 $ 1,251.214 $ 789,147 14 ■ �' i �' � a '.. l AOAROE CO I HE CIRC R CLERK OF T�.7 UIT COL17T Agency Fund Year Ended September 30, 2006 Balance Balance October 1, September 30, 2005 AdditIons Deductions 2006 Assets Cash and short-term investments $ 4,629,813 $ 48,424,231 $ 49,264,692 $ 3,789,352 Due from others 10,798 53,232 57,703 61327 Total assets $ 4,640,611 $ 48,477,463 $ 49,322,395 $ 3,795,679 Liabilities Due to others $ 2,886,950 $ 3,262,056 $ 3,847,915 $ 2,301,091 Due to Board of County Commissioners 113,279 1,391,250 1,375,344 129,185 Due to other governmental agencies 1,640,302 43,824,167 44,099,136 1,365,403 Total liabilities $ 4,640,611 $ 48,477,463 $ 49,322,395 $ 3,795,879 15 E w E T A To the Honorable Danny L. Kolhage, Clerk of the Circuit Court of Monroe County, Florida: We have audited the financial statements of each major fund of the Monroe County, Florida Clerk of the Circuit Court (the "Clerk") as of and for the year ended September 30, 2006, which JIQ-'s Wgii Jilijill 1411ill, lid Iraya N1sW&g oW; repot t1irmT, ultou january,5T, ATI ror Tne p-Ef-paue ui Curnphance Ulm Seudun and Chapter 10.560, Rules of the Auditor General -Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Audng Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Clerk's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide an opinion on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a reportable 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. We noted no matters involving the internal control over financial reporting and its operations that we consider to be material weaknesses. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Clerk's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, and contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, privillAS 2-X1giAi1X VX C*XK;FI19-X0e wft fttse Arivisiois w2s xot ar objective of our audit, aild accordingly, we do not express such an opinion. The results of our tests disclosed no instances if noncompliance or other matters that are required to be reported under Government Auditing Standards. This report is intended solely for the information and use of management and applicable state agencies, and is not intended to be and should not be used by anyone other than these speced parties. MMMWM �41 M The Rules • the Auditor General (Section 10.554(l)(h)4) require disclosure in the management letter of the following matters if not already addressed in the auditors' reports on compliance and internal controls: (1) violations of laws, rules, regulations, and contractual provisions that have occurred, or are likely to have occurred; (2) improper or illegal expenditures; (3) improper or inadequate accounting procedures (e.g., the omission of required disclosures from the financial statements); (4) failures to properly record financial transactions, and (5) • im inaccuracies, shortages, defalcations, and instances of fraud discovered by, or that come to t attention of, the auditor. There were no such matters noted. The Rules of the Auditor General (Section 10.554(l)(h)5) also require that the name or offici title and legal authority for the primary government and each component unit of the reporti entity be disclosed in the management letter, unless disclosed in the notes to the financi statements. The Clerk is a separately elected county official established pursuant to t Constitution of the State of Florida. There are no component units related to the Clerk. The Rules of the Auditor General (Section 10.554(l)(h)7(a)) state that a management left shall have a statement as to whether or not the Clerk complied with the budget certified by th - Florida Clerk. of the Courts Operations Corporation pursuant to Section 28.35, Florida Statute In connection with our audit of the financial statements of the Clerk we noted no noncomplian - with Section 28.35 regarding the budget certified by the Florida Clerk of the Courts Operatio Corporation. The Rules of the Auditor General (Section 10.554(l)(h)7(b)) state that a management left 2 akft -• i - •- •T1rW&W%iM-r1 • developed and certified pursuant to Section 28.35, Florida Statutes. In connection with our aud of the financial statements of the Clerk, our testing did not indicate that the lerk as i noncompliance with Section 28.35 regarding the performance standards developed an1. certified. TAP Orlando, Florida January 30, 2007 19