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Fiscal Year 1995 I i I MONROE COUNTY, FLORIDA -I PROPERTY APPRAISER � i FINANCIAL STATEMENTS j �� SEPTEMBER 30, 1995 KEMP & GREEN, P.A. CERTIFIED PUBLIC ACCOUNTANTS L; �I i- CONTENTS Lj Paqe Independent Auditors' Report 1-2 Financial Statements: Combined Balance Sheet - All Fund Types and Account Groups 3 Statement of Revenues, Expenditures, and Changes in Fund Balance - General Fund 4 Statement of Revenues, Expenditures and Changes in Fund j Balance - Budget and Actual (Budgetary Basis) - General Fund 5 Notes to Financial Statements 6-10 Supplemental Information: Combining Statement of Changes in Assets and Liabilities - Agency Fund 11 Other Reports: i Independent Auditors' Report on the Internal Control Structure 12-13 U Independent Auditors' Management Letter 14-15 Independent Auditors' Report on Compliance 16 LJ IL I i , J _ KEMP £3 GREEN, P.A. Certified Public Accountants ;L 1438 KENNEDY DRIVE P. O. BOX 1529 KEY WEST, FLORIDA 3G041-1529 MEMBER OF AMERICAN INSTITUTE WM. O. KEMP, C.P.A. (305) 294-2581 AND FLORIDA INSTITUTE OF MARVA E. GREEN, C.P.A. FAX # (305) 294-4778 CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS' REPORT Mr. Ervin H. Higgs Property Appraiser Monroe County, Florida We have audited the financial statements of the Property Appraiser of Monroe County, Florida (",Property Appraiser") as of September 30, 1995 and for the year - then ended, as listed in the accompanying table of contents. These financial statements are the responsibility of the Property Appraiser. Our responsibility is to express an opinion on these financial statements based on our audit. _! We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. These 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 opinion. As discussed in Note 1, the financial statements present only the Property Appraiser and are not intended to present fairly the financial position of Monroe County, Florida and the results of operations and cash flows of its proprietary fund types in conformity with generally accepted accounting principles. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Property Appraiser as of September 30, 1995, and the results of its operations for the year then ended in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The supplemental information listed in the accompanying table of contents, which is also the responsibility of the management of the Property Appraiser, is presented for purposes of additional analysis and is not a required part of the financial statements. Such information has been subjected to the auditing procedures applied in the audit of the financial 'statements and, in our opinion, is fairly stated in all material respects when considered in relation to the financial statements taken as a whole. �� -1- In accordance with Government AuditingStandards, we have also issued a report p dated March 8, 1996 on our consideration of the Property Appraiser's internal control structure and a report dated March 8, 1996 on its compliance with laws and regulations. P Kemp & Green, P.A. Certified Public Accountants March 8, 1996 -I � I U it -2- Li MONROE COUNTY, FLORIDA PROPERTY APPRAISER 1 COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30, 1995 Governmental Fiduciary Account Fund T_vge Fund Type Group Totals Long-Term (Memoran- General Agency Debt dum only) Assets: Cash and Investments $ 179,349 $ 457,990 $ - $ 637,339 Prepaid Expenses 58,202 - - 58,202 Amount to be Provided - - 127,014 127,014 Total Assets; $ 237,551 $ 457.990 $ 127,014 $ 822,555 Liabilities: Accounts Payable $ 26,347 $ - $ - $ 26,347 Accrued Wages 19,196 - - 19,196 Due to Other Governments 26,990 - - 26,990 Due to Individuals - 457,990 - 457,990 Long-Term Debt - - 127,014 127,014 Total Liabilities 72,533 457,990 127,014 657,537 Fund Balance 165,018 - - 165,018 Total Liabilities and Fund Balance $ 237,551 $ 457,990 $ 127,014 $ 822,555 The accompanying notes are an integral part of these financial statements. -3- � l - I' MONROE COUNTY, FLORIDA PROPERTY APPRAISER STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - GENERAL FUND FOR THE YEAR ENDED SEPTEMBER 30, 1995 Revenues: Board of County Commissioners $ 1,841,297 Other Taxing Districts 276,859 Charges for Service 36 Other 12,663 Total Revenues 2,130,855 Expenditures: Current: General Government: Personal Services 1,530,546 Operating Expenses 449,650 Capital Outlay 20,739 Total Expenditures 2,000,935 Excess of Expenditures Over Revenues 129,920 Fund Balance, Beginning of Year 35,098 Fund Balance, End of Year $ 165,018 The accompanying notes are an integral part of these financial statements -4- '. I MONROE COUNTY FLORIDA PROPERTY APPRAISER STATEMENT OF REVENUES AND EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL (BUDGETARY BASIS) - GENERAL FUND FOR THE YEAR ENDED SEPTEMBER 30, 1995 Actual Variance (Budgetary Favorable i Budget Basis) (Unfavorable) Revenues: Board of County, Commissioners $ 1,852,812 $ 1,841,297 $ (11,515) Other Taxing Districts 299,653 297,732 (1,921) Charges for Service - 36 36 Miscellaneous - 12,663 12,663 Total Revenues 2,152,465 2,151,728 (737) Expenditures: Current: General Government: Personal Services 1,683,283 1,528,083 155,200 Operating Expenses 448,032 472,733 (24,701) Capital Outlay 12,750 20,739 (7,989) Total Expenditures 2,144,065 2,021,555 122,510 Excess of Revenues Over Expenditures 8 400 130 173 121 773 p , Other Financing Sources - Contingency 8,400 - 8,400 , 9 Y - Excess of Revenues and Other Sources Over Expenditures, Budgetary Basis of Accounting - 130,173 130,173 Adjustments: To Adjust Expenditures for Accruals - 20,620 20,620 To Adjust Revenues for Accruals - (20.873) (20,873) Excess of Revenues Over Expenditures, J GAAP Basis of Accounting - 129,920 129,920 Fund Balance, Beginning of Year 35,098 35,098 - Fund Balance, End of Year $ 35,098 $ 165,018 $ 129,920 The accompanying notes are an integral part of these financial statements. -5- i U I _ MONROE COUNTY, FLORIDA PROPERTY APPRAISER NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1995 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following is a summary of the significant accounting principles and policies used in the preparation of these financial statements. Reporting Entity - The Property Appraiser of Monroe County, Florida ("Property Appraiser") is a separate Constitutional Officer as provided by the laws of the State of Florida.' For financial reporting purposes, it is deemed to be a part of the County's primary government, and therefore is included as such in the Monroe County Comprehensive Annual Financial Report. Basis of Presentation - These financial statements have been prepared in conformity with the accounting principles and reporting guidelines established by the Governmental Accounting Standards Board. The Property Appraiser utilizes the following fund types and account groups: -- Governmental Fund. Type: The General Fund - This fund is used to account for all revenue and -. expenditures applicable to the general operations of the Property Appraiser that are not required either legally or by generally accepted accounting principles to be accounted for in another fund. Fiduciary Fund Type: The Agency Fund - This fund is custodial in nature and does not involve - measurements of results of operations (assets equal liabilities) . The Agency Fund is merely a clearing account for assets held by the Property Appraiser as l an agent for individuals, private organizations, other governments, or other funds. Account Group: General Long-Term Debt Account Group - This account group is established to account for the long-term debt of the Property Appraiser financed from governmental funds. Basis of Accounting - The modified accrual basis of accounting is followed by the r General Fund. Under the modified accrual basis of accounting, revenues are recorded when received or when susceptible to accrual , that is, measurable and available to finance the Property Appraiser's operations. Expenditures are recorded when the liability is incurred except for accumulated sick pay and vacation pay which is not recorded as an expenditure. Budgets are prepared on the cash basis. -6- MONROE COUNTY, FLORIDA PROPERTY APPRAISER NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1995 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Budgetary Requirement - Expenditures are controlled by appropriations in accordance with the budget requirements set forth in the Florida Statutes. The budgeted revenues and expenditures in the accompanying financial statements reflect all approved amendments. General Fixed Assets - The tangible personal property used by the Property Appraiser in its operations is shown in the General Fixed Assets Account Group of the Board of County Commissioners. In addition, the office space and certain other expenditure items used in the Property Appraiser's operations are provided at no cost by the Board of County Commissioners. Undistributed Excess Fees - Florida Statutes provide that assessed fee revenue collected by the Property Appraiser in excess of expenditures shall be retained and applied to next year's operating costs. The amount of undistributed excess fees at the end of each year applicable to the Board of County Commissioners of Monroe County is reported as fund balance. Compensated Absences - The Property Appraiser's policy grants employees annual leave and sick leave in varying amounts. Upon termination of employment, employees with six months or more of credited service can receive payment for accumulated annual leave. In general , sick leave payments are granted upon termination of employment to employees with five years or more of credited service. The maximum payment is subject to percentages and maximum hour limitations. Accumulated sick leave is accrued to the extent that such amounts would normally be'liquidated with expendable available financial resources. The remaining liability is reflected in the General Long-Term Account Group. Total Columns on Combined Statements - The column entitled "Totals (Memorandum Only)" of this report is included for informational purposes only. This total column is not comparable to consolidated financial information, as the basic reporting entity is by fund type, and the various funds use different bases of accounting. In addition, interfund type eliminations have not been made in arriving at the amounts included in this column. NOTE 2 - CASH AND, INVESTMENTS Cash and investments at September 30, 1995 consist of the following: Demand Deposits $ 179,349 Deferred Compensation Plan Investments (at Market Value) 457,990 $ 637,339 -7- MONROE COUNTY, FLORIDA PROPERTY APPRAISER NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1995 NOTE 2 - CASH AND INVESTMENTS (Continued) Demand and .time deposits are fully insured in accordance with Florida Statute 280, which established the multiple financial institution collateral pool . Legally permissible investments are defined by Florida Statute 125.31 and primarily consist .of Federal And State securities. NOTE 3 - LONG-TERM DEBT The following is a summary of changes in long-term debt for the year ended September 30, 1995. Accrued Compensated Absences I Long Term Debt, Beginning of Year $ 100,470 Debt Issued 26,544 Long Term Debt, End of Year $ 127.014 NOTE 4 - LEASE OBLIGATIONS The Property Appraiser pays rent under cancelable operating leases for office equipment. Rental expense for the current year amounted to $30,300. NOTE 5 - RETIREMENT PLAN Substantially all' full -time Property Appraiser employees are participants in the Florida Retirement System ("The System") , a multiple-employer, cost-sharing public retirement system. The System, which is controlled by the State Legislature and administered by the. State of Florida, Department of Administration, Division of Retirement, covers approximately 573,000 full -time employees of various governmental units within the State of Florida. The System provides for vesting of benefits after 10 years of creditable service. Normal retirement benefits are available to employees who retire at or after age 62 with 10 or more years of service. Early retirement is available after 10 0 years of service with a 5% reduction of benefits for each year prior to normal retirement age. Retirement benefits are based upon age, average compensation and years-of-service -credit where average compensation is computed as the average of an individual 's five highest years of earnings. _� -8- i MONROE COUNTY, FLORIDA PROPERTY APPRAISER NOTES TO FINANCIAL STATEMENTS r , SEPTEMBER 30, 1995 NOTE 5 - RETIREMENT PLAN (Continued) The Property Apprai ser has no responsi bi 1 i ty to the System other than to make the periodic payments required by State Statutes. Ten-year historical trend information showing the System's progress in accumulating sufficient assets to pay benefits when due is presented in the System's June 30, 1995 Comprehensive Annual Financial Report. The amount reported below as "pension benefit obligation" is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases estimated to be payable in the future as a result of employee service to date. The measure is the actuarial present value of credited projected benefits and is intended to assist users in assessing the j plan's funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among government pension plans and employers. The System does not conduct separate measurements of assets and pension benefit obligations for individual employers. The pension benefits obligation at June 30, 1993 for the System as a whole, determined through an actuarial valuation performed as of that date, was $47.3 billion. The System's net assets available for benefits on that date (valued at amortized cost) were $41.6 billion, resulting in an unfunded pension -' benefit obligation of $5.7 billion. Participating employer contributions are based upon state-wide rates established by the State of Florida. These rates are applied to employee salaries as follows: regular;' employees, 16.91%; and elected officials, 27.48%. There are no employee contributions to the Plan. The Property Appraiser's contributions of approximately $220,000 made during the year ended September 30, 1995 were made in accordance with contribution requirements determined by the actuarial valuation of the �System as of June 30, 1995. These contributions represented approximately .008% of total contributions required of all participating employers during the fiscal year of the System ended June 30, 1995. Total payroll for Property Appraiser's employees during the fiscal year ended September 30, 1995 was approximately $1,214,000, with the portion attributed to employees covered by the System being $1,207,000. The contribution to the System for the year was 18.1% of total payroll . There were no changes in actuarial assumptions, benefit provisions, actuarial _ funding methods or any other significant factors that affected the Property Appraiser's contribution during the fiscal year ended September 30, 1995. NOTE 6 - DEFERRED COMPENSATION PLAN The Property Appraiser offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all -9- -- MONROE COUNTY, FLORIDA PROPERTY APPRAISER NOTES TO FINANCIAL STATEMENTS !, SEPTEMBER 30, 1995 NOTE 6 - DEFERRED COMPENSATION PLAN (Continued) Property Appraiser employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available -to employees - until termination, retirement, death, or unforeseeable emergencies. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights of the Property Appraiser (without being restricted to the provisions of benefits under the plan) , subject only to the claims of the,Property Appraiser's general creditors. Participants' rights under the plan are equal to those of general creditors of the Property Appraiser in an amount equal to the fair market value of the deferred account for each participant. The Property Appraiser has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. The Property Appraiser believes that it is unlikely that the assets will be used to satisfy the claims of general creditors in the future. NOTE 7 - LITIGATION The Property Appraiser is a defendant in various lawsuits and is involved in other disputes wherein substantial amounts are claimed. In the opinion of the Property Appraiser, these suits and claims should not result in judgements or settlements which, in aggregate, would have a material effect on the Property Appraiser's financial position. NOTE 8 - RISK MANAGEMENT The Property Appraiser is exposed to various risk of loss related to tort; theft of, damage to, and destruction of assets; errors and omissions; injuries to 11 employees; and natural disasters. The Property Appraiser participates in the coverage provided by the Board of County Commissioners of Monroe County for Workers Compensation, Group Insurance, and Risk Management internal service funds. Under these programs, the Worker's Compensation Fund provides $450,000 coverage per claim for regular employees. The Group Insurance Fund provides coverage up to $75,000 for each medical claim. Risk Management provides $100,000 for each general liability claim and $25,000 for most property damage claims. Windstorm, Flood and Property Damage insurance excess coverage varies by individual property. The 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 j three years. The Property Appraiser makes payments to the Worker's Compensation, Group Insurance and Risk Management Funds based on estimates of the amounts needed to pay prior and current year claims. �I -10- LJ J MONROE COUNTY, FLORIDA PROPERTY APPRAISER COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES - AGENCY FUND FOR THE YEAR ENDED SEPTEMBER 30, 1995 i DEFERRED Balance, Balance, COMPENSATION FUND 1994 Additions Deductions 1995 Assets: .Cash and Investments $ 366,683 $ 116,330 $ 25,023 $ 457,990 I Liabilities: Due to Individuals $ 366,683 $ 116,330 $ 25,023 $ 457,990 L_� �I �I KEMP !& GREEN, P.A. Certified Public Accountants 1438 KENNEDY DRIVE P. O. BOX 1529 KEY WEST, FLORIDA 33041-1529 MEMBER OF AMERICAN INSTITUTE WM. O. KEMP, C.P.A. (305) 294-2581 AND FLORIDA INSTITUTE OF MARVA E. GREEN, C.P.A. FAX # (305) 294-4778 CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS' REPORT ON THE INTERNAL CONTROL STRUCTURE Mr. Ervin A. Higgs Property Appraiser } Monroe County, Florida We have audited the financial statements of the Property Appraiser of Monroe County, Florida, ("Property Appraiser") for the year ended September 30, 1995, and have issued our report thereon dated March 8, 1996. -I' We conducted our audit in accordance with generally accepted auditing standards and 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. In planning and performing our audit of the financial statements of the Property Appraiser for the year ended September 30, 1995, we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide -- assurance on the internal control structure. The management of the Property Appraiser is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgements by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded_against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any. internal control structure, errors or irregularities may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. In planning and performing our audit of the financial statements of the Property Appraiser for the year ended September 30, 1995, we obtained an understanding of ;J the internal control structure. With respect to the internal 'control structure, we obtained an understanding of the design of relevant policies and procedures and whether. they have been placed in operation, and we assessed control risk 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 structure. Accordingly, we do not express such an opinion. �I -12- _ Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be reportable V conditions and, accordingly, would not necessarily disclose all reportable conditions that are also considered to be material weaknesses. A material t weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities 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 structure and its operations that we consider to be material weaknesses as defined above. We also noted other matters involving the internal control structure and its operation that we have reported to the management of the Property Appraiser in the Auditor's Management Letter dated March 8, 1996 included at page 14. This report is intended for the information of Board of County Commissioners, management and others within the County, and officials of applicable federal and state agencies. However, this report is a matter of public record and its distribution is not limited. Kemp & Green, P.A. Certified Public Accountants March 8, 1996 �i -13- KEMP Z4 GREEN, P.A. Certified Public Accountants 1438 KENNEDY DRIVE P. O. BOX 1529 KEY WEST, FLORIDA 33041-1529 MEMBER OF AMERICAN INSTITUTE WM. O. KEMP, C.P.A. (305) 294-2581 AND FLORIDA INSTITUTE OF MARVA E. GREEN, C.P.A. FAX * (305) 294-4778 CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS' MANAGEMENT LETTER Mr. Ervin A. Higgs Property Appraiser Monroe County, Florida In planning and performing our audit of the financial statements of the Property Appraiser of Monroe County, Florida .("Property Appraiser") , for the year ended September 30, 1995, we considered the Property Appraiser's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements. Although our audit was not designed to provide assurance on the internal control structure and its operations, we noted certain matters involving the internal control structure and !_! its operation, and are submitting for your consideration related recommendations designed to help the Property Appraiser make improvements and achieve operational efficiencies. Our comments reflect our desire to be of continuing assistance to the Property Appraiser. Reported in Prior Year's Management Letter, Not Implemented as of September 30, 1995 During the course of our audit of the financial statements of the Property we noted appropriate action had been taken u Appraiser, on recommendations and p suggested accounting procedures as outlined in the Management Letter for the year - ended September 30, 1994. Current Year ar Findings None OTHER REQUIRED DISCLOSURES w Marva Green was the Auditor in Charge for the audit of the Property Appraiser. We attest that the Auditor in Charge met the educational requirements pursuant to Chapter .11.45,. Florida Statutes. The Property Appraiser was not in a state of financial emergency as described in Florida Statutes, Section 218.503(1) . -14- I We have reviewed the annual report filed with the Department of Banking and Finance for Monroe County, Florida pursuant to Section 218.32, Florida Statutes. This report is in agreement with the annual audit report which incorporates the financial statements of the Property Appraiser. Requirements relative to Public Records Modernization Trust money do not apply to the Property Appraiser. This report is intended solely for the information of the Board of County Commissioners and-others within the County, and officials of applicable federal and state agencies. This restriction is not intended to limit the distribution of this report, which is a matter of public record. Kemp & Green, P.A. Certified Public Accountants March 8, 1996 -15- KEMP Ed GREEN, P.A. Certified Public Accountants 1438 KENNEDY DRIVE P. O. BOX 1529 KEY WEST, FLORIDA 33041-1529 MEMBER OF AMERICAN INSTITUTE WM. O. KEMP, C.P.A. (305) 294-2581 AND FLORIDA INSTITUTE OF I"I MARVA E. GREEN, C.P.A. FAX * (305) 294-4778 CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS' REPORT ON COMPLIANCE Mr. Ervin A. Higgs;, Property Appraiser Monroe County, Florida We have audited the financial statements of the Property Appraiser of Monroe _ . County, Florida ("Property Appraiser") , as of and for the year ended September 30, 1995 and have issued our report thereon dated March 8, 1996. We conducted our audit in accordance with generally accepted auditing standards and 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. Compliance with laws, regulations, contracts, and grants applicable to the Property Appraiser' is the responsibility of the Property Appraiser's management. As art of obtaining reasonable assurance about whether the financial statements are free of material misstatement, we performed tests of the Property Appraiser's - compliance with certain provisions of laws, regulations, contracts, and grants. However, the objective of our audit of the financial statements was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported herein under Government Auditing Standards. s intended for the information of the Board of Count Commissioners This report i y , management and others within the County, and officials of applicable federal and state agencies. However, this report is a matter of public record and its distribution is not limited. 4- , - Kemp & Green, P.A.' Certified Public Accountants March 8, 1996 -16-