HomeMy WebLinkAbout20122068.tiff Mt McGee, Hearne & Paiz, LLP
Certified Public Accountants and Consultants
314 West 18th Street,Cheyenne,Wyoming 82001-4404
To the Board of Directors
Weld County Federal Mineral Lease Act District
1150 O Street
Greeley, Colorado 80631
Attention: David E. Long, Board President
We are pleased to present this report related to our audit of the financial statements and compliance of the
Weld County Federal Mineral Lease Act District (the "District") as of December 31, 2011 and for the
period from August 17, 2011 (date of inception) to December 31, 2011. This report summarizes certain
matters required by professional standards to be communicated to you in your oversight responsibility for
the District's financial and compliance reporting process.
Statement on Auditing Standards No. 114 requires the auditor to communicate certain matters to keep
those charged with governance adequately informed about matters related to the financial statement audit
that are, in our professional judgment, significant and relevant to the responsibilities of those charged
with governance in overseeing the financial reporting process. The following summarizes these
communications.
The Auditor's Responsibility under Professional Standards
Our responsibility under auditing standards generally accepted in the United States of America and
Government Auditing Standards issued by the Comptroller General of the United States has been
described to you in our arrangement letter dated May 25, 2012.
Accounting Practices
• Adoption of or Change in, Accounting Policies: Management has the ultimate responsibility for the
appropriateness of the accounting policies used by the District. In the current period, the District
adopted accounting principles generally accepted in the United States of America for governmental
entities upon its inception.
• Significant or Unusual Transactions: We did not identify any significant or unusual transactions or
significant accounting policies in controversial or emerging areas for which there is a lack of
authoritative guidance or consensus.
• Alternative Treatments Discussed with Management: We did not discuss with management any
alternative treatments within accounting principles generally accepted in the United States of America
for accounting policies and practices related to material items during the current audit period.
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2012-2068
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Management's Judgments and Accounting Estimates
Accounting estimates are an integral part of the preparation of financial statements and are based upon
management's current judgment. The process used by management encompasses their knowledge and
experience about past and current events and certain assumptions about future events. There were no
areas where it was necessary for management to form significant accounting estimates in connection with
the preparation of the financial statements.
Audit Adiustments
No audit adjustments were made to the original trial balance presented to us to begin our audit.
Uncorrected Misstatements
There were no uncorrected misstatements to the original trial balance presented to us to begin our audit.
Disagreements with Management
We encountered no disagreements with management over the application of significant accounting
principles, the basis for management's judgments on any significant matters, the scope of the audit, or
significant disclosures to be included in the financial statements.
Consultation with Other Accountants
We are not aware of any consultations management had with other accountants about accounting or
auditing matters.
Significant Issues Discussed with Management
No significant issues arising from the audit were discussed or were the subject of correspondence with
management.
Difficulties Encountered in Performing the Audit
We did not encounter any difficulties in dealing with management during the audit.
Certain Written Communications between Management and Our Firm
A copy of the audit representation letter between our firm and the management of the District is attached
to this letter.
This report is intended solely for the information and use of the Board of Directors and management and
is not intended to be and should not be used by anyone other than these specified parties. It will be our
pleasure to respond to any questions you have regarding this report. We appreciate the opportunity to be
of service to the Weld County Federal Mineral Lease Act District.
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Cheyenne, Wyoming
July 16, 2012
July 13, 2012
McGee, Hearne& Paiz, LLP
P.O. Box 1088
Cheyenne, Wyoming 82003
In connection with your audit of the basic financial statements of the Weld County Federal Mineral Lease
Act District (the "District") as of December 31, 2011 and for the period from August 17, 2011 (date of
inception) to December 31, 2011, we confirm that we are responsible for the fair presentation in the
financial statements of financial position and changes in financial position in conformity with accounting
principles generally accepted in the United States of America.
We confirm to the best of our knowledge and belief as of July 13, 2012, the following representations
made to you during your audit:
I. The financial statements referred to above are fairly presented in conformity with accounting
principles generally accepted in the United States of America.
2. We are a component unit of Weld County, Colorado as this term is defined in Section 2100 of the
Governmental Accounting Standards Board's Codification of Governmental Accounting and
Financial Reporting Standards.
3. We have identified for you all of our funds and governmental functions.
4. We have properly classified all funds and activities.
5. We are responsible for compliance with laws and regulations applicable to the District, including
adopting, approving, and amending budgets.
6. We have identified and disclosed to you all laws and regulations that have a direct and material
effect on the determination of financial statement amounts including legal and contractual
provisions for reporting specific activities in separate funds.
7. We have made available to you:
a. All financial records and related data of all funds and activities, including those of all
special funds, programs, departments, projects, activities, etc., in existence at any time
during the period covered by your audit.
b. All minutes of the meetings of the governing board and committees of board members or
summaries of actions of recent meetings for which minutes have not yet been prepared.
McGee, Hearne& Paiz, LLP
July 13, 2012
Page 2
c. All communications from grantors, lenders, other funding sources or regulatory agencies
concerning noncompliance with:
i Statutory, regulatory or contractual provisions or requirements.
ii Financial reporting practices that could have a material effect on the financial
statements.
8. We have no knowledge of fraud or suspected fraud affecting the District involving:
a. Management.
b. Employees who have significant roles in the internal control.
c. Others where the fraud could have a material effect on the financial statements.
9. We acknowledge our responsibility for the design and implementation of programs and controls to
provide reasonable assurance that fraud is prevented and detected.
10. We have no knowledge of any allegations of fraud or suspected fraud affecting the District,
received in communications from employees, former employees, analysts, regulators, short sellers,
or others.
11. We are aware of no significant deficiencies, including material weaknesses, in the design or
operation of internal controls that could adversely affect the District's ability to record, process,
summarize, and report financial data.
12. There have been no communications from regulatory agencies concerning noncompliance with, or
deficiencies in, financial reporting practices.
13. We have no plans or intentions that may materially affect the carrying value or classification of
assets and liabilities.
14. The following have been properly recorded and/or disclosed in the financial statements:
a. Related-party transactions, including those with the primary government having
accountability for the District, as defined by Section 2100 of the Governmental Accounting
Standard Board's Codification of Governmental Accounting and Financial Reporting
Standards, and interfund transactions, including interfund accounts and advances receivable
and payable, sale and purchase transactions, interfund transfers, long-term loans, leasing
arrangements and guarantees, all of which have been recorded in accordance with the
economic substance of the transaction and appropriately classified and reported.
b. The fair value of investments.
c. Amounts of contractual obligations for construction and purchase of real property or
equipment not included in the liabilities or encumbrances recorded on the books.
d. Net positions and fund balance classifications.
15. We are responsible for making the accounting estimates included in the financial statements.
Those estimates reflect our judgment based on our knowledge and experience about past and
current events and our assumptions about conditions we expect to exist and courses of action we
expect to take.
McGee, Hearne& Paiz, LLP
July 13, 2012
Page 3
16. There are no:
a. Material transactions that have not been properly recorded in the accounting records
underlying the financial statements.
b. Violations or possible violations of laws or regulations whose effects should be considered
for disclosure in the financial statements or as a basis for recording a loss contingency. In
that regard, we specifically represent that we have not been designated as, or alleged to be, a
"potentially responsible party" by the Federal Environmental Protection Agency or any
equivalent state agencies in connection with any environmental contamination.
c. Other material liabilities or gain or loss contingencies that are required to be accrued or
disclosed by Statement of Financial Accounting Standards No. 5 and/or GASB Statement
No. 10.
d. Guarantees, whether written or oral, under which the government is contingently liable.
e. Arrangements with financial institutions involving compensating balances or other
arrangements involving restrictions on cash balances.
f Line of credit or similar arrangements.
g. Agreements to repurchase assets previously sold.
h. Security agreements in effect under the Uniform Commercial Code.
i. Liens or encumbrances on assets or revenues or any assets or revenues which were pledged
as collateral for any liability or which were subordinated in any way.
j. Liabilities which are subordinated in any way to any other actual or possible liabilities.
k. Debt issue repurchase options or agreements, or sinking fund debt repurchase ordinance
requirements.
I. Debt issue provisions.
m. Leases and material amounts of rental obligations under long-term leases.
n. Significant estimates and material concentrations known to management which are required
to be disclosed in accordance with the AICPA's Statement of Position 94-6, Disclosure of
Certain Significant Risks and Uncertainties. Significant estimates are estimates at the
balance sheet date that could change materially within the next year. Concentrations refer
to volumes of business, revenues, available sources of supply, or markets for which events
could occur which would significantly disrupt normal finances within the next year.
o. Authorized but unissued bonds and/or notes.
p. Risk financing activities.
q. Derivative financial instruments.
r. Special or extraordinary items.
s. Arbitrage rebate liabilities.
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July 13,2012
Page 4
t. Investments, intangibles,or other assets which have permanently declined in value.
u. For risk retention, uninsured losses or loss retentions (deductibles) attributable to events
occurring through December 31, 2011 and/or for expected retroactive insurance premium
adjustments applicable to periods through December 31, 2011.
v. Material losses to be sustained in the fulfillment of, or from the inability to fulfill, any
service commitments.
w. Material losses to be sustained as a result of purchase commitments.
x. Environmental clean-up obligations.
17. There are no unasserted claims or assessments that our lawyer has advised us are probable of
assertion and must be disclosed in accordance with Statement of Financial Accounting Standards
No. 5 and/or GASB Statement No. 10.
18. We have no direct or indirect, legal or moral, obligation for any debt of any organization, public or
private, that is not disclosed in the financial statements.
19. We have satisfactory title to all owned assets.
20. We have complied with all aspects of contractual agreements that would have a material effect on
the financial statements in the event of noncompliance.
21. Net positions and fund balances are properly classified and, when applicable, approved.
22. Expenses or expenditures have been appropriately classified in or allocated to functions and
programs in the statement of activities, and allocations have been made on a reasonable basis.
23. Revenues are appropriately classified in the statement of activities within program revenues and/or
general revenues.
24. We have reviewed, approved, and are responsible for overseeing the preparation and completion
of the basic financial statements and related notes.
25. With respect to the management's discussion and analysis, and the budgetary comparison schedule
presented as required by the Governmental Accounting Standards Board to supplement the basic
financial statements:
a. We acknowledge our responsibility for the presentation of such required supplementary
information.
b. We believe such required supplementary information is measured and presented in
accordance with guidelines prescribed by accounting principles generally accepted in the
United States of America.
c. There are no underlying significant assumptions or interpretations regarding the
measurement or presentation of such information.
McGee, Hearne& Paiz, LLP
July 13, 2012
Page 5
In connection with your audit, conducted. in accordance with Government Auditing Standards, we
confirm:
26. We are responsible for:
a. Compliance with the laws, regulations, and provisions of contracts and grant agreements
applicable to the District.
b. Establishing and maintaining effective internal control over financial reporting.
27. We have identified and disclosed to you:
a. All laws, regulations, and provisions of contracts and grant agreements that have a direct
and material effect on the determinations of financial statement amounts or other financial
data significant to audit objectives.
b. Violations (and possible violations) of laws, regulations, and provisions of contracts and
grant agreements whose effects should be considered for disclosure in the auditor's report
on noncompliance.
28. We have a process to track the status of audit findings and recommendations.
29. We have reviewed, approved, and take full responsibility for the financial statements and related
notes and acknowledge the auditor's role in the preparation of this information.
30. We are responsible for determining that significant events or transactions that have occurred since
the balance sheet date and through July 13, 2012 have been recognized or disclosed in the
financial statements. No events or transactions other than those disclosed in the financial
statements have occurred subsequent to the balance sheet date and through July 13, 2012 that
would require recognition or disclosure in the financial statements. We further represent that as of
July 13, 2012, the financial statements were complete in a form and format that complied with
accounting principles generally accepted in the United States of America, and all approvals
necessary for issuance of the financial statements have been obtained.
During the course of your audit, you may have accumulated records containing data which should be
reflected in our books and records. All such data have been so reflected. Accordingly, copies of such
records in your possession are no longer needed by us.
WELD COUNTY FEDERAL MINERAL
LEASE ACT DISTRICT
David E. Long, Board President
WELD COUNTY
Barbara Connolly, Controller
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I WELD COUNTY
FEDERAL MINERAL LEASE ACT DISTRICT
I (A COMPONENT UNIT OF WELD COUNTY, COLORADO)
FINANCIAL REPORT
IDECEMBER 31, 2011
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CONTENTS
IINDEPENDENT AUDITOR'S REPORT 1 and 2
IMANAGEMENT'S DISCUSSION AND ANALYSIS 3 and 4
FINANCIAL STATEMENTS
I Balance sheet 5
Statement of revenues, expenditures and changes in
fund balance(statement of activities) 6
' Notes to financial statements 7 and 8
REQUIRED SUPPLEMENTARY INFORMATION
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Budgetary comparison schedule 9
Note to required supplementary information 10
1 INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER
I MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS
PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING
STANDARDS 11 and 12
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Mip McGee Hearne & Paiz LLP
� Certified Public Accountants and Consultants
314 West 18th Street,Cheyenne,Wyoming 82001-4404
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
Weld County Federal Mineral Lease Act District
Greeley, Colorado
' We have audited the accompanying financial statements of the governmental activities and major fund of
the Weld County Federal Mineral Lease Act District (the "District"), a component unit of Weld County,
Colorado, as of December 31, 2011 and for the period from August 17, 2011 (date of inception) to
December 31, 2011, which collectively comprise the District's basic financial statements as listed on the
table of contents. These financial statements are the responsibility of the management of the District.
' Our responsibility is to express opinions on these financial statements based on our audit.
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 Auditing Standards
111 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 consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the District's internal control over financial reporting. Accordingly,we
express no such opinion. 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.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and major fund of the District as of December
31, 2011, and the respective changes in financial position for the period from August 17, 2011 (date of
inception) to December 31, 2011, in conformity with accounting principles generally accepted in the
United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated July 13, 2012
on our consideration of the District's internal control over financial reporting and our tests of its
compliance with certain provision 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.
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Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis on pages 3 and 4 and the budgetary comparison schedule on page 9 be presented
to supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by the Governmental Accounting Standards Board who considers it to be an
essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the required
supplementary information in accordance with auditing standards generally accepted in the United States
of America, which consisted of inquiries of management about the methods of preparing the information
and comparing the information for consistency with management's responses to our inquiries, the basic
financial statements, and other knowledge we obtained during our audit of the basic financial statements.
We do not express an opinion or provide any assurance on the information because the limited procedures
do not provide us with sufficient evidence to express an opinion or provide any assurance.
42-H7--/Limit- Facia pp
' Cheyenne, Wyoming
July 13, 2012
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WELD COUNTY FEDERAL MINERAL LEASE ACT DISTRICT
' MANAGEMENT'S DISCUSSION AND ANALYSIS
December 31, 2011
The discussion and analysis of the Weld County Federal Mineral Lease Act District's (the
"District") financial performance provides an overall review of the District's financial activities
as of December 31, 2011 and for the period from August 17, 2011 (date of inception) to
December 31, 2011. The intent of this discussion and analysis is to look at the District's
financial performance as a whole. Readers should also review the financial statements and the
notes to the financial statements to broaden their understanding of the District's financial
performance.
The Management's Discussion and Analysis (MD&A) is an element of the reporting model
adopted by the Governmental Accounting Standard Board (GASB) in the Statement No. 34,
Basic Financial Statements and Management's Discussion and Analysis for State and Local
Governments, issued June 1999. Normally, certain comparative information between the current
year and the prior year is required to be presented in the MD&A. However, 2011 is the first year
of operation of the District.
Financial Highlights
The District was created in accordance Colorado Revised Statute Sections 30-20-1301 through
' 1306 for the purpose of receiving moneys distributed by the Colorado State Department of Local
Affairs from the Local Government Mineral Impact Fund to mitigate the social and economic
impacts of the areas of unincorporated Weld County (County) impacted by the development,
' processing, or energy conversion of fuels and minerals leased under the Federal Mineral Leasing
Act. The District was created August 17, 2011, nunc pro tunc, June 29, 2011. The District's
assets exceeded its liabilities at the close of 2011 by $848,637 (fund balance). As of December
31, 2011, except as expended for administrative expenses as permitted by Colorado Revised
Statutes, the fund balance of the District is restricted for use on areas within the unincorporated
areas of the County that are impacted by the development, processing, or energy conversion of
fuels and minerals leased under the Federal "Mineral Lands Leasing Act" of February 25, 1920,
as amended.
' The District had total revenues of $849,460 in 2011. The total operating revenues were
$845,882 and investment earnings were $3,578 for the first year of operation. The total expenses
were $823.
' Using the Basic Financial Statements
The Basic Financial Statements consist of Management's Discussion and Analysis (this section)
and financial statements and notes to those statements. These statements are organized so that
the reader can understand the District as an entire operating entity.
' Since the District has no differences between the modified-accrual and fall-accrual basis of
accounting, the presentation of the District-wide financial statements is essentially the same as
the presentation of funds. Therefore, only one set of financial statements is presented.
' 3
The Balance Sheet presents information on the District's assets and liabilities, with the difference
' between the two reported as fund balance. Over time, increases or decreases in fund balance
may serve as a useful indicator of whether the financial position of the District is improving or
deteriorating.
The Statement of Revenues, Expenditures, and Changes in Fund Balance presents information
showing how the District's fund balance changed during 2011, the first year of operation. This
' statement tells how general District services were financed in the short term as well as what
remains for future spending.
The District has only one fund, which is a governmental fund. The financial statements also
include notes that explain some of the information in the financial statements.
' Financial Analysis of the District as a Whole
Since this is the first year of operation, no comparative information for the prior year is available.
Fund balance at December 31, 2011 was $848,637. Deposits with the County Treasurer held by
' the District at December 31, 2011 totaled $848,702, which represents 100% of the District's total
assets.
Reporting the District's Fund
Fund financial reports provide detailed information about the District's single fund. Federal
mineral lease revenues for the first year of operations for 2011 were $845,882. Net non-
operating revenues for 2011 were $3,578 from investment earnings.
Budget and Actual Comparisons
' For the first year of operations, actual Federal mineral lease revenues equaled budgeted revenues
in 2011. Actual expenditures were $823, which was less than what was budgeted in 2011.
Expenses were below budget because no grants were awarded to mitigate impacts in 2011.
The Future of the District
The District has adopted policies for the distribution of grants to mitigate the social and
' economic impacts of the areas of unincorporated County impacted by the development,
processing, or energy conversion of fuels and minerals leased under the Federal Mineral Leasing
Act. In 2012, the District plans on granting funds to mitigate traffic impacts from oil and gas
' drilling activities on County roads and funding a water quality testing program for landowners
with oil and gas wells near their water wells in the County.
' Request for Information
The financial report is designed to provide information for regulatory reporting to state agencies
and those with an interest in the District's finances. Questions concerning this or any additional
information should be addressed to Carol Harding, District Secretary, P.O. Box 758, Greeley,
Colorado 80632.
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WELD COUNTY
FEDERAL MINERAL LEASE ACT DISTRICT
' BALANCE SHEET
December 31,2011
ASSETS
' Assets
Deposits with County Treasurer(Note 2) $ 848,702
Total assets $ 848,702
LIABILITIES AND FUND BALANCE
Liabilities
' Accounts payable and accrued expenses $ 65
Fund Balance, restricted(Note 1) 848,637
' Total liabilities and fund balance $ 848,702
See Notes to Financial Statements.
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WELD COUNTY
FEDERAL MINERAL LEASE ACT DISTRICT
STATEMENT OF REVENUES,EXPENDITURES AND CHANGES
' IN FUND BALANCE (Statement of Activities)
For the Period from August 17,2011 (Date of Inception)
to December 31,2011
Revenues
' Intergovernmental revenue - federal mineral lease revenue $ 845,882
Investment income 3,578
Total revenues 849,460
Expenditures
Current:
' General government 823
Total expenditures 823
Excess of revenues over expenditures 848,637
' Fund Balance, beginning -
Fund Balance, ending $ 848,637
See Notes to Financial Statements.
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WELD COUNTY
FEDERAL MINERAL LEASE ACT DISTRICT
NOTES TO FINANCIAL STATEMENTS
Note 1. Nature of Business and Summary of Significant Accounting Policies
' Basis of presentation: The accompanying financial statements of the Weld County Federal Mineral Lease
Act District (the "District") have been prepared in conformity with accounting principles generally
accepted in the United States of America(GAAP)applicable to governmental entities.
Since the District has no differences in accounting between modified-accrual and full-accrual, the
presentation of the District-wide financial statements is essentially the same as the presentation of funds.
' Therefore, only one set of financial statements is presented.
Financial reporting entity: In the 2011 Colorado Legislative Session, House Bill 11-1218 was passed
which allowed counties to create a "Federal Mineral Lease Act District" to receive direct distribution
Federal mineral lease payments from the Colorado Department of Local Affairs. The District was
established for the purpose of transferring these payments to the District to streamline the mitigation of
impacts according to the guidance in the Mineral Lands Leasing Act 30 U.S.C. 191 and provisions of
Colorado Revised Statues.
The District is administered by Weld County, Colorado (the "County"), which provides meeting space,
maintenance of financial records, treasury services, payroll services, and other administrative services as
may be requested by the District Board of Directors and agreed upon by the County for a small monthly
fee. The County is the primary government of the District.
Basis of accounting: The District uses the modified accrual basis of accounting. Under the modified
accrual basis of accounting, revenues are recognized when susceptible to accrual; that is 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. Expenditures are recorded when the related fund liability is
' incurred.
Due to the nature of the District's activities and transactions, there is no difference between the amounts
reported under the modified accrual and the accrual methods of accounting.
Use of estimates: The preparation of financial statements in conformity with accounting principles
' generally accepted in the United States of America requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual
results could differ from those estimates.
Deposits with State Treasurer: The District's cash is pooled with the County's cash in an account
managed by the Weld County Treasurer. The account is reported at the fair market value of the cash and
securities underlying the investment pool.
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WELD COUNTY
FEDERAL MINERAL LEASE ACT DISTRICT
NOTES TO FINANCIAL STATEMENTS
Fund equity: The Governmental Accounting Standards Board (GASB) has issued Statement No. 54,
Fund Balance Reporting and Governmental Fund Type Definitions (GASB 54). As prescribed by GASB
54, governmental funds report fund balance in classifications based primarily on the extent to which the
District is bound to honor constraints on the specific purposes for which amounts in the funds can be
spent.
Restricted fund balance includes amounts that can be spent only for the specific purposes stipulated by
constitution, external resource providers, or through enabling legislation. Restrictions may effectively be
changed or lifted only with consent of the resource providers.
As of December 31, 2011, except as expended for administrative expenses as permitted by Colorado
Revised Statutes, the fund balance of the District is restricted for use on areas within the unincorporated
' areas of the County that are impacted by the development, processing, or energy conversion of fuels and
minerals leased under the Federal Mineral Lands Leasing Act of February 25, 1920, as amended.
Note 2. Deposits
' Deposits for the District are invested in the pooled cash and investments account managed by the Weld
County Treasurer. State Statutes authorize the Treasurer to invest in obligations of the United States and
certain U.S. agency securities, certain international agency securities, general obligation and revenue
bonds of U.S. local government entities, banker's acceptance of certain banks, commercial paper, written
repurchase agreements collateralized by certain authorized securities, certain money market funds, and
guaranteed investment contracts. The County has no provisions in its investment policy that would
further limit investment choices. Detailed information on the County Treasurer's pooled cash and
investments is available from the County Treasurer.
Note 3. Subsequent Events
On January 11, 2012, the District entered into intergovernmental agreements with the County in which
the District agreed to pay $795,000 to the County in 2012 as funding for various road improvement
projects on the County roads. In addition,the District agreed to pay $50,000 per year in 2012, 2013, and
2014 to the County as funding for a Gas Chromatograph Mass Spectrometry instrument.
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' REQUIRED SUPPLEMENTARY INFORMATION
The District's required supplementary information includes the budgetary comparison
schedule as described in the accompanying Note to Required Supplementary
Information following the schedule.
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WELD COUNTY
FEDERAL MINERAL LEASE ACT DISTRICT
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BUDGETARY COMPARISON SCHEDULE- GENERAL FUND
For the Period from August 17,2011 (Date of Inception)
to December 31,2011
Variance with
Final Budget
1 Budgeted Amounts Positive
Original Final Actual (Negative)
1 Revenues
Intergovernmental revenue -
federal mineral lease
1 revenue $ $ 845,882 $ 845,882 $
Investment income 3,578 3,578
Total revenues - 845,882 849,460 3,578
Expenditures
General government - 845,882 823 845,059
1 Net Change in Fund Balance $ - $ - $ 848,637 $ 848,637
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See Note to Required Supplementary Information.
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WELD COUNTY
FEDERAL MINERAL LEASE ACT DISTRICT
NOTE TO REQUIRED SUPPLEMENTARY INFORMATION
For the Period from August 17,2011 (Date of Inception)
to December 31,2011
' Budget
The budgetary comparison schedule presents a comparison of the legally adopted budget with actual data.
The District prepares its budget on a cash basis, and the revenues and expenditures presented in the
aforementioned schedule are on the modified accrual basis. Any differences in revenues and expenditures
as a result of the difference in accounting basis are considered immaterial. Appropriations lapse at fiscal
' year end. All budget amendments are approved by the Board of Directors and are presented within the
final budget figures.
Colorado State Statutes require the preparation of an annual budget which provides documentation that all
sources and uses of District resources are properly planned, budgeted, and approved. The budget, upon
adoption, is the legal document which places restrictions and limitations on the purposes and amounts for
which District monies may be expended.
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McGee, Hearne & Paiz, LLP
Certified Public Accountants and Consultants
314 West 18th Street,Cheyenne,Wyoming 82001-4404
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' INDEPENDENT AUDITOR'S 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
To the Board of Directors
Weld County Federal Mineral Lease Act District
Greeley, Colorado
We have audited the financial statements of the governmental activities and major fund of the Weld
' County Federal Mineral Lease Act District (the "District") as of December 31, 2011 and for the period
from August 17, 2011 (date of inception) to December 31, 2011, which collectively comprise the
District's basic financial statements, and have issued our report thereon dated July 13, 2012. 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 Auditing Standards,
issued by the Comptroller General of the United States.
' Internal Control over Financial Reporting
Management of the District is responsible for establishing and maintaining effective internal control over
' financial reporting. In planning and performing our audit, we considered the District's internal control
over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our
opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness
' of the District's internal control over financial reporting. Accordingly, we do not express an opinion on
the effectiveness of the District's internal control over financial reporting.
' A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination
of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement
of the District's financial statements will not be prevented, or detected and corrected on a timely basis.
Our consideration of the internal control over financial reporting was for the limited purpose described in
' the first paragraph of this section and was not designed to identify all deficiencies in the internal control
over financial reporting that might be deficiencies, significant deficiencies or material weaknesses. We
did not identify any deficiencies in internal control over financial reporting that we consider to be material
' weaknesses, as defined above.
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Compliance and Other Matters
1 As part of obtaining reasonable assurance about whether the District's financial statements are free of
material misstatement,we performed tests of its compliance with certain provisions of laws,regulations,
contracts and grant agreements,noncompliance with which could have a direct and material effect on the
1 determination of financial statement amounts. However,providing an opinion on compliance with those
provisions was not an objective of our audit and,accordingly,we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance that are required to be reported under
1 Government Auditing Standards.
This report is intended solely for the information and use of the management,the Board of Directors,
others within the entity and the State of Colorado and is not intended to be and should not be used by
anyone other than those specified parties.
1 Cheyenne,Wyoming
July 13,2012
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