Audit

Ronald L.
Jones, Chief Examiner

14-008

Report on the

Wilcox County Commission

Wilcox County, Alabama

October 1, 2011 through September 30, 2012

Filed: February 7, 2014

Department of
Examiners of Public Accounts
50 North Ripley Street, Room 3201
P.O. Box 302251
Montgomery, Alabama 36130-2251
Website: www.examiners.alabama.gov

State of Alabama
Department of
P.O. Box 302251, Montgomery, AL 36130-2251
Ronald L. Jones
Chief Examiner
50 North Ripley Street, Room 3201
Telephone (334) 242-9200
Honorable Ronald L. Jones
Chief Examiner ofPublic Accounts
Montgomery, Alabama 36130
Dear Sir:
FAX (334) 242-1775
Under the authority of the Code of Alabama 1975, Section 41-5-21, I submit this report on
the results of the audit of the Wilcox County Commission, Wilcox County, Alabama, for the
period October 1, 2011 through September 30, 2012.
Sworn to and subscribed before me this
the of .... be,-, 20__ll__.

Notary Public
rb
14-008
Respectfully submitted,

Examiner ofPublic Accounts

Table of Contents
Page
Wilcox County
Commission

Summary A

Contains items pertaining to federal, state and local legal compliance, Commission
operations, and other matters.

Schedule of State and Local Compliance and Other Findings C

Contains detailed information about findings pertaining to state and local legal
compliance, and other findings.

Independent Auditors Report G

Reports on whether the financial information constitutes a fair presentation of
the financial position and results of financial operations in accordance with
generally accepted accounting principles (GAAP).

Managements Discussion and Analysis J

Provides information required by the Governmental Accounting Standards
Board (GASB) that is prepared by management of the Commission introducing
the basic financial statements and providing an analytical overview of the
Commissions financial activities for the year. This information has not been
audited, and no opinion is provided about the information.

Basic Financial Statements 1

Provides the minimum combination of financial statements and notes to the
financial statements that is required for the fair presentation of the Commissions
financial position and results of operations in accordance with GAAP.

Exhibit #1 Statement of Net Assets 2

Exhibit #2 Statement of Activities 4

Exhibit #3 Balance Sheet Governmental Funds 6

Exhibit #4 Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Assets 8

Exhibit #5 Statement of Revenues, Expenditures and Changes in Fund
Balances Governmental Funds 9

Table of Contents
Page
Wilcox County
Commission

Exhibit #6 Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the
Statement of Activities 11

Exhibit #7 Statement of Net Assets Proprietary Funds 13

Exhibit #8 Statement of Revenues, Expenses and Changes in Fund Net Assets
Proprietary Funds 14

Exhibit #9 Statement of Cash Flows Proprietary Funds 16

Exhibit #10 Statement of Fiduciary Net Assets 18

Exhibit #11 Statement of Changes in Fiduciary Net Assets 19

Notes to the Financial Statements 20

Required Supplementary Information 45

Provides information required by the GASB to supplement the basic financial
statements. This information has not been audited and no opinion is provided
about the information.

Exhibit #12 Schedule of Revenues, Expenditures and Changes in Fund
Balances Budget and Actual General Fund 46

Exhibit #13 Schedule of Revenues, Expenditures and Changes in Fund
Balances Budget and Actual RRR Gasoline Tax Fund 50

Exhibit #14 Schedule of Funding Progress Defined Benefit Pension Plan 52

Supplementary Information 53

Contains financial information and notes relative to federal financial assistance.

Exhibit #15 Schedule of Expenditures of Federal Awards 54

Notes to the Schedule of Expenditures of Federal Awards 58

Table of Contents
Page
Wilcox County
Commission

Additional Information 59

Provides basic information related to the Commission, including reports and
items required by generally accepted government auditing standards
and/or U. S. Office of Management and Budget (OMB) Circular A-133
for federal compliance audits.

Exhibit #16 Commission Members and Administrative Personnel a listing
of the Commission members and administrative personnel. 60

Exhibit #17 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 a report on internal controls related to the financial
statements and on whether the Commission complied with laws
and regulations which could have a direct and material effect
on the Commissions financial statements. 61

Exhibit #18 Report on Compliance With Requirements That Could have a
Direct and Material Effect on Each Major Program and on
Internal Control Over Compliance in Accordance With OMB
Circular A-133 a report on internal controls over compliance with
requirements of laws, regulations, contracts, and grants applicable to
major federal programs and an opinion on whether the Commission
complied with laws, regulations, and the provisions of contracts or
grant agreements which could have a direct and material effect on
each major program. 63

Exhibit #19 Schedule of Findings and Questioned Costs a schedule
summarizing the results of audit findings relating to the
financial statements as required by Government Auditing
Standards and findings and questioned costs for federal awards
as required by OMB Circular A-133. 66

Exhibit #20 Auditee Response/Corrective Action Plan a response by the
Commission on the results of the audit and a corrective action plan
for federal audit findings. 70
__________________________________________________

14-008
A

Department of

SUMMARY


The Wilcox County Commission (the Commission) is governed by a six-member body
elected by the citizens of Wilcox County. The members and officials in charge of governance
of the Commission are listed on Exhibit 16. The Commission is the governmental agency that
provides general administration, public safety, construction and maintenance of county roads
and bridges, sanitation services, health and welfare services and educational services to the
citizens of Wilcox County.

This report presents the results of an audit the objectives of which were to determine whether
the financial statements present fairly the financial position and results of financial operations
and whether the Commission complied with applicable laws and regulations, including those
applicable to its major federal financial assistance programs. The audit was conducted 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 as well as the requirements of the
Department of Examiners of Public Accounts under the authority of the Code of Alabama
1975, Section 41-5-14.

An unqualified opinion was issued on the financial statements, which means that the
Commissions financial statements present fairly, in all material respects, its financial position
and the results of its operations for the fiscal year ended September 30, 2012.

Findings are numbered and reported by the fiscal year in which the finding originally
occurred.

Instances of noncompliance with state and local laws and regulations were found during the
audit as shown on the Schedule of State and Local Compliance and Other Findings and they
are summarized below.

CURRENT FINDINGS

2012-01 relates to the Commission transferring funds from the Special Capital
Improvement Fund to the Gasoline Tax Fund for payroll expenses.

14-008
B

2012-03 relates to the Commissioners not adhering to the same policies and procedures as
other customers of the Solid Waste and Water Systems.

2012-05 relates to several funds having deficit cash balances.

Findings that were presented in prior audits have not been resolved as shown on the Schedule of
State and Local Compliance and Other Findings and they are summarized below.

UNRESOLVED PRIOR FINDINGS

2011-01 relates to the Commission purchasing real property without first obtaining an
appraisal or documenting that it determined that a fair and reasonable price was being paid
for the property.

2008-02 relates to the Commissions failure to comply with the provisions for uses of the
2008 General Obligation Warrants proceeds.

Problems were found with the Commissions internal controls over financial reporting
(Exhibit 17) and they are summarized below:

2012-02 relates to the Commission not following policies and procedures in handling
delinquent customers for the Water System Fund.

2012-04 relates to payment plans not being properly set up for the Solid Waste Fund and
Water System Fund.

2005-01 relates to the lack of a detailed separate listing of accounts receivable for the Solid
Waste Fund and the Water System Fund.

2004-02 relates to the lack of segregation of duties within the Solid Waste and Water
System functions.

The following officials/administrative personnel were invited to an exit conference to
discuss the findings and recommendations appearing in this report: Administrator of
the County Commission: Clarissa Dear; and County Commissioners: Ricky Powell,
Reginald W. Southall, Reginald O. Weatherly, Michael R. Saulsberry, and J ohn R. Moton, J r.
The following individuals attended the exit conference, held at the office of the Commission:
Administrator of the County Commission: Clarissa Dear; Commissioners: Ricky Powell,
Reginald O. Weatherly, and J ohn R. Moton, J r.; and representatives of the Department of
Examiners of Public Accounts: Christina Smith, Audit Manager and Cindy R. Wilson,
Examiner of Public Accounts. The results of the report were also discussed via the telephone
with Commissioner Reginald W. Southall.

C

Schedule of State and Local
Compliance and Other Findings
Schedule of State and Local Compliance and Other Findings
For the Year Ended September 30, 2012
Wilcox County
Commission
D

Ref.
No.

Finding/Noncompliance
2012-01 Finding:
The Commission receives funds appropriated by the County Government
Improvement Act, Title 11, Chapter 29, Code of Alabama 1975. These funds
are required to be accounted for in a Special Capital Improvement Fund and
expended for certain capital improvement purposes outlined in the Code of
Alabama 1975, Section 11-29-6. During the audit period, $153,700 was
transferred from the Special Capital Improvement Fund to the Gasoline Tax
Fund to cover payroll expenses which are not included in allowable expenditures
from Capital Improvement funds.

Recommendation:
The Commission should expend Special Capital Improvement fund in
compliance with the Code of Alabama 1975, Section 11-29-6.
2012-03 Finding:
The Code of Alabama 1975, Section 36-25-5(a), states no public official shall
use his official position or office to obtain personal gain for himself.
Furthermore, this section states personal gain is achieved when the public
official receives, obtains, exerts control over, or otherwise converts to personal
use the object constituting such personal gain. Three of the six county
commissioners (Districts 1, 3 and 4) received water service and garbage pickup
through Wilcox County, which is under the direct control of the Wilcox County
Commission members. The Water System Fund and the Solid Waste Fund
account for the financial information of the Countys water and garbage
activities. Based upon a review of the billing information for the three
commissioners being serviced by the water and garbage department, it was
noted that Commissioners for Districts 3 and 4 did not make a single payment
on their bills during fiscal year 2012 and the District 1 Commissioner only
made two payments during fiscal year 2012. Furthermore, after reviewing
the disconnect lists for months within the audit period, it was noted that
these Commissioners names appeared on the disconnect list, but they were
never disconnected and continued to receive water service and garbage pickup.
As of September 30, 2012, account balances for Commissioners District 1,
District 3, and District 4 were $1,855.00, $493.16, and $1,574.52, respectively.
Furthermore, District 3 Commissioner had an additional inactive account with an
outstanding balance of $763.53. A review of the minutes and other financial
activity of the Water System Fund indicated the Commission was under contract
with a private company to manage the water system (including billing for
garbage pickup).

Wilcox County
Commission
E

Ref.
No.

Finding Continued:
The minutes also reflected a concerted effort to cutoff customers for non-
payment and expedite collection of past due amounts. Regular customers of the
County were expected to make regular payments on their water and garbage
bills, have past due amounts added to their bills if not paid timely, been pursued
for payment delinquency for garbage collection, and faced service cut-off for
non-payment on water service. These three commissioners appeared to have
achieved personal gain as public officials in receiving water service and garbage
collection without following the same protocol as ordinary customers.

Recommendation:
The Commissioners should adhere to the same payment policies and procedures
that apply to ordinary customers of the water and garbage system.
2012-05 Finding:
The Code of Alabama 1975, Section 11-8-10, states that no warrant or order for
the payment of money shall be issued in pursuance of authority of the county
commission until funds are available for its payment upon presentation to the
treasurer of depository. On numerous occasions, the General Fund, Gasoline
Tax Fund, Road and Bridge Fund and Water System Fund had deficit cash
balances.

Recommendation:
Checks should not be issued until funds are available for payment.
2011-01 Finding:
A good system of internal controls should include policies and procedures
to ensure the Commission pays only fair and reasonable prices for real
property acquired. The Commission purchased an acre of land for $8,500 in
February 2012. Per review of the minutes and discussion with the County
Administrator, the Commission did not have the property appraised before the
purchase and could not provide an explanation as to how they determined this
was a fair and reasonable price for the land.

Recommendation:
The Commission should document through an appraisal or by other means that
purchases of real property are made at fair and reasonable prices.

Wilcox County
Commission
F

Ref.
No.

2008-02 Finding:
The Wilcox County Commission issued General Obligation Warrants,
Series 2008 dated March 1, 2008 and General Obligation Warrants, Series 2012
dated J anuary 10, 2012. According to the Official Statements, the purpose of the
warrants being issued was to advance refund a portion of the Countys General
Obligation Warrants, and to construct various capital improvement projects in
the County. In addition, the County obtained a letter from the bond issue
counsel that described the appropriate uses of the proceeds received from the
2008 General Obligation Warrants. The attorneys letter referenced the related
bond documents and requirements of the Internal Revenue Code stating that the
proceeds were to be used for capital improvements that have a long useful life.
In testing the expenditures recorded in the 2008 and 2012 General Obligation
Construction Funds, it was noted that the proceeds were used for purchase of
road maintenance materials, general repairs, and other items not having a long
useful life. The use of the proceeds did not appear to comply with the provisions
outlined in the related bond documents.

Recommendation:
The Commission should comply with the provisions in the bond documents for
the General Obligation Warrants, Series 2008 and Series 2012, for the use of the
proceeds derived from the issuance.

G

Independent Auditors Report
14-008
H

Independent Auditors Report

We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund, and the aggregate remaining fund information of the
Wilcox County Commission, as of and for the year ended September 30, 2012, which
collectively comprise the basic financial statements of the Wilcox County Commission as
listed in the table of contents as Exhibits 1 through 11. These financial statements are the
responsibility of the Wilcox County Commissions management. 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, 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 Wilcox County Commissions internal control over
financial reporting. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, 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, the business-type
activities, each major fund, and the aggregate remaining fund information of the Wilcox
County Commission, as of September 30, 2012, and the respective changes in financial
position and cash flows, where applicable, thereof for the year then ended 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
December 10, 2013, on our consideration of the Wilcox County Commissions internal
control over financial reporting and on 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.

Accounting principles generally accepted in the United States of America require that the
Management's Discussion and Analysis (MD&A), the Schedule of Revenues, Expenditures
and Changes in Fund Balances - Budget and Actual, and the Schedule of Funding Progress,
(Exhibits 12 through 14), 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 the 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.
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the Wilcox County Commission's basic financial statements. The
accompanying Schedule of Expenditures of Federal Awards (Exhibit 15) is presented for the
purposes of additional analysis as required by U. S. Office of Management and Budget
Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, are
presented for purposes of additional analysis and are not a required part of the financial
statements. Such information is the responsibility of management and was derived from and
relates directly to the underlying accounting and other records used to prepare the financial
statements. The information has been subjected to the auditing procedures applied in the
audit of the financial statements and certain additional procedures, including comparing and
reconciling such information directly to the underlying accounting records and other records
used to prepare the financial statements or to the financial statements themselves, and other
additional procedures in accordance with auditing standards generally accepted in the United
States of America. In our opinion, the schedule of expenditures of federal awards are fairly
stated in all material respects in relation to the financial statements as a whole.
December 1 0, 2013
14-008
~ J J Q < r
Ronald L. Jones
Chief Examiner
Department of Examiners of Public Accounts
This Page Intentionally Blank

J

Managements Discussion and Analysis
(Required Supplementary Information)
K
Management
'
s Discussion and Analysis (MD&A)
September 30, 2012
Our discussion and analysis of the Wilcox County Commission's (the "Commission") financial performance
provides an overview of the Commission's financial activities for the fiscal year ended September 30, 2012.
Please read it in conjunction with the Commission's financial statements and notes to the financial
statements, which immediately follow this analysis.

The Management's Discussion and Analysis (MD&A) is an element of the reporting model adopted by the
Governmental Accounting Standards Board (GASB) in their Statement No. 34, Basic Financial Statements
and Management
'
s Discussion and Analysis for State and Local Governments issued J une 1999. The
model contained in GASB Statement No. 34 requires that certain comparative information between the
current and prior year be presented. Comparative data is included in this MD&A.
FINANCIAL HIGHLIGHTS:
At the close of the fiscal year ended September 30, 2012, Wilcox Countys governmental assets
exceeded its liabilities by $1,628,481.04, whereas at September 30, 2011, Wilcox Countys assets
exceeded its liabilities by $1,612,877.63. Of the $1,628,481.04 in assets, there were only
$44,959.55 in unrestricted assets available to be used to meet the Countys ongoing obligations to
its citizens and creditors; whereas in 2011 there were $447,030.18 in unrestricted assets available
for those purposes.
In 2012 net assets of governmental activities increased by $15,603.41 as a result of increased
revenues, whereas in 2011, net assets of governmental activities decreased by $318,461.69.
The Commissions business-type assets exceeded its liabilities by $3,865,755.07 in 2012, whereas
at September 30, 2011, the Commissions business-type assets exceeded its liabilities by
$3,833,699.87.
In 2012 the net assets of the Commissions business-type activities increased by $32,055.20, as a
result of increased revenues derived from normal operations. In 2011 net assets of the
Commissions business-type assets decreased by $380,900.36.
Total revenues in 2012 for governmental activities were $9.4 million (including $5.6 million in
general revenues) and total expenses in 2012 were also $9.4 million. Total revenues for
governmental activities in 2011 were $8.1 million with $4.3 million coming from general revenues;
whereas, the total expenses in 2011 were $8.6 million.

REPORT LAYOUT:
The annual report consists of a series of financial statements. Taken together they provide a comprehensive
look at the Commission. This annual report presents the following components of the financial statements:
Government-wide financial statements provide information for the Commission as a whole and
present a longer-term view of the Commission's finances.
Fund financial statements provide detailed information for the Commission's significant funds.
Governmental fund statements tell how general government services were financed in the short-
term as well as what remains for future spending.
The remaining statements provide financial information about activities for which the Commission
acts solely as a trustee or agent for the benefit of those outside of the government.
Notes to the financial statements provide additional information that is essential to understanding
the Commission's financial condition.

The report also contains required supplementary information that further explains and supports the information
in the financial statements.

L

Government-Wide Financial Statements:

The government-wide financial statements are designed to present a broad overview of the Commission's
financial position in a manner similar to a private-sector business. These statements include all assets and
liabilities using the accrual basis of accounting. All of the current year's revenues and expenses are accounted
for in the statement of activities regardless of when cash is received or paid.

The Statement of Net Assets focuses on resources available for future operations. This statement presents a
view of the assets the Commission owns, the liability it owes, and the net difference. The net difference is
further separated into amounts restricted for specific purposes and unrestricted amounts. Over a period of
time, increases or decreases in net assets may indicate whether the Commission's financial position is
improving or deteriorating. To assess the overall health of the Commission you need to consider other non-
financial factors such as changes in the Commission's property tax base and the condition of the
Commission's roads.
The Statement of Activities focuses on gross and net cost of the Commission's programs and the extent to
which such programs rely upon general tax and other revenues. This statement summarizes and simplifies the
user's analysis to determine the extent to which programs are self-supporting and/or subsidized by general
revenues.
Governmental activities include general government, public safety, highways and roads, health, welfare,
culture and recreation, sanitation, and to a small degree, education. Property taxes, gasoline taxes, and
charges for services finance most of these activities.
Fund Financial Statements:
Fund financial statements focus separately on major governmental funds. The Commission establishes many
funds to help control and manage money for particular purposes or to show that it is meeting legal
responsibilities for using certain taxes, grants and other monies. The fund financial statements provide detailed
information about the Commission's significant funds. The Commission's funds can be divided into three
categories governmental funds, fiduciary funds, and proprietary funds.
Governmental funds The majority of the Commission's basic services are reported in governmental funds,
which focus on how money flows into and out of those funds and the balances remaining at year-end that are
available for spending. These funds are reported using the modified accrual basis of accounting, which
measures cash and all other financial assets that can be readily converted to cash. The governmental fund
statements provide a detailed short-term view of the Commission's operations and the basic services it
provides. Governmental fund statements assist the reader in determining the short-term financial resources
available to finance future programs. Both the governmental fund balance sheet and the governmental fund
statements of revenues, expenditures and changes in fund balances provide reconciliation to the government-
wide financial statements.

Fiduciary funds The Commission is responsible for assets that are held on behalf of other organizations or
individuals. The Commission is responsible to ensure the assets reported in these funds are used for their
intended purpose. The fiduciary activities are reported in separate statements of fiduciary assets and changes
in fiduciary net assets. The Commission cannot use these assets to finance its operations; therefore, these
activities have been excluded from the Commission's other financial statements.

Proprietary funds These funds are used, according to the GASB, "to account for operations that are
financed and operated in a manner similar to private business enterprises where the intent of the governing
body (the county commission) is that the cost (expenses) of providing goods and services to the general
public on a continuing basis be financed or recovered primarily through user charges.

M

Major Fund Analysis:
General Fund:
The General Fund had a net decrease of $340,067.58 to its fund balance at September 30, 2012.
The major factors contributing to this decrease were increases in operating expenses for highways
and roads and supplementing the Solid Waste Department. In 2011, the General Fund had a net
decrease of only $10,444.88 to its fund balance.
RRR Gasoline Tax Fund:
In 2012, the RRR Gasoline Tax Fund had a net increase of only $66,330.87 to its fund balance
compared to an increase to RRR Gasoline Tax fund balance of $251,326.60 at September 30, 2011.
The major factors contributing to this smaller increase were due to increases in the costs of road-
building materials.

2008 PBA Funding Agreement Construction Fund
This fund is used to finance the costs of acquiring, constructing and improving certain public
buildings in Wilcox County. In 2012, the 2008 PBA Funding Agreement Construction Fund had a
decrease of $370,307.53 in fund balance.

Solid Waste Fund:
The Solid Waste Fund was financed through garbage collection fees from residential and
commercial customers throughout the county and from significant transfers from the General Fund.
The Solid Waste Fund had an increase in total net assets of $166,539.47 in 2012 resulting from
increased customer billings and reductions in expenses resulting from contracting the services with
Advanced Disposal. This amount is up from a decrease of total net assets of $108,899.35 in 2011.

Water System Fund:
The Water System Fund was financed through water user fees from residential and commercial
customers throughout the county. In 2012, this fund had a decrease in total net assets of
$134,484.27. The major factors contributing to this decrease were increased operating costs to
maintain the Water System. The Water System Fund also had a decrease in total net assets in FY
2011 of $272,001.01.

Notes to the Financial Statements:
The notes provide additional information that is essential to a full understanding of the data provided in the
government-wide and fund financial statements. These notes to the financial statements follow the
presentation of the exhibits contained in this report.

FINANCIAL ANALYSIS OF THE COMMISSION AS A WHOLE:
The following two tables (A-1 and A-2) present the condensed information on the Commission's Net Assets
and Changes in Net Assets for the fiscal year ended September 30, 2012. Comparative information from the
prior year is also included.

As noted earlier, net assets may serve over time as a useful indicator of the Commission's financial position.
In the Commission's case, total assets exceeded liabilities by $5.5 million at the close of the 2011/2012 fiscal
year. In comparison, total assets exceeded liabilities by $5.4 million at the close of the 2010/2011 fiscal
year. The largest portion of the Commission's net assets reflects its investment in capital assets (i.e., land,
buildings, equipment, infrastructure in place and in progress, etc.); less any related debt used to acquire those
assets to provide services to its citizens. Consequently, these assets are not available for future spending.
Although the Commission's investment in capital assets is reported net of related debt, it should be noted that
the resources necessary to repay this debt must be provided from other sources, since the capital assets
themselves cannot be used to liquidate these liabilities.

N

The Commissions total revenues for fiscal year 2012 were approximately $11.37 million, which are nearly
$1.3 million more than last years revenues. Approximately 49% were from program revenues and 51%
were from general revenues (including 2.5 million from property taxes); whereas in 2011, revenues
consisted of 54% from program revenues and 46% from general revenues.

The total cost of all programs and services for 2012 (excluding transfers) was approximately $11.3 million,
which is more than last years expenses of $10.8 million. The Commission's expenses cover a range of
services. In 2012, the majority of the expenses were related to highways and roads (35%), general
government (21%), sanitation (17%) and public safety (15%). In comparison, expense percentages for
services in fiscal year 2011 were highways and roads (30%), general government (21%), sanitation (20%)
and public safety (15%).

Tabl e A-1 Statement of Net Assets
Sept ember 30, 2012
As Compar ed t o Sept ember 30, 2011
Governmental Business-Type Governmental Business-Type
Activities Activities Activities Activities
2012 2012 2011 2011
Current Assets 3,121,853.49 993,936.67 3,630,976.06 676,062.22
Non-current Assets 1,615,181.56 1,397,547.40
Capital Assets, Net 10,768,245.40 3,017,510.19 9,438,812.40 3,295,122.17
Tot al Asset s 15,505,280.45 4,011,446.86 14,467,335.86 3,971,184.39
Current Liabilities 3,405,622.83 48,954.20 3,191,736.56 33,546.93
Non-current Liabilities 10,471,176.58 96,737.59 9,662,721.67 103,937.59
Tot al Liabilit ies 13,876,799.41 145,691.79 12,854,458.23 137,484.52
Net Assets
Invested in capital assets,
net of related debt 1,251,089.20 3,017,510.19 934,707.99 3,295,122.17
Restricted for Highways & Roads 189,623.59 120,359.92
Restricted for Debt Service 35,964.82 16,871.80
Restricted for other purposes 106,843.88 93,907.74
Unrestricted 44,959.55 848,244.88 447,030.18 538,577.70
Tot al Net Asset s 1,628,481.04 3,865,755.07 1,612,877.63 3,833,699.87
O

Governmental Activities:
The total cost of all governmental activities for 2012 (excluding transfers) was $9,420,296.98 compared to
$8,564,716.88 for 2011. However, the net cost to taxpayers for these activities was only $5,585,057.24 in
2012 compared to $4,715,812.60 in 2011. In 2012, those that directly benefited from the programs paid
$953,096.74 and other governments and organizations subsidized certain programs with grants and/or
contributions amounting to $2,882,143.00. In 2011, those that directly benefited from the programs paid
$1,103,474.96 and other governments and organizations subsidized certain programs with grants and/or
contributions in the amount of $2,745,429.32. The amount of $3,361,006.58 received from taxpayers was
from property taxes, general sales taxes, other county sales and use taxes, gasoline taxes and miscellaneous
taxes.

Proprietary Activities:
The revenues for the Solid Waste Fund show an increase in the 2012 fiscal year. Last years revenues were
$700,054.04 compared to this years revenues of $811,433.07. The revenues for the Water System usually
increase each year due to new customers and that is the case this time. In 2012, the Water System revenues
reflect an increase with a total of 964,742.61 compared to $924,141.61 for 2011.

General Fund Budgetary Highlights:
The County Commission has established an annual budget process whereby all departments submit an annual
budget proposal to the Commission for the coming year's operating expenses. The Commission reviews,
adjusts as necessary and then adopts an original budget to fund the operating needs of each department.
Throughout the year, the original budget may be amended to reflect changes in funding needs. In 2012,
departments budgets were not amended due to the unavailability of additional funding needed to cover over-
expenditures in the various departments.

The Commission adopted a balanced budget for the 2011-2012 fiscal year.

P

Changes in Net Assets
September 30, 2012

As Compared to
September 30, 2011

Governmental Business-Type Governmental Business-Type
Activities Activities Activities Activities
2012 2012 2011 2011
Revenues:
Program Revenues:
Charges for Services 953,096.74 1,737,399.74 1,103,474.96 1,608,624.76
Operating Grants &
Contributions 2,242,102.45 2,484,223.71
Capital Grants &
Contributions 640,040.55 261,205.61
General Revenues:
Property Tax for
general purposes 1,886,824.99 1,718,720.32
Property Tax for
specific purposes 624,063.92 777,915.00
General sales tax 500,396.47 348,146.49
County Gasoline sales tax 132,819.39 201,798.30
Miscellaneous taxes 198,403.91 187,123.40
Other county sales and
use tax 18,497.90 18,382.52
Grants not restricted 178,106.06 185,247.44
Interest revenue 10,572.15 6,813.55
Miscellaneous revenue 817,368.78 61,186.67 806,372.43 15,571.37
Other Funding Sources (Uses) -6,159.70 6,159.70 -200,940.54 200,940.54
Donation of Capital Assets 1,239,766.78
Gain(loss) on Disposal of 134,000.00
county assets 347,772.00
Total Revenues 9,435,900.39 1,938,746.11 8,246,255.19 1,825,136.67

Expenses:
General Government 2,363,361.30 2,216,514.09
Public Safety 1,703,184.00 1,622,367.77
Highways and Roads 3,911,926.88 3,261,434.22
Sanitation 62,179.92 1,906,690.91 52,209.54 2,206,037.03
Health 186,366.92 270,080.14
Welfare 396,537.53 388,599.07
Culture and Recreation 181,486.52 142,806.26
Education 19,757.34 19,586.27
Interest on Long-Term Debt 489,640.98 524,073.01
Intergovernmental 105,855.59 67,046.51
Total Expenses 9,420,296.98 1,906,690.91 8,564,716.88 2,206,037.03

Changes in Net Assets 15,603.41 32,055.20 -318,461.69 -380,900.36
Net Assets - Beginning 1,612,877.63 3,833,699.87 1,931,339.32 4,214,600.23
Net Assets - Ending 1,628,481.04 3,865,755.07 1,612,877.63 3,833,699.87

Q

CAPITAL ASSET AND DEBT ADMINISTRATION

Capital Assets:
As of September 30, 2012, the Wilcox County Commission had invested $10,768,245.40 (net of accumulated
depreciation) in capital assets for its governmental activities compared to a net investment of $9,438,812.40
in 2011. The Commission also invested $3,017,510.19 (net of accumulated depreciation) in capital assets for
its business-type activities in 2012 which is a decrease from last year's investment of $3,295,122.17.

(See Table A-3 below.)
This investment in capital assets includes land, land and improvements-exhaustible, infrastructure, buildings,
buildings under capital lease, construction in progress, equipment and furniture, motor vehicles, equipment
under capital lease and accumulated depreciation.

Major additions during the 2012 year included building a new Senior Center, building a new Ferry Terminal
and Pavilion, developing a new park, the purchase of two acres of land, one J ohn Deere Tractor, four new
2012 Dodge Chargers, one used 2012 Chev. Tahoe, two rotary cutters, three mowers, a 2012 Kaufman
Trailer, a PA System, and computer equipment for the Sheriff, Reappraisal and Highway departments.

Table A-3 CAPITAL ASSETS

Governmental Business-type
Activities 2012 FY Activities 2012 FY

Land 487,425.05 109,929.00
Land and Improvements - exhaustible 176,037.64 7,415,807.49
Infrastructure 2,406,496.43
Buildings and Building Improvements 5,620,185.19
Construction in Progress 61,968.00
Equipment and Furniture 3,754,609.83 434,413.76
Motor Vehicles 1,312,260.39 171,678.33
Equipment under Capital Leases 1,462,380.43
Assets Under Funding Agreement 3,780,578.14
Accumulated Depreciation (8,293,695.70) (5,114,318.39)

TOTALS 10,768,245.40 3,017,510.19


Land 466,925.05 109,929.00
Land and Improvements - exhaustible 44,618.00 7,415,807.49
Infrastructure 2,406,496.43
Buildings and Building Improvements 3,606,213.47
Construction in Progress 408,227.45
Equipment and Furniture 3,736,919.30 541,665.46
Motor Vehicles 1,277,690.59 350,478.33
Equipment under Capital Lease 1,297,441.43
Assets Under Funding Agreement 3,780,578.14
Accumulated Depreciation (7,586,297.46) (5,122,758.11)

TOTALS 9,438,812.40 3,295,122.17

R

Debt Outstanding:

As of September 30, 2012, the Wilcox County Commission increased its outstanding debt by $781,982.74 in
its governmental activities due to the addition of new capital leases and the issuance of the 2012 GO
Warrants that refunded other warrants and added additional money. The business-type activities decreased its
debt by only $7,200.00 at September 30, 2012. Also in 2012, the Commission did not retire any capital
leases for its governmental activities, nor did the Commission retire any leases in its business-type activities.

In 2011, the Commission increased its outstanding debt by $805,312.08 in its governmental activities and
decreased its outstanding debt in its business-type activities by $27,705.96. Also in 2011, the Commission
retired one capital lease in the amount of $63,917.58, but showed an increase to its debt for its governmental
activities because of the issuance of new capital leases. The Commission retired one capital lease in the
amount of $76,898.00 to decrease its debt in its business-type activities.

Table A-4 OUTSTANDING DEBT


2012 General Obligation Warrants 4,430,000.00
2008 PBA Funding Agreement Payable 3,550,000.00
Capital Lease Payable (Principal) 1,319,911.03
Water System Notes Payable 102,000.00

TOTALS 11,379,911.03 102,000.00


2008 PBA Funding Agreement Payable 3,620,000.00
Capital Lease Payable (Principal) 1,179,590.48
Water System Notes Payable 109,200.00

TOTALS 10,304,590.48 109,200.00

Economic Factors and Next Year's Budgets and Rates:
The most significant factors to future budgets continue to be law enforcement, corrections, roads and bridges,
along with payments on long term debt and capital leases.

County Engineer Fredrick Powell provided the following information relative to roads and bridges: Wilcox
County Commission has approximately 554 miles of roads and 76 bridges to maintain. There are 238 miles
of 238 miles of paved roads and approximately 316 miles of unpaved roads. Nearly 70% of the County's
bridges need to be repaired or replaced. In the 2011-2012 fiscal year, the Commission resurfaced one road
and repaired several bridges but did not replace any bridges. The County has plans to replace 3 bridges and
to resurface two roads in the 2012-2013 fiscal year. Within the next five years, the Commission plans to
replace a total of eight bridges and resurface at least seven roads.

S

The increased costs of road building materials, personnel, fuel, and equipment will continue to have major
impacts on Wilcox County Commission's future budgets. The Commission foresees further cuts in its
operating budget due to fluctuating revenues and increased maintenance needs on older equipment.

CONTACTING WILCOX COUNTY COMMISSIONS FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, investors and creditors with a
general review of the Commissions finances and to illustrate the Commissions accountability for money
received. If you have any questions concerning this report or should need further financial information,
please contact Clarissa J . Dear, County Administrator, Wilcox County Commission, P. O. Box 488, Camden,
Alabama 36726, call (334) 682-9112 or email wilcoxco@frontiernet.net. The Wilcox County Commission
Office is located at 12 Water Street, Suite 200 in the Courthouse Annex and is open Monday through Friday
from 8:00 AM to 4:30 PM.

1

Basic Financial Statements
Wilcox County
Commission 2 Exhibit #1
Statement of Net Assets
September 30, 2012

Governmental Business-Type
Activities Activities Total
Assets
Current Assets
Cash 253,506.85 $ 1,872.76 $ 255,379.61 $
Receivables, Net (Note 4) 305,906.92 1,299,653.89 1,605,560.81
Ad Valorem Taxes Receivable 2,244,582.22 2,244,582.22
Internal Balances (Note 11) 307,589.98 (307,589.98)
Deferred Charges - Debt Issuance Costs 10,267.52 10,267.52
Total Current Assets 3,121,853.49 993,936.67 4,115,790.16

Noncurrent Assets
Restricted Cash 350,842.15 350,842.15
Cash with Fiscal Agent 926,247.37 926,247.37
Deferred Charges - Debt Issuance Costs 338,092.04 338,092.04
Capital Assets (Note 5):
Nondepreciable 549,393.05 109,929.00 659,322.05
Depreciable, Net 10,218,852.35 2,907,581.19 13,126,433.54
Total Noncurrent Assets 12,383,426.96 3,017,510.19 15,400,937.15

Total Assets 15,505,280.45 4,011,446.86 19,516,727.31

Liabilities
Current Liabilities
Payables (Note 7) 439,628.01 39,913.26 479,541.27
Deferred Revenue 2,341,738.63 2,341,738.63
Accrued Wages Payable 122,894.66 1,840.94 124,735.60
Accrued Interest Payable 199,531.44 199,531.44
Long-Term Liabilities:
Portions Due or Payable Within One Year:
Notes Payable 7,200.00 7,200.00
Capital Leases Payable 280,699.16 280,699.16
PBA Funding Agreement 75,000.00 75,000.00
Less: Unamortized Discount (4,003.93) (4,003.93)
Less: Deferred Charges on Refunding Debt (49,865.14) (49,865.14)
Total Current Liabilities 3,405,622.83 $ 48,954.20 $ 3,454,577.03 $

The accompanying Notes to the Financial Statements are an integral part of this statement.
Wilcox County

Governmental Business-Type
Activities Activities Total
Noncurrent Liabilities
Portions Due or Payable After One Year:
Notes Payable $ 94,800.00 $ 94,800.00 $
Capital Leases Payable 1,039,211.87 1,039,211.87
Warrants Payable 6,510,000.00 6,510,000.00
PBA Funding Agreement 3,475,000.00 3,475,000.00
Less: Unamortized Discount (98,610.00) (98,610.00)
Less: Deferred Charges on Refunding Debt (673,817.89) (673,817.89)
Compensated Absences 219,392.60 1,937.59 221,330.19
Total Noncurrent Liabilities 10,471,176.58 96,737.59 10,567,914.17

Total Liabilities 13,876,799.41 145,691.79 14,022,491.20

Net Assets
Invested in Capital Assets, Net of Related Debt 1,251,089.20 3,017,510.19 4,268,599.39
Restricted for:
Highways and Roads 189,623.59 189,623.59
Debt Service 35,964.82 35,964.82
Other Purposes 106,843.88 106,843.88
Unrestricted 44,959.55 848,244.88 893,204.43

Total Net Assets 1,628,481.04 $ 3,865,755.07 $ 5,494,236.11 $

Wilcox County
Statement of Activities

Charges Operating Grants
Functions/Programs Expenses for Services and Contributions
Governmental Activities
General Government 2,363,361.30 $ 342,986.34 $ 204,129.88 $
Public Safety 1,703,184.00 6,737.81 180,926.56
Highways and Roads 3,911,926.88 594,990.60 1,622,420.29
Sanitation 62,179.92 8,381.99
Health 186,366.92 75,073.30
Welfare 396,537.53 159,552.42
Culture and Recreation 181,486.52
Education 19,757.34
Interest and Fiscal Charges 489,640.98
Intergovernmental 105,855.59
Total Governmental Activities 9,420,296.98 953,096.74 2,242,102.45

Business-Type Activities
Solid Waste 801,660.50 772,658.27
Water System 1,105,030.41 964,741.47
Total Business-Type Activities 1,906,690.91 1,737,399.74

Total 11,326,987.89 $ 2,690,496.48 $ 2,242,102.45 $

General Revenues:
Taxes:
Property Taxes for General Purposes
Property Taxes for Specific Purposes
General Sales Tax
County Gasoline Sales Tax
Other County Sales and Use Taxes
Miscellaneous Taxes
Grants and Contributions Not Restricted
for Specific Purposes
Investment Earnings
Miscellaneous Revenues
Donation of Capital Asset
Gain on Disposition of Capital Assets
Total General Revenues
Transfers and Contributions
Total General Revenues and Transfers

Change in Net Assets

Net Assets - Beginning of Year
Net Assets - End of Year

Program Revenues
Wilcox County

Capital Grants Governmental Business-Type
and Contributions Activities Activities Total

$ (1,816,245.08) $ $ (1,816,245.08) $
74,165.69 (1,441,353.94) (1,441,353.94)
417,394.76 (1,277,121.23) (1,277,121.23)
(53,797.93) (53,797.93)
(111,293.62) (111,293.62)
(236,985.11) (236,985.11)
148,480.10 (33,006.42) (33,006.42)
(19,757.34) (19,757.34)
(489,640.98) (489,640.98)
(105,855.59) (105,855.59)
640,040.55 (5,585,057.24) (5,585,057.24)

(29,002.23) (29,002.23)
(140,288.94) (140,288.94)
(169,291.17) (169,291.17)

640,040.55 $ (5,585,057.24) (169,291.17) (5,754,348.41)

1,886,824.99 1,886,824.99
624,063.92 624,063.92
500,396.47 500,396.47
132,819.39 132,819.39
18,497.90 18,497.90
198,403.91 198,403.91
178,106.06 178,106.06
10,572.15 10,572.15
817,368.78 61,186.67 878,555.45
1,239,766.78 1,239,766.78
134,000.00 134,000.00
5,606,820.35 195,186.67 5,802,007.02
(6,159.70) 6,159.70
5,600,660.65 201,346.37 5,802,007.02

15,603.41 32,055.20 47,658.61

1,612,877.63 3,833,699.87 5,446,577.50
1,628,481.04 $ 3,865,755.07 $ 5,494,236.11 $

Net (Expenses) Revenues and Changes in Net Assets
Primary Government
Wilcox County
Balance Sheet
Governmental Funds
September 30, 2012

General RRR Gasoline
Fund Tax Fund
Assets
Cash $ 121,899.17 $
Cash with Fiscal Agent
Receivables (Note 4) 238,182.50 67,724.42
Ad Valorem Taxes Receivable 1,700,085.10
Advances to Water System 307,589.98
Total Assets 2,245,857.58 189,623.59

Liabilities and Fund Balances
Liabilities
Payables (Note 7) 82,192.31
Deferred Revenue 1,769,385.20
Accrued Wages Payable 118,569.65
Total Liabilities 1,970,147.16

Fund Balances
Restricted for:
Highways and Roads 189,623.59
Debt Service
Capital Projects
Other Purposes
Assigned for:
Debt Service
Capital Projects
Unassigned 261,714.52
Total Fund Balances 275,710.42 189,623.59
Total Liabilities and Fund Balance 2,245,857.58 $ 189,623.59 $
Wilcox County
2008 PBA Funding Other Total
Agreement Governmental Governmental
Construction Fund Funds Funds

$ 482,449.83 $ 604,349.00 $
563,378.54 362,868.83 926,247.37
305,906.92
544,497.12 2,244,582.22
307,589.98
563,378.54 1,389,815.78 4,388,675.49

357,366.54 69.16 439,628.01
572,353.43 2,341,738.63
4,325.01 122,894.66
357,366.54 576,747.60 2,904,261.30

189,623.59
222,450.65 222,450.65
206,012.00 482,086.31 688,098.31
106,843.88 106,843.88
13,995.90
7,730.96 7,730.96
2,550.15 2,550.15
(8,593.77) 253,120.75
206,012.00 813,068.18 1,484,414.19
563,378.54 $ 1,389,815.78 $ 4,388,675.49 $
Wilcox County
Reconciliation of the Balance Sheet of Governmental Funds to the
September 30, 2012
Total Fund Balances - Governmental Funds (Exhibit 3) 1,484,414.19 $
Amounts reported for governmental activities in the Statement of Net Assets
(Exhibit 1) are different because:
Capital assets used in governmental activities are not financial resources and therefore
are not reported as assets in governmental funds (Note 5). 10,768,245.40
Debt issuance costs are reported as current expenditures in the funds. However,
debt issuance costs are deferred and amortized over the life of the debt and are
included in the governmental activities in the Statement of Net Assets.
Current Assets Noncurrent Assets
Deferred Charges 10,267.52 $ 338,092.04 $ 348,359.56
Certain liabilities are not due and payable in the current period and therefore are not
reported as liabilities in the funds. These liabilities at year-end consist of:
Due or Payable Due or Payable
Within One Year After One Year
Capital Lease Contracts Payable 280,699.16 1,039,211.87
Warrants Payable 6,510,000.00
PBA Funding Agreement 75,000.00 3,475,000.00
Unamortized Discounts (4,003.93) (98,610.00)
Deferred Charge on Refunding (49,865.14) (673,817.89)
Accrued Interest Payable 199,531.44
Compensated Absences 219,392.60
Total Liabilities 501,361.53 $ 10,471,176.58 $ (10,972,538.11)
Total Net Assets - Governmental Activities (Exhibit 1) 1,628,481.04 $
Wilcox County
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds

General RRR Gasoline
Fund Tax Fund
Revenues
Taxes 2,922,942.53 $ $
Licenses and Permits 41,427.39
Intergovernmental 1,449,751.50 823,967.11
Charges for Services 444,564.21
Miscellaneous 1,263,305.50 464.62
Total Revenues 6,121,991.13 824,431.73

Expenditures
Current:
General Government 1,837,145.10
Public Safety 1,514,206.09
Highways and Roads 2,012,073.03 758,100.86
Sanitation 62,179.92
Health 164,379.49
Welfare 230,632.25
Education 19,757.34
Capital Outlay 231,859.15
Debt Service:
Principal Retirement 48,461.05
Debt Issuance Costs
Interest and Fiscal Charges 4,580.46
Intergovernmental 105,855.59
Total Expenditures 6,313,880.56 758,100.86

Excess (Deficiency) of Revenues Over Expenditures (191,889.43) 66,330.87

Other Financing Sources (Uses)
Transfers In 141,095.63
Sale of Capital Assets
Proceeds of Debt Issued
Inception of Capital Leases 188,781.60
Interest and Fiscal Charges (22,292.60)
Payment to Escrow Agent
Transfers Out (455,762.78)
Total Other Financing Sources (Uses) (148,178.15)

Net Changes in Fund Balances (340,067.58) 66,330.87

Fund Balances - Beginning of Year 615,778.00 123,292.72
Fund Balances - End of Year 275,710.42 $ 189,623.59 $
Wilcox County
2008 PBA Funding Other Total
Agreement Governmental Governmental
Construction Fund Funds Funds

$ 438,064.05 $ 3,361,006.58 $
41,427.39
796,030.45 3,069,749.06
11,098.05 455,662.26
59.86 10,318.04 1,274,148.02
59.86 1,255,510.59 8,201,993.31

291,320.17 2,128,465.27
1,514,206.09
47,103.25 750,715.55 3,567,992.69
62,179.92
164,379.49
157,569.53 388,201.78
94,354.78 177,105.87
19,757.34
323,264.14 326,787.37 881,910.66
70,000.00 118,461.05
153,474.98 153,474.98
408,898.85 413,479.31
105,855.59
370,367.39 2,253,121.23 9,695,470.04

(370,307.53) (997,610.64) (1,493,476.73)

987,360.70 1,128,456.33
300.00 300.00
4,430,000.00 4,430,000.00
188,781.60
(22,292.60)
(3,670,999.01) (3,670,999.01)
(678,853.25) (1,134,616.03)
1,067,808.44 919,630.29

(370,307.53) 70,197.80 (573,846.44)

576,319.53 742,870.38 2,058,260.63
206,012.00 $ 813,068.18 $ 1,484,414.19 $
Wilcox County
Reconciliation of the Statement of Revenues, Expenditures and Changes
in Fund Balances of Governmental Funds to the Statement of Activities
Net Change in Fund Balances - Total Governmental Funds (Exhibit 5) (573,846.44) $
Amounts reported for governmental activities in the Statement of Activities
(Exhibit 2) are different because:
Governmental funds report capital outlay as an expenditure. However, in the Statement
of Activities, the cost of those assets is allocated over their estimated useful lives
as depreciation expense. This is the amount by which capital outlay differed from
depreciation in the current period.
Capital Outlay Expenditures 881,910.66 $
Depreciation Expense (792,244.44)
Total 89,666.22
Payments to refund debt are recorded as expenditures or other financing uses in the
governmental funds, but reductions to long-term liabilities in the Statement of Net
Assets do not effect the Statement of Activities. 3,670,999.01
Proceeds from the issuance of debt are reported as other financing sources in
governmental funds and thus contribute to the change in fund balance. Issuing
long-term debt increases liabilities in the Statement of Net Assets but does not
affect the Statement of Activities. Discounts, premiums, issuance costs and
deferred amounts on refunding are reported in the funds in the year the applicable
debt is issued; however, these amounts are deferred and amortized over the life of
the debt issued in the case of discounts and issuance costs. Deferred amounts
on refunding are deferred and amortized over the life of the debt refunded.
Old Debt New Debt
Debt Issued:
Amortization of Discount on Debt Issued (4,003.93) $ $
Amortization of Debt Issuance Costs (10,267.52)
Amortization of Deferred Amounts on Refunding (49,865.14)
Proceeds of Debt Issued (4,430,000.00)
Issuance Costs 153,474.98
Capital Leases (188,781.60)
Total (64,136.59) (4,465,306.62)
Net Adjustment (4,529,443.21)
Wilcox County
Repayment of debt principal is an expenditure in the governmental funds, but the
repayment reduces long-term liabilities in the Statement of Net Assets and does
not affect the Statement of Activities.
Repayments:
Warrants Payable 70,000.00 $
Capital Leases 48,461.05
Total 118,461.05
In the Statement of Activities, donation of capital assets is recorded as revenue,
whereas in the governmental funds it is not recorded. 1,239,766.78
Change in Net Assets of Governmental Activities (Exhibit 2) 15,603.41 $
Wilcox County
Proprietary Funds
September 30, 2012

Total
Solid Water Enterprise
Waste Fund System Fund Funds
Assets
Current Assets
Cash 1,872.76 $ $ 1,872.76 $
Receivables (Note 4) 662,739.16 636,914.73 1,299,653.89
Total Current Assets 664,611.92 636,914.73 1,301,526.65

Noncurrent Assets
Capital Assets (Note 5):
Nondepreciable 63,000.00 46,929.00 109,929.00
Depreciable, Net 279,024.91 2,628,556.28 2,907,581.19
Total Noncurrent Assets 342,024.91 2,675,485.28 3,017,510.19
Total Assets 1,006,636.83 3,312,400.01 4,319,036.84

Liabilities
Current Liabilities
Accounts Payable 8,331.45 31,581.81 39,913.26
Advances from the General Fund 307,589.98 307,589.98
Accrued Wages Payable 1,840.94 1,840.94
Portions Due and Payable Within One Year:
Notes Payable 7,200.00 7,200.00
Total Current Liabilities 10,172.39 346,371.79 356,544.18

Noncurrent Liabilities
Portions Due and Payable After One Year:
Notes Payable 94,800.00 94,800.00
Compensated Absences 1,937.59 1,937.59
Total Noncurrent Liabilities 1,937.59 94,800.00 96,737.59
Total Liabilities 12,109.98 441,171.79 453,281.77

Net Assets
Invested in Capital Assets, Net of Related Debt 342,024.91 2,675,485.28 3,017,510.19
Unrestricted 652,501.94 195,742.94 848,244.88

Total Net Assets 994,526.85 $ 2,871,228.22 $ 3,865,755.07 $

Enterprise Funds
Wilcox County
Statement of Revenues, Expenses and Changes in Fund Net Assets
Proprietary Funds

Total
Operating Revenues
Charges for Services 710,007.86 $ $ 710,007.86 $
Water Sales 835,547.59 835,547.59
Utility Privilege Tax 30,992.93 30,992.93
Tap Fees 24,314.76 24,314.76
Sewer Service Fees 9,425.32 9,425.32
Miscellaneous 38,774.80 1.14 38,775.94
Late Payment Fees 61,930.41 63,980.87 125,911.28
Returned Check Fees 720.00 480.00 1,200.00
Total Operating Revenues 811,433.07 964,742.61 1,776,175.68

Operating Expenses
Salaries 46,422.64 46,422.64
Employee Benefits and Payroll Taxes 16,299.29 16,299.29
Contractual and Professional Services 540,251.24 540,006.39 1,080,257.63
Billing Fees 12,969.04 17,798.87 30,767.91
Advertising 88.50 531.00 619.50
Materials and Supplies 97,796.23 26,741.64 124,537.87
Repairs and Maintenance 16,509.22 28,732.82 45,242.04
Utilities 7,267.77 62,328.54 69,596.31
Utility Privilege Tax 27,393.81 27,393.81
Travel 2,358.30 2,358.30
Insurance 526.43 1,632.00 2,158.43
Depreciation 26,951.84 250,660.14 277,611.98
Purchase of Water 147,383.06 147,383.06
Bad Debt Expense 24,840.00 1,200.00 26,040.00
Miscellaneous 622.14 622.14
Total Operating Expenses 792,280.50 1,105,030.41 1,897,310.91

Operating Income (Loss) 19,152.57 $ (140,287.80) $ (121,135.23) $
Enterprise Funds
Wilcox County

Total
Nonoperating Revenues (Expenses)
Gain on Sale of Capital Assets 134,000.00 $ $ 134,000.00 $
Miscellaneous Revenue 16,607.20 5,798.00 22,405.20
Interest Revenue 5.53 5.53
Commissions-Auction Company (9,380.00) (9,380.00)
Total Nonoperating Revenues (Expenses) 141,227.20 5,803.53 147,030.73

Income (Loss) Before Transfers 160,379.77 (134,484.27) 25,895.50

Transfers and Contributions
Transfers In 6,159.70 6,159.70
Total Transfers and Contributions 6,159.70 6,159.70

Changes in Net Assets 166,539.47 (134,484.27) 32,055.20

Total Net Assets - Beginning of Year 827,987.38 3,005,712.49 3,833,699.87

Total Net Assets - End of Year 994,526.85 $ 2,871,228.22 $ 3,865,755.07 $

Enterprise Funds
Wilcox County
Statement of Cash Flows
Proprietary Funds
Total
Cash Flows From Operating Activities
Cash Received from Customers 621,698.21 $ 932,005.85 $ 1,553,704.06 $
Cash Payments to Suppliers for Goods and Services (676,484.12) (839,483.39) (1,515,967.51)
Cash Payments to Employees for Services (62,284.15) (62,284.15)
Net Cash Provided by Operating Activities (117,070.06) 92,522.46 (24,547.60)
Cash Flows From Noncapital and
Financing Activities
Operating Transfers In 6,159.00 6,159.00
Sale of Surplus Property 16,607.90 16,607.90
Recoveries on Insurance 5,798.00 5,798.00
Interfund Loans Made/Repaid (28,444.08) (93,658.16) (122,102.24)
Net Cash Flows Provided by Noncapital
Financing Activities (5,677.18) (87,860.16) (93,537.34)
Cash Flows From Capital and Related
Financing Activities
Proceeds from Sale of Capital Asset 124,620.00 124,620.00
Principal Payments (7,200.00) (7,200.00)
Net Cash Flows Used by Capital
and Related Financing Activities 124,620.00 (7,200.00) 117,420.00
Cash Flows From Investing Activities
Interest Received 5.53 5.53
Net Cash Flows Provided from Investing Activities 5.53 5.53
Net Increase/(Decrease) in Cash 1,872.76 (2,532.17) (659.41)
Cash and Cash Equivalents - Beginning of Year 2,532.17 2,532.17
Cash and Cash Equivalents - End of Year 1,872.76 $ $ 1,872.76 $
Enterprise Funds
Wilcox County
Total
Reconciliation of Operating Income to
Net Cash Provided by Operating Activities
Operating Income (Loss) 19,152.57 $ (140,287.80) $ (121,135.23) $
Adjustments to Reconcile Operating Income (Loss)
to Net Cash Provided by Operating Activities
Depreciation 26,951.84 250,660.14 277,611.98
Change in Assets and Liabilities:
Increase/Decrease in Accounts Receivable (164,894.86) (31,536.76) (196,431.62)
Increase/Decrease in Accounts Payable 1,282.61 13,686.88 14,969.49
Increase/Decrease in Accrued Wages Payable 437.78 437.78
Net Cash Provided/(Used) by Operating Activities (117,070.06) $ 92,522.46 $ (24,547.60) $
Enterprise Funds
Wilcox County
Statement of Fiduciary Net Assets
September 30, 2012

Private-Purpose Agency
Trust Funds Funds
Assets
Cash 109,240.00 $ 42,230.62 $
Receivables 214.54
Total Assets 109,454.54 42,230.62

Liabilities
Other Payables 109,240.00 42,230.62
Total Liabilities 109,240.00 42,230.62 $

Net Assets
Held in Trust for Other Purposes 214.54
Total Net Assets 214.54 $

Wilcox County
Statement of Changes in Fiduciary Net Assets

Private-Purpose
Trust Funds
Additions
Court Fees 204.29 $
District Attorney's Fees 2,659.82
Total Additions 2,864.11

Deductions
General Government 2,970.52
Total Deductions 2,970.52

Change in Net Assets (106.41)

Net Assets - Beginning of Year 320.95
Net Assets - End of Year 214.54 $

Notes to the Financial Statements
Wilcox County
Commission
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Note 1 Summary of Significant Accounting Policies

The financial statements of the Wilcox County Commission (the Commission) have been
prepared in conformity with accounting principles generally accepted in the United States of
America (GAAP) as applied to governmental units. The Governmental Accounting Standards
Board (GASB) is the accepted standard-setting body for establishing governmental accounting
and financial reporting principles. The more significant of the governments accounting policies
are described below.

A. Reporting Entity

The Wilcox County Commission is a general purpose local government governed by separately
elected commissioners. Generally accepted accounting principles (GAAP) require that the
financial statements present the Commission (the primary government) and its component units.
Component units are legally separate entities for which a primary government is financially
accountable or other organizations for which the nature and significance of their relationship
with the primary government are such that exclusion would cause the reporting entitys financial
statements to be misleading or incomplete. Based on the application of the above criteria, there
are no component units which should be included as part of the financial reporting entity of the
Commission.

B. Government-Wide and Fund Financial Statements

Government-Wide Financial Statements

The statement of net assets and the statement of activities display information about the
Commission. These statements include the financial activities of the primary government,
except for fiduciary activities. Eliminations have been made to minimize the double counting of
internal activities. These statements distinguish between the governmental and business-type
activities of the Commission. Governmental activities generally are financed through taxes,
intergovernmental revenues, and other nonexchange transactions. Business-type activities are
financed in whole or in part by fees charged to external parties.

The statement of activities presents a comparison between direct expenses and program revenues
for each segment of the business-type activities of the Commission and for each function of the
Commissions governmental activities. Direct expenses are those that are specifically associated
with a program or function and, therefore, are clearly identifiable to a particular function. The
Commission does not allocate indirect expenses to the various functions. Program revenues
include (a) charges to customers or applicants who purchase, use or directly benefit from goods,
services, or privileges provided by a given function or program and (b) grants and contributions
that are restricted to meeting the operational or capital requirements of a particular program.
Revenues that are not classified as program revenues, including all taxes, are presented as
general revenues.

Wilcox County
Commission
21

Fund Financial Statements

The fund financial statements provide information about the Commissions funds, including
fiduciary funds. Separate statements for each fund category governmental, proprietary, and
fiduciary are presented. The emphasis of fund financial statements is on major governmental
and enterprise funds, each displayed in a separate column. All remaining governmental and
enterprise funds are aggregated and reported as nonmajor funds.

The Commission reports the following major governmental funds:

General Fund The general fund is the primary operating fund of the Commission. It is
used to account for all financial resources except those required to be accounted for in
another fund. The Commission primarily received revenues from collections of property
taxes and revenues collected by the State of Alabama and shared with the Commission.
Also, the fund is used to report the expenditure of 7 cent State gasoline tax revenue for the
construction, improvement, maintenance and supervision of highways, bridges and streets.

RRR Gasoline Tax Fund This fund is used to account for the Countys share of statewide
four-cent gasoline tax. Revenues are earmarked for the resurfacing, restoration, and
rehabilitation of county roads.

2008 PBA Funding Agreement Construction Fund This fund is used to account for
financial resources generated by the PBA Funding Agreement. These funds may be used to
finance the costs of acquiring, constructing and improving certain public buildings in Wilcox
County.

The Commission reports the following major enterprise funds:

Water System Fund This fund is used to account for the costs of providing water service to
county residents.

Solid Waste Fund This fund is used to account for cost of providing solid waste service to
county residents.

Wilcox County
Commission
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The Commission reports the following governmental fund types in the Other Governmental
Funds column:

Governmental Fund Types

Special Revenue Funds These funds are used to account for and report the proceeds of
specific revenue sources that are restricted or committed to expenditure for specified
purposes other than debt service or capital projects.

Debt Service Funds These funds are used to account for and report financial resources that
are restricted, committed, or assigned to expenditure for principal and interest and for the
accumulation of resources for principal and interest payments maturing in future years.

Capital Projects Funds These funds are used to account for and report that are restricted,
committed, or assigned to expenditure for capital outlay, including the acquisition or
construction of capital facilities and other capital assets.

The Commission reports the following fiduciary fund types:

Fiduciary Fund Types

Private-Purpose Trust Funds These funds are used to report all trust agreements under
which principal and income benefit individuals, private organizations, or other governments.

Agency Funds These funds are used to report assets held by the Commission in a purely
custodial capacity. The Commission collects these assets and transfers them to the proper
individual, private organizations, or other government.

C. Measurement Focus, Basis of Accounting and Financial Statement Presentation

The government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary
fund financial statements. Revenues are recorded when earned and expenses are recorded at the
time liabilities are incurred, regardless of the timing of related cash flows. Nonexchange
transactions, in which the Commission gives (or receives) value without directly receiving
(or giving) equal value in exchange, include property taxes, grants, entitlements, and donations.
On an accrual basis, revenue from grants, entitlements, and donations is recognized in the fiscal
year in which all eligibility requirements have been satisfied. Revenue from property taxes is
recognized in the fiscal year for which the taxes are levied.

Wilcox County
Commission
23

As a general rule, the effect of interfund activity has been eliminated from the government-wide
financial statements. Exceptions to the general rule are charges between the governments solid
waste function, water system function, and various other functions of the government.
Elimination of these charges would distort the direct costs and program revenues reported for the
various functions concerned.

Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are both 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 Commission considers revenues to be available if they are
collected within sixty (60) days of the end of the current fiscal year. Expenditures are recorded
when the related fund liability is incurred, except for principal and interest on general long-term
debt, claims and judgments, compensated absences, and landfill closure and postclosure care
costs, which are recognized as expenditures to the extent they have matured. General capital
asset acquisitions are reported as expenditures in governmental funds. General long-term debt
issued and acquisitions under capital leases are reported as other financing sources.

Proprietary funds distinguish operating revenues and expenses from nonoperating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary funds principal ongoing operations. The
principal operating revenues of the Commissions enterprise funds are charges to customers for
sales and services. Operating expenses for enterprise funds include the cost of sales and
services, administrative expenses, and depreciation on capital assets. All revenues and expenses
not meeting this definition are reported as nonoperating revenues and expenses.

Under the terms of grant agreements, the Commission funds certain programs by a combination
of specific cost-reimbursement grants, categorical block grants, and general revenues. Thus,
when program expenses are incurred, there are both restricted and unrestricted net assets
available to finance the program. It is the Commissions policy to first apply cost-
reimbursement grant resources to such programs, followed by general revenues.

Private-sector standards of accounting and financial reporting issued prior to December 1, 1989,
generally are followed in both the government-wide and proprietary fund financial statements to
the extent that those standards do not conflict with or contradict guidance of the Governmental
Accounting Standards Board. Governments also have the option of following subsequent
private-sector guidance for their business-type activities and enterprise funds, subject to this
same limitation. The Commission has not elected to follow subsequent private-sector guidance.

Wilcox County
Commission
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D. Assets, Liabilities, and Net Assets/Fund Balances

1. Deposits and Investments

Cash and cash equivalents include cash on hand and demand deposits. For purposes of the
statement of cash flows, the proprietary fund type considers all highly liquid investments with a
maturity of three months or less when purchased to be cash equivalents.

State statutes authorize the County Commission to invest in obligations of the U. S. Treasury and
securities of federal agencies and certificates of deposit. Investments are reported at fair value,
based on quoted market prices.

2. Receivables

Sales tax receivables are based on the amounts collected within 60 days after year-end. Sales tax
receivables consist of taxes that have been paid by consumers in September. This tax is
normally remitted to the Commission within the next 60 days.

Millage rates for property taxes are levied at the first regular meeting of the Commission in
February of each year. Property taxes are assessed for property as of October 1 of the preceding
year based on the millage rates established by the County Commission. Property taxes are due
and payable the following October 1 and are delinquent after December 31. Amounts receivable,
net of estimated refunds and estimated uncollectible amounts, are recorded for the property taxes
levied in the current year. However, since the amounts are not available to fund current year
operations, the revenue is deferred and recognized in the subsequent fiscal year when the taxes
are both due and collectible and available to fund operations.

Receivables due from other governments include amounts due from grantors for grants issued for
specific programs and capital projects.

Receivables in enterprise funds consist primarily of amounts due from customers who are
charged fees for services provided by the Commission. These amounts are reported net of an
allowance for doubtful accounts. The allowance for doubtful accounts is based on past
collection experience.

3. Deferred Charges

Deferred charges included the costs associated with the issuance of long-term debt that are
amortized over the life of the debt.

Wilcox County
Commission
25

4. Restricted Assets

Certain general obligation warrants, as well as certain resources set aside for their repayment, are
classified as restricted assets on the balance sheet because they are maintained in separate bank
accounts and their use is limited by applicable bond covenants. The Series 2012 and Series 2008
General Obligation and the Series 2008 PBA Funding Agreement Debt Service Funds are used to
segregate resources accumulated for debt service payments. The Series 2012 General Obligation
and the PBA Funding Agreement Construction Funds are used to report proceeds that are
restricted for use in various capital improvement projects.

5. Capital Assets

Capital assets, which include property, equipment, and infrastructure assets (e.g., roads, bridges,
water and sewer systems, and similar items), are reported in the applicable governmental and
business-type activities columns in the government-wide financial statements. Such assets are
valued at cost where historical records are available and at an estimated historical cost where no
historical records exist. Donated fixed assets are valued at their estimated fair market value on
the date received. Additions, improvements and other capital outlays that significantly extend
the useful life of an asset are capitalized. Other costs incurred for repairs and maintenance are
expensed as incurred. Major outlays of capital assets and improvements are capitalized as
projects are constructed. Interest incurred during the construction phase of capital assets of
business-type activities is included as part of the capitalized value of the assets constructed.

Depreciation on all assets is provided on the straight-line basis over the assets estimated
useful life. Capitalization thresholds (the dollar values above which asset acquisitions are added
to the capital asset accounts) and estimated useful lives of capital assets reported in the
government-wide statements and proprietary funds are as follows:

Capitalization
Threshold
Estimated
Useful Life

Buildings and Improvements $ 50,000 20 40 years
Equipment and Furniture $ 5,000 5 10 years
Motor Vehicles $ 5,000 5 15 years
System Infrastructure $100,000 25 40 years
Bridges $ 50,000 40 50 years
Land Improvements $ 50,000 25 40 years

Wilcox County
Commission
26

The majority of governmental activities infrastructure assets are roads and bridges. The
Association of County Engineers has determined that due to the climate and materials used in
road construction, the base of the roads in the county will not deteriorate and therefore should
not be depreciated. The remaining part of the roads, the surface, will deteriorate and will be
depreciated. The entire costs of bridges in the county will be depreciated.

6. Long-Term Obligations

In the government-wide financial statements, and proprietary fund types in the fund financial
statements, long-term debt and other long-term obligations are reported as liabilities in the
applicable governmental activities, business-type activities, or proprietary fund type statement of
net assets. Discounts, as well as issuance costs, are deferred and amortized over the life of the
bonds. Long-term debt payable is reported net of the applicable discount. Issuance costs are
reported as deferred charges and amortized over the term of the related debt.

In the fund financial statements, governmental fund types recognize discounts, as well as bond
issuance costs, during the current period. The face amount of debt issued is reported as other
financing sources. Discounts on debt issuances are reported as other financing uses. Issuance
costs, whether or not withheld from the actual debt proceeds received, are reported as debt
service expenditures.

7. Compensated Absences

The Commission has a standard leave policy for its full-time employees as to sick and annual
leave.

Annual Leave

Employees earn annual leave according to the following schedule:

Completed Service
Earned
Annual Leave

0-2 years 2 hours per pay period
2-5 years 2.5 hours per pay period
20 years plus 6 hours per pay period

Wilcox County
Commission
27

Sick Leave

Employees earn credit for paid sick leave at the rate of one-half day (4 hours) of leave for each
two-week pay period for a total of 104 hours per year. Eligible county employees may
accumulate up to 120 days of sick leave. Employees hired before J anuary 1, 1986, are eligible to
be paid for a portion of accrued sick leave upon separation from county services.

The Commission uses the termination method to accrue its sick leave liability. Under this
method an accrual for earned sick leave is made only to the extent it is probable that the benefits
will result in termination payments, rather than be taken as absences due to illness or other
contingencies, such as medical appointments and funerals.

8. Net Assets/Fund Equity

Net assets are reported on the government-wide and proprietary fund financial statements and are
required to be classified for accounting and reporting purposes into the following net asset
categories:

Invested in Capital Assets, Net of Related Debt Capital assets, net of accumulated
depreciation and outstanding principal balances of debt attributable to the acquisition,
construction or improvement of those assets. Any significant unspent related debt proceeds
at year-end related to capital assets are not included in this calculation.

Restricted Constraints imposed on net assets by external creditors, grantors, contributors,
laws or regulations of other governments, or law through constitutional provision or enabling
legislation.

Unrestricted Net assets that are not subject to externally imposed stipulations. Unrestricted
net assets may be designated for specific purposes by action of the Commission.

Fund balance is reported in the fund financial statements. Fund balances of governmental funds
are reported in classifications to indicate the level of constraints on the use of the fund balances.
Those classifications and associated constraints are as follows:

Nonspendable Nonspendable fund balances include amounts that cannot be spent because
they are either (a) not in spendable form or (b) legally or contractually required to be
maintained in-tact. Examples of nonspendable fund balance reserves for which fund balances
shall not be available for financing general operating expenditures include: inventories,
prepaid items, and long-term receivables.

Wilcox County
Commission
28

Restricted Restricted fund balances consist of amounts that are subject to externally
enforceable legal restrictions imposed by creditors, grantors, contributors, or laws and
regulations of other governments; or through constitutional provisions or enabling
legislation.

Committed Committed fund balances consist of amounts that are subject to a purpose
constraint imposed by formal action or resolution of the Commission, which is the highest
level of decision-making authority, before the end of the fiscal year and that require the same
level of formal action to remove or modify the constraint.

Assigned Assigned fund balances consist of amounts that are intended to be used by the
Commission for specific purposes. The Commission authorizes the Commission Chairman
or County Administrator to make a determination of the assigned amount of fund balance.
Such assignments may not exceed the available (spendable, unrestricted, uncommitted) fund
balance in any particular fund. Assigned fund balances require the same level of authority to
remove the constraint.

Unassigned Unassigned fund balances include all spendable amounts not contained in the
other classifications. This portion of the total fund balance in the general fund is available to
finance operating expenditures.

In circumstances where an expenditure is to be made for a purpose for which amounts are
available in multiple fund balance classifications, the order in which resources will be expended
is as follows: restricted fund balance, followed by committed fund balance, assigned fund
balance, and lastly unassigned fund balance.

Note 2 Stewardship, Compliance, and Accountability

Budgets

Budgets are adopted on a basis of accounting consistent with accounting principles generally
accepted in the United States of America (GAAP) for the General Fund with the exception of ad
valorem and sales and use taxes, which are budgeted only to the extent expected to be received
rather than on the modified accrual basis of accounting. The RRR Fund budgets on a basis of
accounting consistent with GAAP. All other governmental funds adopt budgets on the modified
accrual basis of accounting. Capital projects funds adopt project-length budgets. All
appropriations lapse at fiscal year-end.

Wilcox County
Commission
29

The present statutory basis for county budgeting operations is the County Financial Control Act
of 1935, as amended by Act Number 2007-488, Acts of Alabama. According to the terms of the
law, at some meeting in September of each year, but in any event not later than October 1, the
Commission must estimate the anticipated revenues, estimated expenditures and appropriations
for the respective amounts that are to be used for each of such purposes. The appropriations
must not exceed the total revenues available for appropriation plus any balances on hand.
Expenditures may not legally exceed appropriations.

Budgets may be adjusted during the fiscal year when approved by the County Commission. Any
changes must be within the revenues and reserves estimated to be available.

Note 3 Deposits and Investments

A. Deposits

The custodial credit risk for deposits is the risk that, in the event of a bank failure, the
Commission will not be able to cover deposits or will not be able to recover collateral securities
that are in the possession of an outside party. The Commissions deposits at year-end were
entirely covered by federal depository insurance or by the Security for Alabama Funds
Enhancement Program (SAFE Program). The SAFE Program was established by the Alabama
Legislature and is governed by the provisions contained in the Code of Alabama 1975, Sections
41-14A-1 through 41-14A-14. Under the SAFE Program all public funds are protected through a
collateral pool administered by the Alabama State Treasurers Office. Under this program,
financial institutions holding deposits of public funds must pledge securities as collateral against
those deposits. In the event of failure of a financial institution, securities pledged by that
financial institution would be liquidated by the State Treasurer to replace the public deposits not
covered by the Federal Deposit Insurance Corporation (FDIC). If the securities pledged fail to
produce adequate funds, every institution participating in the pool would share the liability for
the remaining balance.

B. Cash with Fiscal Agents

As of September 30, 2012, the Commissions cash with fiscal agents was invested as follows:

Rating Maturity Fair Value

Money Market Mutual Funds:
Federated Treasury Obligations Fund
Institutional Services Shares CUSIP 60934N872 AAAm 397 days or less $926,247.37

Wilcox County
Commission
30

Interest Rate Risk Interest rate risk is the risk that changes in interest rates will adversely
affect the fair value of an investment. The Commission does not have a formal investment
policy that limits investment maturities as a means of managing its exposure to fair value losses
arising from increased interest rates.

Credit Risk State law requires that pre-refunded public obligations, such as any bonds or other
obligations of any state of the United States of America or of any agency instrumentality or local
governmental unit of any such state that the Commission invests in be rated in the highest rating
category of Standard & Poors Corporation and Moodys Investors Service, Inc. The
Commission does not have a formal policy regarding this state law. As of September 30, 2012,
the Commissions investments in Federated U. S. Treasury Obligations Money Market Funds
were rated AAAm by Standard & Poors Rating Group.

Custodial Credit Risk For an investment, this is the risk that, in the event of the failure of the
counterparty, the government will not be able to cover the value of its investments or collateral
securities that are in the possession of an outside party. The Commission has no formal policy
regarding custodial credit risk.

Concentrations of Credit Risk Concentration of credit risk is the risk of loss attributed to the
magnitude of a governments investment in a single issuer. The Commission does not have a
formal policy regarding concentrations of credit risk.

Note 4 Receivables

On September 30, 2012, receivables for the Commissions individual major funds and nonmajor
funds in the aggregate, including the applicable allowances for uncollectible accounts, are as
follows:

Accounts Intergovernmental
Total
Receivables

General Fund $ 70,537.41 $167,645.09 $ 238,182.50
RRR Gasoline Tax Fund 67,724.42 67,724.42
Total Governmental Activities 70,537.41 235,369.51 305,906.92

Business-Type Activities:
Gross Solid Waste Fund 1,090,579.16 1,090,579.16
Less: Allowance for Uncollectibles (427,840.00) (427,840.00)
Net Solid Waste Fund 662,739.16 662,739.16

Gross Water System Fund 762,514.73 762,514.73
Less: Allowance for Uncollectibles (125,600.00) (125,600.00)
Net Water System Fund 636,914.73 636,914.73
Total Net Business-Type Activities $1,299,653.89 $ $1,299,653.89

Wilcox County
Commission
31

Governmental funds report deferred revenues in connection with receivables for revenues that
are not considered to be available to liquidate liabilities of the current period. Governmental
funds also defer revenue recognition in connection with resources that have been received, but
not yet earned. At September 30, 2012, the various components of deferred revenue and
unearned revenue reported in the governmental funds were as follows:

Unavailable Unearned

Ad Valorem Property Taxes $2,244,582.22 $
Ad Valorem Motor Vehicle Taxes 81,396.60
Excess Reappraisal Funds 15,759.81
Total Deferred/Unearned Revenue for Governmental Funds $2,244,582.22 $97,156.41

Note 5 Capital Assets

Capital asset activity for the year ended September 30, 2012, was as follows:

Balance
10/01/2011 Additions (*) Retirements (*)
Balance
09/30/2012

Capital Assets, Not Being Depreciated:
Land $ 466,925.05 $ 20,500.00 $ $ 487,425.05
Construction in Progress 408,227.45 1,535,680.24 (1,881,939.69) 61,968.00
Total Capital Assets, Not Being Depreciated 875,152.50 1,556,180.24 (1,881,939.69) 549,393.05

Capital Assets Being Depreciated:
Land Improvements 44,618.00 131,419.64 176,037.64
Buildings 3,483,633.47 2,013,971.72 5,497,605.19
Building Improvements 122,580.00 122,580.00
Infrastructure 2,406,496.43 2,406,496.43
Equipment and Furniture 3,736,919.30 43,077.53 (25,387.00) 3,754,609.83
Motor Vehicles 1,277,690.59 94,029.00 (59,459.20) 1,312,260.39
Equipment Under Capital Leases 1,297,441.43 164,939.00 1,462,380.43
Assets Under Funding Agreement 3,780,578.14 3,780,578.14
Total Capital Assets Being Depreciated 16,149,957.36 2,447,436.89 (84,846.20) 18,512,548.05

Less Accumulated Depreciation for:
Land Improvements (44,618.00) (4,380.65) (48,998.65)
Buildings (1,663,191.25) (104,936.45) (1,768,127.70)
Building Improvements (50,605.74) (6,878.67) (57,484.41)
Infrastructure (346,189.84) (60,162.41) (406,352.25)
Equipment and Furniture (3,269,912.53) (221,640.06) 25,387.00 (3,466,165.59)
Motor Vehicles (1,183,601.01) (29,674.62) 59,459.20 (1,153,816.43)
Equipment Under Capital Leases (250,885.84) (267,711.19) (518,597.03)
Assets Under Funding Agreement (777,293.25) (96,860.39) (874,153.64)
Total Accumulated Depreciation (7,586,297.46) (792,244.44) 84,846.20 (8,293,695.70)
Total Capital Assets Being Depreciated, Net 8,563,659.90 1,655,192.45 10,218,852.35
Total Governmental Activities Capital Assets, Net $ 9,438,812.40 $3,211,372.69 $(1,881,939.69) $10,768,245.40

(*) Reclassifications were made for projects included in construction in progress that were completed in the amount of
$1,881,939.69.

Wilcox County
Commission
32

Balance
10/01/2011 Additions (*)

Retirements (*)
Balance
09/30/2012

Capital Assets, Not Being Depreciated:
Land $ 109,929.00 $ $ $ 109,929.00
Total Capital Assets, Not Being Depreciated 109,929.00 109,929.00

Capital Assets Being Depreciated:
Buildings and Improvements 7,415,807.49 7,415,807.49
Equipment and Furniture 541,665.46 (107,251.70) 434,413.76
Motor Vehicles 350,478.33 (178,800.00) 171,678.33
Total Capital Assets Being Depreciated 8,307,951.28 (286,051.70) 8,021,899.58

Less Accumulated Depreciation for:
Buildings and Improvements (4,275,294.74) (240,420.29) (4,515,715.03)
Equipment and Furniture (496,985.02) (37,191.69) 107,251.70 (426,925.01)
Motor Vehicles (350,478.35) 178,800.00 (171,678.35)
Total Accumulated Depreciation (5,122,758.11) (277,611.98) 286,051.70 (5,114,318.39)
Total Capital Assets Being Depreciated, Net 3,185,193.17 (277,611.98) 2,907,581.19
Total Business-Type Activities Capital Assets, Net $ 3,295,122.17 $(277,611.98) $ $ 3,017,510.19

Depreciation expense was charged to functions/programs of the primary government as follows:

Current Year
Depreciation
Expense

General Government $224,628.51
Public Safety 188,977.91
Health 21,987.43
Welfare 8,335.75
Total Depreciation Expense Governmental Activities $792,244.44

Current Year
Depreciation
Expense

Sanitation Solid Waste $ 26,951.84
Water System 250,660.14
Total Depreciation Expense Business-Type Activities $277,611.98

Wilcox County
Commission
33

Note 6 Defined Benefit Pension Plan

A. Plan Description

The Commission contributes to the Employees Retirement System of Alabama, an agent
multiple-employer public employee retirement system that acts as a common investment and
administrative agent for the various state agencies and departments.

Substantially all employees of the Commission are members of the Employees Retirement
System of Alabama. Membership is mandatory for covered or eligible employees of the
Commission. Benefits vest after 10 years of creditable service. Vested employees may retire
with full benefits at age 60 or after 25 years of service. Retirement benefits are calculated by
two methods with the retiree receiving payment under the method which yields the highest
monthly benefit. The methods are (1) Minimum Guaranteed, and (2) Formula, of which the
Formula method usually produces the highest monthly benefit. Under this method retirees are
allowed 2.0125% of their average final salary (best three of the last ten years) for each year of
service. Retirees may also elect to receive a reduced retirement allowance (Special Privileges at
Retirement) in order to provide an allowance to a designated beneficiary after the members
death. Disability retirement benefits are calculated in the same manner. Pre-retirement death
benefits in the amount of the annual salary for the fiscal year preceding death is provided to plan
members.

The Employees Retirement System was established as of October 1, 1945, under the provisions
of Act Number 515, Acts of Alabama 1945, for the purpose of providing retirement allowances
and other specified benefits for State employees, State police, and on an elective basis to all
cities, counties, towns and quasi-public organizations. The responsibility for general
administration and operation of the Employees Retirement System is vested in the Board of
Control. Benefit provisions are established by the Code of Alabama 1975, Sections 36-27-1
through 36-27-103, as amended, Sections 36-27-120 through 36-27-139, as amended, and
Sections 36-27B-1 through 36-27B-6. Authority to amend the plan rests with the Legislature of
Alabama. However, the Legislature has granted the Commission authority to accept or reject
various Cost-Of-Living-Adjustments (COLAs) granted to retirees.

The Retirement Systems of Alabama issues a publicly available financial report that includes
financial statements and required supplementary information for the Employees Retirement
System of Alabama. That report may be obtained by writing to The Retirement Systems of
Alabama, 201 South Union Street, Montgomery, Alabama 36130-2150.

Wilcox County
Commission
34

B. Funding Policy

Employees of the Commission, with the exception of full-time law enforcement officers,
are required by statute to contribute 5 percent of their salary to the Employees Retirement
System. As of J anuary 1, 2001, full-time law enforcement officers are required by statute to
contribute 6 percent of their salary to the Employees Retirement System. The Commission is
required to contribute the remaining amounts necessary to fund the actuarially determined
contributions to ensure sufficient assets will be available to pay benefits when due. The
contribution requirements of the Commission are established by the Employees Retirement
System based on annual actuarial valuations. The employers contribution rate for the year
ended September 30, 2012 was 7.40% percent based on the actuarial valuation performed as of
September 30, 2009.

C. Annual Pension Cost

For the year ended September 30, 2012, the Commissions annual pension cost of $143,192
was equal to the Commissions required and actual contribution. The required contribution
was determined using the entry age normal method. The actuarial assumptions as of
September 30, 2011, the latest actuarial valuation date, were: (a) 8 percent investment rate of
return on present and future assets, and (b) projected salary increases ranging from 7.25 percent
at age 20 to 3.75 percent at age 65. Both (a) and (b) include an inflation component of 3 percent.
The actuarial value of assets was determined using techniques that smooth the effects of short-
term volatility in the market value of investments over a five-year period. The unfunded
actuarial accrued liability is being amortized as a level percentage of projected payroll on an
open basis. The remaining amortization period as of September 30, 2011, was 30 years.

The following is three-year trend information for the Commission:

Fiscal Year
Ended
Annual Pension
Cost (APC)
Percentage of
APC Contributed
Net Pension
Obligation

09/30/2012 $143,192 100% $0
09/30/2011 $170,943 100% $0
09/30/2010 $168,258 100% $0

D. Funded Status and Funding Progress

As of September 30, 2011, the most recent actuarial valuation date, the plan was 85.0 percent
funded. The actuarial accrued liability for benefits was $8,227,786 and the actuarial value of
assets was $6,989,613 resulting in an unfunded actuarial accrued liability (UAAL) of
$1,238,173. The covered payroll (annual payroll of active employees covered by the plan) was
$2,363,119, and the ratio of the UAAL to the covered payroll was 52.4 percent.

Wilcox County
Commission
35

The Schedule of Funding Progress, presented as RSI following the notes to the financial
statements, presents multiyear trend information about whether the actuarial value of plan assets
is increasing or decreasing over time relative to the actuarial accrued liability for benefits.

Note 7 Payables

On September 30, 2012, payables for the Commissions individual major funds and other
governmental funds in the aggregate are as follows:

Vendors
Due To Other
Governments
Total
Payables

General Fund $82,192.31 $ $ 82,192.31
2008 PBA Funding Agreement Construction Fund 357,366.54 357,366.54
Other Governmental Funds 69.16 69.16
Total Governmental Activities $82,261.47 $357,366.54 $439,628.01

Wilcox County
Commission
36

Note 8 Lease Obligations

Capital Leases

The Commission is obligated under certain leases accounted for as capital leases. Assets under
capital leases totaled $1,462,380.43 for governmental activities at September 30, 2012. If the
Commission completes the lease payments according to the schedules below, which is the stated
intent of the Commission, ownership of the leased equipment will pass to the Commission. The
lease purchase contracts give the Commission the right to cancel the lease with 30 days written
notice and payment of a pro rata share of the current years lease payments. Until that time, the
leased equipment will be identified separately on the balance sheet. The following is a schedule
of future minimum lease payments under capital leases, together with the net present value of the
minimum lease payments as of September 30.

Fiscal Year Ending
Governmental
Activities

September 30, 2013 $ 328,743.40
2014 285,272.12
2015 277,862.81
2016 293,362.82
2017 276,362.83
Total Minimum Lease Payments 1,461,603.98
Less: Amount Representing Interest (141,692.95)
Present Value of Net Minimum Lease Payments $1,319,911.03

Note 9 Long-Term Debt

In March 2008, General Obligation Warrants, with interest rates of 5.00 to 5.50 percent, were
issued to provide funds for certain capital improvements and to refund the 2005 General
Obligation Warrants and a portion of the 2004 General Obligation Warrants.

In J une 2008, the Public Building Authority (the PBA) Funding Agreement, with interest rates
of 3.75 to 5.125 percent, was issued to provide funds for certain capital improvements and to
refund a lease purchase agreement with the PBA.

In J anuary 2012, General Obligation Warrants of $4,430,000, with interest rates of 2.10 to 4.65
percent, were issued for the purposes of advance refunding outstanding 2004 Series General
Obligation Warrants, advance refunding a portion of the 2008 Series General Obligation
Warrants, and to construct various capital projects.

Wilcox County
Commission
37

The following is a summary of long-term debt transactions for the Commission for the year
ended September 30, 2012:

Debt
Outstanding
10/01/2011
Issued/
Increased
Repaid/
Decreased
Debt
Outstanding
09/30/2012
Amounts
Due Within
One Year

Warrants Payable:
2012 General Obligation Warrants $ $4,430,000.00 $ $ 4,430,000.00 $
2008 PBA Funding Agreement Payable 3,620,000.00 (70,000.00) 3,550,000.00 75,000.00
2008 General Obligation Warrants 4,155,000.00 (2,075,000.00) 2,080,000.00
2004 General Obligation Warrants 1,350,000.00 (1,350,000.00)
Less Deferred Amounts:
Discount (140,492.13) 37,878.20 (102,613.93) (4,003.93)
Deferred Charges on Refunding (392,467.02) (489,421.15) 158,205.14 (723,683.03) (49,865.14)
Total Warrants Payable 8,592,040.85 3,940,578.85 (3,298,916.66) 9,233,703.04 21,130.93

Other Liabilities:
Capital Leases Payable 1,179,590.48 1,260,747.99 (1,120,427.44) 1,319,911.03 280,699.16
Total Other Liabilities 1,398,983.08 1,260,747.99 (1,120,427.44) 1,539,303.63 280,699.16
Total Governmental Activities
Long-Term Liabilities 9,991,023.93 5,201,326.84 (4,419,344.10) 10,773,006.67 301,830.09

Notes Payable 109,200.00 (7,200.00) 102,000.00 7,200.00
Other Liabilities:
Total Other Liabilities 1,937.59 1,937.59
Total Business-Type Activities
Long-Term Liabilities $ 111,137.59 $ $ (7,200.00) $ 103,937.59 $ 7,200.00

During fiscal year 2012, the Commission refinanced five capital leases into one lease. The
accrued interest due at the time ($22,292.60) was rolled into the principal balance of the new
lease. The increase of $1,094,258.99 and the decrease of $1,071,966.39 included above is not
reflected on Exhibit 5.

Payments on the warrants payable that pertain to the Commissions governmental activities are
made by the Debt Service Funds. The Capital Lease Liability for the Governmental Activities
will be liquidated by the General Fund. The Note Payable for Business-Type Activities is paid
by the Water System Fund.

The compensated absences liability attributable to the governmental activities will be liquidated
by several of the Commissions governmental funds. In the past, approximately 93% has been
paid by the General Fund and 7% by the Reappraisal Fund.

Wilcox County
Commission
38

The following is a schedule of debt service requirements to maturity:


2012 General Obligation 2008 General Obligation
Warrants Payable Warrants Payable
Fiscal Year Ending Principal Interest Principal Interest

September 30, 2013 $ $ 170,607.50 $ $ 111,527.50
2014 170,607.50 111,527.50
2015 170,607.50 111,527.50
2016 170,607.50 111,527.50
2017 170,607.50 111,527.50
2018-2022 980,000.00 797,027.50 557,637.50
2023-2027 685,000.00 668,965.00 475,000.00 499,662.50
2028-2032 685,000.00 551,375.00 615,000.00 356,968.75
2033-2037 850,000.00 386,922.50 800,000.00 166,352.50
2038-2042 1,230,000.00 165,956.25 190,000.00 5,225.00
Totals $4,430,000.00 $3,423,283.75 $2,080,000.00 $2,143,483.75

Business-Type Activities
Notes Payable
Total Principal
and Interest
Requirements
Fiscal Year Ending Principal Interest to Maturity

September 30, 2013 $ 7,200.00 (*) $ 7,200.00
2014 7,200.00 7,200.00
2015 7,200.00 7,200.00
2016 7,200.00 7,200.00
2017 7,200.00 7,200.00
2018-2022 36,000.00 36,000.00
2023-2027 30,000.00 30,000.00
Total $102,000.00 $102,000.00

(*) Interest-Free Note

Wilcox County
Commission
39

Total Principal
2008 PBA Funding Capital Lease and Interest
Agreement Payable Contracts Payable Requirements
Principal Interest Principal Interest to Maturity

$ 75,000.00 $ 171,490.00 $ 280,699.16 $ 48,044.24 $ 857,368.40
75,000.00 168,677.50 253,457.40 31,814.72 811,084.62
80,000.00 165,490.00 254,420.98 23,441.83 805,487.81
85,000.00 162,090.00 261,455.87 31,906.95 822,587.82
85,000.00 158,477.50 269,877.62 6,485.21 801,975.33
500,000.00 731,737.52 3,566,402.52
625,000.00 603,592.54 3,557,220.04
790,000.00 437,303.80 3,435,647.55
1,000,000.00 218,868.80 3,422,143.80
235,000.00 12,043.76 1,838,225.01
$3,550,000.00 $2,829,771.42 $1,319,911.03 $141,692.95 $19,918,142.90

Issuance Costs, Deferred Charges on Refunding and Discounts

The Commission has issuance costs, as well as discounts, in connection with the issuance of its
2004 General Obligation Warrants. A portion of the issuance costs and discount was refunded
by the 2008 General Obligation Warrants. The remaining issuance costs and discount were
being amortized using the straight-line method over a period of 18 years up until fiscal year 2012
at which time the remainder of the unamortized issuance costs and discount were refunded by the
2012 General Obligation Warrants.

The Commission has warrant issuance costs, as well as discounts and deferred charges on
refunding, in connection with the issuance of its 2008 General Obligation Warrants. A portion
of the issuance costs, discounts, and deferred charges on refunding was refunded by the 2012
General Obligation Warrants. The remaining issuance costs and discount are being amortized
using the straight-line method over a period of 30 years and the remaining deferred charges on
refunding are being amortized using the straight-line method over a period of 13 years, the
remaining life of the warrants defeased.

The Commission has issuance costs, as well as discounts, in connection with the issuance of its
2008 PBA Funding Agreement. The issuance costs and discounts are being amortized using the
straight-line method over a period of 30 years and the deferred charges on refunding are being
amortized using the straight-line method over a period of 17 years, the remaining life of the old
debt.

Wilcox County
Commission
40

The Commission has issuance costs and deferred charges on refunding in connection with the
issuance of its 2012 General Obligation Warrants. The issuance costs are being a7mortized
using the straight-line method over a period of 30 years and the deferred charges on refunding
are being amortized using the straight-line method over a period of 27 years, the remaining life
of the warrants defeased.

Issuance
Costs
Deferred
Charges on
Refunding Discount

Issuance Costs, Deferred Charges on Refunding and Discounts
2012 General Obligation Warrants $ 153,474.98 $ 489,421.15 $
2008 PBA Funding Agreement Payable 152,600.40 218,661.89 92,460.00
2008 General Obligation Warrants 157,375.00 301,629.40 55,315.90
2004 General Obligation Warrants 66,273.05 19,741.55
Total Issuance Costs, Deferred Charges on Refunding, and Discounts 529,723.43 1,009,712.44 167,517.45
Amount Amortized and/or Refunded in Prior Years (69,888.48) (127,824.27) (27,025.32)
Balance Issuance Costs, Deferred Charges on Refunding, and Discounts 459,834.95 881,888.17 140,492.13
Current Amount Amortized (101,207.87) (108,340.00) (33,874.27)
Current Amount Refunded (10,267.52) (49,865.14) (4,003.93)
Balance Issuance Costs, Deferred Charges on Refunding and Discounts $ 348,359.56 $ 723,683.03 $102,613.93

Pledged Revenues

General Obligation Warrants, Series 2012

The Commission has pledged tax revenues from the 7-mill ad valorem tax to repay $4,430,000 in
General Obligation Warrants, Series 2012 issued on J anuary 20, 2012 to refund a portion of the
Commissions General Obligation Warrants, Series 2008; the remaining un-refunded portion of
the Commissions General Obligation Warrants, Series 2004 and provide funds for various other
capital improvements. Future revenues in the amount of $7,853,283.75 are pledged to repay
principal and interest on the warrants at September 30, 2012. Pledged revenues in the amount of
$943,412.49 were received during the fiscal year ended September 30, 2012 with $33,647.59
being used to pay interest payments during this fiscal year. These warrants are scheduled to
mature in fiscal year 2042.

Wilcox County
Commission
41

General Obligation Warrants, Series 2008

The Commission has pledged tax revenues from the 7-mill ad valorem tax to repay
$4,155,000.00 in General Obligation Warrants, Series 2008 issued on March 1, 2008 to refund a
portion of the Commissions General Obligation Warrants, Series 2004; the Commissions
General Obligation Warrants, Series 2005 and provide funds for various other capital
improvements. A portion of these warrants ($2,075,000) were refunded by the General
Obligation Warrants, Series 2012. Future revenues in the amount of $4,223,483.75 are pledged
to repay principal and interest on the warrants at September 30, 2012. Pledged revenues in the
amount of $943,412.49 were received during the fiscal year ended September 30, 2012 with
$167,156.25 being used to pay interest payments during this fiscal year. These warrants are
scheduled to mature in fiscal year 2038.

2008 PBA Funding Agreement Payable

The Commission has pledged tax revenues from the 2 -mill ad valorem tax and license
fees to repay $3,820,000.00 of its 2008 PBA Funding Agreement payable which was entered
into to refund its 2000 PBA Lease and to fund various other capital improvements. Future
revenues in the amount of $6,379,771.42 are pledged to repay principal and interest on the
warrants at September 30, 2012. Pledged revenues in the amount of $430,862.25 were received
during the fiscal year ended September 30, 2012 with $244,115.00 being used to pay principal
and interest payments during this fiscal year. This funding agreement is scheduled to mature in
fiscal year 2038.

Defeased Debt

On J anuary 20, 2012, the Commission issued $4,430,000.00 in General Obligation Warrants
with interest rates of 2.10 to 4.65 percent, for the purposes of advance refunding outstanding
2004 Series General Obligation Warrants, advance refunding a portion of the 2008 Series
General Obligation Warrants, and to construct various capital projects. A portion of the net
proceeds were used to purchase U. S. government securities. Those securities were deposited in
an irrevocable trust with an escrow agent to provide for all future debt service payments on the
remainder of the 2004 Series Warrants and a portion of the 2008 Series Warrants. As a result,
these warrants are considered to be defeased and the liability for those warrants has been
removed.

The advance refunding resulted in a difference between the reacquisition price and the net
carrying amount of the old debt of $489,421.15. This difference is being netted against the new
debt and amortized over the remaining life of the old debt which is shorter than the life of the
new debt issued. As a result of the advance refunding, the Commission increased its total debt
service requirements by $627,042.43, which resulted in an economic gain (difference between
the present value of the debt service payments on the old and new debt) of $81,079.56.

Wilcox County
Commission
42

Prior Year Defeasance of Debt

In prior years, the Commission defeased its General Obligation Warrants, Series 2005, by
placing the proceeds of the new warrants in an irrevocable trust to provide for all future
debt service payments of the old warrants. Accordingly, the trust account assets and the
liability for the defeased debt are not included on the Commissions financial statements. At
September 30, 2012, the total of $1,205,000.00 of warrants outstanding are considered defeased.

Note 10 Risk Management

The Commission is exposed to various risks of loss related to torts; theft of, damage to, and
destruction of assets; errors and omissions; injuries to employees; and natural disasters. The
Commission has general liability insurance through the Association of County Commissions of
Alabama (ACCA) Liability Self Insurance Fund, a public entity risk pool. The Fund is self-
sustaining through member contributions. The Commission pays an annual premium based on
the Commissions individual claims experience and the experience of the Fund as a whole.
Coverage is provided up to $500,000 per claim for a maximum total coverage of $2,000,000 and
unlimited defense costs. Employment-related practices damage protection is limited to $100,000
per incident with a $5,000 deductible and unlimited defense costs.

The Commission has workers compensation insurance through the Association of County
Commissions of Alabama (ACCA) Workers Compensation Self Insurance Fund, a public entity
risk pool. Premiums are based on a rate per $100 of remuneration for each class of employee
which is adjusted by an experience modifier for the individual county. At year-end, pool
participants are eligible to receive refunds of unused premiums and the related investment
earnings. The Commission may qualify for additional discounts based on losses and premium
size. Employment-related practices damage protection is limited to $50,000 per incident with a
$5,000 deductible and unlimited defense costs.

The Commission purchases commercial insurance for its other risks of loss, including property
and casualty insurance and employee health insurance. Settled claims resulting from these risks
have not exceeded commercial insurance coverage in any of the past three fiscal years.

Wilcox County
Commission
43

Note 11 Interfund Transactions

Advances To/From Other Funds

The advances due to/from other funds at September 30, 2012, were as follows:

Advance to
Other Funds
General Fund

Advance from Other Funds:
Water System Fund $307,589.98
Totals $307,589.98

This advance was from proceeds of the 2004 and 2008 General Obligation Warrants and for a
prior year short-term loan for the operation of the water system. In fiscal year 2012, $93,658.16
of the advance was repaid to the General Fund.

Interfund Transfers

The amounts of interfund transfers during the fiscal year ending September 30, 2012, were as
follows:

Transfers Out

General
Fund
Other
Governmental
Funds Totals

Transfers In:
General Fund $ $141,095.63 $ 141,095.63
Other Governmental Funds 449,603.08 537,757.62 987,360.70
Total Other Governmental Funds 449,603.08 678,853.25 1,128,456.33
Solid Waste Fund 6,159.70 6,159.70
Totals $455,762.78 $678,853.25 $1,134,616.03

The Commission typically used transfers to fund ongoing operating subsidies and to transfer
the portion from the General Fund to the Debt Service Funds to service current-year
debt requirements.

Wilcox County
Commission
44

Note 12 Related Organizations

A majority of the members of the Board of the agencies listed below are appointed by the
Wilcox County Commission. The Commission, however, is not financially accountable, because
it does not impose its will and have a financial benefit or burden relationship for these agencies,
and the agencies are not considered part of the Commissions financial reporting entity. The
agencies presented below are considered related organizations of the County Commission.

Related Organizations

Millers Ferry Water Authority
Wilcox County Public Building Authority
Wilcox County Housing Authority

Wilcox County
Commission
45
Required Supplementary Information
Wilcox County
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual - General Fund
Actual Amounts
Original Final Budgetary Basis
Revenues
Taxes 2,526,005.00 $ 2,526,005.00 $ 2,546,403.19 $
Licenses and Permits 16,000.00 16,000.00 15,265.99
Intergovernmental 439,300.00 439,300.00 559,220.91
Charges for Services 461,193.00 461,193.00 428,284.69
Miscellaneous 751,200.00 751,200.00 775,620.91
Total Revenues 4,193,698.00 4,193,698.00 4,324,795.69

Expenditures
Current:
General Government 1,743,412.00 1,743,412.00 1,837,145.10
Public Safety 915,277.00 915,277.00 1,005,210.47
Highways and Roads
Sanitation 53,927.00 53,927.00 62,179.92
Health 159,528.00 159,528.00 164,379.49
Welfare 213,302.00 213,302.00 186,736.19
Culture and Recreation 71,734.00 71,734.00 82,751.09
Education 20,570.00 20,570.00 19,757.34
Capital Outlay 65,365.45
Debt Service:
Principal Retirement 22,949.00 22,949.00 26,617.95
Interest and Fiscal Charges 3,542.00 3,542.00 3,022.39
Intergovernmental 88,976.00 88,976.00 105,855.59
Total Expenditures 3,293,217.00 3,293,217.00 3,559,020.98

Excess (Deficiency) of Revenues
Over Expenditures 900,481.00 900,481.00 765,774.71

Transfers In 90,088.00 90,088.00 5,677.02
Inception of Capital Lease 37,068.00
Interest and Fiscal Charges
Transfers Out (986,017.00) (986,017.00) (863,035.82)
Total Other Financing Sources (Uses) (895,929.00) (895,929.00) (820,290.80)
Net Change in Fund Balances 4,552.00 4,552.00 (54,516.09)
Fund Balances - Beginning of Year 334,193.15
Fund Balances - End of Year 4,552.00 $ 4,552.00 $ 279,677.06 $
Budgeted Amounts
Wilcox County
Budget to GAAP Actual Amounts
Differences GAAP Basis
(1) (2) 376,539.34 $ 2,922,942.53 $
(2) 26,161.40 41,427.39
(2) 890,530.59 1,449,751.50
(2) 16,279.52 444,564.21
(2) 487,684.59 1,263,305.50
1,797,195.44 6,121,991.13
1,837,145.10
(3) (508,995.62) 1,514,206.09
(3) (2,012,073.03) 2,012,073.03
62,179.92
164,379.49
(3) (43,896.06) 230,632.25
82,751.09
19,757.34
(3) (166,493.70) 231,859.15
(3) (21,843.10) 48,461.05
(3) (1,558.07) 4,580.46
105,855.59
(2,754,859.58) 6,313,880.56
(957,664.14) (191,889.43)
(4) (5) 135,418.61 141,095.63
(4) 151,713.60 188,781.60
(22,292.60) (22,292.60)
(5) 407,273.04 (455,762.78)
672,112.65 (148,178.15)
(285,551.49) (340,067.58)
(6) 281,584.85 615,778.00
(3,966.64) $ 275,710.42 $
Wilcox County
Budget and Actual - General Fund
Explanation of differences:
(1) The Commission budgets ad valorem taxes and sales and use taxes as collected,
rather than on the modified accrual basis (GAAP).
Some amounts are combined with the General Fund for reporting purposes, but are budgeted separately.
(2) Revenues
Gasoline Tax Fund 1,585,736.38 $
Public Highway and Traffic Fund 111,299.75
UAB Health Projects Fund 24,120.75
Emergency Management Fund 6,700.00
(3) Expenditures
Gasoline Tax Fund 2,201,967.90 $
Public Highway and Traffic Fund 508,606.42
UAB Health Projects Fund 38,904.92
Special J ail Operations Fund 389.20
EMA Fund 4,991.14
(4) Other Financing Sources/(Uses), Net
Gasoline Tax Fund
(5) The Commission does not budget for Interfund eliminations
that are required when combining funds for reporting purposes.
Net Decrease in Fund Balance - Budget to GAAP
(6) The amount reported as "fund balance" on the budgetary basis of accounting derives
from the basis of accounting used in preparing the Commission's budget. This amount
differs from the fund balance reported in the Statement of Revenues, Expenditures and
Changes in Fund Balances because of the cumulative effect of transactions such
as those described above.
Wilcox County
69,338.56 $
1,727,856.88

(2,754,859.58)
264,839.61
407,273.04
(285,551.49) $
Wilcox County
Budget and Actual - RRR Gasoline Tax Fund
Actual Amounts
Original Final Budgetary Basis
Revenues
Intergovernmental 652,100.00 $ 652,100.00 $ 620,595.34 $
Miscellaneous 160.00 160.00 244.61
Total Revenues 652,260.00 652,260.00 620,839.95
Expenditures
Highways and Roads 957,000.00 957,000.00 758,100.86
Total Expenditures 957,000.00 957,000.00 758,100.86
Excess (Deficiency) of Revenues
Over Expenditures (304,740.00) (304,740.00) (137,260.91)

Transfers In 240,700.00 240,700.00 143,000.00
Total Other Financing Sources (Uses) 240,700.00 240,700.00 143,000.00

Net Change in Fund Balances (64,040.00) (64,040.00) 5,739.09
Fund Balances - Beginning of Year 64,040.00 64,040.00 93,226.22
Fund Balances - End of Year $ $ 98,965.31 $
Explanation of differences:
Some amounts are combined with the RRR Gas Tax Fund for reporting purposes, but are budgeted separately.
(1) Revenues from Secondary Road Fund
(2) The Commission does not budget for intrafund eliminations
that are required when combining funds for reporting purposes.
Net Increase in Fund Balance - Budget to GAAP
(3) The amount reported as "fund balance" on the budgetary basis of accounting derives from the basis of
accounting used in preparing the Commission's budget. This amount differs from the fund balance
reported in the Statement of Revenues, Expenditures and Changes in Fund Balances because of the
cumulative effect of transactions such as those described above.
Budgeted Amounts
Wilcox County
Budget to GAAP Actual Amounts
Differences GAAP Basis
(1) $ 203,371.77 $ 823,967.11
(1) 220.01 464.62
203,591.78 824,431.73
758,100.86
758,100.86
203,591.78 66,330.87
(2) (143,000.00)
(143,000.00)
60,591.78 66,330.87
(3) 30,066.50 123,292.72
90,658.28 $ 189,623.59 $
203,591.78 $
(143,000.00)
60,591.78 $
Schedule of Funding Progress
Defined Benefit Pension Plan
Wilcox County Exhibit #14
Commission
52

Actuarial
Valuation
Date

Actuarial
Value of
Assets
(a)
Actuarial
Accrued
Liability
(AAL)
Entry Age
(b)*

Unfunded
AAL
(UAAL)
(b-a)

Funded
Ratio
(a/b)

Covered
Payroll
(c)

UAAL as a
Percentage
of Covered
Payroll
[(b-a)/c]

09/30/2011**** $6,989,613** $8,227,786 $1,238,173 85.0% $2,363,119 52.4%
09/30/2010*** $7,019,423 $7,908,170 $ 888,747 88.8% $2,331,320 38.1%
09/30/2009 $6,966,695 $7,424,226 $ 457,531 93.8% $2,438,569 18.8%

* Reflects liability for cost of living benefit increases granted on or after October 1, 1978.
** Market Value of Assets as of September 30, 2011: $6,008,931.
*** Reflects the impact of Act 2011-27, which closes the DROP program to new applicants
after March 24, 2011.
****Reflects changes in actuarial assumptions.

Wilcox County
Commission
53
Supplementary Information
Wilcox County
Schedule of Expenditures of Federal Awards
Federal Grantor/ Federal Pass-Through
Pass-Through Grantor/ CFDA Grantor's
Program Title Number Number
U. S. Department of Agriculture
Passed Through Alabama Department
of Education
Summer Food Service Program for Children (M) 10.559 N/A
Direct Program
Community Facilities Loans and Grants 10.766 N/A
Total U. S. Department of Agriculture
U. S. Department of the Interior - Bureau of
Land Management
Direct Program
Payments in Lieu of Taxes 15.226 N/A
Passed Through Alabama Department of
Economic and Community Affairs
Outdoor Recreation-Acquisition, Development and Planning 15.916 N/A
Total U. S. Department of Interior
U. S. Department of Transportation
National Highway Traffic Safety Administration
Passed Through Alabama Tombigbee Regional Commission
Highway Safety Cluster:
State and Community Highway Safety 20.600 N/A
Safety Belt Performance Grants 20.609 N/A
Total Highway Safety Cluster/U. S. Department of Transportation
U. S. Department of Health and Human Services
Passed Through University of Alabama at Birmingham
Centers for Research and Demonstration for Health Promotion
and Disease Prevention 93.135 N/A
Passed Through Alabama Tombigbee Regional Commission
Rural Health Care Services Outreach, Rural Health Network 93.912 N/A
Development and Small Health Care Provider Quality
Improvement Program
Total U. S. Department of Health and Human Services
Sub-Total Forward
Wilcox County
Assistance Federal Revenue
Period Total Share Recognized Expenditures
10/01/2011-09/30/2012 158,552.42 $ 158,552.42 $ 158,552.42 $ 158,552.42 $
10/01/2011-09/30/2012 90,000.00 69,480.00 69,480.00 69,480.00
248,552.42 228,032.42 228,032.42 228,032.42
10/01/2011-09/30/2012 9,130.00 9,130.00 9,130.00 9,130.00
10/01/2010-02/01/2012 100,000.00 50,000.00 5,709.37 5,709.37
109,130.00 59,130.00 14,839.37 14,839.37
10/01/2011-09/30/2012 2,768.36 2,768.36 2,768.36 2,768.36
10/01/2011-09/30/2012 1,917.33 1,917.33 1,917.33 1,917.33
4,685.69 4,685.69 4,685.69 4,685.69
10/01/2011-09/30/2012 28,495.56 28,495.56 28,495.56 28,495.56
10/01/2011-09/30/2012 45,441.00 45,441.00 45,441.00 45,441.00
73,936.56 73,936.56 73,936.56 73,936.56
436,304.67 $ 365,784.67 $ 321,494.04 $ 321,494.04 $
Budget
Wilcox County
Schedule of Expenditures of Federal Awards
Federal Grantor/ Federal Pass-Through
Pass-Through Grantor/ CFDA Grantor's
Program Title Number Number
Sub-Total Brought Forward
U. S. Department of Homeland Security
Passed Through Alabama Emergency Management Agency
Emergency Management Performance Grants 97.042 N/A
Passed Through Alabama Department of Homeland Security
Homeland Security Grant Program 97.067 N/A
Total U. S. Department of Homeland Security
U. S. Department of Housing and Urban Development
Passed Through Alabama Department of Economic
and Community Affairs
Community Development Block Grants/State's Program (M) 14.228 CY CE PF 09 020
Total Expenditures of Federal Awards
(M) =Major Program
N/A =Not Available or Not Applicable
The accompanying Notes to the Schedule of Expenditures of Federal Awards are an integral part of this schedule.
Wilcox County
Assistance Federal Revenue
Period Total Share Recognized Expenditures
436,304.67 $ 365,784.67 $ 321,494.04 $ 321,494.04 $
10/01/2011-09/30/2012 21,967.86 21,967.86 21,967.86 21,967.86
10/01/2011-09/30/2012 78,213.96 78,213.96 78,213.96 78,213.96
100,181.82 100,181.82 100,181.82 100,181.82
10/01/2009-03/29/2012 275,000.00 250,000.00 148,480.10 148,480.10
811,486.49 $ 715,966.49 $ 570,155.96 $ 570,155.96 $
Budget
Notes to the Schedule of Expenditures
of Federal Awards
Wilcox County
Commission
58

Note 1 Basis of Presentation

The accompanying Schedule of Expenditures of Federal Awards includes the federal grant
activity of the Wilcox County Commission and is presented on the modified accrual basis of
accounting. The information in this schedule is presented in accordance with the requirements of
OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations.
Therefore, some amounts presented in this schedule may differ from amounts presented in or
used in the preparation of the basic financial statements.

Note 2 CDBG Program

The Commission received federal awards under the Community Development Block
Grants/States Program (CFDA Number 14.228). However, pursuant to instructions from the
pass-through entity the compliance requirements relative to the Community Development Block
Grants/Entitlement Grants (CFDA Number 14.218) were used for compliance testing.

Wilcox County
Commission
59
Additional Information
Commission Members and Administrative Personnel
Commission
60

Commission Members Term Expires

Hon. Michael R. Saulsberry Chairman, District 3 November 2014

Hon. Mark H. Curl Member, District 1 Deceased

Hon. J ohn R. Moton, J r. Member, District 2 November 2016

Hon. Reginald O. Weatherly Member, District 4 November 2014

Hon. Ricky Powell Member, District 5 November 2016

Hon. Reginald W. Southall Member, District 6 November 2014

Administrative Personnel

Clarissa J . Dear County Administrator Indefinite

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
Commission
61

We have audited the financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the Wilcox County
Commission as of and for the year ended September 30, 2012, which collectively comprise the
Wilcox County Commissions basic financial statements and have issued our report thereon
dated December 10, 2013. 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 Wilcox County Commission is responsible for establishing and maintaining
effective internal control over financial reporting. In planning and performing our audit, we
considered the Wilcox County Commissions 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 Wilcox
County Commissions internal control over financial reporting. Accordingly, we do not express
an opinion on the effectiveness of the Wilcox County Commissions internal control over
financial reporting.

Our consideration of internal control over financial reporting was for the limited purpose
described in the preceding paragraph and was not designed to identify all deficiencies in internal
control over financial reporting that might be significant deficiencies or material weaknesses and
therefore, there can be no assurance that all deficiencies, significant deficiencies, or material
weaknesses have been identified. However, as discussed below, we identified certain
deficiencies in internal control over financial reporting that we consider to be material
weaknesses and others that we consider to be significant deficiencies.

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 entitys financial statements will not be prevented,
or detected and corrected on a timely basis. We consider the deficiency described as item
2004-02 in the accompanying Schedule of Findings and Questioned Costs to be a material
weakness.

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
A significant deficiency is a deficiency or a combination of deficiencies in internal control that is
less severe than a material weakness, yet important enough to merit attention by those charged
with governance. We consider the deficiencies described as items 2012-02, 2012-04, and
2005-01 in the Schedule of Findings and Questioned Costs to be significant deficiencies.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Wilcox County Commission'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 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 instances of no noncompliance or other matters that are required to be reported
under Government Auditing Standards. We noted certain matters that we have reported to the
management of the Wilcox County Commission in the Schedule of State and Local Compliance
and Other Findings.
The Wilcox County Commission's response to the findings identified in our audit are described
in the accompanying Auditee Response/Corrective Action Plan. We did not audit the Wilcox
County Commission's response and, accordingly, we express no opinion on it.
This report is intended solely for the information and use of management, the County
Administrator, the Wilcox County Commissioners, others within the entity, federal awarding
agencies and pass-through entities and is not intended to be and should not be used by anyone
other than these specified parties.
December 10, 2013
Wilcox County
Commission
62
Chief Examiner
Exhibit #17
Report on Compliance With Requirements That Could
Have a Direct and Material Effect on Each Major
Program and on Internal Control Over Compliance in
Accordance With OMB Circular A-133
Commission
63

Independent Auditor's Report

Compliance

We have audited the Wilcox County Commissions compliance with the types of compliance
requirements described in the OMB Circular A-133 Compliance Supplement that could have a
direct and material effect on each of the Wilcox County Commissions major federal programs
for the year ended September 30, 2012. The Wilcox County Commissions major federal
programs are identified in the Summary of Examiners Results Section of the accompanying
Schedule of Findings and Questioned Costs. Compliance with the requirements of laws,
regulations, contracts and grants applicable to each of its major federal programs is the
responsibility of the Wilcox County Commissions management. Our responsibility is to express
an opinion on the Wilcox County Commissions compliance based on our audit.

We conducted our audit of compliance in accordance with auditing standards generally accepted
in the United States of America; the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Comptroller General of the United States; and
OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations.
Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance requirements
referred to above that could have a direct and material effect on a major federal program
occurred. An audit includes examining, on a test basis, evidence about the Wilcox County
Commissions compliance with those requirements and performing such other procedures as we
considered necessary in the circumstances. We believe that our audit provides a reasonable basis
for our opinion. Our audit does not provide a legal determination of the Wilcox County
Commissions compliance with those requirements.

In our opinion, the Wilcox County Commission complied, in all material respects, with the
compliance requirements referred to above that could have a direct and material effect on each of
its major federal programs for the year ended September 30, 2012.

Commission
64

Internal Control Over Compliance

Management of the Wilcox County Commission is responsible for establishing and maintaining
effective internal control over compliance with requirements of laws, regulations, contracts and
grants applicable to federal programs. In planning and performing our audit, we considered the
Wilcox County Commissions internal control over compliance with the requirements that could
have a direct and material effect on a major federal program to determine the auditing procedures
for the purpose of expressing our opinion on compliance and to test and report on internal control
over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing
an opinion on the effectiveness of internal control over compliance. Accordingly, we do not
express an opinion on the effectiveness of the Wilcox County Commissions internal control
over compliance.

A deficiency in internal control over compliance exists when the design or operation of a control
over compliance does not allow management or employees, in the normal course of performing
their assigned functions, to prevent, or detect and correct, noncompliance with a type of
compliance requirement of a federal program on a timely basis. A material weakness in internal
control over compliance is a deficiency, or combination of deficiencies, in internal control over
compliance, such that there is a reasonable possibility that material noncompliance with a type of
compliance requirement of a federal program will not be prevented, or detected and corrected, on
a timely basis.

Our consideration of the internal control over compliance was for the limited purpose described
in the first paragraph of this section and was not designed to identify all deficiencies in internal
control over compliance that might be deficiencies, significant deficiencies or material
weaknesses. We did not identify any deficiencies in internal control over compliance that we
consider to be material weaknesses, as defined above.

This report is intended solely for the information and use of management, members of the
Wilcox County Commission, County Administrator, others within the entity, federal awarding
agencies and pass-through entities and is not intended to be and should not be used by anyone
other than these specified parties.
December 10,2013
Wilcox County
Commission
65
t f , J t ~ r
Ronald L. Jones
Chief Examiner
Exhibit #18
Schedule of Findings and Questioned Costs
Commission
66

Section I Summary of Examiner's Results

Financial Statements

Type of opinion issued: Unqualified
Internal control over financial reporting:
Material weakness(es) identified? X Yes No

Significant deficiency(ies) identified?

X Yes None reported
Noncompliance material to financial
statements noted?

Yes X No

Federal Awards

Internal control over major programs:
Material weakness(es) identified? Yes X No

Significant deficiency(ies) identified?

Yes X None reported
Type of auditors report issued on compliance
for major programs:

Unqualified
Any audit findings disclosed that are required
to be reported in accordance with
Section 510(a) of OMB Circular A-133?

Yes X No

Identification of major programs:

CFDA Numbers Name of Federal Program or Cluster

10.559 Summer Food Service Program for
Children

14.228 Community Development Block
Grants/States Program

Dollar threshold used to distinguish between
Type A and Type B programs:

$300,000.00

Auditee qualified as low-risk auditee? Yes X No

Commission
67

Section II Financial Statement Findings (GAGAS)

Ref.
No.
Type of
Finding

Questioned
Costs
2012-02 Internal
Control
Finding:
The Commission has adopted a policies and
procedures manual for the operation of the Water
System. The Commissions policy on cutting-off
water services for delinquent payment states all
outstanding bills, late fees and reconnection fees
must be paid in full prior to service being
reconnected. During the audit period, customers
were reconnected without paying amounts due in full
and some customers that qualified for disconnection
were still receiving water service.
Recommendation:
The Commission should ensure the policies and
procedures of the Wilcox County Water System
established by the Commission are properly
implemented.

2012-04 Internal
Control
Finding:
A properly designed system of internal controls over
collections ensures amounts due are properly
collected. In testing payment plans authorized by the
Commission, five customers had amounts adjusted
off their accounts which were never set up as a
payment plan in the system. Additionally, payment
plans set up for four customers did not agree with
amounts adjusted off customer accounts. As a result,
amounts due to the Commission for solid waste and
water services of $1,891.30 were never collected.
Recommendation:
The Commission should ensure proper controls are in
place for setting up payment plans in the Solid Waste
and Water System.

Commission
68

Section II Financial Statement Findings (GAGAS)

Ref.
No.
Type of
Finding

Questioned
Costs
2005-01 Internal
Control
Finding:
Generally accepted accounting principles require
detailed subsidiary listings to support total balances
on the general ledger. The Commission did not
provide a separate listing of accounts receivable for
the Solid Waste Fund and the Water Fund. A listing
of accounts receivables for solid waste and water
accounts was on file; however the report did not
provide a detailed breakdown for applicable customer
adjustments and customer pay plans that presented
total amounts due for solid waste accounts and water
accounts.
Recommendation:
Accounts receivable balances for the Solid Waste
Fund and the Water System Fund should be
supported by a detailed listing of accounts
receivables.

2004-02 Internal
Control
Finding:
An adequate internal control system requires
segregation of duties over the handling of money.
There was a lack of segregation of duties within the
Solid Waste and Water System functions. The billing
of customers, collection of money, and receipting of
money is all performed by two individual clerks. The
Office Manager is responsible for the receiving of the
daily mail, posting all receipts received in the mail,
filling out the deposit slips, and making the daily
deposits.
Recommendation:
The Commission should ensure that a segregation of
duties is in place within the Solid Waste and Water
System functions.

Commission
69

Section III Federal Awards Findings and Questioned Costs

Ref.
No.
CFDA
No.

Program

Questioned
Costs

No matters were reportable.

Commission
70
Auditee Response/Corrective Action Plan
MICHAEL R. SAULSBERRY
Chairman
Commissioner
District No. 3
Office: (334) 357..()894
REGINALD SOUTHALL
Vice Chairman
Commissioner
District No. 6
Home: (334) 455-9604
WILLIAM W. (BILL) ALBRITTON
Commissioner
District No. 1
Home: (334) 682-9199
Cell: (334) 850-8426
JOHN R. MOTON, JR.
Commissioner
District No. 2
Office: (334) 410-2283
REGINALD 0. WEATHERLY
Commissioner
District No. 4
Cell: (334) 850-0774
RICKY POWELL
Commissioner
District No. 5
Office: (334) 682-9842
FREDRICK POWELL
County Engineer
Office: (334) 682-4725
Email: wceng2@mchsi.com
CLARISSA J. DEAR
Administrator
Office: (334) 682-9112
E-mail: wilcoxco@frontiernet.net
RAY A. MONTGOMERY
Purchasing Agent
Office: (334) 682-5985
Email: wilcoxcopurchasing@frontiemet.net
Fax: (334) 682-4285
DONALD M. MCLEOD
County Attorney
Office: (334) 682-4223
dmcleod@frontiemet.net
WILCOX COUNTY COMMISSION
P. 0. BOX488
12 WATER STREET, SUITE 200
CAMDEN, ALABAMA 36726
(334) 682-9112
FAX (334) 682-9621
January 23, 2014
Mr. Ronald L. Jones, ChiefExaminer
P. 0. Box 302251
Dear Mr. Jones:
As required by the U.S. Office of Management and Budget (OMB) Circular A-
133, Audits of States, Local Governments, and Non-Profit Organizations,
Section .315, the Wilcox County Commission has prepared and hereby
submits the following Corrective Action Plan for the findings included in the
Schedule of Findings for the year ended September 30, 2012.
Corrective Action Plan Details
Finding #2012-02: The Commission has adopted a policies and procedures
manual for the operation of the Water System. The Commission's policy on
cutting-off water services for delinquent payment states "all outstanding bills,
late fees and reconnection fees must be paid in full prior to service being
reconnected". During the audit period, customers were reconnected without
paying amounts due in full and some customers that qualified for disconnection
were still receiving water service.
Corrective Action Plan: ClearWater Solutions is responsible for this corrective
action. The Commission will instruct ClearWater Solutions to adhere to the
adopted policies and procedures for the operation of the Water System. This
corrective action will be implemented immediately.
Finding #2012-04: A properly designed system of internal controls over
collections ensures amounts due are properly collected. In testing payment
plans authorized by the Commission, five customers had amounts adjusted off
their accounts, which were never set up as a payment plan in the system.
Additionally, payment plans set up for four customers did not agree with
amounts adjusted off customer accounts. As a result, amounts due to the
Commission for solid waste and water services of $1,891.30 were never
collected.
Corrective Action Plan: ClearWater Solutions is responsible for this corrective
action. The Commission will instruct ClearWater Solutions to properly set up
payment plans and make sure that the amount adjusted off agrees with the
Mr. Ronald L. Jones, Chief Examiner
January 23, 2014
Page2
amount set up on the payment plan so that all money due to the Commission will be properly collected.
This corrective action will be implemented immediately.
Finding #2005-01: Generally accepted accounting principles require detailed subsidiary listings to support
total balances on the general ledger. The Commission did not provide a separate listing of accounts
receivable for the Solid Waste Fund and the Water System Fund. A listing of accounts receivables for solid
waste and water accounts was on file; however the report did not provide a detailed breakdown for
applicable customer adjustments and customer pay plans that presented total amounts due for solid waste
accounts and water accounts.
Corrective Action Plan: ClearWater Solutions is responsible for this corrective action. The Commission
will request that a separate detailed listing of accounts receivable for the Solid Waste Fund and the Water
System Fund be provided to the County Administrator on a monthly basis. This corrective action will be
implemented immediately.
Finding #2004-02: An adequate internal control system requires segregation of duties over the handling of
money. There was a lack of segregation of duties within the Solid Waste and Water System functions. The
billing of customers, collection of money, and receipting of money were all performed by two individual
clerks. The Office Manager was responsible for the receiving of the daily mail, posting all receipts
received in the mail, filling out the deposit slips and making the daily deposits.
Corrective Action Plan: ClearWater Solutions is responsible for this corrective action. The Commission
receives the deposit slips and daily reports of collections for Water System and Solid Waste functions on a
daily basis. The Commission believes the two clerks are sufficient to carry out the duties needed in these
departments with oversight from the County Commission office. The Commission will continue to monitor
this situation to make a determination of whether a change needs to be implemented.
Finding #2012-01: The Commission receives funds appropriated by the County Government Improvement
Act, Title 11, Chapter 29, Code of Alabama 1975. These funds are required to be accounted for in a
Special Capital Improvement Fund and expended for certain capital improvement purposes outlined in the
Code of Alabama 1975, Section 11-29-6. During the audit period, $153,700 was transferred from the
Special Capital Improvement Fund to the Gasoline Tax Fund to cover payroll expenses, which are not
included in allowable expenditures from Capital Improvement funds.
Corrective Action Plan: Wilcox County Commission is responsible for this corrective action. The funds
that were borrowed from the Special Capital Improvement Fund to meet Gasoline Tax Fund payroll
obligations have been completely repaid. The Commission will not use funds from the Special Capital
Improvement Fund for purposes that are not allowable expenditures. This corrective action will be
implemented immediately.
Finding #2012-03: The Code of Alabama 1975, Section 36-25-5(a) states no public official shall use his
official position or office to obtain personal gain for himself. Furthermore, this section states personal gain
is achieved when the public official receives, obtains, exerts control over, or otherwise converts to personal
January 23, 2014
Page3
use the object constituting such personal gain. Three of the six county commissioners (Districts 1, 3 and 4)
received water service and garbage pickup through Wilcox County, which is under the direct control of the
Wilcox County Commission members. The Water System Fund and the Solid Waste Fund account for the
financial information of the County's water and garbage activities. Based upon a review of the billing
information for the three commissioners being serviced by the water and garbage department, it was noted
that Commissioners for Districts 3 and 4 did not make a single payment on their bills during fiscal year
2012 and the District 1 Commissioner only made two payments during fiscal year 2012. Furthermore, after
reviewing the disconnect lists for months within the audit period, it was noted that these Commissioners'
names appeared on the disconnect list, but they were never disconnected and continued to receive water
service and garbage pickup. As of September 30, 2012, account balances for Commissioners District 1,
District 3 and District 4 were $1,855.00, $493.16 and $1,574.52 respectively. Furthermore, District 3
Commissioner had an additional inactive account with an outstanding balance of$763.53. A review of the
minutes and other financial activity of the Water System Fund indicated the Commission was under
contract with a private company to manage the water system (including billing for garbage pickup). The
minutes also reflected a concerted effort to cutoff customers for non-payment and expedite collection of
past due amounts. Regular customers of the County were expected to make regular payments on their
water and garbage bills, have past due amounts added to their bills if not paid timely, been pursued for
payment delinquency for garbage collection, and faced service cut-off for non-payment on water service.
These three commissioners appeared to have achieved personal gain as public officials in receiving water
service and garbage collection without following the same protocol as ordinary customers.
Corrective Action Plan: ClearWater Solutions and the listed Commissioners are responsible for this
corrective action; the Commissioners by paying their bills and ClearWater Solutions by following the
operating policies and procedures. The entire amount that was owed by the Commission of District 1 has
been paid. The Commissioner of District 3 is on a pay plan to catch up the amount he owes for Water and
Solid Waste services. The Commissioner of District 4 is also on a pay plan to catch up the amount he owes
for Water and Solid Waste services. The Commission has provided ClearWater with policies and
procedures for operating the Water System. The Wilcox County Commission will advise ClearWater
Solutions to follow the policies and procedures that are in place for the operation of the Water System and
Solid Waste functions. This corrective action will be implemented immediately.
Finding #2012-05: The Code of Alabama 1975, Section 11-8-10, states that "no warrant or order for the
payment of money shall be issued in pursuance of authority of the county commission until funds are
available for its payment upon presentation to the treasurer of depository." On numerous occasions, the
General Fund, Gasoline Tax Fund, Road and Bridge Fund and Water System Fund had deficit cash
balances.
Corrective Action Plan: The County Administrator is responsible for this corrective action. There have
been instances when numerous checks are written for payment, but were held until funds became available
to send them out. We will be careful not to release payment for any goods or services for which sufficient
funds are not available to cover the payment. This corrective action will be implemented immediately.
January 23, 2014
Page4
Finding #2011-01: A good system of internal controls should include policies and procedures to ensure
the Commission pays only fair and reasonable prices for real property acquired. The Commission
purchased an acre of land for $8,500 in February 2012. Per review of the minutes and discussion with the
County Administrator, the Commission did not have the property appraised before the purchase and could
not provide an explanation as to how they determined this was a fair and reasonable price for the land.
Corrective Action Plan: The Wilcox County Commission is responsible for this corrective action. The
Commission will have an appraisal done prior to the purchase of any real property. This corrective action
will be implemented immediately.
Finding #2008-02: The Wilcox County Commission issued General Obligation Warrants, Series 2008
dated March 1, 2008 and General Obligation Warrants, Series 2012 dated January 10, 2012. According to
the Official Statements, the purpose of the warrants being issued was to advance refund a portion of the
County's General Obligation Warrants, and to construct various capital improvements projects in the
County. In addition, the County obtained a letter from the bond issue counsel that described the
appropriate uses of the proceeds received from the 2008 General Obligation Warrants. The attorney's letter
referenced the related bond documents and requirements of the Internal Revenue Code stating that the
proceeds were to be used for capital improvements that have a long useful life. In testing the expenditures
recorded in the 2008 and 2012 General Obligation Construction Funds, it was noted that the proceeds were
used for purchase of road maintenance materials, general repairs and other items not having a long useful
life. The use of the proceeds did not appear to comply with the provisions outlined in the related bond
documents.
Corrective Action Plan: The Wilcox County Commission is responsible for this corrective action. The
Commission will use the proceeds from the 2008 and 2012 General Obligation Warrants for capital
improvements that have a long useful life as referenced in the bond documents. This corrective action will
be implemented immediately.
Submitted by:
:Michael R. Saulsberry, Chairman
MRS/cjd
Cc: Commissioners, ClearWater Solutions, file

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Ronald L.

Jones, Chief Examiner

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