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Home My WebLink AboutAUDIT 06-30-1984TOWN OF NORTH ANDOVER, ~LASSACHUSETTS FINANCIAL STATEMENTS AND AUDITOR'S REPORT June 30, 1984 SEP ,~ 3 1985 TOWN OF NORTH ANDOVER, MASSACHUSETTS CONTENTS AUDITOR'S REPORT FINANCIAL STATEMENTS Combined Balance Sheet -Ail Fund Types and Account Group Combined Statement of Revenues, Expenditures and Changes in Fund Balances -Ail Governmental Fund Types Combined Statement Of Revenues and Expenditures - Budget (Budgetary Basis) and Actual - General and Revenue Sharing Funds Statement of Revenues, Expenses and Changes in Fund Equity-Nonexpendable Trust Funds Statement Of Changes in Financial Position - Nonexpendable Trust Funds NOTES TO FINANCIAL STATEMENTS Exhibit 5 Schedule 4 10 SUPPLEMENTAL INFORMATION SCHEDULE OF RECONCILIATION OF TREASURER'S CASH SCHEDULE OF INVESTMENTS SCHEDULE OF TAXES, LIENS, EXCISE, DEPARTMENTAL ACCOUNTS RECEIVABLE, ASSESSMENTS, USER CHARGES AND LIENS I II III 26 27 28 IRA A. JACKSON COMMISSIONER EDWARD J. COLLINS. Jr DEPUTY COMMISSIONER KENNETH A MARCHURS DIRECTOR OF ACCOUNT5 MAIL AODRES~ P.O BOX 701E BOSTON MASS 0220-: Board of Selectmen Town of North Andover North Andover, Massachusetts 01845 Honorable Selectmen: We have examined the combined financial statements of the various funds of the Town of North Andover as of and for the year ended June 30, 1984, as listed in the table of contents. Except as explained in the following two paragraphs, our examination was made in accordance with generally accepted auditing standards, and accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. Our examination did not include the Community Development Block Grant Programs which are audited by various independent auditors. However, the financial statements of the programs are included with the accompanying financial report. Current financial statements for the library trust funds in custody of trustees are not available. Accordingly, financial _statements for these accounts are not included in the accompanying combined financial statements as required by generally accepted accounting principles. The town follows accounting practices prescribed by the Commonwealth of Massachusetts which vary in certain respects from generally accepted accounting principles. The most significant difference relates to the use of the cash basis method for recording pension expenses for employees. Generally accepted accounting principles require that pension costs be determined by actuarial methods instead of the cash "pay-as-you-go" basis described in Note 3 to the accompanying financial statements. Consistent with the practices of many municipalities in the Commonwealth of Massachusetts, the town has not maintained historical cost records of its property, plant and equipment. Accordingly, the combined financial statements referred to above do not include a general fixed asset account group which should be presented to conform with generally accepted accounting principles. In our opinion, except for the effects of not providing for pension costs on an actuarial basis, and except that the omission of financial statements of the town's §eneral fixed assets and trust funds in custody of trustees results in an incomplete presentation as explained above, the combined financial statements referred to above present fairly the financial position of the Town of North Andover, Massachusetts at June 30, 1984 and the results of its operations for the year then ended in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year. Our examination has been made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying financial information listed as schedules in the table of contents is presented for purposes of additional analysis and is not a required part of the £inanctal statements of the Town of North Andover, Massachusetts. The information has been subjected to the auditing procedures applied in the examination of the financial statements and, in our opinion, is stated fairly in all material respects in relation to the financial statements taken as a whole. In connection with our examination, we also (1) performed tests of compliance with the Revenue Sharing Act and regulations as detailed in the Commentary on the Audit Requirements of the 1980 Amendments to the State and Local Fiscal Assistance Act issued by the Office of Revenue Sharing, U.S. Department of the Treasury, and (2) compared the data on the 1984 General Revenue Sharing Form F21Awith the audited records of the Town of North Andover. In our opinion, for the items tested, the Town of North Andover complied with the aforementioned provisions of the Revenue Sharing Act and regulations. Further, based on our examination and the procedures referred to above, nothing came to our attention to indicate that the Town of North Andover had not complied with the aforementioned provisions of the Revenue Sharing Act and regulations. --~nneth A. Marchurs Director, Bureau of Accounts Department of Revenue April 8, 1985 3 TOI4N OF NORTH ANDOVE~, ~L~SSACHUSETTS C0HBINED BALANCE SttEET- ALL FUND TYPES AND ACCOUNT flROUP June 30, 1986, Exhibit Asset~ Cash Investments, at cost Receivables (note Property taxes Other taxes Tax liens Hotor Vehicle Excise Other £zcise Departmental Special Assessments User Cbarses and Liens Reserve for abatements and ezemptious (note 4) Dye from other funds Tax foreclosures Anounts to be provided for paTeeut o! bonds Total assets ~eueral Governmental Fund Types Fiduciary Fund T~pee Account Croup Revenue Special Trust and Long-Term SharinB Revenue Asency Debt 1,040,071 2,704,597 662,091 633 47,144 262,608 206 10,242 143,909 (618,766) 8,49~ 5,901 { (49,216) { 300,000 248,085 124,150 235,917 13,623 305.901 ~ 310.851 { 261,70~ 34210,000 Totals (Hemoraudum on17) 996,756 3,252,682 662,091 633 47,144 262,608 206 10,242 143,909 124,150 (618,766) 249,540 8,494 3,210,000 *- 4 TOWN OF NORTH ANDOVER, MASSACHUSETTS COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUP June 30, 1984 ~xhibit I (Continued) Warrants payable Employees' vithholdinss Other liabilities Due to other funds Deferred revenue-P~operty taxes(Note l) Deferred revenue'Other receivables (Nots Bonds payable Total liabilities Fund Equity Fuud balauc~m~ Reserved for encumbrances (Note 4) Reserved for extraordinary or unforeseen expenses Unreserved{ Desisnated (note $) Undesignated Total fund equity C6mnitmeuts and continseut ltabtlitlem (notes ?, 10, Il, and Total liabilities and fund equity General Governmental Fund Types Fiduciary Fund Types Revenue Special Trust and ~harins Reveuu_ ~ ASeucy 399,5&9 11,313 249,540 $74,678 423,475 1~736~599 124,150 124,150 837,611 12,270 (3,§81) !,678,330 2,524,630 305,901 (1,591) 188,292 261,708 305,90! 186,701 261,708 Account Group Lous-Term Debt 3,210,000 ,3~210,000 Totals (Memoraudu~ 399,549 78,044 11,313 249,540 574,678 3,210,000 837,611 12,270 300,729 2,128,330 3~278~940 See accompsnyin~ notes to financial statements. TOW OF NORTH A~DOVER, ~L~SSAC~USEIT$ COMBINED STATE~T OF REVENUES, EXP~DI~JRES ~ CHAI~GES ~q ~ BALANCES - ALL COVERI~T~AL FUND TYPES AND ~P~DABLE TRUST FIJ~DS For the year ended June 30, 1984 ~zhibtt 2 Revenues: Property taxes Other taxes Tax liens Notor Vehicle excise Other ~tcis& Licenses, permits and fines Nonentetprise charges for services Depsrtaeota! ~ntergovez~aental ~at~ninss on investments ~lscellaneous Tota~ revenues F~pend~turesl General 8ovetmment Public safety Health and aaa~ttation Hiihvay Veterans Schools end libraries Recreation Unclassified Public works Debs and interest Tots! e~penditures E~cess (deficiency) of revenues over expenditures Genera! Oovez~mental Fund Types Revenue Specis! Sharin& Revenue 10,077,678 66 66,273 733,575 893 96,080 1,157,700 17,307 3,191,603 42,158 475~326 15,836~259 Fiductat-7 Fund Types ,~zpendable Trust 690~16 1,629,962 353,377 17,243 370~520 2~120,058 689,658 2,218,899 300,000 252,160 &36,390 62,950 1,124,848 904 38,547 7,797~627 660,743 175,286 1,351,701 1,076,357 805,134 _ 913,333 15~349~423 300~000 2~031~i14 ._ 486,836 70~620 . 88~944 2,099 2~099 2~099 Totals (~emorandu~ 10,077,&78 66 &6,273 733,575 893 94,080 1,157,700 707,&23 4,97~,722 61,500 [8~329,036 &89,658 2,771,059 &97,360 1,125,752 3~,547 8,&38,370 175,286 2,&26,058 805,13~ 913~333 ~7,680,537 _ 668~499 TOI~N OF NORTH ANDOVER, NASSACI{USETTS COMBINED STATEHENT OF REVENU£S, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS For the year ended June 30, 1986 Exhibit 2 (continued) Other financing sources (uses)~ State and county charges Operating trans£ers in Operating transfers out Total other financing sources (uses) Excess (deficiency) of revenues and other financing sources over expenditures and other uses Fund balance Jul~ 1, 1983 Fund balance June 30, 1986 Oovermnental Fund Types Revenue Special Fiduciary Fund Type General Shariu~ Revenue ' Trust -- (543,610) 10,372 (10~372) , ($33~238) (10,372) .... (66,402) 70~620 78~572 ~ 2,571,032 235,281 108,129 38,296 To~als (Nemoraudum Only) (563,610) I0,372 (10,37~) _(~43}610) 104~889 2,952,738 9es accompanying notes to financial statements. Acttml R~venues: Property taxes ~ 10,077,478 Other taxes 66 Tax L~ens 46,273 Horst Vehicle EXnJJe 733,57§ Other Excise 893 Licenses, pernits end fines 94,080 Nonenterp£tse charses for services 1,157,700 Departmental 17,307 Intetgover~sen~l 3,191,403 Earuln8s on Investments &2,158 Htscellsneous 4751326 Total revenues 15~8361259 Expenditures: General 8ovetument 489,6~8 FUbIIc safety 2,218,899 Health and sauitetioa 434,390 HLgbvays 1,124,848 Veterans 38,547 SchooXs and Libraries 7,797,627 Recreation 17~,206 Uncles,it/ed ls$~1,701 FUbllc VOtkl 805,134 Debt and Interest 913,333 ToiLS SZlMnditures 1813491423 revenuel over eZp~l- ditures Adjustment to BudgetatT ~asls TOWN OF NORTH ANDOV~, HASSACHUSETTS CONBINED STATENENT OF REVENUES ~ EXPENDITURES - BUDGET (BUDGETARY IL~SIS) ~ ACTUAL - GENERAL AND REVEI~IE SHARING FUNDS For the year ended June 30, 1981 General Fund Actual Adjustment Actual OD Varlance~ to on Budgetary Favorable Budsetary Budgetary Baste nBudget (UGfavorable) Actual Basin Basin 574,678 10,652,15& j 10,652,3~6 J J 66 66 46,273 14,170 32,103 733,575 596,934 136,641 893 1,074 (181) 94,080 96,945 (2,865) 1,157,700 975,472 182,228 17,307 7,464 9,843 3,191,403 3,125,206 66,197 353,377 42,158 89,691 (47,533) 17,243 475~326 L1. gf756 355,570 574z678 16~4101937 1~,678,868 732,069 370,620 Federal Revenue Shartnl Fund Exhibit 3 353,377 17,243 300,000 370,620 3001000 489,658 494,660 ~,002 2,218,899 2,219,271 372 300.000 434,390 &40,275 5,885 1,124,848 1,158,472 33,62~ 38,547 29,059 (9,488} 7,797,627 7,808,479 10,852 175,286 181,001 5,71§ 1,3~1,701 1,117,207 65,506 805,134 007,144 2,010 913,333 917,374 4,041 15,349,423 15~472,942 123~$19 300~000 300,000 300,000 300~000 300~000 $ 486.836 $ 574.678 $~ $ 205.926 (Budset lncludel the current year's budset amounts adjusted for encunbrencel outstandins mC the bestnnins and end of the period). s,.~blz.l s Totals (Nenorandtua O~17) See accompenyins notes to financial statements. 8 Actual Variance: ou Var/anent Favorable SudgetetT Fevorable (Unfavorable) BasLe Bud~ (Unfavorable) $ ~ 10,652,156 J 10,652,156 ~ 66 66 46,273 14,170 32,103 733,575 596,934 1-36,641 893 1,074 (181) 94,080 96,945 (2,865) 1,157,700 975,472 182.228 17,307 7,464 9,843 ~3,377 3,544,780 3,425,206 ti9,~74 17,243 39,401 89,691 (30,290) 4751326 L19~756 3551570 700620 16~7811557 1519781868 802,689 s 70.620 489,658 494,660 5,002 2,518,899 2,519,271 372 434,390 440,275 ~,885 1,124,840 1,150,472 33,624 38,547 29,059 (9,480) 7,797,627 7,808,479 10,852 17~,286 181,001 5,715 1.3~1,70! 1,417,207 65,~06 80~,134 807,144 2,010 9131333 :. 9171374 . 41041 15:649~423 15f772f942 123.519 926.2O8 Exhibit TOWN OF NORTH ANDOVER, MASSACHUSETTS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND EQUITY ''NONEXPENDABLE TRUST FUNDS For the year ended June 30, 1984 Operating revenues: Interest Total operating revenues Operating expenses: Other charges and expenses Total operating expenses Net income Fund equity July 1, 1983 Fund equity June 30, 1984 Fiduciar7 Fund Types Nonexpendable Trust 7,919 7,919 6,138 6~138 1,781 219,532 221 313 See accompanying notes to financial statements. Exhibit 5 TOWN OF NORTH ANDOVER, MASSACHUSETTS STATEMENT OF CHANGES IN FINANCIAL POSITION NONEXPENDABLE TRUST FUNDS For the year ended June 30, 1984 Sources of working capital: Operations: Net income (loss) Working capital provided by operations Total sources of working capital Fiduciary Fund Types Non-expendable Trust 1,781 1,78. 1 1,781 Net increase (decrease) in working capital Elements of net increase (decrease) in working capital: Cash Net increase (decrease) in working capital See accompanying notes to financial statements. 10 TOWN OF NORTHANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 1. S,,mm~r~ of St~n~ficant Accounting Policies The accounting policies for financial reporting purposes of the Town of North Andover conform to generally accepted accounting principles for local governmental units except as indicated in note 2. The following is a summary of the significant accounting policies. A. Fund Accounting The town reports its financial activities in several funds and one account group in order to comply with the limitations and restrictions placed on both the resources made available to the town and the services provided. · The various funds are grouped in the financial statements in this report into four generic fund types and two broad fund categories as follows: GOVERNMENTAL FUNDS General Fund - The General Fund is the general operating fund of the town. It is used to account for all financial resources except those required to be accounted for in another fund. Special Revenue Fund - General Revenue Sharing - This special revenue fund is used to account for the proceeds of the State and Local Fiscal Assistance Act and their expenditures as prescribed by the Office of Federal Revenue Sharing. Special Revenue Funds - Others - This special revenue fund is used to account for the proceeds of specific revenue resources (other than general revenue sharing, expendable trusts or major capital projects) that are legally restricted to expenditures for specified purposes. 11 TOWN OF NORTHANDOVER, }~ASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 FIDUCIARY FUNDS Trust Funds - Trust funds are used to account for assets held by the town in a trustee capacity or as an agent for individuals, private organizations, other governments and/or other funds. These include non- expendable trust funds. Nonexpendable trust funds are accounted for in a manner that permits the periodic measurement of revenues earned, expenses incurred and/or net income in order to demonstrate maintenance of capital. ACCOUNT GROUP Long-term Debt and Liabilities - Long-term liabilities expected to be financed from governmental funds are accumulated in the general long-term debt group of accounts. This account group is not a fund. It is only concerned with the measurement of financial position, and therefore, is not involved with a measurement of the results from any operations. B. Basis of Accounting The accompanying financial statements have been Prepared principally on the modified accrual basis of accounting. This method recognizes revenues when they become measurable and available. Expenses are recognized under this method as they are incurred. Revenue Recognition - Property tax revenues are recognized when they become measurable and available. Measurable and available means then due or past due and receivable within the current period or expected to be collected soon enough thereafter to be used to pay liabilities of the current period. 12 TOWN OF NORTH ANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 All other revenues are recognized throughout the year when cash is received. Receipts during the sixty days immediately following the close of the fiscal year are also recognized as available revenue. In applying the susceptible to accrual concept to intergovernmental revenues, the legal and contractual requirements of the numerous individual programs are used as guidance. There are, however, essentially two types of these revenues. In one, monies must be expended on the specific purpose or project before any amounts will be paid to the town, therefore, revenues are recognized based upon the expenditures recorded. In the other, monies are virtually unrestricted as to purpose of expenditure and are usually revocable only for .failure to comply with prescribed compliance requirements. These resources are reflected as revenues at the time of receipt or earlier if the susceptible to accrual criteria is met. Expenses - Expenditures are recorded during the year on a cash disbursement basis. In addition, as required by Massachusetts General Laws, disbursements made during the fifteen days immediately following the close of each fiscal year and which pertain to the prior year are recorded as warrants payable and expenses as of June 30th. Purchase orders outstanding at June 30th related to annual operating expenses are recorded as encumbrances and accordingly as a reservation of fund balance at that date. 13 TOWN OF NORTH ANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 Reconciliation of Budgetary and GAAP Basis Amounts Property taxes reported on the combined statement of revenues and expenditures - budget (budgetary basis) and actual - general and revenue sharing funds (exhibit 3) has been restated so as to reflect the full accrual basis. This restatement was done in order to present both budget and actual amounts on a directly comparable basis. Property taxes as reported on the GAAP basis statements have been adjusted as follows: Property taxes actual Add: Property taxes committed as of June 30, 1984 but not collected within sixty (60) days after the end of that fiscal year. Property taxes -actual adjusted to a budgetary (Non-GAAP) Basis 10,077,478 574,678 $ ~0.652.1~6 Deferred Revenue Property taxes and other revenues that are measurable, but not available have been classified as deferred revenue on June 30, 1984 as follows: 14 TOWN OF NORTH ANDOVER, NASSACHUSETTS NOTES TO FINANCIAL STATEMF, NTS June 30, 1984 General Fund: Outstanding property taxes June 30, 1984 Less: Collections July and August 1984 Motor vehicle excise net of collections for July and August 1984 amounting to $41,267 Other excise Other taxes Tax liens Departmental Special assessment Special Revenue User charges and liens 662,091 87,413 221,341 206 633 47,144 10,242 143,909 574,678 423,475 998,153 124.150 2. Departures from Generally Accepted Accountin~ Principles For years prior to 1984, the town presented its financial statements on the basis of accounting practices prescribed by the Commonwealth of Massachusetts, Department of Revenue. These practices varied in several significant respects from G.A.A.P. During 1981, the Commonwealth of Massachusetts issued a revised uniform municipal accounting system entitled "U.M.A.S." The departures from G.A.A.P. under this revised system, have been substantially narrowed. The town has adopted the revised U.M.A.S. for its financial statement presentation for 1984. 15 TOWN OF NORTH ANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 The significant departures from G.A.A.P. included in the Town of North Andover's financial statements are: a. Retirement benefits are provided for on a "pay-as-you-go" basis rather than an acceptable actuarial cost method (see note 7.) b. General and proprietary fund fixed asset acquisitions are recorded as expenditures at the time purchases are made rather than being capitalized in a general fixed asset group of accounts or proprietary fund. c. Purchases for materials and supplies inventories are recorded as expenditures rather than assets at the time of purchase. 3. Reserve for Extraordinary or Unforeseen Expenses a. The balance in this account represents the transfer of excess amounts from the "Provision for Abatement and Exemption" accounts. This account was previously known or classified as "Overlay Surplus" to be appropriated by town meeting vote for extraordinary or unforeseen expenses in accordance with Chapter 59, Section 25, Massachusetts General Laws. b. Provisions for property tax abatements and exemptions are established for each annual tax levy as prescribed by statute. The primary intent is to provide for these potential refunds or allowances during the year in which the tax would otherwise be due and collected. Excessive amounts no longer necessary are to be transferred to a reserve account to be used for extraordinary or unforeseen expenses as prescribed by the Massachusetts General Laws. 16 TOWN OF NORTH ANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 Statutory provision for abatements and exemptions not in excess of the outstanding property taxes on June 30, 1984 are as follows: Tax levy of 1981 Tax levy of 1982 Tax levy of 1983 Tax levy of 1984 64,138 146,634 239,308 168,686 618.766 Reserve for Encumbrances The balance in this account is made up of current and prior years unexpended appropriations carried forward. 5. Unreserved Fund Balance Certain budgetary surpluses and deficits must, according to the General Laws of the Commonwealth of Massachusetts, be utilized to reduce or be raised in the next subsequent tax rate. These items have been included within the unreserved fund balance pursuant to G.A.A.P., but have been connoted as "Designated" for identification purposes. These items include the following: General Revenue Special Fund Sharing Fund Revenue Designated to reduce the 1985 Tax Levy Reserve for State and County assessments, net Appropriation deficit Court judgment School Lunch 56,230 ~ 330,000 41,172 (8,480) (92,503) (1,591) (3,581) ~ 330,000 $ (1,591) 17 TOWN OF NORTH ANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 The amount designated to reduce the 1985 tax levy was voted from available funds by the local appropriatory body (called the town meeting in Massachusetts) during the spring 1984 annual town meeting. State and County overassessments, net, result from an excess of amounts raised in the tax levy of the current year as compared to the actual expenditures made for such purposes. These amounts will be utilized to reduce the 1985 tax levy. They are comprised of the following: Underestimates: Special Education Air Pollution Control Districts Overestimates: Health Insurance Elderly Retirees State Recreation Areas Ipswich River Watershed District Regional Transit Authority 2,636 141 183 5,104 41 411 (2,777) 5,739 Current year overestimates Prior year overestimates 2,962 38~210 41,172 Appropriation deficit resulted from expenditures that exceeded appropriation during the fiscal year. Interest on Short Term Borrowing 8,480 18 TOWN OF NORTH ANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 6. Pension Plan Substantially all employees of the town, except school teachers and certain other school department employees are members of the Essex County Contributory Retirement System. The pension plan provides retirement benefits for members who have obtained a certain age and for periods of service. Members contribute certain percentages of their salaries or wages to the plan. In addition, the Massachusetts Department of Banking and Insurance determines an amount, each year, that the town must contribute to the system in order to meet that year's projected benefit payments. The town's contribution to the system for the year 1984 amounted to 3558,767. This so called "pay-as-you-go~ method does not provide for the funding of any unfunded liabilities that might exist as a result of an actuarial deter- mination of the fiscal condition of the plan. The amount of the unfunded liability of the Essex County Contributory Retirement System is actuarially determined periodically and reported to the County by the Massachusetts Retirement Law Commission. However, the amount of such liability directly related to the members from the Town of North Andover has not heretofore been separately determined and remains unknown. The school teachers and other non-member school department employees participate in a plan administered by the Massachusetts Teachers' Retirement Board. The town does not directly contribute to this plan. 19 TOWN OF NORTH ANDOVE~, MASSACHUSETTS NOTES TO FINANCIAL STATEI~S June 30, 1984 7. Subsequent Year Authorizations The financial statements for the Town of North Andover as of June 30, 1984, do not reflect the fiscal 1985 town meeting held on April 28, 1984 except for that portion of fund balance designated for expenditures as explained in note 5. The town has authorized a fiscal 1985 operating and capital budget totaling ~16,374,380. These funds will be provided for as follows: 1985 Tax Levies, State Grants, Departmental Revenues, etc., other local receipts Fund Balance Designated For Expenditures: Revenue Sharing Fund General Fund Anticipated Revenue Sharing Entitlements 8 Unemployment Compensation $ 15,988,150 305,901 56,230 24,099 16,374,380 The town is on the reimbursable method of paying unemployment compensation. Under the reimbursable method, the Massachusetts Employment Security Division sends a list monthly to the community of who has received benefits. The community then reimburses the Massachusetts Employment Security Division for those claims against the town. 9. Vacation, Sick Time and Terminal Leave Vacation Vacation A full-time employee or a part-time employee in continuous service shall be granted vacations with pay on the following terms: 2O ~0WN OF NOR~HANDOVER~ MASSACHUSEttS NOTES T0 FINANCIAL S~A~S June 30, 1984 (1) An employee who has completed one year of service shall be entitled to two weeks of vacation with pay, the first week of which may be taken at the end of six months. (2) An employee who has completed five years of service shall be entitled to three weeks of vacation with pay. (3) An employee who has completed ten years of service shall be entitled to four weeks of vacation with pay. Upon the death of an employee who is eligible for vacation under these rules, payment shall be made to the estate of the deceased in an amount equal to the vacation allowance as accrued in the vacation year prior to the employee's death but which had not been granted. In addition, payment shall be made for that portion of the vacation allowance earned in the vacation year during which the employee died up to the time of his separation from the payroll. On June 30, 1984 accumulated vacation benefits had not been determined. Sick Time A full-time employee or a part-time employee in continuous service who has completed six months of service shall be allowed six days leave with pay and thereafter shall be allowed leave of one and one quarter days for each month of service, provided such leave is caused by sickness or injury or by exposure to contagious disease. Buy-back provisions are cited in nTerminal Leaven~ 21 TOWN OF NORTH ANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 Terminal Leave An employee whose service is terminated by retirement shall be allowed a portion of his accumulated sick leave as terminal leave. The following formula shall be used in computing the amount of terminal leave to be allowed a retiring employee: (1) Twenty-five (25) whole years of continuous full-time service shall be considered 100% service. (2) An employee who qualifies for terminal leave shall be entitled to the same percentage that the number of years of service bears to the 100% service factor of 25 years, provided, that in no case shall said leave be measured by more than 60 days accumulated sick leave, or twelve work weeks, whichever is the lesser. On June 30, 1984, accumulated sick leave benefits had not been determined. 10. Summary of Long-Term Debt A. Long Term Debt Transactions Bonds payable on June 30, 1984 amounting to 33,210,000 are secured by the general revenue raising powers of the town, which are restricted by the enactment of legislation during 1980. This legislation is best known as Proposition 2 1/2. The following is a summary of the long term debt transactions, Town of North Andover for the year ended June 30, 1984: 22 TO~ OF NORTH ANDOVER, HASSACHUSETTS NOTES TO 'FINANCIAL STATEHENTS June 30, 1984 Long-Term Debt Transactions General~ Inside Debt Limit Fire Station Fire Engine Total Inside Debt Limit Outeide Debt Limit Franklin School New Blgh School School Project Loan Tota_t Outside Debt Limit Enterprise~ Inside Debt Limit Sevec Sever Sever Outs/de Debt Limit Water-Bradford Street Water-Salem and Stevens Hypalon Cover-Reservoir Total. F. uterprise Debt Total Serial Bonds Payable Original Amount Interest Date of Date of ~alaace Rate ~ssue Maturity July 1, 1983 163,000 6.1I 10/69 10/84 30,000 5.2I 11/78 11/83 710,000 4.5I 12/67 12/87 6,800,000 5.25I 10/71 10/91 250,000 4,7% 5/73 5/88 125,000 180,000 720,000 $ 20,000 25~000 140,000 2,840,000 75,000 3,055,'000 Retirements 10,000 , }~000 15,000 35,000 355,000 405,000 3.251 9/58 9/83 5,000 5,000 4.001 11/66 11/86 20,000 5,000 9.2I 3/82 3/87 575,000 145,000 20,000 140,000 . 25~000 785t000 105.000 5.41 11/78 11/83 140,000 6.451 6/83 6/87 140,000 5.5% 11/78 11/83 20,000 35,000 235,000 Balance Outstanding June 30~ 1984 I0,000 10~000 105,000 2,485,000 60~000 2,650,000 15,000 430,000 105,000 550~000 23 TOWN OF NORTHAND0VER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 B. Annual Debt Service Principal and interest payments due in future years relating to debt outstanding on June 30, 1984 are listed below: Fiscal Total Year Principal Interest Requirements 1985 $ 600,000 $ 175,474 $ 775,474 1986 590,000 138,514 728,514 1987 585,000 101,739 686,739 1988-1991 ~,~35,000 149,452 1,584,4~ 3,210.000- ~ 5~5,179 $ 3.775.179 C .Overlapping Debt The town of North Andover is a member of the Greater Lawrence Sanitary District, the Greater Lawrence Regional Vocational Technical High School District and Essex County. Due to its membership in the districts and the county, the town is indirectly responsible for its proportionate share of the debt incurred by such districts and county as follows: Name of District Greater Lawrence Sanitary District Greater Lawrence Regional Vocational Technical High School District Essex County Principal Amount Percent Amount 3,238,890 8.43% $ 273,038 800,000 5% 40,000 4~986,500 4.22%* 210,430 9,025,390'* ~ .523,468 * Rate subject to change based upon bi-annual report of the Massachusetts Commissioner of Revenue. ** These figures were confirmed with data supplied by the above entities. 24 TOWN OF NORTHANDOVER, MASSACHUSETTS NOTES TO FINANCIAL STATEMENTS June 30, 1984 1984: Legal Debt Margin The following is a computation of the legal debt margin as of June 30, Equalized Valuation-Personal Property And Real Estate Debt Limit - 5% of Equalized Valuation Total Debt $ 3,210,000 Less: Debt Outside Debt Limit 2,755,000 ~ ,694,290,.500 34,714,525 455,000 ,259 ,~25 Legal Debt Margin 11. Contingent Liabilities As of June 30, 1984, various claims and lawsuits were pending against the town. There was no indication if the potential loss on all claims when resolved will have a material effect upon the town's financial position. 25 Schedule TOWN OF NORTH ANDOVER, MASSACHUSETTS SCHEDULE OF RECONCILIATION OF TREASURER'S CASH For the year ended June 30, 1984 Balance July 1, 1983 Receipts Disbursements Balance June 30, 1984 Balances Classified By Depository Checking Accounts First Bank of Boston Arlington Trust State Street Bank and Trust Company Bay Bank-Merrimac Valley Harbor National Boston Safe Deposit Bank of New England United States Trust Essex Bank Century Bank Cash on Hand Cash variation Savings Accounts Community Savings Bay Bank-Merrimac Valley 1,959 322,173 11,126 29,232 29,844 2,389 136,370 404,002 10,719 2,142 27,920 (1,814) 16,557 4,137 Investments (Schedule II) Presentation of Cash on Balance Sheet General Fund Federal Revenue Sharing Fund Special Revenue Fund Presentation of Investments on Balance Sheet General Fund Federal Revenue Sharing Fund 5,723,647 34,109,938 (35,832,232) 4,001,353 976,062 20,694 3,004,597 4,001,353 1,040,071 5,901 (49,216)' 996.756 2,704,597 300,000 $ 3,004,5~7 26 TOWN OF NORTH ANDOVER, MASSACHUSETTS SCHEDULE OF INVESTMENTS June 30, 1984 Schedule II Certificates of deposit: State Street Patriot Bank Bank of New England Bay State United States Trust Essex Bank Arlington Trust Company Bay Bank-Merrimac Valley Massachusetts Municipal Depository Trust Certificate Interest Maturity Number Rate % Date 76488 9.75 7-6-84 17300 10.00 7-6-84 Book Value 200,000 200,000 31979 10.00 7-6-84 200,000 36512 10.125 7-6-84 300,000 36491 10.125 7-5-84 350,000 9611 10.00 7-6-84 200,000 46390 9.75 7-3-84 1,250,000 41 10.00 7-9-84 300,000 44000123 10.00 open 4,597 3.004.597 27 T0~q OF NORTH ANDOV~, ~SSAC~dSETTS SCHEDULE OF TAXES, LIENS, EXCISE, DEPART~rJ~TAL ACCOU~TS RF, CEI?A~LE, ASSESS~L~,NTS, USER Ob~RGES AND LIENS For the year ended June 30, 1986 Schedule Levy of 1984 Levy of 1983 Levy of 1982 Levy of 1981 Levy of 1980 Levy of 1979 Levy of 1978 Personal Froperty Taxes~ Levy of 1986 Levy of 1983 Levy of 1982 Levy of 1981 Levy of 1980 Levy of 1979 Levy of 1978 Lev,/ of 1977 Levy of 1975 Forest Laud Taxesl Levy of 1986 Levy of 1983 Levy of 1982 Levy of 1981 Abatements Collections Uncollected Uncollected Transfers and AdJusted Net of Uncollected Per Detail July 1, 1983 Commitments .Adjustments Collectible Refunds June 30~ 1984 June 30~ 1986 ~ 10,722,772 $ 171,046 $ 10,§51i728 5,607,168 136,656 5,470,512 147,493 12,061 135,432 76,964 8,796 68,168 3,453 3,453 (171) (171) 6 6 245,129 148 244,981 92,910 571 92,339 452 452 679 679 862 862 1,339 1,339 1,113 1,113 644 644 34 34 5__..932.~4._~.~ ~ 1_~.0,967.901 ~ ~ ~ 16.5~~9 ~ 313 ~ 313 213 213 3 3 104 104 10,150,851 5,276,531 76,888 67,587 2,652 243,123 91,843 &00,875 193,981 58,544 581 801 (171) 6 1,858 696 679 862 1,336 1,113 644 34 389,891 187,979 59,134 232 1,770 1,265 504 679 897 1,010 1,096 655 645.147 313 il 35 213 37 3 3 104 104 28 TO,tN OF NORT~ ANDOVER, HASSACHUS£ITS SCREDULE OF TAXES, LIENS, EXCISE, DEPARTHENTALACC0UNT$ REC£IVABLE, ASSESSMENTS, USER CHAR~ES AND LIENS For the year ~nded 3une 30, 1984 Schedule III (eo~tinued) Tax Liens: Taxes ia Litigation Tax Titles Notor Vehicle Excise: Levy of 1984 Levy of 1983 Levy of 1982 Levy of 1981 Levy of 1980 Levy of 1979 Levy oE 1978 Levy of 1977 Levy ot 1976 Levy of I975 Levy of 1976 Levy of 1973 Levy of 1972 Fnma Excisei Levy of 1983 Lev? oE 1980 Levy oE 1979 Levy of 1977 FoFest l~oduc[a tax! Levy of 1983 Abatements Collections Uocollected Uncollected Transfers and Adjusted Net of Uncollected Per l~tail July Ip 1983 Commitments Adjustments Collectible Refunds June 30t 1981 ~uue 30t 1981 7,457 J (107) J 7;5G4 37t012 (48,840) ~5;852 100,1i~ ~ 629,486 t (20,106} t 649,~92 214,797 30,4S3 284,4SS 13,856 1,972 880 14~948 6,075 6,07~ 19,575 19,575 5,688 (43) 5,731 8,169 8,169 3,016 3,016 2,383 2,383 1,058 1,058 713 713 292 29~ 177 177 J 893 t 893 96 96 69 69 ~J ~ d~ . 66 7,564 ~8,708 ~6.27t 479,668 246,188 2,885 400 2,177 991 617 a55 73 20 10 12 893 ?,7,144 169,94& 37,967 12,063 $,675 17,398 6,740 7,752 2,56L 2,3~0 1,038 703 16§ 262__~0_8~ 96 &l &,7z159 171,079 27,603 12,464 6,06! 24,243 A,886 963 517 116 927 622 ~7q ~0.~2~ 96 70 29 TOWN OF NORT}! ANDOVE~, MASSACHUSETTS SCHEDULE OF T~ES, LI~S, EXCISE, DEP~~ ACCO~S ASSESS~TS, US~ C~GES ~P For the ~ear ended June 30, 1984 Schedule III (continued) ~epartuentalsl Veterans Special Assessmental Sewer assessments paid in advance Apportioned sewer assessment not due Unapportioned sewer Suspended ~ater main assessment Apportioned water ~ain nssessmentS not due Unapportioned water ~ala assessment User char&es and lieos~ Water liens added to tsxesl 1984 1983 1982 1981 1980 1979 Water ltstes Accounts Receivable Vater ~alutenance and Construction Accounts Receivable Sewer Liens Added To Tazesl 1984 1983 1982 1981 1980 1979 Sub total Abatements Uncollected Transfers and Adjusted ~uly 1~ 1983 Co~aitments Adjustments Collectible t 2,125 66,833 18,289 10,548 8,255 66,690 ~03.925 t ,68.81~ Collections Net of Refunds 66,833 12,877 18,289 750 1&,472 25,020 (1,731) 6,524 ~15~432) _51,258 8~268 ~ 23,427 j J 23,427 20,07~ lI,106 ~,969 $,208 5,208 68 68 (88) (88) (132) (132) 73,335 699,299 21,790 750,844 2,037 34,243 19,269 17,011 19,779 19,779 15,~6& 11,545 3,919 6,323 (203) 6,~26 (225) (225) (7~) 13~ 136 122,125 ~76~748 66,507 832,366 30 20,628 2,610 3,116 693,873 17,100 18,056 870 377 756,630 Uncollected ~sne 30, 198~ (2,120) 53,956 17,539 25,020 6,524 .42~990 2,799 3,359 2,092 66 (132) 56,971 (89) 1,723 3,0~9 6,1~9 (225) (76) 136 75,736 Uncollected Per Detail June 30~ 198& ~8.018 35.033 2~,020 6,403 42,990 $ 2,862 3,315 2,092 1,723 6,1&9 ~3,638 TOVN OF NORTH ANDOVER, HASSACHUSEI'~S SCHEDULE OF TAXES, LIENS, EXCISE, DEPARTMENTAL ACCOUNTS KECEIVABLE, ASSESSHF. JqTS, USER CfL~,B.G£S ~ LTENS For the year ended June 30, 1984 Schedule I]! (continued) Totals f~om previous pass Sever rates accounts receivable Abatements Uncollected Transfers and Adjusted July 1, 1983 Commitments Adjustments Collectible 122,125 776,748 66,507 832,366 61,904 327,174 250 388,828' Sewer Maintenance and Construction Accounts Receivable 3,950 11,601 Water Hain Asseasneut Added to Taxeet 1984 1,731 1983 1,731 Sewer Assessments Added to Taxee~ 1984 9,502 1983 10,053 1982 54 Commited lnteres: on Assessments Added to Taxes{ 1984 2,977 1983 5,346 1982 2 1981 79 Detail list not provided {~ ~ { l__e. 13_1. e.464 Collections Net of Refunds 756,530 344,715 Uncollected June 30, 1984 75,736 44,113 5,692 9,859 7,053 2.806 Uncollected Per l)etatl June 30, 1984 73,638 42,872 1,731 1,551 180 180 1,521 210 30 180 180 9,502 5O8 54 9,545 241 8O 54 189 490 2 79 2,977 4,656 690 2 79 9,261 428 2,788 200 241 150 5& 189 452 2 31