Review report, Lake Lanier Islands Development Authority, a component unit of the state of Georgia, year ended June 30, 1994

STATE OF GEORGIA DEPARTMENT OF AUDITS
254 WASHINGTON STREET
ATLANTA, GEORGIA 30334

REVIEW REPORT LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY
A COMPONENT UNIT OF THE STATE OF GEORGIA
YEAR ENDED JUNE 30, 1994

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY - TABLE OF CONTENTS -

SECTION I

FINANCIAL

INDEPENDENT ACCOUNTANT'S COMBINED REPORT ON REVIEW OF FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION

EXHIBITS

FINANCIAL STATEMENTS

A COMBINED BALANCE SHEET (STATUTORY BASIS)

ALL FUND TYPES AND ACCOUNT GROUPS

2

B STATEMENT OF CHANGES IN FUND BALANCES

(STATUTORY BASIS)

GOVERNMENTAL FUND TYPE

3

C STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES

BUDGET FUND

4

D STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES

COMPARED TO BUDGET

BUDGET FUND

6

E NOTES TO THE FINANCIAL STATEMENTS

7

SUPPLEMENTARY INFORMATION

F COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES

FIDUCIARY FUND TYPE - AGENCY FUNDS

18

SCHEDULES

1 SCHEDULE OF APPROVED BUDGET

19

2 CASH AND CASH EQUIVALENTS

20

3 INVESTMENTS

21

4 SCHEDULE OF OTHER REVENUES RETAINED

22

5 SCHEDULE OF OTHER OPERATING EXPENSES

23

6 RECONCILIATION OF PER DIEM AND FEES

24

SECTION II FINDINGS AND IMPROPER OR QUESTIONED COSTS SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS

SECTION I FINANCIAL

CLAUDE L. VICKERS STATE AUDITOR (404) 656-2174
TAX RATIO (404) 656-0494

~.epartm.ent nf J\uhits
254 WASHINGTON STREET. S.W. ROOM 214
!4-tfonht, &i.enr_gin 30334-8400
February 2, 1995

FINANCIAL AUDl1S (404) 656-2180
PROGRAM AUDl1S (404) 656-2006

Honorable Zell Miller, Governor Members of the General Assembly of Georgia Members ofthe Lake Lanier Islands Development Authority
and Honorable Robert L. Burson, Executive Director
INDEPENDENT ACCOUNTANT'S COMBINED REPORT ON REVIEW OF FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION
Ladies and Gentlemen:
We have reviewed the accompanying financial statements (Exhibits A through E) of the Lake Lanier Islands Development Authority as of and for the year ended June 30, 1994, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants_ As described in Note 1, these financial statements were prepared on a prescribed basis of accounting that demonstrates compliance with the budgetary statutes and regulations of the State of Georgia, which is a comprehensive basis of accounting other than generally accepted accounting principles. All information included in these financial statements is the representation of the management of the Lake Lanier Islands Development Authority.
A review consists principally of inquiries of agency personnel and analytical procedures applied to financial data_ It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware ofany material modifications that should be made to the accompanying financial statements in order for them to be in conformity with the basis of accounting described in Note 1.
Our review was made for the purpose of expressing limited assurance that there were no material modifications that should be made to the financial statements in order for them to be in conformity with the basis of accounting described in Note 1. The accompanying supplementary information (Exhibit F and Schedules 1

94ARL-4

through 6) is presented only for supplementary analysis purposes. Such information has been subjected to the inquiries and analytical procedures applied in the review of the financial statements and we are not aware of any material modifications that should be made thereto.
Respectfully submitted,
~~/4
Claude L. Vickers State Auditor
CLV:jy 94ARL-4

FINANCIAL STATEMENTS - 1-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY COMBINED BALANCE SHEET (STATUTORY BASIS)
ALL FUND TYPES AND ACCOUNT GROUPS
JUNE 30, 1994

EXHIBIT "A"

GOVERNMENTAL FIDUCIARY
FUNBDOOTGYtPtE FUANGDENCTYYPE

GENERAACLCOUNT GROGUEPNSERAL

FIXED

LONG-TERM

~

DEBT

3~ TOTALS
JONE~oM,sn1o9ra9n4dumJO0nN1 E, 1993

~

Cash and Cash Equivalents (See Schedule)

$4,496,585.69 $ 238,197.82

$ 4,734,783.51 $ 4,339,788.92

Investments (See Schedule)

$2 .473, 711.11

$ 2,473,711.11 $1,983,880.00

Accounts Receivable

$1,729,040.01

$1,729,040.01 $1,554,096.10

Prepaid Items

$ 54,159.10

$ 54,159.10$ 52,693.75

Inventories

$ 341,595.42

$ 341,595.42$ 295,391.79

Consigned License and Postal Stock.

$ 9,947.63

$ 9I 947. 63 $______9...,8.6...,.2...0._3

Fixed Assets Buildings Equipment

$26,126,766.00 4,987,423.70

$26,126,766.00 $26,126,766.00 4,987,423.70 4,692,153.90

$31,114,189.70

$31,114,189.70 $30,818,919.90

Amount to be Provided for Payment of: Accrued Canpensated Absences Advances through Georgia Department of Natural Resources General Obligation Bond Proceeds State Appropriation

$ 184,341.07 $ 184,341.07$ 145,826.97 42,622,909.00 42,622,909.00 45,286,840.00
698,969.00 698,969.00 1,397,938.00

$43,506.219.07 $43,506,219.07 $46.830,604.97

Total Assets

$9.095.091.33 $ 248.145.45 $31.114.189.70 $43.506.219.07 $83.963.645.55 $85.885.237.46

LIAFOBNIDLITEIOEUSI IVAND

Liabilities Accounts Payable Payroll Withholdings Salaries Payable Funds Held for Others Canpensated Absences Repayment of Advances through Georgia Department of Natural Resources

$ 812,270.62 13,025.98 94,202.82 $ 248,145.45 124,839.54

$ 812,270.62$ 863,179.26

13,025.98

8,546.54

94,202.82 140,506.81

248,145.45 175,165.36

$ 184,341.07 309,180.61 266,154.88

43,321,878.00 43.321,878.00 46,684,778.00

Total Liabilities

$1,044,338.96$ 248,145.45

$43,506,219.07 $44,798,703.48 $48,138,330.85

Fund Equity

Investment in General Fixed

Assets

Fund Balances

Reserved

Advanced Group Deposits $ 259,248.45

Unreserved

Designated for Replacement

and/or Major Repairs to

Aquatic Rental Boat Fleet 949,356.99

Undesignated

6,842,146.93

$31,114,189.70

$31,114,189.70 $30,818,919.90 259,248.45 268,052.39 949,356.99 864,119.83
6,842,146.93 5,795,814.49

Total Fund Equity

$8,050,752.37

$31,114,189. 70

$39,164,942.07 $37,746,906.61

Total Liabilites and

Fund Equity

$9.095.091.33 $ 248.145.45 $31.114.189.70 $43.506.219.07 $83.963.645.55 $85.885.237.46

See Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Infonnation. The notes to the financial statements are an integral part of this statement.
- 2-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY STATEMENT OF CHANGES IN FUND BALANCES (STATUTORY BASIS)
GOVERNMENTAL FUND TYPE YEAR ENDED JUNE 30, 1994

EXHIBIT "B"

FUND BALANCES - JULY 1
Reserved Unreserved
ADDITIONS
Adjustment for Change in Accounting Policy Excess of Funds Available over Expenditures
Exhibit "C" Increase in Reserve for
Advance Group Deposits Prior Year's Checks Voided
DEDUCTIONS
Adjustment to Prior Year's Accounts Receivable Decrease in Reserve for
Advance Group Deposits Unreserved Fund Balance Carried Over from
Prior Year as Funds Available
FUND BALANCES - JUNE 30
(To Exhibit "A")

BUDGET FUND YEAR ENDED JUNE 30, 1994 JUNE 30, 1993

$ 268,052.39 $ 172,740.85 6,659,934.32 5,481,807.02
$ 6,927,986.71 $ 5,654,547.87

$

0.00 $ 42,190.20

7,826,503.97 6,614,300.80

0.00

95,311.54

0.00

4,066.66

------------- -------------

$ 7,826,503.97 $ 6,755,869.20

$ 35,000.05 $

623.34

8,803.94

0.00

6,659,934.32 5,481,807.02

$ 6,703,738.31 $ 5,482,430.36

$ 8,050,752.37 $ 6,927,986.71
============= =============

See Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information. The notes to the financial statements are an integral part of this statement.
- 3-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 30. 1994

EXHIBIT "C" Page 1

FUNDS AVAILABLE REVENUES
OTHER REVENUES RETAINED (See Schedule) Fees Hotel Occupancy Tax Interest Earned Rentals Sales Sponsorships Other Total Revenues
CARRY-OVER FROM PRIOR YEAR Transfer from Unreserved Fund Balance Designated Undesignated Total Carry-Over from Prior Year
Total Funds Available
EXPENDITURES PERSONAL SERVICES
Salaries and Wages Employer's Contributions for:
F.I.C.A. Retirement Hea 1th Insurance Unemployment Compensation Insurance Workers' Compensation Insurance Drug Testing
REGULAR OPERATING EXPENSES Motor Vehicle Expenses Supplies and Materials Repairs and Maintenance Utilities Rents (Other than Real Estate) Insurance and Bonding Other Operating Expenses (See Schedule) Publications and Printing

TOTALS YEAR ENDED JUNE 30. 1994 JUNE 30, 1993

$ 4,993,095.26 $ 4,306,490.32

538,581.71

0.00

276,256.55

185,059.88

6,783,979.99 5,965,393.11

3,181,771.95 2,813,059.80

38,795.37

34,325.87

205,600.89

90,479.64

$16,018,081.72 $13,394,808.62

$ 864,119.83 $ 758,092.90 5,795,814.49 4,723,714.12
$ 6,659,934.32 $ 5,481,807.02
$22.678.016.04 $18.876.615.64

$ 5,514,069.33 $ 5,132,510.61

446,791.58 231,561.28 285,725.55
2,983.41 24,132.66
400.00

401,020.78 185,192.44 254,967.40
1,707.84 11,454.43
200.00

$ 6,505,663.81 $ 5,987,053.50

$ 63,944.85 $ 987,470.76 443,612.67 885,190.44
51,339.66 413,956.88
1,254,436.97 38,660.99

69,598.38 681,890.85
446,280.94 775,727.09
41,153.86 302,018.01 943,439.86 48,308.45

$ 4,138,613.22 $ 3,308,417.44

See Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
The notes to the financial statements are an integral part of this statement.
- 4-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
BUDGET FUND YEAR ENDED JUNE 30. 1994

EXHIBIT "C" Page 2

EXPENDITURES TRAVEL COMPUTER CHARGES
Other Costs Supplies and Materials
TELECOMMUNICATIONS PER DIEM, FEES AND CONTRACTS
Per Diem and Fees CAPITAL OUTLAY
Other Costs Repairs and Maintenance
OTHER BOAT/ATTRACTION REPLACEMENT Equipment Equipment Purchases Other Costs Repairs and Maintenance
LOAN REPAYMENT: 5-YEAR LOAN LOAN REPAYMENT: 20-YEAR LOAN
Total Other Total Expenditures Excess of Funds Available over Expenditures

TOTALS YEAR ENDED JUNE 30, 1994 JUNE 30. 1993
$ 18,223.23 $_ _2..._3.,..9...5.._8_-.3__0_
$ 25,662.93 $ 27,200.64 $ 67,423.50$ 75,748.05
$ 60 , 139 . 13 $_ _5_8_.,..3...8.._.0-.1__0_
$ 442,970.64 $ 718,614.74

$ 165,124.58 $ 89,084.23

64,791.03

24,888.84

$ 229,915.61 $ 113,973.07

$ 698,969.00 $ 448,969.00

$ 2,663,931.00 $ 1,500,000.00

$ 3,592,815.61 $ 2,062,942.07

$14,851,512.07 $12,262,314.84

7,826,503.97 6,614,300.80

$22.678,016.04 $18.876,615.64

See Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
The notes to the financial statements are an integral part of this statement.
- 5-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY STATEMENT OF FUNDS AVAILABLE AND EXPENDITURES
COMPARED TO BUDGET BUDGET FUND
YEAR ENDED JUNE 30. 1994

EXHIBIT "D"

FUNDS AVAILABLE REVENUES
Other Revenues Retained CARRY-OVER FROM PRIOR YEAR
Transfer from Unreserved Fund Balance

BUDGET

ACTUAL

VARIANCE FAVORABLE (UNFAVORABLE)

$16,544,919.00 $16,018,081.72 $ -526,837.28 0.00 6,659,934.32 6,659,934.32

$16,544,919.00 $22,678,016.04 $ 6,133,097.04

EXPENDITURES
Personal Services Regular Operating Expenses Travel Motor Vehicle Purchases Equipment Computer Charges Telecommunications Per Diem, Fees and Contracts Capital Outlay Boat/Attraction Replacement Loan Repayment: 5-Year Loan Loan Repayment: 20-Year Loan

$ 6,516,582.00 $ 6,505,663.81 $ 10,918.19

4,507,280.00 4,138,613.22

368,666.78

70,000.00

18,223.23

51,776.77

53,500.00

0.00

53,500.00

57,550.00

0.00

57,550.00

40,000.00

25,662.93

14,337.07

145,000.00

67,423.50

77,576.50

110,000.00

60,139.13

49,860.87

1,682,107.00 442,970.64 1,239,136.36

0.00

229,915.61 -229,915.61

698,969.00

698,969.00

0.00

2,663,931.00 2,663,931.00

0.00

------------- ------------- -------------

$16,544,919.00 $14,851,512.07 $1,693,406.93

Excess of Funds Available over Expenditures

$ 7,826,503.97 $ 7,826,503.97
============= =============

See Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.

The notes to the financial statements are an integral part of this statement.

- 6-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXIIlBIT "E"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REPORTING ENTITY The Lake Lanier Islands Development Authority is an instrumentality of the State of Georgia and a public corporation which is assigned to the Department ofNatural Resources for administrative purposes only. The Authority consists ofnine (9) members as follows: the Commissioner of the Department ofNatural Resources and eight (8) additional members appointed by the Governor. The Authority is considered a component unit of the State of Georgia and is included within the State of Georgia reporting entity for financial reporting purposes because of the significance of its legal, operational and financial relationships with the State of Georgia.
FUND ACCOUNTING The Lake Lanier Islands Development Authority uses funds and account groups to report on its financial position and the results of its operations determined in conformity with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia. Fund accounting is designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain governmental functions or activities. A fund is a separate accounting entity with a self-balancing set of accounts. An account group, on the other hand, is a financial reporting device designed to provide accountability for certain assets and liabilities that are not recorded in the funds because they do not directly affect net expendable available financial resources. Funds and account groups presented in the accompanying financial statements are as follows:
GOVERNMENTAL FUND TYPE
BUDGET FUND - The fund used to account for activities and functions as set forth in the operating budget approved by the Lake Lanier Islands Development Authority. This presentation differs from generally accepted accounting principles in that such principles provide that the Budget Fund of the Authority be accounted for as a Proprietary Fund Type - Enterprise Fund. An Enterprise Fund is used to account for operations that are financed and operated in a manner similar to private business enterprises, where the intent is that costs of providing goods or services to the general public on a continuing basis are financed or recovered primarily through user charges or that periodic measurement of revenues earned and expenses incurred are appropriate for capital maintenance, public policy, accountability and other purposes.
FIDUCIARY FUND TYPE
AGENCY FUNDS - The funds used to account for assets held for use by other funds, governments, or individuals.
ACCOUNT GROUPS
GENERAL FIXED ASSETS - The account group used to account for fixed assets used in governmental fund type operations. Fixed assets purchased are recorded at historical cost. Donated fixed assets are recorded at fair market value on the date donated. Disposals are deleted at recorded values. The Authority's buildings have been included in the General Fixed Assets Account Group for fiscal year 1994.
-7-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXIIlBIT "E"

NOTE I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
FUND ACCOUNTING
ACCOUNT GROUPS The Authority appraised the cost of buildings at historical cost, if available. When historical cost was not available various Mean's Publications were used to detennine replacement cost. Historical cost indexes were then applied to replacement costs to determine estimated acquisition costs. No depreciation has been provided on general fixed assets. This accounting methodology differs from generally accepted accounting principles in that the Budget Fund ofthe Authority should be accounted for as a Proprietary Fund Type Enterprise Fund. Fixed assets utilized in the operations ofa Proprietary Fund Type - Enterprise Fund should be recorded as assets of such a fund, rather than in the General Fixed Assets Account Group. The depreciation ofsuch fixed assets should be recorded as an expense of the Enterprise Fund in order to more effectively determine the total cost of providing goods and services to the general public on a continuing basis.
GENERAL LONG-TERM DEBT - The account group used to report the noncurrent portions of certain governmental long-term liabilities, such as claims, judgments and compensated absences, which will be paid from future resources. This presentation differs from generally accepted accounting principles in that the Budget Fund of the Authority should be reflected as a Proprietary Fund Type - Enterprise Fund. The liabilities and related expenses for the items listed above should be recorded as a part of the Enterprise Fund in order to more effectively determine the total cost of providing goods and services to the general public on a continuing basis.
BASIS OF ACCOUNTING MEASUREMENT FOCUS
The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. Governmental funds should be accounted for using the current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements ofthese funds present increases (i.e., revenues) and decreases (i.e., expenditures) in net current assets. Proprietary fund types, on the other hand, should be accounted for on a flow of economic resources measurement focus. With this measurement focus, all assets and all liabilities are included on the balance sheet. Operating statements of these funds present increases, (i.e., revenues) and decreases (i.e., expenses) in net total assets. In accordance with accounting practices prescribed or permitted by the State of Georgia, the Budget Fund utilizes the current financial resources measurement focus.
GOVERNMENTAL FUND TYPE BUDGET FUND
Except as disclosed in the following paragraphs, units of government of the State of Georgia record their Budget Fund revenues and expenditures in accordance with the modified accrual basis of accounting. Under the modified accrual basis ofaccounting, revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). "Measurable" means the amount ofthe transaction can be determined and "available" means collectible within the current period or soon enough thereafter to be used to pay liabilities ofthe current period. Revenues that are accrued consist of certain amounts earned under operating
- 8-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "E"

NOTE I: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING GOVERNMENTAL FUND TYPE BUDGETFUND
agreements with other parties. Further, the modified accrual basis of accounting calls for expenditures, other than accrued interest ofgeneral long-term debt, to be recorded when the related fund liability is incurred. The Budget Fund, which should be reflected as a Proprietary Fund Type - Enterprise Fund in accordance with generally accepted accounting principles, should be maintained on the accrual basis of accounting.
Contractual obligations for services which have not been performed and for goods which have not been delivered at the end of the fiscal year are recognized as expenditures and liabilities in the accompanying financial statements. The recognition of encumbrances as expenditures and liabilities is in conformity with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but is not consistent with generally accepted accounting principles, which do not provide for the recording of encumbrances within the Proprietary Fund Type - Enterprise Fund.
Prior period adjustments and certain other items are reported as additions to and deductions from fund balances ofthe Budget Fund in the accompanying financial statements. This presentation is in accordance with accounting practices prescribed or permitted by statutes and regulations of the State of Georgia, but differs from generally accepted accounting principles for proprietary fund types in that immaterial adjustments should be reported as current period revenues and expenses.
The Authority records the cost of annual and sick leave provided to the employees ofits Recreation Division when paid, in accordance with policies of the State of Georgia, rather than when earned. The cost of annual leave earned by Recreation Division employees but not yet paid at the end of the fiscal year is reflected in the General Long-Term Debt Account Group, in that such liability is not expected to be financed from expendable available financial resources. This practice differs from generally accepted accounting principles for proprietary fund types in that the total accrued liability for compensated absences at the end ofthe fiscal year should be reflected as a fund liability of the proprietary fund type involved.
FIDUCIARY FUND TYPE AGENCY FUNDS
The Agency Funds are custodial in nature in that assets are equally offset by liabilities to other funds, governmental units, or individuals. The modified accrual basis of accounting is utilized for recognizing assets and liabilities.
BUDGET A budget for the financial operations of the Lake Lanier Islands Development Authority is approved by the Authority at a selected meeting. The budget is not subject to review or approval by the Legislature of the State of Georgia and therefore, is a nonappropriated budget. Budgets are prepared to provide a basis for funding operations and there is no legal prohibition regarding overexpenditure of the aggregate budget.

-9-

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXIIlBIT "E"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS Cash and Cash Equivalents include currency on hand, demand deposits with banks and other financial institutions and short-term, highly liquid investments with maturity dates within three months of the date acquired.
INVESTMENTS Investments are defined as those financial instruments with terms of three months or more from the date of purchase and certain other securities held for the production of revenue. Investments are stated at cost.
INVENTORIES Inventories for resale are made up of gas and oil, novelties, food and beverages. Inventories are shown at current purchase price, except for gas and oil, which is shown at weighted average cost, on the Combined Balance Sheet. Expendable supplies are recorded as expenses at the time of purchase.
RESERVED FUND BALANCE Reserves represent those portions of fund equity not appropriable for expenditure or legally segregated for a specific future use. The following is a briefdescription ofthe reserve reflected in the accompanying financial statements:
ADVANCE GROUP DEPOSITS The amounts received as advanced deposits to reserve facilities of the Lake Lanier Islands Development Authority.
COMPENSATED ABSENCES Compensated absences represent obligations of the Authority relating to employee's rights to receive compensation for future absences based upon services already rendered. This obligation relates only to vesting accumulating annual leave in which payment is probable and can be reasonably estimated. The Authority records the cost ofannual leave provided to the employees of its Hotel/GolfDivision when earned. See Note 1 Basis of Accounting, Governmental Fund Type, Budget Fund.
MEMORANDUM ONLY - TOTAL COLUMNS Total columns on the Combined Balance Sheet (Statutory Basis) are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position in conformity with generally accepted accounting principles. Neither are such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.
COMPARATIVE DATA Comparative total data for the prior year have been presented in the accompanying :financial statements in order to provide an understanding of changes in the Authority 's :financial position and operations. However, comparative data have not been presented in all statements because their inclusion would make certain statements unduly complex and difficult to understand.
- 10 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "E"

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
COMPARATIVE DATA
The amounts reflected on the Combined Balance Sheet (Statutory Basis) at June 30, 1994 for the asset caption "Fixed Assets - Buildings" and the fund equity caption "Investments in General Fixed Assets" includes the addition of previously unrecorded buildings. (See Note 1 - General Fixed Assets and Note 3) The amounts reflected for the asset and fund equity captions referred to above at June 30, 1993 have been restated to reflect these additions.
NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS
STATE OF GEORGIA COLLATERALIZATION STATUTES AND POLICIES Funds of the State of Georgia cannot be placed in a depository paying interest longer than ten days without the depository providing a surety bond to the State. In lieu of a surety bond, the depository may pledge as collateral any one or more ofthe following securities as enumerated in the Official Code of Georgia Annotated Section 50-17-59:
(I) Bonds, bills, notes, certificates ofindebtedness or other direct obligations of the United States or of the State of Georgia.
(2) Bonds, bills, notes, certificates ofindebtedness or other obligations of the counties or municipalities ofthe State of Georgia.
(3) Bonds of any public authority created by the laws of the State of Georgia, providing that the statute that created the authority authorized the use of the bonds for this purpose.
(4) Industrial revenue bonds and bonds of development authorities created by the laws of the State of Georgia.
(5) Bonds, bills, certificates of indebtedness, notes, or other obligations of a subsidiary corporation of the United States government, which are fully guaranteed by the United States government both as to principal and interest, and debt obligations issued by the Federal Land Bank, the Federal Home Loan Bank, the Federal Intermediate Credit Bank, the Central Bank for Cooperatives, the Farm Credit Banks, the Federal Home Loan Mortgage Association, and the Federal National Mortgage Association.
(6) Guarantee or insurance of accounts provided by the Federal Deposit Insurance Corporation.
As authorized in the Official Code of Georgia Annotated Section 50-17-53, the State Depository Board has
adopted policies which allow agencies ofthe State of Georgia the option of exempting demand deposits from the collateral requirements.

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "E"

NOTE 2: CUSTODIAL CREDIT RISKS OF CASH DEPOSITS AND INVESTMENTS

CATEGORIZATION OF DEPOSITS For purposes of analysis of custodial credit risk, cash deposits consist of all bank balances which include demand deposits and/or interest bearing accounts. These bank balances are categorized below in order to provide information about the extent to which such deposits are exposed to custodial credit risk.

Category 1 - Amounts covered by depository insurance or collateralized with securities (at market value) held by the Authority or by its agent in the Authority's name.

Category 2 - Amounts collateralized with securities (at market value) held by the financial institution's trust department or agent in the Authority's name.

Category 3 - Amounts collateralized with securities (at market value) held by the financial institution or by its trust department or agent, but not in the Authority's name, and amounts uncollateralized.

Canying Amount

Bank ~

Risk Categories

2

3

Cash Deposits

S l 713 370.18 $ 2.074.020 53 S 101.023 97 S 1 972.996.56 $===0.,..0.0..

CATEGORIZATION OF INVESTMENTS

For purposes of analysis of custodial credit risk, investments consist of U. S. Government securities. Investments are stated at cost, and are summarized and classified as to custodial .credit risk within the categories described below:

Category 1 - Insured or registered, or securities held by the Authority or its agent in the Authority's name.

Category 2 - Uninsured or unregistered, with securities held by the counterparty's trust department or agent in the Authority's name.

Category 3 - Uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the Authority's name.

The carrying amounts shown below also include amounts maintained in an investment pool by the Office of Treasury and Fiscal Services.

Type ofInvestment

Risk Categories

2

3

Carrying Amount

Market
Value

U. S. Government Securities

s 5453 274 44 s ===o.,.oo... s ===oo.,,o s 5 453 974.44 s s4s3 974 44

- 12 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXHIBIT "E"

NOTE 3: CHANGES IN GENERAL FIXED ASSETS

The following is a summary of changes of equipment in the General Fixed Assets Account Group during the fiscal year:

Buildings

Equipment

Total

Balance July 1, 1993 Retroactive Restatement ofPrior
Year Balance Balance July 1, 1993 Restated Additions Deductions

$

0.00 $4,692,153.90 $ 4,692,153.90

26,126,766.00

26,126,766.00

$26,126,766.00 $4,692,153.90 $30,818,919.90

367,105.92 367,105.92

71,836.12

71,836.12

Balance June 30, 1994

$26.126.766,00 $4,987,423.70 $31.114,189.70

NOTE 4: GENERAL LONG-TERM DEBT

REPAYMENT OF ADVANCES In prior years, the Lake Lanier Islands Development Authority received funds from the State of Georgia from the sale of general obligations bonds of the State of Georgia and from budgeted appropriations through the Department ofNatural Resources. These funds have been used for capital outlay projects for the Lake Lanier Islands Development Authority. The Authority has agreed to repay these contributions and an amount equivalent to interest to the extent that funds are available.

CHANGES IN GENERAL LONG-TERM DEBT A summary of changes in General Long-Term Debt for the year ended June 30, 1994, follows:

Compensated Absences

Advances Through the

Georgia D~artment of

Natural Resources

General

Obligation

State

Bond Proceeds Appropriation

Balance July 1, 1993

$ 145,826.97 $45,286,840.00 $ 1,397,938.00

Additions Annual Leave Earned and Utilized (Net) Salaries Salary Related Fringe Benefits (*)
Deductions Payments to Georgia Department of Natural Resources

25,414.15 13,099.95
2,663,931.00

698,969.00

Balance June 30, 1994

$ 184,341.07 $42.622.909.00 $ 698,969.00

(*) Includes related fringe benefits applicable to compensated absences at July 1, 1993.

- 13 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXIIlBIT "E"

NOTE 4: GENERAL LONG-TERM DEBT

The aggregate future annual payments for advances through the Georgia Department ofNatural Resources as of June 30, 1994, including principal and interest are as follows:

1995 1996 1997 1998 1999 and Subsequent
NOTE 5: LEASE WITH SECRETARY OF THE ARMY

$ 3,362,900.00 2,663,931.00 2,663,931.00 2,663,931.00
31,967,185.00
$43,321,878 00

On April 15, 1968, the Secretary of the Army entered into an agreement with the Department of Natural Resources (DNR), formerly the Department of State Parks, whereby DNR agreed to lease certain properties known as "Lake Lanier Islands" from the U. S. government for public park and recreational purposes. Subsequently, DNR sublet these properties to the Lake Lanier Islands Development Authority. The term of the lease runs through April 14, 2036.

NOTE 6: RETIREMENT PLAN

The Lake Lanier Islands Development Authority established an employee retirement plan on July 1, 1970. The plan is a defined contribution plan in which benefits depend solely on amounts contributed to the plan plus investment earnings. The Lake Lanier Islands Development Authority Pension Trust is administered by the Berkshire Life Insurance Company and is available to all regular full-time employees effective the first day of the month following employment. After one year of participation in the plan, the accrued value and all future contributions made by the Authority to the employee's account become 100% vested in the employees' name. The Authority contributes 6.7% of the employee's salary to the plan. No contributions are made to the plan by the employee. The Berkshire Life Insurance Company establishes an individual account for each participant and distributes earnings on investments to each individual account annually. Upon termination or retirement, any invested benefit will be paid to the participant in a lump sum or as periodic payments from one of the deferred options available. The Authority's total payroll in fiscal year 1994 amounted to $5,514,069.33 of which approximately $3,456,000.00 was for covered employees and used by the Authority for calculating contributions. For the year under review, the Authority contributed $231,561.28 to the retirement plan. The Authority has no further liability under the plan other than the future contributions to the plan as established.

NOTE 7: LEAVE POLICIES

Employees earn ten hours of sick leave each month with a maximum accumulation of ninety days. Unused accumulated sick leave does not vest with the employee and is forfeited upon retirement or termination of employment.

- 14 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY NOTES TO THE FINANCIAL STATEMENTS JUNE 30, 1994

EXI-IlBIT "E"

NOTE 7: LEAVE POLICIES
Employees earn annual leave ranging from ten to fourteen hours each month depending upon the employees' length ofcontinuous State service with a maximum accumulation of forty five days. Employees are paid for unused accumulated annual leave upon retirement or termination of employment.
NOTE 8: CONTINGENCIES
Litigation, claims and assessments filed against the Lake Lanier Islands Development Authority, if any, are generally considered to be actions against the State of Georgia. Pursuant to the Official Code of Georgia Annotated, the Department of Administrative Services maintains a program of purchased insurance and selfinsurance which provides coverage for such litigation, claims and assessments. Accordingly, significant litigation, claims and assessments pending against the State of Georgia are disclosed in the State of Georgia Comprehensive Annual Financial Report for the fiscal year ended June 30, 1994.
NOTE9: SUBSEOUENTEVENTS
Pursuant to Act 851 (SB 377) effective July 1, 1994, all officers and full-time employees of the Lake Lanier Islands Development Authority shall become members of Employees' Retirement System under the "New Plan". Anyone with a previous membership status under Employees' Retirement System shall retain that status and be allowed to retain or reestablish creditable service under the previous membership. Any employee who was already a member and becomes an employee of the Authority on or after July 1, 1994 shall continue in the same membership status.
NOTE 10: BONDING INFORMATION
The Executive Director and all employees ofthe Lake Lanier Islands Development Authority are bonded under a Public Employees Blanket Bond written by Employers Insurance of Wausau, their Bond No. 1450-00110723, on which the premium was paid to October 1, 1994. Under this agreement the Public Employee Dishonesty Coverage insures the Authority to a maximum of$1,000,000.00 against loss sustained through fraudulent or dishonest acts by its employees. The Faithful Performance of Duty Coverage insures the Authority to a maximum of $100,000.00 against loss sustained from failure of its employees to perform faithfully their duties or to account properly for all monies and property received by virtue of their position or employment.
All employees ofthe Lake Lanier Islands Development Authority are also bonded under a Commercial Crime Policy written by the United States Fire Insurance Company, their Policy No. 626 011675 2, on which the premium was paid to October 1, 1994. Under this additional public employee dishonesty coverage, the policy insures the Authority to a maximum of $4,000,000.00 against loss sustained through fraudulent or dishonest acts by its employees.

- 15 -

SUPPLEMENTARY INFORMATION - 17 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
FIDUCIARY FUND TYPE - AGENCY FUNDS YEAR ENDED JUNE 30, 1994

EXHIBIT "F"

ASSETS/

ASSETS/

LIABILITIES

LIABILITIES

FUND

JULY 1, 1993 ADDITIONS

DELETIONS JUNE 30, 1994

------------ --------- --------- -------------

Concessionaire Security Deposits BMS Enterprises, Incorporated Lanier Sailing Academy

$ 19,347.33 $

299 .17 $ 19,646.50 $

0.00

1,000.00

23.97

23.97

1,000.00

------------- ------------- ------------- -------------

$ 20,347.33 $

323 .14 $ 19,670.47 $

1,000.00

------------- ------------- ------------- -------------

Other

Aquatic Rental Deposits

$ 100,726.00 $ 109,566.98 $ 112,252.41 $ 98,040.57

Georgia Department of Natural Resources

6,325.30

7,102.00

7,991.30

5,436.00

Lake Lanier Islands Development Authority

Pension Trust Plan

44,230.00

231,561.28

136,634.03

139,157.25

United States Postal Service

3,536.73

3,336.15

2,361.25

4,511.63

------------- ------------- ------------- -------------

$ 154,818.03 $ 351,566.41 $ 259,238.99 $ 247,145.45
------------- ------------- ------------- -------------

$ 175,165.36$ 351,889.55$ 278,909.46$ 248,145.45

See accompanying notes and Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
- 18 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY SCHEDULE OF APPROVED BUDGET YEAR ENDED JUNE 30. 1994

SCHEDULE "1"

FUNDS AVAILABLE
REVENUES
Other Revenues Retained
EXPENDITURES
Personal Services Regular Operating Expenses Travel Motor Vehicle Purchases Equipment Computer Charges Telecommunications Per Diem, Fees and Contracts Capital Outlay Loan Repayment: 5-Year Loan Loan Repayment: 20-Year Loan

ORIGINAL BUDGET

BUDGET ADJUSTMENTS

TOTAL

$15,334,518.00$ 1,210,401.00 $16,544,919.00

$ 6,516,582.00

$ 6,516,582.00

3,974,299.00 $ 532,981.00 4,507,280.00

45,000.00

25,000.00

70,000.00

52,500.00

1,000.00

53,500.00

54,545.00

3,005.00

57,550.00

40,000.00

40,000.00

120,000.00

25,000.00 145,000.00

60,000.00

50,000.00 110,000.00

1,108,692.00 573,415.00 1,682,107.00

698,969.00

698,969.00

2,663,931.00

2,663,931.00

------------- ------------- -------------

$15,334,518.00 $1,210,401.00 $16,544,919.00

See accompanying notes and Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
- 19 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY CASH AND CASH EQUIVALENTS JUNE 30 1 1994

SCHEDULE "2"

NONINTEREST BEARING ACCOUNTS

Wachovia Bank of Georgia, N. A., Gainesville, Georgia
INTEREST BEARING ACCOUNTS

Wachovia Bank of Georgia, N. A., Gainesville, Georgia
Cash Investment Account U. S. Treasury Bill No. 912794M76
Purchase Date: June 10, 1994 Maturity Date:

August 11, 1994

OTHER

Cash on Hand

$1,712,346.21

$ 1,023.97 2,980,263.33

2,981,287.30

41,150.00

$ 4,734,783.51

See accompanying notes and Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
- 20 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY INVESTMENTS
JUNE 30. 1994

SCHEDULE "3"

INVESTMENT TYPE
Wachovia Bank of Georgia, N. A., Gainesville, Georgia
U. S. Treasury Bill No. 912794L77

PURCHASE DATE

MATURITY DATE

AMOUNT

June 21, 1994

September 22, 1994 $ 2,473,711.11
=============

See accompanying notes and Independent Accountant's Combined Report on Review of inancial Statements and Supplementary Information.
- 21 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY SCHEDULE OF OTHER REVENUES RETAINED YEAR ENDED JUNE 30, 1994

SCHEDULE "4"

Fees Beach Users Golf Operations Parking Permits Magic Nights of Light Telephone
Hotel Occupancy Tax
Interest Earned
Rentals Beach Equipment Boats Fishing Boats Group Boats Houseboats Pontoon Boats Sport Boats
Campsites Fishing Tackle Golf Club Rentals Golf Shoe Rentals Horserides Lease Agreements - Concessionaires Picnic Pavilions Rooms Ski Equipment
Sales Concerts Gas, Oil, Novelties, Food and Beverages Less: Cost of Goods Sold
Gross Profit on Sales Water and Power Sales
Sponsorships
Other Cash Over - Short Commissions Filming Insurance Recovery Claims Jury Duty Photocopies Service Charge on Returned Checks Vendor's Compensation on Sales Tax Collections

$ 2,276,987.78 1,515,728.22 786,705.44 369,516.28 44,157.54 $ 4,993,095.26
------------538,581.71
276,256.55

$ 171,981.16

$ 39,399.31 277,825.07
310,055.62
267,608.08
154,643.83
-------------

1,049,531.91
221,184.36 2,448.09 15,159.35 536.91 75,778.13
990,097.60 74,538.66
4,177,518.25 5,205.57
-------------

6,783,979.99

$ 26,429.66 $4,613,245.39
1,682,889.53
------------2,930,355.86
224,986.43
-------------

3,181,771.95 38,795.37

$ -2,594.78 36,199.55 2,100.00 93,502.77 75.00 61,496.08 641.10 14,181.17
-------------

205,600.89
-------------

$16,018,081.72

See accompanying notes and Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
- 22 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY SCHEDULE OF OTHER OPERATING EXPENSES YEAR ENDED JUNE 30. 1994
REGULAR OPERATING EXPENSES
Advertising, Publicity, and Promotion Bank Service Charges Charge Card Fees Hilton Conversion Costs Hilton Data Communications Hilton Reservation Fees Hilton Royalty Hilton Training Costs Property Loss/Damage Prospect Subsistence Registration Fees Subscriptions and Dues Travel Agent Commissions

SCHEDULE "5"
$ 843,047 .13 16,996.80
108,137.17 1,156.92
20,800.00 70,556.38 121,396.00
487.80 50.07
4,562.81 3,604.03 14,198.54 49,443.32
-------------
$1,254,436.97

See accompanying notes and Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
- 23 -

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY RECONCILIATION OF PER DIEM AND FEES YEAR ENDED JUNE 30, 1994

SCHEDULE "6"

Totals per Annual Supplement Adjustment 01 her, Samuel L.
Totals per Report

TYPE PAYMENT
-------

FEE AMOUNT

EXPENSE AMOUNT
-------

$ 68,967.76 $ 2,810.01 $

TOTAL 71,777.77

Attorney

-11,638.64

-11,638.64

------------- ------------- -------------

$ 57,329.12 $

2,810.01 $ 60,139.13

============= ============= =============

See accompanying notes and Independent Accountant's Combined Report on Review of Financial Statements and Supplementary Information.
- 24 -

SECTION II FINDINGS AND IMPROPER OR QUESTIONED COSTS

LAKE LANIER ISLANDS DEVELOPMENT AUTHORITY SCHEDULE OF FINDINGS AND IMPROPER OR QUESTIONED COSTS
YEAR ENDED JUNE 30, 1994

STATUS OF PRIOR YEAR FINDINGS AND IMPROPER OR QUESTIONED COSTS

The status of the finding disclosed in the review report for the year ended June 30, 1993 is listed below:

Audit Control Number

Status ofFinding

913-93-01

Corrective Action Implemented