HomeMy WebLinkAbout2016-07-17 - Agendas - FinalFAYETTEVILLE PUBLIC LIBRARY
Hershey Garner, President
Janine Parry, Vice -President
Susan Graham, Treasurer
We inspire imagination and foster learning.
Board of Trustees
July 18, 2016 4 pm
AGENDA
Regular Meeting Ann Henry Board Room
Maylon Rice, Secretary
Kim Agee
Brenda Boudreaux
Suzanne Clark
I. Call to order
II. Minutes
A. Approval of minutes
1. June 20, 2016 — page 2-5
B. Signed minutes
1. April 18, 2016 — page 6-7
2. May 16, 2016 — page 8
III. Old business/information
A. Foundation update — Hershey Garner
B. Library Expansion
1. Update on City Hospital property
2. Public input sessions with Jeffrey Scherer
3. Update on Civic Millage Committee activities
C. Staff Changes
1. Update on Director of Development position
D. Resolution authorizing transfer of Development Department to the Foundation: Approved at last board
meeting but H. Garner needs to sign.
IV. New business/information
A. Management Letter — page 9-14
B. Management Representation Letter — page 15-20
C. 2015 Audit Report — page 21-49
II. Public Comment
III. Adjournment
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FAYETTEVILLE PUBLIC LIBRARY
Hershey Garner, President
Janine Parry, Vice -President
Susan Graham, Treasurer
Board Members Present: M. Rice, J.
Board Members Absent: H. Garner
Staff: J. Atha, S. Palmer, L. Yandell,
Others: Jeff Koenig
Press: Dan Holtmeyer
Board of Trustees
June 20, 2016 4 pm
MINUTES
Regular Meeting Ann Henry Board Room
Prepared by G. Jelinek
Maylon Rice, Secretary
Kim Agee
Brenda Boudreaux
Parry, K. Agee, S. Graham, S. Clark, B.Boudreaux
Suzanne Clark
G. Jelinek, D. Johnson, G. Allen, W. Fitzgibbon, S. Davis
We inspire imagination and foster learning.
I. Call to order: J. Parry called the meeting to order at 4:00 pm.
Minutes
A. Approval of minutes: M. Rice moved to approve the minutes April 18, 2016 and May 16,
2016; B. Boudreaux seconded. All voted AYE.
B. Signed minutes
1. February 15, 2016
Reports
A. Management reports
1. Key upcoming events: Opera in the Ozarks will be Saturday, June 25. Public input
sessions with Jeff Scherer are scheduled for July 6-8. Outside the Lines coloring for adults
is Saturday, July 16. FPL's 100th Anniversary and Summer Reading finale will be
Saturday, July 30. Mayor Jordan will make a proclamation and Bootsie Ackerman will
speak on behalf of Congressman Womack. The summer concludes in August with another
partnership with the Fayetteville Roots Festival featuring music, authors, and celebrity
chefs.
2. April 2016 -May 2016 Strategic Plan progress: Friday morning movies continue to
bring in crowds. Outreach continues to increase with Reading with the Razorbacks; Sit,
Stay, Read; Cat Tales; and First Thursday. Youth Services staff visited all the elementary
schools to promote summer reading. D. Johnson discussed the importance of promoting
from within to find the best cultural fit for our organization and mentioned several recent
promotions. He congratulated N. Rowe for stepping in when B. Holt left as marketing
manager and acknowledged his work advertising our 100th anniversary and SRC. M. Rice
asked for a round of applause for all promoted and recognition for M. Burdette for
changing positions within the library. The Friends book sale on May 21 took in $1600. S.
Graham stated that Friends will start having 3 large book sales per year. IT deployed a
Nimble 10 gig storage area network (SAN). In the absence of a Development Director, we
sent out requests to join RFS and were overwhelmed by the response.
B. Performance Measures: 350 youth attended the Young Meteorologist Weather Festival in April.
Study rooms were checked out 815 times in April and May. D. Johnson mentioned the role
weather plays in program attendance; we may not have as many attendees on nice sunny days and
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we also have low attendance in inclement weather. Because UA students were here studying for
finals in April/May, we maxed out on Wi-Fi licenses several times. Plans are to increase the
number of these licenses which is part of IT's infrastructure development plan. L. Yandell
mentioned that we are now measuring our bandwidth in terabytes. J. Parry asked for program
attendance numbers for Baby Bookworms and Toddler Time. L. Greenwood stated that Baby
Bookworm attendance has been 115-120 and a recent Toddler Time saw 105 people in the Story
Time room. D. Johnson stated that program attendance increases in the summer and youth
programs are 50% of programming.
c. Financial reports
1. Budget to Actual: S. Davis reported that the YTD budget revenue state turn back is
performing just as the legislature hoped it would. Nevertheless, some funding has been
restored. The $15,000 GIF grant is actually the second half of the grant from NWA
economic development. The transfer from the city and millage revenues are tracking
nicely. Millage amounts are slightly down but that is a timing issue from when people pay
property taxes and should increase as the deadline approaches. We took in $2685.00 in
Erik Larson reception tickets, but had to refund $45 to some who did not attend. The
audit took a long time mostly due to the software conversion. S. Davis has not yet gone
through all revenue sources and some (such as cafe rental) may seem low, but the task will
be completed soon. Designated gifts include a $65,000 estate donation as well as
donations for Youth Services. The Foundation will set its budget July 11, 2016.
2. Balance Sheet: S. Davis reported that YTD budgets were set upon spending trends
from last year. We are slightly ahead of historical pace but still within budget. A
discrepancy was noted regarding health insurance. For example, Adult Services was
budgeted $43,116 in health insurance costs this year and as of May $40,469 has been
spent. When we write the check for health insurance it includes the employer and
employee portion and has all been charged to employee expense. It will be corrected for
the June meeting. We are $20,000 ahead on materials purchases and only $12,000
ahead in library services expenses. $686,000 of $889,000 in administrative expenses
has been spent. For the most part, funds should be fully utilized this year. Because of
vacancies in Marketing and Development, we are under budget by $29,000. S. Davis
mentioned that because of recommendations made by the Long Term Revenue Committee,
we don't fill positions just because they are vacant, but only when they are needed. L.
Mandell and N. Rowe have taken on additional responsibilities and N. Rowe has been
compensated. J. Parry stated that we have been working with approximately the same
number of staff for 10 years and there needs to be a cap on that. D. Johnson stated that
we will revisit vacancies if they are deemed a necessity. In the facilities budget, $137,000
has been reinvested. We are waiting for the bill for the front door replacement and so the
amount in that budget will decrease. S. Palmer stated that facilities is looking carefully at
current projects to ensure that work will not be re -done during the expansion. IT has used
technology reserve money for the SAN replacement. Finally, a draft audit report was
released today. The audit committee will meet to review the draft.
IV. Old business/information
A. Library Expansion: Election commission decision: Vince Chadick, Bo Bittle, and D. Johnson
discussed with election commission about number of venues for August 9th election. The election
commission has requested 7 polling locations. Originally we desired 4 polling locations because
of cost, but there will no longer be paper ballots and thus the cost is minimal. The polling
locations will be Baldwin Church of Christ, Central United Methodist, Covenant Presbyterian
Church, Mount Comfort Church of Christ, Sang Ave Baptist Church, Sequoyah Methodist Church,
and Trinity Fellowship. There will be paper ballots available for early voting which is Tuesday —
Friday, (August 2-5, 2016) and also on Monday, August 8, 2016. Voters can vote at any location.
We are currently reviewing a sample ballot.
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B. Update on City Hospital property: No update. The Arkansas Supreme Court has not put it on
the docket and there is a narrow window left until the justices recess for the summer.
c. Public input sessions with Jeffrey Scherer: Jack Poling and Jeffrey Scherer will be here August
6-8. There will be more in depth discussion on what the expansion on the city hospital property
will look like. The meeting times are tentatively scheduled for 5:30 pm, noon, and 9:OOam,
respectively. We are requesting an audience with the Chamber during one of the sessions. It will
be the same format we have had previously which consists of 30-45 minutes of slides with J.
Scherer followed by questions. A press release will go out as well as an e -newsletter to all of our
patrons. D. Johnson stated that the millage committee has done such a good job of educating the
community that there might be more interest in these meetings. A full schedule will be sent out
soon. S. Graham mentioned how effective targeted sessions have been in the past (e.g. meeting
with a group of teens). D. Johnson stated that this presentation should be more visually compelling
and may include a 3D model.
D. Update on Civic Millage Committee activities: Jeff Koenig stated that the millage committee
has spent a lot of time at the Farmers' Market this past month. Committee members will also be
attending the next two First Thursdays, a Washington County Democrats meeting on June 21, and
the Political Animals club. Four mass mailings will go to 7000 targeted voters as well as an email
to their contact list. Facebook page metrics include 260 page visits per day and 17,000 visits
weekly. About 1500 people have engaged with the page and there are 1300 "Likes". Hannah
Withers of Maxine's will hold a public fundraiser on July 6, 2016. Jeff Koenig and Board of
Trustees members will host a private support party at Koenig's condo on July 11,
E. Staff Changes
1. Willow Fitzgibbon, Director of Library Services
2. Carlye Dennis, Manager of Volunteer & Outreach Services
3. Amy Nelson Lamont, Adult Services Librarian
4. Update on Director of Development position: D. Johnson interviewed 2 promising
candidates. Another candidate will be interviewed in early July.
F. Resolution authorizing transfer of Development Department to the Foundation: K. Agee stated
that we previously discussed this in 2014, but did not act upon it. The Director of Development
will be employed by the Foundation but will be under the rules and regulations of the library. As
previously discussed, this is a move to protect donor information. D. Johnson stated that this
position was previously under the Foundation, but Louise Schaper moved it under the Executive
Director and we are moving it back. M. Rice moved to adopt the resolution to transfer the
Development Department to the Foundation. B. Boudreaux seconded. All voted AYE.
V. New business/information
G. 2015 Audit Report (if available): S. Davis stated that it is not yet ready, but close.
H. Roberta Fulbright Speaker: Ann Patchett will speak the evening of March 31'. This is a free
event, but there will be a ticketed reception.
1. CNN filming of Jim Blair: On Tuesday June, 14, CNN interviewed Jim Blair in our Fulbright
room for 2.5 hours. The interview is part of a Hillary Clinton profile that will debut Labor Day
weekend. D. Johnson requested an unedited recording of the interview.
J. Summer Reading Kickoff: We have programs for children, teens, or adults 7 days a week. As
of June 21, 4,202 have registered for summer reading. Registration for a class for children started
at 9am and was full at 9:01am. We could have several more full classes if we had the space and
funds. Parents now sign their children up online.
K. Building improvements: S. Palmer stated that they have not spent all of their reinvested funds
yet. The front door has been replaced. The bathrooms in the front lobby will get ADA
improvements, new countertops, and maybe some hands free faucets. J. Parry asked about
bathrooms with partitions instead of doors. S. Palmer stated that he and Jeffrey Scherer have
discussed it.
L. Tool lending library: W. Fitzgibbon reported it is going well. Tools have checked out 127
times which is about 40 per month. People can donate tools and some vendors have donated new
tools. The next steps are perhaps making kits of tools for specific purposes such as for new
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students moving into apartments. There are also talks about having a self -check and catalog
computer at Feed Communities.
M. Partnership between FPL, Good Folks Production, and KUAF: D. Johnson stated that Mike
Shirkey, who hosts Pickin' Post on KUAF, used to host concerts at his downtown Fayetteville home
and is looking for a new venue. Now known as Pickin' Post Productions, on some Friday nights at
FPL, we will have ticketed music events after the library is closed. FPL will get 30% of the
proceeds. The first event will be July 22, 2016 featuring Jack Williams. Roy Book Binder will
perform on August 6, 2016. B. Boudreaux inquired about staffing for the event. D. Johnson
stated that it would be himself or W. Fitzgibbon, C. Moody for sound and housekeeping. Arsaga's
may or may not stay open for the events. It will be marketed on Mike Shirkey's Pickin' Post
program on KUAF. Also discussed for FPL expansion is a program like Prairie Home companion in
which Kyle Kellams and Mike Shirkey could host story -tellers and musicians live at the library.
N. Appointment of Finance Committee: The Finance Committee will provide financial guidance
and direction for the library and will review the report prepared by the annual external audit. It
may conduct executive sessions with outside auditors, the Executive Director and the Finance
Manager: B. Boudreaux and M. Rice will continue to serve as the finance committee and will
review the audit report.
V. Public Comment none
VI. Adjournment: The meeting adjourned at 4:57 by consensus.
Mayon Rice, Secretary Date
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FAYETTEVILLE PUBLIC LIBRARY
Brenda Boudreaux, President
Hershey Garner, Vice -President
Maylon Rice, Treasurer
Board of Trustees
April 18, 2016 4 pm
MINUTES
Regular Meeting Ann Henry Board Room
Janine Parry, Secretary
Kim Agee
Suzanne Clark
Susan Graham
Trustees present: B. Boudreaux, H. Garner, M. Rice, J. Parry, K. Agee, S. Clark, S. Graham
Trustees absent: none
Staff: C. Moody, G. Allen, L. Yandell, G. Jelinek, S. Houk, S. Palmer, L. Greenwood, C. Dennis
Press: Dan Holtmeyer
Others: Bo Bittle, Jeff Koenig, Vince Chadick
We inspire imagination and foster learning.
I. Call to order: B. Boudreaux called the meeting to order at 4:01 pm.
11. Minutes
A. Approval of minutes: H. Garner moved to approve the minutes of February 15, 2016; S. Clark
seconded. All voted AYE.
III. Reports
A. Management reports
1. Key upcoming events: Author Erik Larson drew a crowd and the public responded well to FPL's
first ticketed reception. In response to a request from the ALA, FPL is working with CCOA to offer
financial classes for veterans. SRC kick-off is Saturday June 4th, and FPL's 100th birthday is being
celebrated this year.
2. February 2016 -March 2016 Strategic Plan progress: Like libraries across the country, FPL is
struggling to meet the demands for programming.
3. Performance Measures: Check-outs have plateaued (a nationwide trend) as patrons find
resources on-line and elsewhere. However, program attendance is continuing to increase.
B. Financial reports
1. Budget to Actual as of February 2016: Total revenue for the first two months was budgeted at
$424,000; $404,000 has been collected. Cash collections through the register will add $11,000
to the total. Expenses are also tracking well with $364,000 budgeted and $310,000 spent.
Following the Long -Term Revenue Committee's recommendation, there are no plans to spend money
from the Long Term Reserve Fund, currently $1 million. There are a number of planned projects,
e.g., remodeling bathrooms for ADA compliance and replacing front door that will be paid from the
Facilities Reserve. No expenditures are planned from the Furniture and Equipment Reserve.
Typically, up to $100,000 is budgeted from the IT Reserve; however, due to our financial condition,
the city increased its transfer from $35,000 to $100,000. The amount will fluctuate over the next
4-5 years and isn't a permanent infusion of funds. The 2015 audit is about 3 weeks behind
schedule due to FPL's conversion to new accounting software.
IV. New business
A. Introduce Jeff Koenig, leader of Civic Millage Committee: Mr. Koenig presented basic plans for a
millage campaign this summer. FPL needs tax revenue and private donations to move forward. The
proposed millage consists of two parts: capital funds for expansion and operating funds for the expansion as
well as for Blair Library. Historically, it's been difficult to get voter approval for operating funds, so
operating and capital funding will be combined on a single ballet. As the campaign progresses, Janine Parry
will analyze the voter rolls for those most likely to vote. A concerted Facebook campaign combined with
high visibility at the Farmers' Market — both used successfully in the last two elections — will be the focus of
campaigning. Members of the Civic Millage Committee and the Library Board of Trustees will be requested
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to make phone calls reminding citizens to vote. Kim Agee will be the Board's representative on the Civic
Millage Committee. The millage being discussed is 1.2% for capital bonds and 1.5% for operations for a
total of 2.7 - at the most. The bonds will sunset, a provision essential to show good faith with the voters.
Mr. Koenig is working with David Johnson to develop a single sheet of 10 facts and talking points for public
education and discussion. The committee will also develop a slogan/catch phrase to be associated with the
campaign. Jeff Scherer will provide visuals, and an endorsement ad will appear in the newspaper a week
before the election.
B. Decide Election Date/ Expansion Calendar: Resolution needed to initiate the process: Architect Jeffrey
Scherer will be in Fayetteville from May 2-4 to meet with a variety of stakeholders. He will return in early
July with completed visuals for the campaign. The ballot will include two questions: Do you want to
expand? Do you want to operate both the expansion and the existing building? If a voter is for the first
question, s/he must vote yes to the second question. H. Garner moved to adopt the resolution initiating the
expansion process; M. Rice seconded. All voted AYE.
C. Discuss board meeting more frequently during expansion phase: By consensus, trustees agreed to meet
monthly on 3'" Mondays, at least through the end of July.
D. 2015 Preliminary Budget to Actual Report and Budget Roll -Forward Request: H. Garner moved to
approve the staff roll -forward request; M. Rice seconded. All voted AYE.
E. Approve MSR Change Order for Phase 2B: The rollover approved in item D above will pay for the change
order. H, Garner moved to approve the MSR change order; M. Rice seconded. All voted AYE.
F. Reaffirm FPL's intent to execute the existing contract with Washington Regional to purchase the City
Hospital Property: H. Garner moved to acknowledge and reaffirm FPL's commitment to the contract with
Washington Regional Medical Center to purchase the City Hospital property; S. Clark seconded. All voted
AYE.
G. Letter to Stone Family: A proposal was made to write the Stone Family explaining the money to be used
for the purchase can only be used for a capital expenditure, clarifying the library's intent to honor the spirit
of the Stone Family ancestors, and proposing that a part of the City Hospital property include a permanent
honor to the Stone Family. Following discussion, it was decided that communicating with the family during
litigation may not be advisable. The trustees may wish to write the family when, and if, the property is
purchased by the library.
H. Acknowledgement of Bequests & Planned Giving: H. Garner moved to approve the resolution of
recognition and appreciation for a bequest from Oscar and Peg Leverenz; J. Parry seconded. All voted AYE.
H. Garner moved to approve the resolution of recognition and appreciation for a bequest from Charles
Russum; M. Rice seconded. All voted AYE.
I. Correct PTO Policy: H. Garner moved to correct the PTO policy as recommended by staff; M. Rice
seconded. All voted AYE.
J. Appointment of Nominating Committee for Officers: B. Boudreaux and J. Parry will comprise the
Nominating Committee to select officers for the next term beginning June 1, 2016.
V. Public Comment
VI. Explanation of legal proceedings: The Stone Family has appealed the ruling by the 3 judge panel of the Court of
Appeals to the full Court. The full Court of Appeals may affirm the 3 judge panel or refuse to hear the appeal. At
that point, the Supreme Court could decide to review the case which could lengthen the process considerably. The
quickest resolution is full Appeals Court affirmation of the 3 judge determination and a refusal by the Supreme
Courts to take up the case.
VII, Adjournment: The meeting adjourned at 4:54 by consensus.
Janine Parry, / retary
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Date
AYETTEVILLE PUBLIC LIBRARY
Brenda Boudreaux, President
Hershey Garner, Vice -President
Maylon Rice, Treasurer
Board of Trustees
May 16, 2016 4 pm
MINUTES
Regular Meeting Ann Henry Board Room
Janine Parry, Secretary
Kim Agee
Suzanne Clark
Susan Graham
Present: B. Boudreaux, J. Parry, S. Clark, H. Garner, S. Graham, M. Rice
Absent: K. Agee
Others: Jeff Koenig
Staff: L. Yandell, S. Palmer, C. Dennis, S. Houk, W. Fitzgibbon, G. Jelinek
We inspire imagination and foster learning.
I. Call to order B. Boudreaux called the meeting to order at 4:00
II. Old business — Informational Purposes
A. Update on City Hospital Property: The Supreme Court has not made a decision on the Stone
case though one is imminent as it's unlikely the court would recess having not addressed the
question.
B. Update on Civic Millage Committee: J. Koenig reported almost 200 brochures were
distributed at the recent Farmers' Market to a positive reception. Brochures will also be
distributed at the Block Street Block Party. The Facebook campaign is well under way. The Civic
Millage Committee's budget is about $20,000 (private money). Stephen Smith and George
Shelton are helping with research that will focus the campaign's efforts. The City Council meets
tomorrow night (Tuesday, May 17, 2016) and B. Boudreaux encouraged all to attend.
c. Report of the Nominating Committee: The committee, comprised of B. Boudreaux and J.
Parry, nominated H. Garner for President, J. Parry for Vice President, S. Graham for Treasurer, and
M. Rice for Secretary for a one year term beginning June 20. S. Clark moved to approve the slate
of officers; H. Garner seconded. All voted AYE. The President customarily serves as the Board of
Trustees' delegate to the Foundation unless the President delegates this function to someone else.
New officers will assume their duties at the June meeting.
III. New Business — Action Required
A. Approval to move the Director of Development position to the Foundation: Originally, this
position was employed by the Foundation. A former Executive Director moved the position to the
library. Staff will research the minutes as to whether this move has already been done. If the
Development Director becomes the Foundation's employee, D. Johnson will remain as managing
supervisor. The Foundation will rent office space, furniture and equipment for the Development
Director. V. Chadick will craft the contract to be approved by the Board at its next meeting.
IV. Adjournment: Meeting adjourned by consensus at 4:30 pm.
8
Date
CPAs & Advisors
Board of Tnnstees tinct Management
Fayetteville Public Library
Fayetteville, Arkansas
As part of our audit of the financial statements of Fayetteville Public Library (the Library), a
component unit of the City of Fayetteville, Arkansas, as of and for the year ended
December 31, 2015, we wish to conununicate the following to you.
AUDIT SCOPE AND RESULTS
Auditor's Responsibility Under Auditing Standards Generally Accepted in the United
States of America
An audit performed in accordance with auditing standards generally accepted in the United
States of America is designed to obtain reasonable, rather than absolute, assurance about the
financial statements. In performing auditing procedures, we establish scopes of audit tests in
relation to the financial statements taken as a whole. Our engagement does not include a detailed
audit of every transaction. Our engagement letter more specifically describes our
responsibilities.
These standards require communication of significant matters related to the financial statement
audit that are relevant to the responsibilities of those charged with governance in overseeing the
financial reporting process. Such natters are communicated in the remainder of this letter or
have previously been conmuuticated during other phases of the audit. The standards do not
require the auditor to design procedures for the ptupose of identifying other matters to be
conmuuticated with those charged with governance.
An audit of the financial statements does not relieve management or those charged with
governance of their responsibilities. Our engagement letter more specifically describes your
responsibilities.
Oualitative Aspects of Significant Accounting Policies and Practices
Sienifca,t Acconnhinz Policies
The Library's significant aeeounting policies are described in note 1 of the audited financial
statements.
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Board of Trustees and Management
Fayetteville Public Library
Page 2
Alternative Accounting, Treatments
We had discussions with management regarding alterative accounting treatments within
accounting principles generally accepted in the United States of America for policies and
practices for material items, including recognition, measurement and disclosure considerations
related to the accounting for specific transactions as well as general accounting policies, as
follows:
• No matters are reportable.
Management Jndements and Accounting, Estimates
Accounting estimates are au integral part of financial statement preparation by management,
based on its judgments. The following areas involve significant estimates for which we are
prepared to discuss management's estimation process and our procedures for testing the
reasonableness of those estimates:
• Depreciation of capital assets
Financial Statement Disclosures
The following areas involve particularly sensitive financial statement disclosures for which we
are prepared to discuss the issues involved and related judmnents made in formulating those
disclosures:
• No matters are reportable.
Audit Adiustments
During the course of any audit, an auditor may propose adjustments to financial statement
amorists. Management evaluates our proposals and records those adjustments which, in its
judgment, are required to prevent the financial statements from being materially misstated.
Areas in which adjustments were proposed include:
Proposed Audit Adjustments Recorded
• Accounts payable
• Beginning equity — to agree to the prior year report
• Contribution revenue
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Board of Trustees and Management
Fayetteville Public Library
Page 3
Proposed Audit Adjustments Not Recorded
e No matters are reportable.
Auditor's Judgments About the Onatity of the Entity's Accounting Principles
During the course of the audit, we made the following observations regarding the Company's
application of accounting principles:
e No matters are reportable.
Other Material Written Communications
Listed below are other material written conununications between management and us related to
the audit:
• Management representation letter (attached)
INTERNAL CONTROL OVER FINANCIAL REPORTING
In planning and performing our audit of the financial statements of the Fayetteville Public
Library as of and for the year ended December 31, 2015, in accordance with auditing standards
generally accepted in the United States of America, we considered the Library's internal control
over financial reporting (internal control) 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 Library's internal control. Accordingly, we do
not express an opinion on the effectiveness of the Library's internal control.
Our consideration of internal control was for the limited purpose described in the preceding
paragraph and was not designed to identify all deficiencies in internal control 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 that we consider to be
significant deficiencies.
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Board of Trustees and Management
Fayetteville Public Library
Page 4
A deficiency in interval 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 of the Library's financial statements on a timely
basis. A deficiency in design exists when a control necessary to tweet a control objective is
missing or an existing control is not properly designed so that, even if the control operates as
designed, a control objective would not be met. A deficiency in operation exists when a properly
designed control does not operate as designed or when the person performing the control does
not possess the necessary authority or competence to perform the control effectively.
A material weakness is a deficiency, or a combination of deficiencies, in internal control, such
that there is a reasonable possibility that a material misstatement of the Library's financial
statements will not be prevented or detected and corrected on a timely basis.
A significant deficiency is a deficiency, or 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 observed the following matters that we consider to be significant deficiencies.
Significant Deficiencies
Unreconciled Bank Accounts and Investment Activity
While performing the audit of the Library and Foundation, it was noted that monthly bank
reconciliations and investment reconciliations were not performed throughout the year. Untimely
review of tnontldy bank and investment activity and inadequate reconciliations could lead to
both errors cotmnitted by Libruy personnel or third parties and intentional acts of fraudulent
activity to go unnoticed, both of which could lead to a material misstatement of the financial
statements. Bank reconciliations were completed at year-end, but BKD recommends that
management stay diligent in ensuing these reconciliations are completed on a monthly basis and
are completed as timely as reasonably possible to ensure any such errors or activity are both
recognized and corrected in their infancy.
Software Implementation
During the year, the Library and Foundation acquired and installed new financial reporting
software in order to allow the Library and Foundation to utilize better features for more efficient
and effective financial repotting. However, after implementing the software, there was
inadequate reconciliation between the final balances within the old software and the beginning
balances within the new software, creating differences and inaccurate financials. BKD
recommends that whenever new software is implemented, a reconciliation process be
implemented to ensue a seamless transition to the new software and to eliminate any potential
issues and/or material misstatements that could arise in the future.
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Board of Trustees and Management
Fayetteville Public Library
Page 5
Review and Reconciliation of Donations Received
Contributions and donations received by the Director of Development were neither reviewed nor
reconciled atter original posting. into the system. This could lead to amounts received being
inaccurately recorded as to both amount and to donor (posted to wrong accotmt). In addition,
without proper review and reconciliation between the amounts received, posted, and deposited
into the bank, misappropriation of assets could occur or other errors that could lead to a demise
in the public's faitlt and willingness to provide future contributions and support to the Libraty
and Foundation. BKD recommends that the Library and Foundation implement a process and
continuously review to ensure that contributions and donations received from the public are
reviewed and reconciled timely to ensure any potential enorss are identified and corrected as
quickly as possible.
Deficiency
Physical Inventor' of Fixed Assets
Currently, there is no physical inventory or emit perfonued on the fixed assets of the Library.
Lack of at least an amnutl review of fixed assets could lead to certain items becoming danuiged
or misplaced without being identified timely. In terms of danrged assets, repairs are often less
costly than replacement if they are identified in time. BKD reconunends the Library implement a
process to take a physical inventory of tixecl assets at least mutually as well as an inspection of
more significant and valuable assets.
We observed other matters that we consider to be deficiencies that we communicated to
management orally.
OTHER MATTERS
We observed the following matters and offer these comments and suggestions with respect to
matters which came to our attention during the course of the audit of the financial statements.
Otu audit procedures are designed primarily to enable us to form an opinion on the financial
statements and, therefore, may not bring to light all weaknesses in policies and procedures that
may exist. However, these matters are offered as constructive suggestions for the consideration
of management as part of the ongoing process of modifying and improving financial and
administrative practices and procedures. tate can discuss these matters further at your
convenience and may provide implementation assistance for changes or improvements.
13
Board of Trustees and Management
Fayetteville Public Library
Page 6
Fraud Hotline Implementation
In its "2014 Report to the Nation on Occupational Fraud and Abuse," the Association of
Certified Fraud Examiners estimates that 5% of revenue is lost to fraud and abuse. One of the
most cost-effective strategies in combating fraud is the implementation of a third -party hotline.
We reconnnend that management consider implementing a third -party hotline this year.
Independent studies have shown that a significant amount of fraudulent activity is discovered by
way of anonymous tips; the third -party hotlines can play a key role in the facilitation of this
important information. hi our own experience, we also have found that third -party hotlines can
be an important strategy in accelerating the discovery of inappropriate activity in the
organization and thereby reducing losses relating to such activity. In addition, the
implementation of such a hotline can add to the overall control environment and "tone at the top"
of the company and thereby serve as an important deterrent to fraud within the organization.
This communication is intended solely for the information and use of management, the Board of
Trustees, and others within the organization and is not intended to be and should not be used by
anyone other than these specified parties.
I%y trt-P
June 27, 2016
Enclosure
14
PAYETTEVILLE PUBLIC LIBRARY
June 27, 2016
131W, LLP
Certified Public Accountants
P.O. Box 1893
Rogers, Arkansas 72757
We are providing this letter in connection with your audits of our financial statements as of and
for the year ended December 31, 2015. We confirm that we are responsible for the fair presentaUou
of the financial statements in conformity with accounting principles generally accepted in the
United States of America. We are also responsible for adopting sound accounting policies,
establishing and maintaining effective internal control over financial reporting, operations and
compliance, and preventing and detecting fraud.
Certain representations in this letter are described as being limited to matters that are material.
Items are considered material, regardless of size, if they involve an omission or misstatement of
accounting information that, in light of surrounding circumstances, makes it probable that the
judgment of a reasonable person relying on the information would be changed or influenced by
the omission or misstatement.
We confirm, to the best of our knowledge and belief, the following;
1. We have fulfilled our responsibilities, as set out in the terms of our engagement
letter dated January 11, 2016, for the preparation and fair presentation of the
financial statetnents in accordance with accounting principles generally accepted in
the United States of America.
2, We acknowledge our responsibility for the design, implementation and
maintenance of internal control relevant to the preparation and fair presentation of
financial statements that are free from material misstatement, whether due to fraud
or error.
3. We acknowledge our responsibility for the design, implementation and
maintenance of internal control to prevent and detect fraud.
4. We have reviewed and approved a draft of the financial statements and related notes
referred to above, which you prepared in connection with your audit of our financial
statements. We acknowledge that we are responsible for the fair presentation of
the financial statements and related notes.
15
BKD, LLP
Certified Public Accountants
Page 2
5. We have provided you with:
(a) Access to all information of which we are aware that is relevant to the
preparation and fair presentation of the financial statements such as records,
documentation and other matters.
(b) Additional information that you have requested from us for the purpose of
the audit.
(c) Unrestricted access to persons within the entity from whom you determined
it necessary to obtain audit evidence.
(d) All minutes of meetings of the governing body held through the date of this
letter.
(e) All significant contracts and grants.
6. All transactions have been recorded in the accounting records and are reflected in
the financial statements.
7. We have informed you of all current risks of a material atnount that are not
adequately prevented or detected by entity procedures with respect to:
(a) Misappropriation of assets.
(b) Misrepresented or misstated assets, liabilities or net position.
8. We understand the potential penalties for failure to disclose reportable tax
transactions to the taxing authorities and have fully disclosed to BKD any and all
known reportable tax transactions.
9. We have no knowledge of any known or suspected:
(a) Fraudulent financial reporting or misappropriation of assets involving
managetnent or employees who have significant roles in internal control.
(b) Fraudulent financial reporting or misappropriation of assets involving others
that could have a material effect on the financial statements.
10. We have no knowledge of any allegations of fraud or suspected fraud affecting the
Library received in communications from employees, customers, regulators,
suppliers or others.
We have disclosed to you the identity of the entity's related parties and all the
related party relationships and transactions of which we are aware. Related patty
relationships and transactions have been appropriately accounted for and disclosed
401 W. mountain St.
Fayetteville, M 72701.
479.856.7000 1 www.faylib.org
16
BKD, LLP
Certified Public Accountants
Page 3
in accordance with accounting principles generally accepted in the United States of
America. We understand that the tern related party refers to an affiliate;
management, and members o f their immediate families, component units; and any
other party with which the entity may deal if it can significantly influence, or be
influenced by, the management or operating policies of the other. The tern affiliate
refers to a party that directly or indirectly controls, or is controlled by, or is under
common control with us.
12. Except as reflected in the financial statements, there are no:
(a)
Plans or intentions that may materially affect carrying values
classifications of assets and liabilities.
nr
(b) Material transactions omitted or improperly recorded in the financial
statements.
(e)
Material gain/loss contingencies requiring accrual or disclosure, including
those arising from environmental remediation obligations.
(d) Events ocetrring subsequent to the balance sheet/statement of net position
date through the date of this letter requiring adjustment or disclosure in the
financial statements.
(e)
(0
(g)
Agreements to purchase assets previously sold.
Restrictions on cash balances or compensating balance agreements.
Guarantees, whether written or oral, under which the Library is contingently
liable.
13. We have disclosed to you all known instances of noncompliance or suspected
noncompliance with laws and regulations whose effects should be considered when
preparing financial statements.
14. We have no reason to believe the Library owes any penalties or payments under the
Employer Shared Responsibility Provisions of the Patient Protection and
Affordable Care Act nor have we received any correspondence from the IRS or
other agencies indicating such payments may he due.
15. We are not aware of any pending or threatened litigation or claims whose effects
should be considered when preparing the financial statements. We have not sought
or received attorney's services related to pending or threatened litigation or claims
401 W. Mountain St.
Fayetteville, AR 72701.
479.356.7000 1 www.faylib.or6
17
BKD, LLP
Certified Public Accountants
Page 4
during or subsequent to the audit period, Also, we are not aware of any litigation
or claims, pending or threatened, for which legal counsel should he sought.
16. Adequate provisions and allowances have been accreted for any material losses
from:
(a) lineallectible pledge receivables.
(b) Purchase commitments in excess of normal requirements or above prevailing
market prices.
17. Except as disclosed in the financial statements, we have:
(a)
(b)
Satisfactory title to all recorded assets, and they are not subject to any liens,
pledges or other encumbrances.
Complied with all aspects of contractual and grant agreements, for which
noncompliance would materially affect the financial statements.
18. We have not been designated as a potentially responsible party (PRP or equivalent
status) by the Environmental Protection Agency (EPA) or other cognizant
regulatory agency with authority to enforce environmental laws and regulations.
19. With regard to deposit and investment activities:
(a)
All deposit, repurchase and reverse repurchase agreements and investment
transactions have been made in accordance with legal and contractual
requirements.
(b) Disclosures of deposit and investment balances and risks in the financial
statements are consistent with our understanding of the applicable laws
regarding enforceability of any pledges of collateral.
(e) We understand that your audit does not represent an opinion regarding the
enforceability of any collateral pledges.
20. With respect to any nonattest services you have provided us during the year,
including drafting the financial statements and related notes:
(a) We have designated a qualified management -level individual to he
responsible and accountable for overseeing the nonattest services.
We have established and monitored the performance of the nonattest services
to ensure that they meet our objectives.
(b)
401 W, Mountain St.
Fayetteville, AR 72701
479.856.7000 1 www.taylib.org
18
13K0, LLP
Certified Public Accountants
Page 5
(c)
We have made any and all decisions involving management functions with
respect to the nonattest services and accept fill responsibility for such
decisions.
(d) We have evaluated the adequacy of the services performed and any findings
that resulted.
21. The financial statements disclose all significant estimates and material
concentrations known to us. Significant estimates are estimates at the balance sheet
date which could change materially within the next year. Concentrations refer to
volumes of business, revenues, available sources of supply, or markets for which
events could occur which would significantly disrupt normal finances within the
next year. Significant assumptions used by us in making accounting estimates,
including those measured at fair value, are reasonable.
22. The supplementary information required by the Governmental Accounting
Standards Board, consisting of management's discussion and analysis and
budgetary comparisons, has been prepared and is measured and presented in
conformity with the applicable GASB pronouncements, and we acknowledge our
responsibility for the infonnation. The information contained therein is based on
all facts, decisions and conditions currently known to us and is measured using the
same methods and assumptions as were used in the preparation of the financial
statements. We believe the significant assumptions underlying the measurement
and/or presentation of the information are reasonable and appropriate. There has
been no change from the preceding period in the methods of measurement and
presentation.
23. With regard to supplementary information:
(a)
We acknowledge our responsibility for the presentation of the supplementary
information in accordance with the applicable criteria,
(b) We believe the supplementary information is fairly presented, both in form
and content, in accordance with the applicable criteria.
(c) The methods of measurement and presentation of the supplementary
information are unchanged from those used in the prior period,
(d) We believe the significant assumptions or interpretations underlying the
measurement and/or presentation of the supplementary information are
reasonable and appropriate.
(e) If the supplementary information is not presented with the audited financial
statements, we acknowledge we will make the audited financial statements
401 W. Mountain St.
Fayetteville, Aft 72701
179350.7000 1 www.taylib.org
19
BKD, LLP
Certified Public Accountants
Page 6
readily available to intended users of the supplementary information no later
than the date such information and the related auditor's report are issued.
David Johnson, Executive Director
YON-�
Stephen Davis, Accounting and Human
Resources Manager
401 W. Mountain St.
Fayetteville, AR 72701
479.856.7000 waw ,faylib.org
20
Fayetteville Public Library
A Component Unit of the City of Fayetteville, Arkansas
Independent Auditor's Report and Financial Statements
December31, 2015
BKDLLP
CPAs & Advisors
21
Fayetteville Public Library
A Component Unit of the City of Fayetteville, Arkansas
December 31, 2015
Contents
Independent Auditor's Report 1
Management's Discussion and Analysis 3
Financial Statements
Governmental Fund Balance Sheet/Statement of Net Position7
Statement of Governmental Fund Revenues, Expenditures and Changes in
Fund Balances/Statement of Activities 8
Notes to Financial Statements .. 9
Required Supplementary Information
Budgetary Comparison Schedule 21
Supplementary Information
Governmental Fund Balance Sheet/Statement of Net Position — Library Only 22
Statement of Governmental Fund Revenues, Expenditures, and Changes in
Fund Balances/Statement of Activities — Library Only 23
Combining Statement of Governmental Fund Revenues, Expenditures and Changes in
Fund Balances/Statement of Activities 24
22
BKD
CPAs & Advisors
rrr
Independent Auditor's Report
Board of Trustees
Fayetteville Public Library
Fayetteville, Arkansas
We have audited the accompanying financial statements of the governmental activities and the major fund
of the Fayetteville Public Library, a component unit of the City of Fayetteville, Arkansas, as of and for
the year ended December 31, 2015, and the related notes to the financial statements, which collectively
comprise the Library's basic financial statements as listed in the table of contents.
Management's Responsibility for the Fimunctal Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor's itor's Responsibility
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.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free from material misstatement.
bkd.cor
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or en•or.
In making those risk assessments, the auditor considers intemal control relevant to the entity's preparation
and fair presentation of the financial statements in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's
internal control. Accordingly, we express no such opinion. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of significant accounting estimates
made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
23
Board of Trustees
Fayetteville Public Library
Page 2
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and the major fund of the Fayetteville Public
Libraiy as of December 31, 2015, and the respective changes in financial position thereof for the year
then ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis and budgetary information listed in the table of contents be presented to
supplement the basic financial statements. Such information, although not 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 knowledgewe obtained during our audit of the basic financial statements.
We do not express an opinion or provide any assurance on the information because the limited procedures
do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Infortnation
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the Library's basic financial statements as awhole. The Library only and combining statements
listed in the table of contents are presented for purposes of additional analysis and are not a required part
of the basic financial statements. Such information has not been subjected to the auditing procedures
applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or
provide any assurance on it.
Prior- Year Comparative Infotnation
We have previously audited the Library's 2014 financial statements, and we expressed unmodified audit
opinions on the respective financial statements of the governmental activities and the major fund in our
report dated June 27, 2016. In our opinion, the summarized comparative information presented herein as
of and for the year ended December 31, 2014, is consistent, in all material respects, with the audited
financial statements from which it has been derived.
Rogers, Arkansas
June 27, 2016
24
Fayetteville Public Library
A Component Unit of the City of Fayetteville, Arkansas
Management's Discussion and Analysis
Year Ended December 31, 2015
introduction
As management of the Fayetteville Public Library (the "Library"), we offer readers of the Library's
financial statements this narrative overview and analysis of the Library's financial activities for the
year ended December 31, 2015. It should be read in conjunction with the accompanying basic
financial statements of the Library.
Financial Highlights
Key financial highlights for 2015 are as follows:
• The assets of the Library exceeded its liabilities and deferred inflows at the close of the most
recent fiscal year by $32,090,557 (net position). Unrestricted net position of $4,362,387 may
be used to meet the Library's ongoing obligations and $3,943,985 is available to meet the
Fayetteville Public Library Foundation (the "Foundation") obligations.
• The Library's total net position decreased by $607,506 or 2%. The Foundation's net position
decreased by $78,254 or 1%.
• As of the close of the current year, the Library's governmental fund reported ending fund
balances of $3,022,699 attributable to the Library and $9,320,770 attributable to its Foundation,
a decrease of $42,254 or .5% for the Foundation and a decrease of $346,992 or 10% for the
Library in comparison with the prior year.
• At the end of the current fiscal year, unassigned fund balance for the governmental fund was
$4,900,000, or 106% of total governmental fund expenditures. The Library portion of this
amount excluding its Foundation was $2,956,015, or 65% of Library governmental fund
expenditures.
Overview of Financia! Statements
This annual report consists of three parts: management's discussion and analysis (this section), the
basic financial .statements and required supplementary information (Budgetary Comparison
Schedule). The basic financial statements include information that presents two different views of
the Library.
The Library's basic financial statements not only include the Library but also its blended
component unit, Fayetteville Public Library Foundation (the "Foundation"). The Foundation,
although a legal separate entity, is, in substance, part of the Library's operations since its primary
function is to raise funds for the benefit of the Library. The effect of the transactions between the
Library and Foundation is eliminated in the basic financial statements.
25
The governmental fiord column of the financial statements includes information on the Library's
General Fund (which includes the Library and Foundation) under the modified accrual basis of
accounting using the current financial resource method. The governmental fund is used to account
for essentially the same functions reported as in the government -wide financial statements
(statement of net position and statement of activities columns on pages 7 and 8, respectively).
However, unlike the government -wide financial statements, government fund financial statements
focus on near-term inflows and outflows of spendable resources, as well as on balances of
spendable resources available at the end of the fiscal year. Such information may be useful in
evaluating the Library's near-term financing requirements.
The adjustment column of the financial statements represents adjustments necessary to convert the
governmental fund financial statements to the government -wide financial statements under the full
accrual method of accounting. The adjustments columns provide reconciliations to facilitate the
comparison between the governmental fund and government -wide financial statements.
The third column presents the Library's government -wide financial statements which are designed
to provide readers with a broad overview of the Library's finances in a manner similar to a private -
sector business.
The .statement of net position presents information on all of the Library's assets, liabilities, and
deferred inflows/outflows of resources with the difference reported as net position. Over time,
increases or decreases in net position may serve as a useful indicator of whether the financial
position of the Library is improving or deteriorating.
The statement of activities presents information showing how the Library's net position changed
during the most recent fiscal year. All changes in net position are reported as soon as the
underlying event giving rise to the change occurs, regardless of the timing of related cash flows.
Thus, revenues and expenses are reported in this statement for some items that will only result in
cash flows in future fiscal periods.
Because the focus of the governmental fund is narrower than that of the government -wide financial
statements, it is usefid to compare the information presented for the governmental fundwith similar
information presented for the government -wide financial statements. By doing so, readers may
better understand the long -teen impact of the Library's near-term financing decisions.
The financial statements also include notes that explain some of the information in the financial
statements and provide more detailed data. The statements are followed by a section of required
supplementary information that further explains and supports the information in the financial
statements.
Government -Wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government's financial
position. In the case of the Library, assets exceeded liabilities and deferred inflows of resources by
$32,090,557 at the close of the most recent fiscal year.
A portion of the Library's net position (26%) is unrestricted and may be used to meet the Library's
ongoing obligations to citizens and creditors.
26
Current and Other Assets
Capital Assets, net
Total Assets
Statements of Net Position
Library Foundation Total
2015 2014 2015 2014 2015 2014
$ 4,876,008
18,332,650
23,208,658
$ 5,172,077 $
18,488,090
23,660,167
9,328,971 $ 9,493,633 $ 14,204,979 $ 14,665,710
74,750 110,750 18,407,400 18, 598,840
9,403,721 9,604,383 32,612,379 33,264,550
Current and Other Liabilities 513,621 435,878 8,201 873 521,822 436,751
Total Liabilities 513,621 435,878 8,201 873 521,822 436,751
Deferred Inflows of Resources - - 129,736 - 129,736
Net Position
Net Investment in Capital Assets
Restricted
Unrestricted
18,332,650 18,488, 090
4,362,387 4,736,199
74,750
5,376,785
3,943,985
110,750
5,450,461
3,912,563
18,407,400
5,376,785
8,306,372
18,598,840
5,450,461
8,648,762
Total Net Position $ 22,695,037 $ 23,224,289 $ 9,395,520 $ 9,473,774 $ 32,090,557 $ 32,698,063
010111111111111 011111111111111111.1111111 1101.111.111111•1111•••••••=
An additional portion of the net position (57%) reflects its net investment in capital assets (e.g.,
land, buildings and furniture and equipment). The Library uses these capital assets to provide
services to citizens; consequently these assets are not available for future spending. The remaining
balance of net position (17%) represents resources that are subject to external restrictions on how
they may be used. Combined unrestricted net position and total net position decreased 4% and less
than 2%, respectively, due to expenses exceeding revenues in 2015 by $607,506.
Statements of Activities
Liuraty Foundolio0 Eliminations Total
2015 2014 2015 2014 2015 2014 2015 2014
Revenues
Grants andcontnbutbm $ 2,537,265 $ 2,428,452 $ 271,108 $ 289,300 $ (137,527) $ (128,126) $ 2,670,746 $ 2,589,626
Local properly tues 1,364,104 1,369,117 - - - - 1,364,104 1,369,117
Fines and fees 114,520 130,447 . 114,520 130,447
Investment income (lose) 29,193 98,887 (78,325) 434,425 - . (49,132) 533,312
Miscellaneous 32,434 49,492 89 8,159 - - 32,523 57,651
Total revenues 4,017,516 4,076,395 192,772 731,884 (137,527) (128,126) 4,132,761 4,680,153
Eapemes 4 606 768 4.771164 271026 259546 (137,527) (128,126) 4.740.267 4,902,584
ClangesinNet Posimn (529,252) (694,769) (78,254) 472,338 - (607,506) (222,431)
Net Position,
Beginning of Year 23.224.289 23.919,058 9473774 9 001 436 - - 32 698 063 32,920,494
Net Position, End of Year $ 22,695.037 $ 23,224,289 $ 9,395,520 $ 9,473,774 $ $ $ 32090,557 $ 32,698,063
amsommiimms•
In 2015, revenues decreased by $547,392 or 12%, and expenses decreased by $162,317 or 3%,
primarily due to:
• A. decrease in investment income of $582,444 or 109%.
• A decrease in materials and supplies of $58,647 or 16%.
• A decrease in services and charges of $63,954 or 9%.
27
Financial Analysis of the Governmental Fund
As noted earlier, the focus of the Library's governmental fund is to provide information on near-
term inflows, outflows and balances of spendable resources. Such information is useful in
assessing the Library's financing requirements. In particular, unassigned fund balance may serve
as a useful measure of a Library's net resources available for discretionary use at the end of the
fiscal year.
As of the end of the cunwent fiscal year, the governmental fund reported ending fund balances of
$3,022,699 and $9,320,770 for the Library and Foundation, respectively. Approximately, 98% and
21% of these amounts constitutes unassigned fund balances, which are available for spending at the
Library's and Foundation's discretion, respectively. The remainder of the fund balances has
spending constraints placed on the purpose for which resources can be used.
The fund balances of the governmental fund changed by $389,246 (a $346,992 decrease and a
$42,255 decrease attributed to the Library and Foundation, respectively) during the current fiscal
year. Key factors in this increase are decreased capital outlays by the Library,
Capital Assets
At the end of 2015, the Library had $18,407,400 net investment in capital assets, as detailed in
Note 4 to the financial statements, a decrease of $191,400. The decrease is primarily due to
depreciation expense of capital assets in the amount of $1,039,938, net of capital asset additions of
$848,498.
Budgetary Highlights
Differences between the final budget and the actual results (budgetary basis) as reported on page 21
can be briefly summarized as follows:
• Total revenues were over budget by 4%.
• Total expenditures were under budget by 1%.
• Overall change in fund balance was 39% or $219,499 greater than budgeted.
Contacting the Library's Financial Management
This financial report is designed to provide a general overview of the Library's finances for all
those with an interest in them. Questions concerning any of the information provided in this report
or requests for additional financial information should be mailed to the following address:
Office of the Manager of Financial Services
Fayetteville Public Library
401 W. Mountain
Fayetteville, AR 72701
28
Fayetteville Public Library
A Component Unit of the City of Fayetteville, Arkansas
Governmental Fund Balance Sheet/Statement of Net Position
December 31, 2015
Governmental 2014
favid Balance Statement of (Memorandum
Sheet Adjustments Net Position Ory)
Assets
Cash and cash equivalents $ 4,121,472 $ - $ 4,121,472 4 3,979,656
Investments 3,213,925 - 3,213,925 3,712,059
Accounts receivable 37,201 37,201 3,185
Property taxes receivable, net
of allowance; $ 109,128 1,379,774 - 1,379,774 1,366,508
Pledges receivable, net 100,000 - 100,000 114758
Grant receivable 200,000 - 200,000 152,015
Accrued interest receivable 15,362 - 15,362 28,269
Inventory 19,253 - 19,253 19,253
Prepaid expense 55,400 - 55,400 115,754
Restricted
Cash and cash equivalents 197,234 - 197,234 314,611
Investments 4,852,864 - 4,852,864 4,841,531
Accrued interest receivable 12,494 - 12,494 18,111
Capital assets, net - 18,407,400 18,407,400 18,598,840
Total assets
$ 14,204,979 18,407,400 32,612,379 33,264,550
Liabilities
Accounts payable $ 166,500 - 166,500 117,099
Accred expenses 310,322 - 310,322 309,652
Unearned revenue 45,000 - 45,000 10,000
Total liabilities 521,822 - 521,822 436751
Deferred Inflows Of Resources
Unavailable revenue - property taxes
Unavailable revenue - contributions
Total deferred inflows of resources
1,339,688 (1,339,688)
129,736
1,339,688 (1,339,688) - 129,736
Fund Balances/Net Position
Fundbalances
Nonspendable
Prepaid expense 66,684 (66,684)
Permanent endowment 1,250,000 (1,250,000)
Restricted 4,126,785 (4,126,785)
Conmitted 2,000,000 (2,000,000)
Unassigned 4,900,000 (4,900,000)
Total flind balances 12,343,469 (12,343,469)
Total liabilities, deferred infovs, and fund balances $ 14,204,979
Net position
Net investment in capital assets 18,407,400 18,407,400 18,598,840
Restricted for capital assets
Expendable 392,711 392,711 391,863
Nonexpendable 500,000 500,000 500,000
Restricted for children's library
Expendable 951,082 951,082 1,069,499
Nonexpendable 750,000 750,000 750,000
Restricted for the volunteer program
Expendable 378,866 378,866 4 05,4 55
Restricted for NEH Grant
Expendable 2,404,126 2,404,126 2,3 33,644
Unrestricted 8,306,372 8,306,372 8,648,762
Total net position $ 32,090,557 $ 32,090,557 8 32,698,063
See Notes to Financial Statements
29
Fayetteville Public Library
A Component Unit of the City of Fayetteville, Arkansas
Statement of Governmental Fund Revenues, Expenditures and
Changes in Fund Balances/Statement of Activities
Year Ended December 31, 2015
Govemmental Statement of
Fund Adjustments Activities
2014
(Memorandum
Only)
Revenues
Contributions
From primary goverrunent $ 2,118,401 $ - $ 2,118,401 $ 2,091,401
Other 384,877 - 384,877 235,085
Property taxes 1,390,925 (26,821) 1,364,104 1,369,117
Investment income (loss) (49,132) (49,132) 533,312
Fines and fees 114,520 114,520 130,447
Gant revenue 41,194 41,194 119,282
State aid 126,274 126,274 143,858
Miscellaneous 39,441 (6,918) 32,523 57,651
Total revenues 4,166,500
(33,739) 4,132,761 4,680,153
Expenditures/Expenses
Current
Personnel services 2,533,364 2,533,364 2,614,682
Materials and supplies 297,435 297,435 356,082
Services and charges 629,902 629,902 693,496
Maintenance 142,129 142,129 184,298
Public relations 10,716 10,716 37,208
Depreciation 1,039,938 1,039,938 955,606
Other 86,783 86,783 61,212
Capital outlay 855,417 (855,417)
Total expemfitures/expenses
4,555,746 184,521 4,740,267 4,902,584
Revenues Over (Under)
Expenditures/Expenses and Change
in Fund Balances/ Net Position (389,246) (218,260) (607,506) (222,431)
Frmd Balances/Net Position
Beginning of the year
End of year
See Notes to Financial Statements
12,732,715 19,965,348 32,698,063 32,920,494
$ 12,343,469 $ 19,747,088 $ 32,090,557 $ 32,698,063
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