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HOUSING AUTHORITYOF

TOWN OF JENA, LOUISIANA

Financial Statements andSupplemental Financial Information

June 30,2006

Under provisions of state law, this report is a publicdocument. A copy of the report has been submitted tothe entity and other appropriate public officials. Thereport is available for public inspection at the BatonRouge office of the Legislative Auditor and, whereappropriate, at the office of the parish clerk of court.

Release Date j(

HOUSING AUTHORITY OFTHE TOWN OF JENA

JENA, LOUISIANA

* The Jena Housing Authority is chartered as a public corporation for the purpose of administering housingprograms for low income families. Under the United States Housing Act of 1937, as amended, the U.S.Department of Housing and Urban Development (HUD) has direct responsibility for administering low-incomehousing programs in the United States. Accordingly, HUD has entered into a contract with the Jena HousingAuthority to make annual contributions (subsidies) for the purpose of funding its programs for low-incomefamilies.

Housing Authority of the Town of JenaJena, Louisiana

Table of ContentsJune 30,2006

Page No.

Independent Auditor's Report 1-2

Management's Discussion and Analysis 3-5

Basic Financial Statements

Statement of Fund Net Assets 7

Statement of Revenues, Expenses, and Changes In Fund Net Assets 8

Statement of Cash Flows 9

Notes to the Basic Financial Statements 10-16

Other Supplemental Statements and Schedules

Schedule of Compensation Paid to Board Members 18

Statement and Certification of Actual Modernization Cost 19

Other Reports

Independent Auditor's Report on Compliance and Internal Control Over Financial ReportingBased on an Audit of the Basic Financial Statements Performed in Accordance withGovernment Auditing Standards 21-22

Schedule of Findings and Questioned Cost 23-24

Status of Prior Year Findings 25

Management Letter Comments 26

Financial Data Schedule 27-28

JOHN R. VERCHER PCCertified Public Accountant

P.O. Box 1608Jena, Louisiana 71342

Tel: (318) 992-6348Fax:(318)992-4374

INDEPENDENT AUDITORS REPORT

Housing Authority of theTown of JenaJena, Louisiana

1 have audited the accompanying basic financial statements of the Housing Authority of the Town of Jena as ofand for the year ended June 30, 2006, as listed in the table of contents. These basic financial statements are theresponsibility of the Housing Authority's management. My responsibility is to express an opinion on these basicfinancial statements based on my audit.

I conducted my audit in accordance with auditing standards generally accepted in the United States of Americaand the standards applicable to financial audits contained in Government Auditing Standards, issued by theComptroller General of the United States. Those standards require that I plan and perform the audit to obtainreasonable assurance about whether the financial statements are free of material misstatement. An audit includesexamining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements. Anaudit also includes assessing the accounting principles used and significant estimates made by management, aswell as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basisfor my opinion.

In my opinion, the basic financial statements referred to above present fairly, in all material respects, the financialposition of the Housing Authority of the Town of Jena, as of June 30, 2006, and the respective changes infinancial position and cash flows, thereof for the year then ended in conformity with accounting principlesgenerally accepted in the United States of America.

In accordance with Government Auditing Standards, 1 have also issued my report dated August 30, 2006, on myconsideration of the Housing Authority of the Town ofJena's internal control over financial reporting and on mytest of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and othermatters. The purpose of that report is to describe the scope of my testing of internal control over financialreporting and compliance and the results of that testing, and not to provide an opinion on the internal control overfinancial reporting or on compliance. That report is an integral part of an audit performed in accordance withGovernment Auditing Standards and should be considered in assessing the results of my audit.

The management's discussion and analysis is not a required part of the basic financial statements but issupplementary information required by Governmental Accounting Standards Board. I have applied certain limitedprocedures, which consisted principally of inquiries of management regarding the methods of measurement andpresentation of the required supplementary information. However, I did not audit the information and express noopinion on it.

MEMBER-AMERICAN INSTITUTE OF CERTIFIED PUD LI C ACCOUNTANTS

SOCIETY OP LOUISIANA CERTIFIED PUBLIC ACCOUNTANTS

1

The accompanying Financial Data Schedule, required by HUD, is presented for purposes of additional analysis,and is not a required part of the basic financial statements. The Financial Data Schedule has been subjected to theauditing procedures applied in the audit of the basic financial statements, and in my opinion, is fairly stated in allmaterial respects in relation to the basic financial statements taken as a whole.

Jena, LouisianaAugust 30, 2006

Housing Authority of the Town of JenaManagement's Discussion and Analysis

June 30,2006

As management of the Jena Housing Authority, we offer readers of the Authority's financial statements thisnarrative overview and analysis of the financial activities to consider the information presented here inconjunction with the Authority's financial statements,

FINANCIAL HIGHLIGHTS

• The assets of the Authority exceeded its liabilities at the close of the most recent fiscal year by $570,657(net assets).

• As of the close of the current fiscal year, the Authority's ending unrestricted net assets increased $57,305.

• The Authority's cash and investment balance at June 30,2006 was $226,756.

• The Authority had total operating revenue of $206,485, and total non-operating revenue of $4,654,

• The Authority had total expenses of $206,423.

• The Authority had a total change in net assets of $4,716 for the year.

OVERVIEW OF THE FINANCIAL STATEMENTS

The discussion and analysis is intended to serve as an introduction of the Authority's basic financial statements.The Authority's basic financial statements consist of the Statement of Net Assets, Statement of Revenues,Expenses and changes in Net Assets, Statement of Cash Flows, and the notes to the financial statements. Thisreport also contains the schedule of expenditures of federal awards as supplemental information in addition to thebasic financial statements themselves.

The Authority's has only one fund type, namely a proprietary fund. The statement of Net Assets included all ofthe Authority's assets and liabilities. This fund type is used for activities which are financial and operated in amanner similar to those in the private sector.

The Authority has two main finding sources in its financial operation. These are the Low Rent Public Housingand Capital Fund Programs. The Low Rent Program consists of 49 units. Funding is provided based on dwellingrents paid by the tenants and operating fund payments received from the Department of Housing and UrbanDevelopment based on a formula. The purpose of this program is to provide funding for low rent housingprograms to allow them to make purchases and capital improvements for the current dwelling structures and assistin their operations.

Housing Authority of the Town of JenaManagement's Discussion and Analysis - Continued

June 30,2006

The Authority's overall financial position and operations for the year is summarized below based on theinformation in the current and prior year financial statements. The table below lists the Comparative Statement ofNet Assets as of June 30,2006.

Statement of Net Assets

Assets FYE2Q05 FYE20Q6 % ChangeCurrent Assets & Other Assets $ 180,583 $ 236,846 31%Capita] Assets, Net 396,570 343,981 -13%Total Assets 577,153 580,827 1%

LiabilitiesCurrent Liabilities 7,472 6,615 -11%Non-Current Liabilities 3,740 3,555 -5%Total Liabilities 11,212 10,170 -9%

Net AssetsInvested in Capital Assets 396,570 343,981 -13%Unrestricted 169,371 226,676 34%Total Net Assets $ 565,941 $ 570,657 1 %

Cash and Investments

Cash and investments increased by $54,906 as of June 30,2006.

Net Assets

The Authority's unrestricted net assets increased by $57,305.t

The Authority's total net assets increased by $4,716.


June 30,2006

The table below lists the Comparative Statement of Revenues, Expenses, and Changes in Net Assets as of June30,2006.

Statement of Revenues, Expenses, & Changes in Net Assets

FYE20Q5 FYE2Q06 % ChangeRevenuesTenant Revenue $ 78,003 $ 71,791 -3%HUD Operating Grants 135,509 130,914 -3%Capital Grants 55,462 -0- -3 00%Other 5,335 8,434 58%Total Revenues 274,309 211,139 -23%

ExpensesAdministration 71,710 65,027 -9%Depreciation 49,661 52,589 6%Operation & Maintenance 60,738 55,176 -9%Taxes & Insurance 23,094 22,681 -2%Utilities 3,280 3,769 15%Tenants 13 44 238%Protective Services -0- 7,137 100%Total Expenses 208,496 206,423 -1%

Changes in Net Assets 65,813 4,716 -93%

Beginning Net Assets 500,128 565,941 13%Ending Net Assets $ 565,941 $ 570,657 1%

Results of Operations

Revenues of the Authority are generated principally from dwelling rent and HUD Operating subsidies. TheAuthority's revenues decreased by $63,170, Expenses decreased by $2,073.

Capital Asset & Debt Administration

Capital Assets

As of June 30,2006 the Authority's investment in capital assets was $343,981 (net of accumulated depreciation).This investment includes land, building improvements, dwelling equipment and maintenance equipment.


June 30,2006

Long Term Debt

The Authority does not have any long-term liabilities at this time.

Future events that will impact the Authority

The Authority relies heavily upon HUD operating subsidies. The amount appropriated has not currently beenapproved for the FYE 2007. Therefore, any results of budget shortfalls cannot be determined.

Contacting the Authority's Finance Management

The financial report is designed to provide a general overview of the Authority's finances for all those with aninterest. Questions concerning any of the information provided in this report or requests for additional financialinformation should be addressed to the following address:

Housing Authority of the Town of JenaPOBox36Jena, La 71342

jjI Basic Financial Statements


Statement of Fund Net AssetsJune 30,2006

ENTERPRISEASSETS FUND

CURRENT ASSETSCash & Cash Equivalents $ 68,203Investments 158,553Receivables (Net of Allowances For Uncollectables) 472Inventory 1,057Prepaid Items 8,561TOTAL CURRENT ASSETS 236,846

NON-CURRENT ASSETSCapital Assets (Net of Accumulated Depreciation) 343,981TOTAL NON-CURRENT ASSETS 343,981

TOTAL ASSETS 580,827

LIABILITIES

CURRENT LIABILITIESAccrued Pilot 6,205Accounts Payable 410TOTAL CURRENT LIABILITIES 6,615

NON-CURRENT LIABILITIESTenant Security Deposits 3,555TOTAL NON-CURRENT LIABILITIES 3,555

TOTAL LIABILITIES 10,170

NET ASSETSInvested in Capital Assets, Net of Related Debt 343,981Unrestricted 226,676TOTAL NET ASSETS $ 570,657

The accompanying notes are an integral part of this statement

8


Statement of Revenues, Expenses, & Changes In Fund Net AssetsYear Ended June 30,2006

OPERATING REVENUESTenant Rental RevenueTenant Revenue OtherHUD PHA Operating GrantTOTAL OPERATING REVENUE

OPERATING EXPENSESAdministration:Administrative SalariesEEC AdministrativeAccounting/LegalOther Operating - AdministrativeCost of Sales & Service:WaterElectricityOrdinary Maintenance - LaborMaterialsContract CostE6C MaintenanceInsurancePayment in Lieu of TaxesProtective Services - Other Contract CostsTenant ServicesDepreciationTOTAL OPERATING EXPENSES

OPERATING INCOME (Loss)

NONOPERATING REVENUE (EXPENSE)Federal GrantsInterest EarningsTOTAL NONOPERATING REVENUE (EXPENSES)

INCOME (Loss) BEFORE CONTRIBUTIONS,TRANSFERS & PRIOR PERIOD ADJUSTMENTS

Prior Period Adjustments

CHANGE IN NET ASSETS

TOTAL NET ASSETS - BEGINNINGTOTAL NET ASSETS - ENDING $

ENTERPRISEFUND

71,7913,780

130,914206,485

37,92915,9444,5506,604

5783,191

26,26310,2667,453

11,19415,8796,8027,137

4452.589

206,423

62

-0-4,6544,654

4,716

-0-

4,716

565.941570,657

The accompanying notes ore an integral port of this statement

9


Statement of Cash FlowsYear Ended June 30,2006

CASH FLOWS FROM OPERATING ACTIVITIESReceipts From Customers & UsersReceipts From HUDPayments to SuppliersPayments to EmployeesPayment in Lieu of TaxesNET CASH PROVIDED (USED) BY OPERATING ACTIVITIES

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIESSubsidy From Federal GrantsNET CASH PROVIDED (USED) BY NONCAPITAL FINANCING ACTIVITIES

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIESOtherAcquisition & Construction of Capital AssetsNET CASH PROVIDED (USED) BY CAPITAL & RELATED FINANCING ACTIVITIES

CASH FLOWS FROM INVESTING ACTIVITIESInvestmentsInterest & Dividends ReceivedNET CASH PROVIDED (USED) BY INVESTING ACTIVITIES

NET INCREASE (DECREASE) IN CASH & CASH EQUIVALENTS

CASH, BEGINNING OF YEARCASH, END OF YEAR

RECONCILIATION OF OPERATING INCOME (Loss) TO NET CASHPROVIDED (USED) BY OPERATING ACTIVITIES

Operating Income (Loss)

Depreciation Expense(Increase) Decrease in Accounts Receivable(Increase) Decrease in Investments(Increase) Decrease in Inventories(Increase) Decrease in Prepaid ItemsIncrease (Decrease) in Accrued PilotIncrease (Decrease) in Customer DepositsIncrease (Decrease) in Accounts PayableTOTAL ADJUSTMENTS

NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES

LISTING OF NONCASH INVESTING, CAPITAL, & FINANCIAL ACTIVITIESContributions of Capital Assets From Government

ENTERPRISEFUND

76,228130,914(85,607)(73,136)(6,802)

41,597

-0--0-

-0--0--0-

-0-4,6544,654

46,251

21,952

68,203

62

52,589(472)

(8,655)(577)(308)

(185)410

41.535

41,597

-0-

Thc accompanying notes arc an integral port of this statement

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NOTES TO THE BASIC FINANCIAL STATEMENTS

INTRODUCTION

The Housing Authority of Jena is a 49 unit apartment complex for persons of low income located in Jena,Louisiana. The Authority is chartered as a public corporation for the purpose of administering decent, safe andsanitary dwelling for persons of low-income.

Legal title to the Authority is held by the Housing Authority of the Town of Jena, Louisiana, a non-profitcorporation. The Authority is engaged in the acquisition, modernization, and administration of low-rent housing.The Authority is administered by a governing Board of Commissioners (the Board), whose members areappointed by the Mayor of Jena, Louisiana. Each member serves a four-year term and receives no compensationfor their services. Substantially all of the Authority's revenue is derived from subsidy contracts with the U. S.Department of Housing and Urban Development (HUD). The annual contributions contracts entered into by theAuthority and HUD provide operating subsidies for Authority-owned public housing facilities for eligibleindividuals.

Under the United States Housing Act of 1937, as amended, the U.S. Department of Housing and UrbanDevelopment (HUD) has direct responsibility for administering low-income housing programs in the UnitedStates. Accordingly, HUD has entered into a contract with the entity to make annual contributions (subsidies) forthe purpose of funding its programs for low-income families,

GASB Statement No. 14 established criteria for determining the governmental reporting entity and componentunits that should be included within the reporting entity. Because the Housing Authority is legally separated andfiscally independent, the Housing Authority is a separate governmental reporting entity. The Housing Authorityincludes all funds, account groups, activities, etc., that are within the oversight responsibility of the HousingAuthority.

The Housing Authority is a related organization of the Town of Jena because the Town of Jena appoints a votingmajority of the Housing Authority's governing board. The Town of Jena is not financially responsible for theHousing Authority, as it cannot impose its will on the Housing Authority and there is no possibility for theHousing Authority to provide financial benefit to, or impose financial burdens on, the Town of Jena. According,the Housing Authority is not a component unit of the financial reporting entity of the Town of Jena.

1. SUMMARY OF ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

A. BASIC FINANCIAL STATEMENTS

The basic financial statements (i.e., the statement of net assets and Che statement of revenues, expenses andchanges in net assets) report information on all of the activities of the authority.

B. MEASUREMENT Focus, BASIS OF ACCOUNTING, & FINANCIAL STATEMENT PRESENTATION

The basic financial statements are reported using the accrual basis of accounting. Revenues are recorded whenearned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows.Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the providerhave been met.

The accompanying financial statements include the activities of several housing programs subsidized by HUD. Asummary of each significant program is provided below.


NOTES TO THE BASIC FINANCIAL STATEMENTS - (CONTINUED)

• Low Income Housing Program - The purpose of the low income housing program is to provide decentand affordable housing to low income families at reduced rents. The developments are owned, maintainedand managed by the authority. The developments are acquired, developed and modernized under HUD'scapital funds programs. Funding of the program operations is provided via federal annual contributioncontracts (operating subsidies) and tenant rents (determined as a percentage of family income, adjustedfor family composition).

• Housing Assistance Programs - The housing assistance payment program utilizes existing privatelyowned family rental housing units to provide decent and affordable housing to low income families.Funding of the program is provided by federal annual housing assistance contributions from HUD, whichprovide for the difference between the approved landlord contract rent and the rent paid by the tenant

Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally arefollowed in the proprietary fund financial statements to the extent that those standards do not conflict with orcontradict guidance of the Governmental Accounting Standards Board. Governments also have the option offollowing subsequent private-sector guidance for their business-type activities and enterprise funds, subject totheir same limitation. The authority has elected not to follow subsequent private-sector guidance.

As a general rule, the effect of tnterfund activity has been eliminated from the basic financial statements.Exceptions to this general rule are payments-in-lieu of taxes and other charges between the government'senterprise operations. Elimination of these charges would distort the direct cost and program revenues reportedfor the various functions concerned.

Operating revenues and expenses have been reported separately from nonoperating items. Operating revenuesand expenses generally result from providing services and producing and delivering goods in connection with anenterprise fund's principal ongoing operations. The primary operating revenue of the housing authority is derivedfrom tenant revenue. Operating expenses for enterprise funds include the cost of sales and services,administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definitionare reported as nonoperating revenues and expenses.

When both restricted and unrestricted resources are available for use, it is the housing authority's policy to userestricted resources first, then unrestricted resources as they are needed.

C. DEPOSITS & INVESTMENTS

The housing authority's cash and cash equivalents are considered to be cash on hand, demand deposits, and short-term investments with original maturities of three months or less from the date of acquisition. State law and thehousing authority's investment policy allow the housing authority to invest in collateralized certificated ofdeposits, government backed securities, commercial paper, the state sponsored investment pool, and mutual fundsconsisting solely of government backed securities.

Investments (bank certificate of deposits in excess of 90 days) for the housing authority are reported at fair value.

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D. RECEIVABLES & PAYABLES

Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of thefiscal year referred to as either "due to/from other funds" (i.e., the current portion of Interfund loans) or "advancesto/from other funds" (i.e., the non-current portion of Interfund loans). All other outstanding balances betweenfunds are reported as "due to/from other funds."

Advances between funds, as reported in the accompanying basic financial statements, are offset by a restriction onnet assets. All trade and other receivables are shown net of an allowance for uncollectibles.

E. INVENTORIES & PREPAID ITEMS

All inventories are valued at cost using the first-in/first out method. Inventories are recorded as expenditureswhen consumed rather than when purchased. Certain payments to vendors reflect costs applicable to futureaccounting periods and are recorded as prepaid items in both government-wide and ftmd financial statements.

F. CAPITAL ASSETS

Capital Assets, which include property, plant, equipment, and infrastructure assets are reported in the applicablecolumns in the government-wide financial statements. Capital assets are capitalized at historical cost Thehousing maintains a threshold level of $500 or more for capitalizing capital assets.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assetslives are not capitalized.

Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurredduring the construction phase of capital assets of business-type activities is included as part of the capitalizedvalue of the assets constructed. The total interest expense included during the current fiscal year was $-0-. Ofthis amount, $-0- was included as part of the cost of capital assets under construction in connection withconstruction projects.

All Capital Assets, other than land, are depreciated using the straight-line method over the following useful lives:

Description Estimated LivesLand improvements 20 yearsBuildings 20 yearsBuilding improvements 10 yearsFurniture and fixtures 5 yearsVehicles 5 yearsEquipment 5 years

G. LONG-TERM OBLIGATIONS

In the government-wide financial statements, long-term debt and other long-term obligations are reported asliabilities. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of thebonds using the effective interest method. Bonds payable are reported net of the applicable bond premium ordiscount. Bond issuance costs are reported as deferred charges and amortized over the term of the related debt.

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H. EXTRAORDINARY AND SPECIAL ITEMS

Extraordinary items are transactions or events that are both unusual in nature and infrequent in occurrence.Special items are transactions or events within the control of the housing authority, which are either unusual innature or infrequent in occurrence.

1. ESTIMATES

The preparation of financial statements inconformity with accounting principles generally accepted in the UnitedStates of America require management to make estimates and assumptions that affect the reported amounts ofassets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements andthe reported amounts of revenues, expenditures, and expenses during the reporting period. Actual results coulddiffer from those estimates.

2. CASH AND INVESTMENTS (CD'S IN EXCESS OF 90 DAYS1

At June 30,2006, the housing authority has cash and investments (book balances) totaling $226,756 as follows:

Demand deposits $ 68,203Time deposits 158.553Total $ 226,756

These deposits are stated at cost, which approximated market. Under state law, these deposits (or the resultingbank balances) must be secured by federal deposit insurance or the pledge of securities owned by the fiscal agentbank. The market value of the pledged securities plus the federal deposit insurance must at all times equal theamount on deposit with the fiscal agent. These securities are held in the name of the pledging fiscal agent bank ina holding or custodial bank that is mutually acceptable to both parties.

At June 30, 2006, the housing authority has $226,756 in deposits (collected bank balances). These deposits aresecured from risk by $100,000 of federal deposit insurance and $233,513 of pledged securities held by thecustodial bank in the name of the fiscal agent bank.

Investments are categorized into these three categories of credit risk:

1. Insured or registered, or securities held by the housing authority or its agent in the housing authority'sname.

2. Uninsured and unregistered, with securities held by the counter party's trust department or agent inthe housing authority's name.

3. Uninsured and unregistered, with securities held by the counter party, or by its trust department oragent but not in the housing authority's name.

At fiscal year-end, the housing authority's investment balances were as follows:

Demand Deposits $ 68,203Certificate of Deposit 66,692Certificate of Deposit 49,463Certificate of Deposit 42,398Total $ 226,756

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Category1100,000 $

-0-100,000 $

2-0- $

233,513233,513 $

3-0- $-0--0- $

Type of InvestmentFD1CPledged SecuritiesTotal

3. CAPITAL ASSETS

Capita! assets activity for the year ended June 30,2006 was as follows:

Fair MarketValue

100,000233,513333,513

Land (Not Depreciated)Leasehold ImprovementsBuildingsFurniture & Equipment, Etc.CFP Capital AssetsTotalLess Accumulated DepreciationNet Capital Assets

BeginningBalance

26,000 $78,836

1,886,84912,64859,287

2,063,620(1.667.050)

Additions Deletions

-0- $ -0- $-0-

59,287-0--0-

59,287(52.589)

-0--0--0-

(59,287)(59,287)

EndingBalance

26,00078,836

1,946,13612,648

-0-2.063.620

-0- (1,719.639)S 396,570 S 6.698 $ (59,287) $ 343,981

Land in the amount of $26,000 is not being depreciated.

4. ACCOUNTS, SALARIES AND OTHER PAYABLES

The payables of $6,615 at June 30, 2006 are as follows:

Accrued Wages/Payroll Taxes PayableAccrued PilotTotal

4106,2056,615

5. RETIREMENT SYSTEMS

The housing authority provides benefits for all full-time employees through a defined contribution plan. In adefined contribution plan, benefits depend solely on amounts contributed to the plan, plus investment earnings.Employees are eligible to participate after a six-month exclusionary period. The entity contributes 8% of theemployee's base monthly salary. The housing authority's contributions for each employee (and interest allocatedto the employee account) vest at 20% annually for each year of participation. An employee is fully vested after 5years of participation.

The housing authority's total payroll for the fiscal year ending June 30, 2006 was $64,192. The housingauthority's contributions were calculated using the base salary amount of $64,192. Contributions to the plan were$-0- and $5,135 by the employees and the housing authority, respectively.

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6. CONTINGENT LIABILITIES

At June 30, 2006, the housing authority is subject to possible examinations made by federal regulators whodetermine compliance with terms, conditions, laws and regulations governing grants given to the housingauthority in the current and prior years. These examinations may result in required refunds by the housingauthority to federal grantors and/or program beneficiaries.

7. ECONOMIC DEPENDENCY

Statement of Financial Accounting Standard (SFAS) No. 14 requires disclosure in financial statements of asituation where one entity provides more than 10% of the audited entity's revenues. The Department of Housing& Urban Development provided $130,914 to the housing authority, which represents approximately 62% of thehousing authority's revenues for die year.

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Other Supplemental Statements& Schedules

17


Schedule of Compensation Paid to Board MembersYear Ended June 30,2006

Board Member Title Salary

Ned McCann Chairman -0-Guy Campbell Vice-Chairman -0-Laverne Paul Commissioner -0-Carolyn G. Hatcher Commissioner -0-

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Statement and Certification of Actual Modernization CostAnnual Contribution Contract

1. The Actual Modernization CostsAre As Follows:

Funds Approved

Funds Expended

Excess of Funds Approved

2. Funds Advanced

Funds Expended

Excess of Funds Advanced

Project2005

73,011

(73,011)

-0-

73,011

(73.011)

-0-

The accompanying notes are an integral part of this statement

19

Other Reports

20

JOHN R. VERCHER PCCertified Public Accountant


Tel: (318) 992-6348Fax:(318)992-4374

INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVERFINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED

IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS

Housing Authority of theTown of Jena

Jena, Louisiana

I have audited the accompanying basic financial statements of the Housing Authority of the Town of Jena,Louisiana, as of and for the year ended June 30,2006, which collectively comprise the Housing Authority's bastefinancial statements and have issued my report thereon dated August 30, 2006. I conducted my audit inaccordance with auditing standards generally accepted in the United States of America and the standardsapplicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States.

Compliance

As part of obtaining reasonable assurance about whether the Housing Authority of the Town of Jena, Louisiana'sbasic financial statements are free of material misstatement, I performed tests of its compliance with certainprovisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and materialeffect on the determination of financial statement amounts. However, providing an opinion on compliance withthose provisions was not an objective of my audit and, accordingly, I do not express such an opinion. The resultsof my tests disclosed no instances of noncompliance that are required to be reported under Government AuditingStandards.

Internal Control Over Financial Reporting

In planning and performing my audit, I considered the Housing Authority of the Town of Jena, Louisiana'sinternal control over financial reporting in order to determine my auditing procedures for the purpose ofexpressing my opinion on the basic financial statements and not to provide assurance on the internal control overfinancial reporting. My consideration of the internal control over financial reporting would not necessarilydisclose all matters in the internal control over financial reporting that might be material weaknesses. A materialweakness is a condition in which the design or operation of one or more of the internal control components doesnot reduce to a relatively low level risk that misstatements in amounts that would be material in relation to thebasic financial statements being audited may occur and not be detected within a timely period by employees in thenormal course of performing their assigned functions. I noted no matters involving the internal control overfinancial reporting and its operation that J consider to be material weaknesses.

_MEMDER_AMERICAN INSTITUTE OF CERTIFIED PUBUC ACCOUNTANTSSOCIETY OP LOUISIANA CERTIFIED PUBLIC ACCOUNTANTS

21

This report is intended solely for the information and use of management, federal awarding agencies andLegislative Auditor's Office and is not intended to be and should not be used by anyone other than these specifiedparties. However, this report is a matter of public record and its distribution is not limited.

August 30, 2006Jena, Louisiana

22

HOUSING AUTHORITY OF THE TOWN OF JENAJENA, LOUISIANA

SCHEDULE OF FINDINGS AND QUESTIONED COSTFor the Year Ended June 30,2006

I have audited the basic financial statements which collectively comprise the Housing Authority of the Town ofJena, Louisiana, as of and for the year ended June 30, 2006 and have issued my report thereon dated August 30,2006. I conducted my audit in accordance with generally accepted auditing standards and the standardsapplicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. My audit of the basic financial statements as of June 30, 2006 resulted in a unqualified opinion.

Section I Summary of Auditor's Reports

a. Report on Internal Control and Compliance Material to the Basic Financial Statements

Internal ControlMaterial Weaknesses QVesIElNo Reportable Conditions DYes KlNo

ComplianceCompliance Material to Basic Financial Statements O Yes IE1 No

b. Federal Awards - (Not Applicable)

Internal ControlMaterial Weaknesses O Yes d No Reportable Conditions Q Yes O No

Type of Opinion On Compliance D Unqualified Q| QualifiedFor Major Programs Q Disclaimer d Adverse

Are the findings required to be reported in accordance with Circular A-133, Section .510(a)7

D Yes D No

c. Identification Of Major Programs:

CFDA Number (s) _ Name Of Federal Program (or Cluster)

Dollar threshold used to distinguish between Type A and Type B Programs: J

Is the auditee a Mow-risk' auditee, as defined by OMB Circular A-133? d Yes [] No

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SCHEDULE OF FINDINGS AND QUESTIONED COSTFor the Year Ended June 30,2006

Section n Financial Statement Findings Required To Be Reported In Accordance With GAGAS

No items to report.

Section HI - Internal Control

No items to report.

Section IV Federal Awards Findings and Questioned Costs

Not applicable.

24


Status of Prior Year FindingsFor the Year Ended June 30,2006

Legislative AuditorState of LouisianaBaton Rouge, Louisiana 70804-9397

The management of the Housing Authority of the Town of Jena, Louisiana has provided the following actionsummaries relating to audit findings brought to their attention as a result of their financial audit for the year endedJune 3 0,2005.

There were no prior year findings.

25

JOHN R VERCHER PCCertified Public Accountant


Tel: (318) 992-6348Fax: (318) 992-4374

MANAGEMENT LETTER COMMENTS

During the course of my audit, I observed conditions and circumstances that may be improved. Below arefindings noted for improvement, my recommendation for improvement and the Housing Authority's plan forcorrective action.

There are no current year comments.

26

PHA: LA142 FYED: 06/30/2006Public

jLineiltemNo.1111100

i

:126126.1:120

11311142

i| Account DescriptionSash - Unrestricteditotai Cash!

Accounts Receivable - Tenants - Dwelling Rents^Allowance for Doubtful Accounts - Dwelling Rente[Total Receivables, : net of allowances for doubtful accounts!

Investments - UnrestrictedJPrenaid Fynenses and Othpr Assets

Low RentPublicHousing$68,203'$68,203

$472$0$472I

$158,553•<tR RR1

jHousing{CapitaljFundjProgramS$0i$bi:$0$0

$0i 1i$ofsn I

Total !$68,203$68,203

$472$0$472

$158,553 jSflSfil

;143 inentries $1,058 $0 $1,058-143.1 ]AJIowance ifor Obsolete nventoiles" !$0

159 Jl°5?.' PH!?,!?1. ?et?i M i_™liei" iLand

$236,846 i$0 '$236,846

$26,000 $26,000162 [Buildings;1? L- iFurnjture. Equipment & Machinery - Dwejtings164 [Furniture, Equipment & MachTnery - Administration

." .1J98 ..... i$0 l j ,788" " ~|$850_;$78,836_ .

J166 cumuated160 ifotal Fixed Assets, Net ofAccumuJated-Deprecaon

639$343,981 JO :J343,981

"|$343;9i31 ~"1$6 " '$34i3;98l";180 ijotal Non--Current Assets

ii9b''''"ri taT/^s'ets'7:'"""?"~ •"" "" $580,827 !$0 :$580,827

eItem jNo. ' Account Description

JLow Rent JPublic Housing [public Capital Fund l

|321 Accrued Wage/Payroll Taxes Payable|33" iA^un^F^yato- ife:341 itenant Security Deposits

$410 $0 $410

$10,170 ;$0 :$10,170

I350 $0

§10,170 |01 j"so".' ." '" -W

$1,170

1508 ToJtelContributed:CapIte^

508,1 jinvested in Capital Assets, Net of Related Debt

:!$o

;$ 34 3,981 i$0 $343,981

?11 - :I?.??!. ??s.?fY?^ .(!5!5?!a5??.

!51lT ^Restricted NeT^Ssete "~

;$oT

!$o ;$0

i$226,676$570,657__ _ ^^^^ „ .1*570,657 J$0_. ;

jS»""~lto"&TtiabiiiteB« ~~ I *5Oi;B27*:'

27

PHA: LA142 FYED: 06/30/2006lineItemiNo. j-~ Account Description703 |Net Tenant Rental Revenue704 [Tenant Revenue - Other705 fTotal tenant Revenue

Low Rent Public Housing ipublic (capital Fund[Housing program __ T°??L

I'.791 " ]$0 " " J71J91'

$0

706 jHUD PHA Operating Grants711 Pnvestrnent income - Unrestricted

57,903

[700 [Total Revenue :___PHA:LA142 "JFYED: 06/30/2666"

:$138,128 !$73,011 $211,139

jLineiltemiNo.911i912915916I9241931932941!942;943|945i952961963969i

|970

t

Account DescriptionAdministrative Salaries.Auditing Fees[Employee Benefit Contributions - Administrative{Other Operating - AdministrativeTenant Services - OtherWaterElectricityjOrdinary Maintenance and Operations - Labor'Ordinary Maintenance and Operations - Materials and OtherjOrdinary Maintenance and Operations - Contract Costs{Employee Benefit Contributions - Ordinary Maintenanceprotective Services - Other Contract CostsInsurance Premiumspayments in Lieu of Taxes[Total Operating Expenses!lExcess Operating Revenue over Operating Expenses

:Low RentJPublicJHousing;$37,929l$4,550|$15,944i$6,604i$44$578:$3,191

,$26,263|$iO,266|$7,453|$11,194[$7,137:$15,879,$6,802j$1 53,834|

.!$-1 5,706

Public HousingCapital FundProgram$0;$o$0

:$0^0;$o:$o$0$0

so!$0l$o$0$0$0;

|$73,011

i

! Total1$37,929JK550$15,944$6,604 i$44 i$578 I[$3,191|$26,263j$10,266J7.453:$11,194:$7,137|$1 5,879$6,602;$153.834

;$57,305

^$52,589 i$0 |?52,589J$2b6^4i23::'-'::.:j$rj"""::r''''''"""':r^.900

'"l7MtI'So!$73,011

|1001 (Operating Transfers In11002 -Operating Transfers Out11010 total Other Financing Sources (Uses)

l$pi 73,p11i$-73t011

;$73,011$-73,011i$6

Excess ( Deficiency) of Operating Revenue Over (Under);Igxpenses; : : : ; : • • • : • : , . . . . , . ; : • : - ' : _ 2 , - ' - , : - - ' -_u_ •_ . ; •.

......... FVED;1iJi6/30/2006

!$4,716 $0 !$4,716

jLineItemiNo. Account Description

Low Rent jPublic Housing •Public [Capital Fund j^Housing Program j Total

!$565,941jPrior Period Adjustments, Equity ransfers and Correction ofErrors

;$59,287 $-59,287 $0

|1"120 [DnitMonthsAvailable11121 iNumberof Unit Months Leased

588„ . ;016™

;588lisa"

28

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