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HomeMy WebLinkAboutBRAA FC Minutes 10.20.22M I N U T E S Barkley Regional Airport Authority FINANCE COMMITTEE Budget Meeting - Tuesday, 10/20/22, 3:30pm In Person Finance Committee (FC) Chairman Durbin welcomed everyone and recognized that a quorum was present. Committee Members present were Ashley Johnson, Marshall Davis and John Durbin, Chairman. Not present was Jay Matheny and Jonas Neihoff. Staff present was Dennis Rouleau, Executive Director (ED). Also present was David Hampton with Kemper CPA Group. Review of draft of Annual Audit of BRAA by Kemper CPAs David Hampton of Kemper CPA Group presented the draft of the various required audit reports to the committee including: 1) letter of significant audit findings, 2) adjusting journal entries, 3) financial statements for the year ending June 30, 2022, 4) report on internal controls over financial reporting and on compliance and other matters, 5) report on compliance for each major program and on internal controls over compliance, 6) report on passenger facility charge program and 7) schedule of finding and questioned costs. Hampton explained the core financial statements received an “unqualified” or “clean” opinion as to the fairness of the statement. He noted no exceptions in any of the other reports on compliance. He did have to repeat one comment on what is considered a “material weakness” in segregation of duties as our in-house accountant can make deposits and reconcile the bank accounts. We mitigate this weakness in part by having second signatures on larger checks by a board member and by having the full board have access to the detail check registers, bank accounts and core financial statements and journal entries monthly. The financial statement were presented for only one year instead of comparative with the prior year because of new lease accounting rules that went into effect for fiscal year ending June 30, 2022 would make the comparisons inappropriate. That rule required that we record an asset for al expected future lease payments from our farm land and lease income from the FBO facility. Instead of “lease income”, a portion of the cash flow from these lease are reported as “interest income” with the balance reducing the receivable. The approximate total of that account receivable is about $667,000 with a nearly offsetting “deferred inflows” liability amount and interest income from such leases were about $47,000 in the fiscal year ended June 30, 2022. We discussed the reporting of grant income and the levels of capitalized AIP projects, primarily the new terminal project and the COVID relief grants. We discussed the assertion in the audit on page 31, Section I – Summary of Auditor’s Results that BRAA was determined to be a “high-risk auditee.” But per Mr. Hampton, this is solely because of the “material weakness” in the segregation of duties noted above. Hampton mentioned that our monthly financial reporting does not properly report grant income and depreciation on capitalized assets. He offered to help the airport in some type of reporting that would continue to disclose the mostly cash basis reporting of normal revenues and expenses supplemented with reporting of the periodic grant income received. Hampton agreed to finalize the reports to be presented to the full Board on the 24th. Mr. Hampton left the meeting. The Committee then recommended the approval of the audit to the full board on Monday. The Committee then reviewed the September Financial data include balance sheet, income statement, accounts receivable, bank statements, check registers, journal entries and reconciliation reports and Dennis answered all questions. It was noted a large increase in “professional services” for September which is mostly driven by outsourcing the police work at $65 per hour in lieu of the normal part-time employee police force which we are having trouble filling. The schedule for the afternoon flight with the stop in Decatur Illinois is hurting our passenger count and thus revenues which were off from budget for September as a result. We briefly previewed the art work recommendations to be presented to the board Monday. Meeting adjourned at 5:15 pm.