Township of Lower Merion
Total Page:16
File Type:pdf, Size:1020Kb
TOWNSHIP OF LOWER MERION MONTGOMERY COUNTY, PENNSYLVANIA COMPREHENSIVE ANNUAL FINANCIAL REPORT For The Fiscal Year Ended December 31, 2012 Prepared by the Department of Finance TOWNSHIP OF LOWER MERION, PENNSYLVANIA Table of Contents Page Introductory Section: Letter of Transmittal i Certificate of Achievement xvi Organizational Chart xvii Board of Commissioners xviii Executive Officials and Staff xix Financial Section: Independent Auditors’ Report 1 Management’s Discussion and Analysis 3 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Position 19 Statement of Activities 20 Fund Financial Statements: Balance Sheet – Governmental Funds 21 Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficit) – Governmental Funds 22 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances (Deficit) of Governmental Funds to the Statement of Activities 23 Statement of Net Assets – Proprietary Funds 24 Statement of Revenues, Expenses, and Changes in Fund Net Position – Proprietary Funds 25 Statement of Cash Flows – Proprietary Funds 26 Statement of Fiduciary Net Position – Fiduciary Funds 28 Statement of Changes in Fiduciary Net Position – Fiduciary Funds 29 Notes to Basic Financial Statements 30 Required Supplementary Information: Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual (Budget Basis) – General Fund 66 Notes to Required Supplementary Information 67 Schedule of Funding Progress and Contributions from the Employer and Other Contributing Entities – Municipal Police Pension Fund 68 Schedule of Funding Progress and Contributions from the Employer and Other Contributing Entities – Township Employees Pension Fund 69 Schedule of Funding Progress – Postemployment Benefits 70 Combining and Individual Fund Statements and Schedules: Nonmajor Governmental Funds – Description of Funds 71 Combining Balance Sheet – Nonmajor Governmental Funds 72 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances – Nonmajor Governmental Funds 73 TOWNSHIP OF LOWER MERION, PENNSYLVANIA Table of Contents Page Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual (Budget Basis) – Nonmajor Special Revenue Funds 74 Internal Service Funds – Description of Funds 75 Combining Statement of Net Position – Internal Service Funds 76 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position – Internal Service Funds 77 Combining Statement of Cash Flows – Internal Service Funds 78 Statistical Section: Statistical Section – Description of Schedules 79 Net Position by Component 80 Changes in Net Position 81 Fund Balances of Governmental Funds 82 Statement of Revenues, Expenditures, and Changes in Fund Balances 83 Assessed and Estimated Actual Value of Taxable Property 84 Property Tax Rate in Mills – All Direct and Overlapping Governments 85 Principal Property Tax Payers 86 Property Tax Levies and Collections 87 Ratio of Outstanding Debt by Type 88 Ratio of Net General Bonded Debt to Assessed Value and Net Bonded Debt per Capita 89 Computation of Direct and Overlapping Debt 90 Computation of Legal Debt Margin 91 Demographic and Economic Statistics 92 Principal Employers 93 Full-Time and Part-Time Employees by Function 94 Operating Indicators by Function 95 Capital Assets Statistics by Function 96 INTRODUCTORY SECTION Letter of Transmittal Certificate of Achievement (Government Finance Officers Association) Organizational Chart List of Elected and Appointed Officials TOWNSHIP OFFICE OF THE TOWNSHIP MANAGER 75 E. Lancaster Ave. OF Ardmore, PA 19003-2376 LOWER MERION Telephone: (610) 645-6100 FAX: (610) 649-0777 MONTGOMERY COUNTY July 30, 2013 The President and Members of the Board of Commissioners: We are pleased to submit the Township of Lower Merion’s Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31, 2012. The annual report is submitted herewith and includes, as required by Code, financial statements which have been examined by an independent firm of certified public accountants. The complete set of financial statements is presented in conformity with generally accepted accounting principles (GAAP) and audited in accordance with generally accepted auditing standards. This report consists of management’s representations concerning the finances of the Township. Consequently, management assumes full responsibility for the completeness and reliability of all the information presented in this report. To provide a reasonable basis for making these representations, management of the Township has established a comprehensive internal control framework that is designed both to protect the government’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the Township’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, the Township’s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. The Township’s financial statements have been audited by CliftonLarsonAllen LLP, a firm of licensed certified public accountants. The goal of the independent audit was to provide reasonable assurance that the financial statements of the Township for the fiscal year ended December 31, 2012, are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditors concluded, based upon the audit, that there was a reasonable basis for rendering an unqualified opinion that the Township’s financial statements for the fiscal year ended December 31, 2012, are fairly presented in conformity with GAAP. The independent auditor’s report is presented as the first component of the financial section of this report. The independent audit of the financial statements of the Township was a part of a broader, federally mandated “Single Audit” designed to meet the special needs of federal grantor agencies. The standards governing Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on the audited government’s internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of federal awards. These reports are available in the Township’s separately issued Single Audit Report. GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The Township’s MD&A can be found immediately following the report of the independent auditors. i Profile of Lower Merion Township The Township of Lower Merion (the “Township”), first settled in 1682 and well known as an attractive and affluent residential community, is located along Philadelphia's famed Main Line in “Delaware Valley, U.S.A.” Fine homes and estates, excellent highways, exclusive shops and department stores, luxurious apartment houses, stately church edifices, buildings dating back to the 17th century, and superior public, private and parochial schools and colleges characterize the Township. Covering an area of 23.64 square miles, the Township is bounded by the City of Philadelphia, the Boroughs of Conshohocken and West Conshohocken, and the Townships of Upper Merion and Whitemarsh in Montgomery County and the Townships of Haverford and Radnor in Delaware County. The Borough of Narberth, although a separate political entity of one-half square mile, is completely surrounded by the Township. Lower Merion has been a Township of the First Class since 1900 – the oldest in the State. The Township is divided into 14 wards and is governed by a Board of Commissioners, with one Commissioner elected from each ward for a term of four years. Seven of the Commissioners are elected every two years to hold overlapping terms. The Board makes policy and legislates by passing resolutions and ordinances within the guidelines and powers established by the First Class Township Code. The Board appoints a Township Manager who is chosen on the basis of executive qualifications and serves as the Township's Chief Executive and Administrative Officer. The Township Manager is responsible to the Board for the administration of all municipal affairs as authorized by the Board and/or Administrative Code of the Township. Other Officers of the Township are the Secretary, Solicitor, Engineer and an elected Treasurer. The Township organization has thirteen departments, all headed by experienced career professionals selected by the Township Manager strictly on the basis of merit and ability to perform the required responsibilities. These departments provide an extensive array of services to Township residents including police and fire protection, refuse and recycling collection and disposal, parks maintenance, recreation activities,