AUDUBON COMMISSION

(A Discretely Presented Component Unit of the City of New Orleans, Louisiana)

Audit of Financial Statements

Year Ended December 31, 2012

LAPORTE Contents

Independent Auditor's Report 1 -3

Management's Discussion and Analysis 4-10

Financial Statements

Statements of Net Position 11-12

Statements of Revenues, Expenses and Changes in Net Position 13

Statements of Cash Flows 14

Notes to Financial Statements 15-29

Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Govemment Auditing Standards 30-31

Schedule of Findings and Responses 32

Summary Schedule of Prior Year Findings 33

Additional Information

Combining Schedule of Net Position 35 - 36

Combining Schedule of Revenues, Expenses and Changes in Net Position 37

Combining Schedule of Cash Flows 38 - 39 •^ LaPorie. APAC ' LAPORTE 1 ] 1 Veterans Blvd. | Suite 600 CPA. t austNESs ADViso«6 MeCalric, LA 70005 504.835.5522 | Y^ 504.835.5535 La Porte, com

Independent Auditor's Report

To the Board of Directors of Audubon Commission

Report on the Financial Statements We have audited the accompanying financial statements of the Audubon Commission (the Commission), a discretely presented component unit of the City of New Orleans, Louisiana, as of and for the year ended December 31, 2012, and the related notes to the financial statements, which collectively comprise the Commission's basic financial statements as listed in the table of contents.

Management's Responsibility for the Financial 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 Responsibility Our responsibility is to express an opinion 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 and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

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 error. In making those risk assessments, the auditor considers internal 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 ofthe financial statements.

NEW ORLEANS HOUSTON BATON ROUGE COVINGTON An Independent!)' Owned Member, iMcGladrey Alliance TheKicG^rey Aliarv:e \s a premiff afliliaton ol irdapgniJant accounling and consulting firms. TlieMcGadrey/yiiarce member firms manlain Ihsir name, autonomy and irrJecenctencs and areiespon^bJefortfeir own dent fee arrarigements.ddive^dsew^esarKl tttai^enarce oi j r^Knt r^alianslipa. I We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion, the financial statements referred to above present fairiy, in all material respects, the financial position of the Commission as of December 31, 2012, and the changes in its financial position and cash flows for the year then ended in conformity 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, on pages 4 through 10, be presented to supplement the basic financial statements. Such information, although not a 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 knowledge we 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 Information

Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The additional combining information for 2012 is presented for purposes of additional analysis of the financial statements rather than to present the financial position and results of operations of the individual companies, and is not a required part of the financial statements. Such information is the responsibility of the Commission's management and was derived from and relates directly to the underiying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underiying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, when considered in relation to the financial statements as a whole.

The financial statements of the Commission, as of and for the year ended December 31, 2011, were audited by other auditors whose report dated May 31, 2012 expressed an unmodified opinion on those statements. other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated June 3, 2013, on our consideration of the Commission's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Commission's internal control over financial reporting and compliance.

A Professional Accounting Corporation

Metairie, LA May 31, 2013 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Management's Discussion and Analysis

The discussion and analysis of the Audubon Commission's (the Commission) financial performance provides an overall review of the Commission's financial activities for the years ended December 31, 2012 and 2011. It should be read in conjunction with the financial statements in this report.

Overview of Financial Statements This annual report consists of five components - Independent Auditor's Report, Management's Discussion and Analysis {this section), Financial Statements, Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters, and Additional Information.

The Financial Statements of the Commission present the financial position of the Commission, the results of its operations and its cash flows. The Financial Statements are prepared on the accrual basis of accounting.

The Statements of Net Position includes all of the Commission's assets and liabilities and provides information about the Commission's investments in resources (assets) and its obligations to creditors (liabilities). It also provides information on the capital structure, liquidity and financial flexibility of the Commission.

The Statements of Revenues, Expenses and Changes in Net Position reports on the current year's performance of the Commission's operations.

The Statements of Cash Flows provides information on the Commission's cash from operations and capital and related financing activities.

The Notes to Financial Statements provide information that is essential in order to gain a full understanding ofthe data in the basic financial statements.

The Additional Information section provides information on the Combining Statement of Net Position, Combining Statement of Revenues, Expenses and Changes in Net Position and Combining Statement of Cash Flows.

Financial Highlights Net assets decreased by $429,728, or 0.5%, and $1,774,466, or 2.0%, in 2012 and 2011, respectively.

Additions to capital assets totaled $5,850,169 in 2012 and $4,416,662 in 2011, respectively.

Noncurrent liabilities decreased by $4,945,673 and $1,520,683 in 2012 and 2011, respectively, due to debt service payments on bonds and also due to the reduction of the inter-company debt between the Audubon Nature Institute, Inc. (the Institute) and the Commission. The Institute has committed to the Commission that it has the intent and ability to continue funding the operations ofthe Commission through operating advances, donations and grants. The Institute has no plans in the next 12 months to demand payment on the amounts receivable from the Commission at December 31, 2012. AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Management's Discussion and Analysis

Operating Facilities Net Results for the Year Ended December 31, 2012 with Prior Years and Budget Comparisons

Actual Actual Actual Budget Budget 2012 2011 2010 2012 2011 Aquarium/IMAX Woldenberg Riverfront Park S 4,159 S 4,320 $ 4,268 $ 3,961 $ 3,681 Audubon Zoo and Park & Audubon Golf Course (2,907) (2,789) (3,303) (3,071) (2,877) Audubon Insectarium (447) (396) (186) (215) (144) Research Center/Species Survival Center (509) (771) (624) (475) (395) Nature Center 21

Total Operations * 296 364 176 $ 200 $ 265

Net Capital Income and Expense (726) (2,138) 100

Change in Net Position $ (430) s (1,774) $ 276

*Excludes capital revenues and expenditures and the depreciation associated with buildings and fixed exhibitory.

Condensed Statement of Revenues, Expenses and Changes in Net Position

Year Ended December 31 Change Change 2012 2011 2010 2011 to 2012 2010 to 2011 Operating Revenues $ 38,427,486 $ 37,495,881 $ 34,977,094 $ 931,605 $ 2,518,787 Operating Expenses 52,578,219 50,121,753 48,677,757 2,456,466 1,443,996

Operating Loss (14,150,733) (12,625,872) (13,700,663) (1,524,861) 1,074,791

Nonoperating Revenues, Net 13,721,005 10,851,406 13,976,717 2,869,599 (3,125,311)

Change in Net Position (429,728) (1,774,466) 276,054 1,344,738 (2,050,520)

Beginning Net Position 84,628,305 86,402,771 86,126,717 (1,774,466) 276,054

Ending Net Position $ 84,198,577 $ 84,628,305 $ 86,402,771 $ (429,728) $ (1,774,466)

Comments on Condensed Statement of Revenues, Expenses and Changes in Net Position

Operating Revenues Operating revenues increased by $931,605 and $2,518,787 in 2012 and 2011, respectively. The increase in 2012 was mainly due to an increase in private events, membership and concessions revenue. The increase in 2011 was mainly due to the opening of the Cool Zoo splash park at the Audubon Zoo and the Parakeet Pointe interactive exhibit at the Audubon Aquarium of the Americas. AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Management's Discussion and Analysis

Included in the 2012 operating revenues of $38,427,486 are admissions revenues of $14,640,000.

Operating Expenses In 2012, there was an increase of approximately $1,899,800 in the cost of material, supplies and contractual services due to additional variable costs related to an increase in business. The increase was also due to additional costs incurred relating to the Gulf United for Lasting Fisheries (GULF) program, which is the result of a contract between the Commission and the Louisiana Department of Wildlife and Fisheries (LDWF) for the Commission to plan and implement a seafood sustainability certification program.

An increase of approximately $540,500 in salaries and benefits in 2012 was mainly due to increased costs of medical insurance and cost of living salary increases.

Non-Operating Revenues An increase in intergovernmental grants for capital projects and programs was mainly due to revenue generated from the contract with LDWF.

Dedicated tax revenues increased by $342,682 and $353,967 in 2012 and 2011, respectively.

Private and government grants and donations for capital projects, education programs and operating support increased in 2012 by $895,290.

Net Capital Assets

Aquarium Species Survival and Audubon Audubon Center/ Audubon Riverfront Audubon Zoo Golf Research Nature Park Insectarium and Park Course Center Center Total Balance December 31, 2010 $44,126,252 $21,702,580 > 46.537,066 $9,222,117 14,228.281 135,816,296 Additions 1,185,748 32,439 2,657,572 43,172 497,731 4,416,662 Depreciation/Disposals (3,029,778) (1,344,040) (2,906,077) (405.156) (781.579) - (8,466.630)

Balance December 31, 2011 42.282,222 20.390,979 46,288,561 8,860.133 13,944,433 131,766,328 Additions 1.725,383 375,591 3,129,382 483.880 76,494 59,439 5,850.169 Depreciation/Disposals (3.018,947) (1.350,274) (2,842,554) (405.073) (794,277) (8,411.125)

Balance Decen^er 31, 2012 $40,988,658 $19,416,296 $46,575,389 $8,938,940 $ 13.226,650 $ 59,439 $ 129,205.372 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Management's Discussion and Analysis

Condensed Statement of Net Position Change Change 2012 2011 2010 2011 to 2012 2010 to 2011 Assets Cash and Cash Equivalents $ 1,424,306 $ 1,862.751 $ 765.093 $ (438,445) $ 1,097,658 Accounts Receivable 748,049 484.104 1,000,196 263,945 (516,092) Inventory 1,435,303 1,398.057 1,450,039 37,246 (51.982) Prepaid Expenses 1,033,823 1,020,556 1.004761 13,267 15,795 Restricted Assets 4,714,900 5,739,414 3.475,046 (1,024,514) 2.264,368 Nondepreciable Capital Assets 4,876,183 3,172,602 4,109,943 1,703,581 (937.341) Depreciable Capital Assets, Net 124,329.189 128.593,726 131.706,353 (4,264,537) (3,112,627) Other Assets. Nonrestricted 9,333,919 10,111,073 10.268,866 (777,154) (157,793)

Total Assets $ 147,895,672 $152,382,283 $153,780,297 JL (4,486,611) $ (1,398.014)

Liabilities Nonrestricted Current Liabilities $ 6,009,078 $ 6,408,743 $ 6,173,554 $ (399.665) $ 235,189 Payables from Restricted Assets 7,115,154 5,826.699 4,164,753 1,288,455 1,661,946 Noncurrent Liabilities 50,572,863 55,518,536 57,039,219 (4,945,673) (1,520,683)

Total Liabilities 63,697,095 67,753,978 67,377,526 (4,056,883) 376,452

Net Position Net Investment in Capital Assets 82,847,412 84,311.185 89,953.980 (1,463,773) (5,642,795) Unrestricted 1,351,165 317.120 (3,551,209) 1,034,045 3,868,329

Total Net Position 84,198,577 84,628,305 86,402,771 (429,728) (1,774,466)

Total Liabilities and Net Position $ 147,895,672 $152,382,283 $153,780,297 $ (4,486,611) $ (1,398,014)

Comments on Condensed Statement of Net Position Net capital assets decrease of $2,560,956 in 2012 was due to an increase in capital asset additions of $5,850,169 offset by depreciation and disposals of $8,411,124.

Net capital assets decrease of $4,040,968 in 2011 was due to the increase in capital asset additions $4,416,662 offset by the depreciation and disposals of $8,466,630.

Noncurrent liabilities decreased by $4,945,673 in 2012 due to debt service payments on bonds, reduction of the inter-company debt between the Institute and the Commission, and final principal and interest on the Aquarium Limited Tax Bonds Series 2003 becoming due in the current period. AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Management's Discussion and Analysis

Condensed Statement of Cash Flows

Change Change 2012 2011 2010 2011 to 2012 2010 to 2011 Net Cash Used in Operating Activities $(7,561,687) $ (3,187,804) $ (5,757,878)$ (4,373,883) $ 2,570,074

Net Cash Provided by Capital and Related Financing Activities 7.123.242 4.285.462 4.989.746 2,837,780 (704.284)

Net (Decrease) Increase in Cash and Temporary Investments (438,445) 1,097,658 (768,132) (1,536,103) 1,865,790

Cash and Temporary Investments Beginning of Year 1.862,751 765.093 1,533,225 1,097,658 (768.132)

End of Year $ 1,424.306 $ 1,862,751 $ 765,093 $ (438,445) $ 1,097,658

Comments on Condensed Statement of Cash Flows Cash used in operating activities increased in 2012 due mainly to an increase in operating expenses of $2,456,466. This was partly off-set by an increase in cash receipts of $931,605. In 2011, cash used in operating activities decreased by $2,570,074 due mainly to an increase in cash receipts of $3,480,969. However, this increase was partly off-set by an increase in payments made for salaries, supplies and services.

Cash provided by capital and related financing activities of $7,123,242 in 2012 was $2,837,780 greater than 2011. This was mainly due to an increase in intergovernmental and other grants. In 2011, cash provided by capital and related financing activities was $4,285,462, which was $704,284 less than 2010. The decrease was partly due to a reduction in grant transfers from the Institute. Also, restricted assets increased due to the new bond proceeds received for capital projects. Short-term restricted liabilities increased due to the Gulf Opportunity Zone Loan becoming due in 2012. There were also less intergovernmental grants received in 2011 than in 2010.

In 2012, there was an overall decrease in cash and temporary investments of $438,445.

General Overview

2012 was marked by promising attendance trends and many successes for the Commission. With an eye on the future, the Commission remained committed to providing outstanding guest experiences, educational opportunities, and preserving the wonders of nature. The combined attendance of the Audubon Zoo, Audubon Aquarium of the Americas, Entergy IMAX® Theater, and the Audubon Butterfly Garden and Insectarium totaled 2.12 million guests, an increase of 1.04%. The Audubon Aquarium of the Americas, the Audubon Butterfly Garden and Insectarium and Entergy IMAX® Theater attendance increased, welcoming 760,150, 259,710, and 239,070 guests, respectively. The Audubon Zoo attendance decreased slightly with 858,058 guests—this was the second year in a row that Audubon Zoo attendance surpassed 850,000 guests! Revenue from admissions totaled $14.64 million. The Commission looks to the future with optimism, ready to embark on new adventures and meet the challenges ahead. AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Management's Discussion and Analysis

Major Achievements In October, Audubon Aquarium of the Americas introduced the Backstage Penguin Pass, an immensely popular experience that allows guests to get up close with an African penguin and a member of the penguin keeper staff. Between October and December 2012, the Backstage Penguin Pass generated over $30,000 in ticket sales.

Audubon Zoo reopened Cool Zoo in April 2012 for a second season. This wild and wet splash park continues to be a summer hit for families looking to escape the heat.

Entergy IMAX® Theatre brought excitement to the theater's gigantic 5 >2-story screen with a mix of educational and blockbuster films during the year including Happy Feet Two 3D, The Dark Knight Rises, and, for a second holiday season in a row. Polar Express 3D.

In March, Audubon's Louisiana Marine Mammal and Sea Turtle Rescue Program came to the aid of a 2-year-old dolphin stranded on a mudflat near Grand Isle, Louisiana. Badly sunburned, the dolphin was too weak to swim on his own and had to be supported by a staff member at all times. Over the next 6 months. Sassafras, as he became affectionately known, was nursed back to health. During that time, it was discovered that he was deaf and could not be released back into the wild. Sassafras now lives at the Institute for Marine Mammal Studies in Gulfport, MS, where he serves as an ambassador for his species.

Construction continued on the new state-of-the-art elephant barn and paddock at Audubon Zoo. With a projected completion date of mid-2013, the new habitat will provide our elephants with a much larger stomping ground.

Repairs and enhancements were completed at Audubon Butterfly Garden and Insectarium's Joe W. and Dorothy Dorsett Brown Foundation Butterflies in Flight exhibit including new lighting, flooring, plants and an amazing array of butterflies.

Restorations funded by the Community Development Block Grant Program (CDBG) were completed on Woldenberg Riverfront Park's Aquatic Colonnade by Ida Kohlmeyer, the Monument to the Immigrant, and the Malcolm Woldenberg bronze sculpture.

In the spring, Olmsted Renewed: Audubon Park's Legacy to the Future, the first major fundraising effort for the care and preservation of Audubon Park, was introduced. This $10 million campaign celebrates the 12^^ anniversary of the Park as well as landscape architect John Charles Olmsted, who designed the green space in the 1890's. At the conclusion of 2012, the campaign had lead gifts and pledges totaling 50% of the fundraising goal.

Membership exceeded expectations in 2012, with revenue totaling $4,410,722 and coming in at 14.5% better than budget. At year end, members accounted for 26% of visitation at Audubon Aquarium of the Americas, 33% at Audubon Zoo, and 7% at Entergy IMAX® Theater. The addition of the Butterfly Garden and Insectarium as a member facility had a significant impact on visitation at that facility, bringing it to 25% in 2012 as compared to 16% in 2011. AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Management's Discussion and Analysis

New Arrivals & Programs In 2012, Gulf United for Lasting Fisheries (GULF), a new conservation initiative to empower seafood buyers with information they need to understand the responsible management of Gulf fisheries, was announced. At Audubon Aquarium of the Americas, a new exhibit, Geaux Fish!, began development to complement this compelling project and educate guests.

The Coastal Wildlife Center, comprised of the Coastal Wildlife Network, GULF, and coastal education, appointed a director in November to coordinate programming.

Audubon Center for Research of Endangered Species celebrated the birth of Crystal, an African black-footed kitten in February 2012. The kitten is the third of her kind to be born from a frozen embryo via in vitro fertilization at Audubon Center for Research of Endangered Species.

During 2012, the Audubon Zoo welcomed several family members, including a male Maguari stork, two female babirusas, a male Amur leopard, a giant anteater, and a golden lion tamarin named Tchoupitoulas.

Audubon Butterfly Garden and Insectarium began breeding and importing several new species including rainbow stag beetles, elephant beetles, violin and ghost mantids, and domino roaches. In addition, breeding programs with giant African millipedes and pink katydids saw great success making it a highly productive year.

Audubon Zoo's herpetology staff successfully bred bushmasters and Louisiana pine snakes, resulting in 8 and 13 hatchlings, respectively. Notably, some of the pine snakes hatched at Audubon Zoo will be released in the wild as part of a collaborative conservation initiative.

Social media initiatives have continued to strengthen, with new fans, friends, and followers every day. At year end, our social network included more than 76,800 Facebook friends, 8,000 Twitter followers, and over 83,000 e-mail subscribers.

Economic Factors and Next Year's Budget The 2013 operating budget is comparable to the 2012 operating budget, which reflects management's intent and expectations that operations will remain consistent. The capital projects underway at the end of 2012 will continue throughout 2013. The impact of these improvements on operating revenues and expenses is not anticipated until calendar year 2014.

Contacting the Commission's Director of Finance This financial report is designed to provide our citizens, customers, and creditors with a general overview of the Commission's finances. If you have any questions about this report or need additional financial information, please contact the Director of Finance, Audubon Nature Institute, 6500 Magazine Street, New Orieans, LA 70118.

10 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Statements of Net Position December 31, 2012 and 2011

2012 2011 Current Unrestricted Assets Cash and Temporary Investments $ 1,424,306 $ 1,862,751 Accounts Receivable, Net of Allowance for Uncollectible Accounts of $49,376 in 2012 and $52,452 in 2011 748,049 484,104 Inventory 1,435,303 1,398,057 Prepaid Expenses 1,033,823 1,020,556

Total Unrestricted Current Assets 4,641.481 4,765,468

Current Restricted Assets Designated for Capital Projects 2,306,878 2,422,906 Debt Service and Bond Reserve Investments 882,456 2,066,669 Accounts Receivable for Capital Improvements 1,525,566 1,249,839

Total Restricted Current Assets 4,714,900 5,739,414

Total Current Assets 9,356,381 10,504,882

Noncurrent Assets Capital Assets Land 800,000 800,000 Buildings and Fixed Exhibitory 221,205,666 218,313,703 Equipment 20,046,132 19,250,233 Construction in Progress 4,076,183 2,372,602 Less: Accumulated Depreciation (116,922,609) (108,970,210)

Net Capital Assets 129,205,372 131,766,328

Other Assets Prepaid Rent - Dock Board 8,568,404 8,684,193 Film Cost - Net of Accumulated Amortization 531,268 754,906 Receivable - Riverfront Economic Development Agreement 81,674 Bond Issue Costs 234,247 293,529 Debt Service and Bond Reserve Investments - Restricted Noncurrent 296,771

Total Other Assets 9,333,919 10,111,073

Total $ 147,895,672 $ 152,382,283

The accompanying notes are an integral part ofthese financial statements.

11 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Statements of Net Position (Continued) December 31, 2012 and 2011

2012 2011 Nonrestricted Current Liabilities Accounts Payable and Other Accrued Liabilities $ 5,868,512 $ 6,340,340 Capital Lease Obligation 140.566 68,403

Total Nonrestricted Current Liabilities 6,009,078 6,408,743

Current Liabilities Payable from Restricted Assets Accrued Interest 1,333,934 1,094,402 Revenue Bonds, Current Portion 1,370,874 Limited Tax Bonds, Current Portion 2,787,724 2,511,123 Gulf Opportunity Zone Loan, Current Portion 1,068,589 797,909 Construction Payables 1.924.907 52,391

Total Current Liabilities Payable from Restricted y^sets 7.115.154 5,826,699

Total Current Liabilities 13.124.232 12,235,442

Noncurrent Liabilities Accrued Interest 923,830 1,130,123 Limited Tax Bonds 25,554,723 28,342,448 Unamortized Premium, Net 2,061,370 2,387,600 Gulf Opportunity Zone Loan 15,125,665 15,960,597 Due to Audubon Nature Institute, Inc. 6,521,477 7,560,378 Capital Lease Obligation 385,798 137,390

Total Noncurrent Liabilities 50,572,863 55,518,536

Total Liabilities 63,697,095 67,753,978

Net Position Net Investment in Capital Assets 82,847,412 84,311,185 Unrestricted 1.351.165 317,120

Total Net Position 84.198.577 84,628,305

Total $147,895,672 $152,382,283

The accompanying notes are an integral part ofthese financial statements.

12 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Statements of Revenues, Expenses and Changes in Net Position Forthe Years Ended December 31, 2012 and 2011

2012 2011 Operating Revenues Charges for Services $ 37,134,153 $ 35,998,927 Other Revenues 1,293,333 1,496,954

Total Operating Revenues 38,427,486 37,495,881

Operating Expenses Salaries and Benefits 22,670,867 22,130,346 Contractual Services, Materials, Supplies and Other 21,171,536 19,271,783 Depreciation and Amortization 8,735,816 8,719,624

Total Operating Expenses 52,578,219 50,121,753

Operating Loss (14,150,733) (12,625,872)

Nonoperating Revenues (Expenses) Audubon Nature Institute, Inc. Grants for Capital Projects and Education Programs 4,201,347 3,306,057 Dedicated Tax Revenues 8,637,520 8,294,838 Intergovernmental Grants for Capital Projects 2,279,214 1,483,615 Interest Income 1,386,153 1,113,390 Interest Expense (2,258,813) (2,820,283) Grant Expenses (432,122) (419,498) Amortization - Debt Costs (92,294) (106,713)

Total Nonoperating Revenues, Net 13,721,005 10,851,406

Change in Net Position (429,728) (1,774,466)

Net Position, Beginning of Year 84,628,305 86,402,771

Net Position, End of Year $ 84,198,577 $ 84,628,305

The accompanying notes are an integral part ofthese financial statements.

13 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Statements of Cash Flows Forthe Years Ended December 31, 2012 and 2011

2012 2011 Cash Flows from Operating Activities Casii Received from Customers $ 38,163,542 $ 38,214,046 Casli Received from FEIVIA Reimbursements - 28,522 Casli Paid to or on Beiialf of Employees (22,513,588) (22,053,951) Casii Paid for Supplies and Services (23,211,641) (19,376,421) Net Cash Used in Operating Activities (7.561.687) (3,187,804) Cash Flows from Capital and Related Financing Activities Grants from the Institute for Capital Projects, Education and Operating Support 4,201,347 3,306,056 Payments for Projects' Design, Construction and Equipment Purchases (3,436,551) (4,437,489) Decrease (Increase) in Restricted Assets 1,321,285 (2,561,138) Increase in Restricted Liabilities 200,011 4,639,163 Dedicated Tax Revenues 8,637,520 8,294,838 Issuance of Bond Principal - 25,000,000 Payment to Bond Escrow Agent - (24,428,502) Payment of Issuance Costs - (192,012) Deposits to Restricted Cash - (3,043,706) Original Issue Premium - 2,433,627 Interest Expense (2,258,813) (2,820,283) Payment of Bond Principal (4,939,253) (4,265,000) Interest Income 1,386,153 1,113,390 Intergovernmental and Other Grants 2,279,214 1,483,615 Grant Expenses (432,122) (419,498) Other 164,451 182,401

Net Cash Provided by Capital and Related Financing Activities 7,123,242 4,285,462 Net (Decrease) Increase in Cash and Temporary Investments (438,445) 1,097,658

Cash and Temporary Investments, Beginning of Year 1,862,751 765,093

Cash and Temporary Investments, End of Year $ 1.424.306 ? 1.862.751 Reconciliation of Operating Loss to Net Cash Used in Operating Activities Operating Loss $ (14,150,733) $ (12,625,872) Adjustments to Reconcile Operating Loss to Net Cash Used in Operating Activities Depreciation and Amortization 8,735,816 8,719,624 (Increase) Decrease in Accounts Receivable and Other Current Assets (430,247) 667,081 (Decrease) Increase in Accounts Payable and Other Current Liabilities (1,716,523) 51,363

Net Cash Used in Operating Activities $ (7.561.687) $ (3.187,804) Noncash Items Capital Lease Obligation $ 526,364 $ 205,793

Purchases for Projects' Design, Construction and Equipment in Accounts Payable and Other Current Liabilities $ 1.924.907 $

The accompanying notes are an integral part ofthese financial statements.

14 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 1. General Information and Summary of Significant Accounting Policies

General information Audubon Park is located on a 400-acre tract within the City of New Orieans (the City) that includes the Audubon Zoo, trails for jogging, biking, and horseback riding, an 18- hole golf course and numerous athletic fields. Act 83 passed by the Louisiana Legislature (the Legislature) in 1871 authorized the Board of Park Commissioners to acquire the land which is now known as Audubon Park. In 1914, the Legislature passed Act 191 which created a Commission to be entrusted with the management and control of Audubon Park. Act 191, as amended, is the current authority for the present Audubon Park Commission which is composed of 24 members who are appointed by the Mayor of the City with the approval of the City Council. Each member serves a six-year term, with four members' terms expiring each year. The Commission is considered a discretely presented component unit of the City and its statements are included in the City's annual financial statements. On January 1, 1996, the Commission's name was changed from Audubon Park Commission to Audubon Commission (the Commission) effective with the City's adoption of amendments to its Home Rule Charter.

On November 4, 1986, City voters approved the levy of a three and four-fifths (3-4/5) mills property tax to finance the construction and certain operating expenses of the Audubon Aquarium of the Americas (the Aquarium). The vote was taken pursuant to Act 309, passed by the Legislature eariier in 1986, which provided that the Commission would develop, construct and operate the Aquarium, and authorized the City to levy and collect the aforementioned ad valorem tax, subject to voter approval, on behalf of the Commission. The City acts through the Commission in the issuance of bonds authorized by Act 309, and through the Board of Liquidation, City Debt, in the sale of its bonds. Construction of the Aquarium of the Americas and Woldenberg Riverfront Park was begun in 1987 and the bonds (Audubon Park Commission Aquarium Bonds, Series 1988 - $25,000,000) were issued in 1988. Construction was completed and the Aquarium was opened to the public in September 1990. Phase II of the Aquarium was completed in 1995.

On June 1, 1990, the Commission and the City entered into an agreement for the construction and operation of the Audubon Wilderness Park and the Freeport McMoRan Audubon Species Survival Center on approximately 64 acres of property owned by the City. The agreement requires an annual payment to the City's General Fund of one dollar ($1.00) per year for a period of fifty (50) years, commencing on May 1, 1990, and terminating on February 28, 2040. The Audubon Center for Research of Endangered Species is located adjacent to the Species Survival Center on 986 acres of United States Coast Guard (Coast Guard) property. The Coast Guard had granted the Commission a 25 year land use license with a 25 year renewal option that was executed on July 1, 2010. The term of such license is to commence on the 1st day of June 2015 and end on the 31st day of May 2040 inclusive, with an option for renewal for 25 additional years thereafter, subject to Coast Guard approval. Improvements completed on this site by the Commission include a 36,000 square-foot research laboratory.

15 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Notel. General Information and Summary of Significant Accounting Policies (Continued)

General information (Continued) Effective October 1, 1994, the Commission received assignment of a facility lease by the Society for Environmental Education (as lessee) with the City (as lessor). The Society for Environmental Education does business as the Audubon Louisiana Nature Center.

The Audubon Insectarium opened in the summer of 2008 and is located in the Customs House building.

The Commission has a contractual management agreement with the Audubon Nature Institute, Inc. (the Institute), a nonprofit organization, under which the Institute manages and operates the Commission facilities located at the Audubon Zoo and Park, the Aquarium and Riverfront Park, the Audubon Insectarium, the Species Survival Center and the Louisiana Nature Center. The Institute employs individuals to operate and maintain the Commission's facilities; however, all operating revenues and expenses, including salary expense, related to these facilities are recorded on the records of the related facility. The Institute also supports the Commission financially through specific donations and grants obtained by the Institute for operations or capital improvements of Commission facilities.

Impact of Hurricanes The Commission is insured for an event of this nature and has property damage insurance and business interruption insurance limits of approximately $65,000,000 for all facilities. The Louisiana Nature Center, located in New Orieans East, flooded during Hurricane Katrina in 2005. The Commission recorded a loss on impairment of the Louisiana Nature Center of approximately $446,000 in 2005 which represented the remaining net book value of the facility at the time and the Louisiana Nature Center has not since reopened. Management is still in the process of developing plans to utilize the site in the future.

Basis of Presentation - Fund Accounting The proprietary fund is used to account for the Commission's ongoing operations and activities which are similar to those in the private sector. Proprietary funds are accounted for using a flow of economic resource measurement focus under which assets and liabilities associated with the operation of these funds are included in the statements of net position. The statements of revenues, expenses and changes in net position present increases (revenues) and decreases (expenses) in net position. The Commission maintains one proprietary fund type - the enterprise fund.

16 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Notel. General Information and Summary of Significant Accounting Policies (Continued)

Use of Estimates The Commission prepares financial statements in accordance with accounting principles generally accepted in the United States of America. Such principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Basis of Reporting In accordance with GASB Statement No. 34, Basic Financial Statements - and Management's Discussion and Analysis - for State and Local Governments, as amended, net position is classified into three components - net investment in capital assets, restricted, and unrestricted. These classifications are defined as follows:

Net Investment in Capital Assets - This component of net position consists of capital position, including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction or improvement of those assets.

Restricted - This component of net position consists of constraints placed on net position use through external constraints imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments or constraints imposed by law through constitutional provisions or enabling legislation.

Unrestricted - This component of net position consists of net position that do not meet the definition of "restricted" or "net investment in capital assets".

Restricted Assets Restricted assets consist primarily of investments maintained in the applicable enterprise fund in accordance with bond indentures. This category is also used to report amounts receivable from public agencies in connection with the funding of capital projects.

Investments Investments are stated at cost or amortized cost, which does not materially differ from market value.

Inventory Inventory is stated at the lower of cost, determined by the first-in, first-out method, or market.

17 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Notel. General Information and Summary of Significant Accounting Policies (Continued)

Capital Assets Capital assets greater than $5,000 and a useful life of over one year are recorded at historical cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives (ranging from 20 to 40 years for buildings and fixed exhibitory and 3 to 20 years for equipment) of the assets. Equipment under capital lease is amortized using the straight-line method over the shorter of the lease term or its useful life. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in revenue or expense for the period. The cost of maintenance and repairs is charged to operations as incurred and significant renewals and betterments are capitalized.

The Commission reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset might not be recoverable through future utilization. An impairment change is recognized when the fair value of an asset is less than its carrying value.

Cash and Temporary Investments The enterprise funds consider all short-term and highly liquid investments with an original maturity of ninety days or less to be temporary investments. Cash and temporary investments at December 31, 2012 and 2011, consisted of unrestricted cash and cash equivalents of $1,424,306 and $1,862,751, respectively.

Budgeting Operating and capital expenditure budgets are adopted by the Commission on a basis consistent with accounting principles generally accepted in the United States. Budget information is utilized for analytical purposes, and the budget process is a key component ofthe Commission's management control environment.

Impact of Recently Issued Accounting Principles

Recently Issued and Adopted Accounting Pronouncements In December 2010, GASB issued Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements. GASB 62 incorporates into GASB's authoritative literature certain accounting and financial reporting guidance that is included in the following pronouncements issued on or before November 30, 1989, which does not conflict with or contradict GASB pronouncements: Financial Accounting Standards Board (FASB) Statements and Interpretations, Accounting Principles Board Opinions and Accounting Research Bulletin of the American Institute of Certified Public Accountants' (AICPA) Committee on Accounting Procedure. This statement is effective for periods beginning after December 15, 2011. The adoption of this statement in 2012 did not have any impact on the Commission's financial statements.

18 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Notel. General Information and Summary of Significant Accounting Policies (Continued)

Impact of Recently Issued Accounting Principles (Continued)

Recently Issued and Adopted Accounting Pronouncements (Continued) In June 2011, the GASB issued Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position. GASB 63 provides guidance for reporting deferred outflows of resources, deferred inflows of resources and net position in a statement of financial position and related disclosures. The statement of net assets is renamed the statement of net position and includes four components of assets, deferred outflows of resources, liabilities, and deferred inflows of resources. The provisions of this statement are effective for financial periods beginning after December 15, 2011. During 2012, the Commission adopted the statement and restated balances previously referred to as net assets to net position.

Recently Issued Accounting Pronouncements In March 2012, the GASB issued Statement No. 65, Items Previously Reported as Assets and Liabilities. GASB 65 clarifies the appropriate reporting of deferred outflows of resources and deferred inflows of resources to ensure consistency in financial reporting. Additionally, the GASB evaluated debt issue costs and concluded that, with the exception of prepaid insurance, the costs relate to services provided in the current period and thus they should be expensed in the current period. This is a significant change from current practice which is to record these as assets and amortize them over the life of the related debt issue. The provisions of the statement are effective for periods beginning after December 15, 2012. Management anticipates, upon retrospective adoption of this new standard in 2013, net position will decrease $234,247 due to derecognition of the unamortized portion of the asset associated with bond issue costs as of December 31, 2012. Similarly, the reported change in net position for the year ended December 31, 2012 will be decreased $59,282 to reflect the reclassification of 2012 costs as expenses, net of the derecognition of amortization expense associated with these assets. The unamortized loss on advance refunding will be reclassified as a deferred outflow of resources on the statement of net position, rather than as a contra- liability as it is currently shown. This line item is still amortized as a component of interest expense over the shorter of the life of the old or new debt.

Reclassifications The Commission has reclassified certain amounts for prior periods to conform to the current year presentation.

Note 2. Cash and Temporary Investments

Cash on Deposit The Commission's deposits at financial institutions at December 31, 2012 and 2011, were $1,275,096 and $1,982,582, respectively, (excluding $149,210 of cash on hand at December 31, 2012 and 2011).

19 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 2. Cash and Temporary Investments (Continued)

Cash on Deposit (Continued) Custodial credit risk is the risk that in the event of a bank failure, the Commission's deposits may not be returned. The Commission does not have a deposit policy for custodial credit risk. As of December 31, 2012 and 2011, no funds were exposed to custodial credit risk.

Investments The carrying and market values of the Commission's investments as of December 31, 2012 and 2011 were $3,189,334 and $3,894,958, respectively. At December 31, 2012, the total was comprised of money market accounts and cash. At December 31, 2011, amounts were comprised of money market accounts of $3,003,003 and treasury bills of $891,955. The average return on the deposits approximated 0.01% at December 31, 2012 and 2011.

Per GASB authoritative guidance, unless there is information to the contrary, obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality.

Interest Rate Risk It is not the Commission's policy to limit investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates.

Custodial Credit Risk For an investment, custodial credit risk is the risk that, in the event of the failure of a counterparty, the Commission would not be able to recover the value of investments or collateral securities that are in the possession of an outside party. At December 31, 2012 and 2011, the Commission is not exposed to significant custodial credit risk with respect to its investments because all investments are either insured by Federal Depository Insurance registered in the name of the Commission or collateralized by other investments pledged in the name ofthe Commission.

Note 3. Other Assets

On April 30, 1992, the Commission, the City and the Board of Commissioners ofthe Port of New Orleans (the Port) entered into an agreement titled "Riverfront Economic Development Agreement" (the Agreement) under which the Commission paid $13,000,000($11,000,000from the sale of the Commission's Aquarium Revenue Bonds, Series 1992 A and $2,000,000 from self-generated funds of the Commission) to the Port.

20 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 3. Other Assets (Continued)

In consideration for the $11,000,000, the Commission was relieved of all rents or fees due for occupancy pursuant to an agreement with the Port dated October 23, 1987, that provided for the development and occupancy of an Aquarium and related facilities by the Commission over the 99 year term of the agreement. The $11,000,000 payment was recorded as prepaid rent and is being amortized on a straight-line basis over the term of the agreement.

In consideration for $2,000,000 of the payment, the City, which became the sole owner of the Rivergate Facility under the agreement, agreed to transfer and assign the second $200,000 of annual net income from the parking facilities at the Rivergate to the Commission for twenty years beginning with the 1992 calendar year. Parking operations were discontinued at the Rivergate and, per the agreement, the City elected to continue paying the $200,000 annually through 2011. Harrah's Jazz Casino Company assumed payment of this receivable from the City upon its operation of the Rivergate Facility. The receivable, which is included in other assets, was fully paid during 2012.

Unamortized bond issue costs represent costs incurred in the issuance of the revenue bonds and the limited tax bonds (Note 5). These costs are being amortized over the life of the bonds.

Film Cost The Commission and a partner began production on an IMAX® film about the Louisiana Wetlands in 2004 and the Commission capitalized its related costs as part of construction in process. On August 29, 2006, the Hurricane on the Bayou, IMAX® film was completed and released at the Aquarium and subsequently released in other theatres around the worid. The Commission amortizes the film costs using the individual-film-forecast-computation method which amortizes such costs in the same ratio that current period actual revenue bears to estimated remaining unrecognized ultimate revenue as of the beginning of the current fiscal year (denominator). The film revenue, included in charges for services, for the years ended December 31, 2012 and 2011, was $346,490 and $291,870, respectively, and ultimate revenue is estimated at $5,282,468. Ultimate revenue includes the estimates that are based on the history of earning such revenue. The Commission recognized $223,639 and $165,503 of the film amortization forthe years ended December 31, 2012 and 2011, respectively.

21 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 4. Capital Assets

Capital assets are summarized as follows by major classification at December 31, 2012 and 2011:

Balance Balance January 1, Additions/ Disposals/ December 31, 2012 Increases Decreases Retirements 2012 Capital Assets Not Depreciated Land $ 800,000 $ - $ - 800,000 Construction in Progress 2,372,602 4,595,544 (2,891,963) 4,076,183

Total Capital Assets Not Depreciated 3,172,602 4,595,544 (2,891,963) 4,876,183

Capital Assets Being Depreciated Buildings and Fixed Exhibitory 218,313,703 2,891,963 221,205,666 Equipment 19,250,234 1,254,625 (458,727) 20,046.132

Total Capital Assets Being Depreciated 237,563,937 1,254,625 2,891,963 (458,727) 241,251,798

Less Accumulated Depreciation (108,970,211) (8,410,459) 458,061 (116,922,609)

Total Capital Assets, Net $131,766,328 $ (2,560.290) $ - :5 (666) $ 129,205,372

Balance Balance January 1, Additions/ Disposals/ December 31, 2011 Increases Decreases Retirements 2011 Capital Assets Not Depreciated Land $ 800,000 $ - $ - $ 800,000 Construction in Progress 3.309,943 3,445.066 (4,382.407) 2,372,602 Total Capital Assets Not Depreciated 4,109,943 3,445.066 (4,382.407) 3.172,602

Capital Assets Being Depreciated Buildings and Fixed Exhibitory 213.931,296 4,382.407 - 218,313,703 Equipment 18,633,830 971.596 - (355,192) 19,250,234

Total Capital Assets Being Depreciated 232.565.126 971.596 4,382.407 (355,192) 237.563,937

Less Accumulated Depreciation (100.858,773) (8,457.622) : 346.184 (108.970,211)

Total Capital Assets, Net $135.816,296 $ (4,040.960) $ $ (9,008) $131.766,328

Depreciation expense for the years ended December 31, 2012 and 2011, related to these assets amounted to approximately $8,410,000 and $8,458,000, respectively.

22 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 5. Bonds and Loan Payable

Bonds and loans payable at December 31, 2012 and 2011, are comprised of the following:

2012 2011 Limited Tax Bonds Audubon Commission Aquarium Bonds Series 2003 A, due in a final installment of $2,695,000 in October 2013; ranging from 3.00% to 5.00%. $ 2,695,000 $ 5,260,000

Audubon Commission Aquarium Bonds Series 2011 A-1, due in annual installments of $2,075,000 to $3,630,000 from October 2014 tiirougii October 2021; 3.276%. 24,370,000 24,370,000

Audubon Commission Aquarium Bonds Series 2011 A-2, due in October 2014; 1.867%. 630,000 630,000

Audubon Commission Improvement and Refunding Zoo Bonds, Series 1997, due in annual installments of $310,000 to $365,000 tiirough December 2016; ranging from 5.00% to 6.50%. 1,345,000 1,635,000

Revenue Bonds Audubon Commission Aquarium Revenue Refunding Bonds Series 1997, due in annual installments of $1,460,000 to $1,520,000 through April 2012; ranging from 4.50% to 5.00%. - 1,520,000

State of Louisiana, Office of Community Development Gulf Opportunity Zone Act Loan 16,194,254 16,758,506

Totai Bonds and Loan Payabie 45,234,254 50,173,506

Deferred Losses on Refinancings, Net of Amortization (697,553) (1,190,558) Unamortized Premium, Net 2,061,370 2,387,600

Total 46,598,071 51,370,548

Less: Current Maturities and Current Portion of Deferred Losses (4,824,591) (5,457,500)

Bonds and Loans Payabie, Noncurrent $ 41,773,480 $ 45,913,048

23 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 5. Bonds and Loan Payable (Continued)

Limited Tax Bonds - Series 2011 A-1 and 2011 A-2 On September 22, 2011, the Commission issued $24,370,000 Aquarium Refunding Bonds Series 2011 A-1 with a net interest cost of 3.276%. The bonds were issued for the purpose of defeasing the Aquarium Refunding Bonds, Series 2001 A and Series 2001 B Bonds and providing amounts for capital improvements to the Audubon Aquarium of the Americas and related facilities and paying costs of issuance of the bonds. On the same date the Commission issued $630,000 Aquarium Refunding Bonds, Taxable Series 2011 A-2 with a net interest rate of 1.867%. The bonds were issued for the purpose of paying a portion of the interest due on the 2011 A Bonds and paying costs of issuance of the Bonds. The Bonds were issued on a complete parity with the Aquarium Refunding Bonds Series 2003 A. The Commission completed the advance refunding to reduce the debt service payments over the next 10 years and to obtain an economic gain (difference between the present values of the old and new debt service payments) of $2,676,682.

Limited Tax Bonds - Series 2003 A On July 9, 2003, the Commission issued $22,285,000 Aquarium Refunding Bonds, Series 2003 A with an average interest rate of 3.726%. The proceeds of this issue were used to advance refund $22,565,000 of the Audubon Commission Aquarium Bonds, Series 1993. The 2003 A Series Bonds were issued on complete parity with the Aquarium Refunding Bonds, Series 2001 A and 2001 B. The advance refund included escrowing $23,685,145 into an irrevocable trust to provide for all future debt service payments on the Series 1993 bonds, therefore the Series 1993 bonds were removed from the statement of net position in 2003. The reacquisition price exceeded the recorded book value by approximately $2.4 million which is reported in the financial statements as a deduction to bonds payable and is being charged to interest expense through 2013 using the straight-line method.

Limited Tax Bonds - Series 2001 A &B On November 1, 2001, the Commission issued $13,555,000 Audubon Commission Aquarium Refunding Bonds, Series 2001 A and $6,683,572 Audubon Commission Aquarium Bonds, Series 2001 B with an average interest rate of 4.5%. Series A was issued to advance refund $13,390,000 of Aquarium Series 1993 Bonds with an average interest rate of 6.25% maturing in October 2014 through 2017. The advance refunding included escrowing $14,573,000 into an irrevocable trust to provide for future debt service for a portion ($13,309,000) ofthe Aquarium Series 1993 Bonds. Therefore, that portion of the Aquarium Series 1993 Bonds was removed from the statement of net position in fiscal 2001. The reacquisition price exceeded the recorded book value by approximately $1.1 million, which is reported in the financial statements as a deduction to bonds payable and is being charged to interest expense through 2017 using the straight-line method. Series B was issued to finance further construction, extension and improvement of the Aquarium and related facilities, including the development, design and construction of the Audubon Insectarium proceeds from the bonds are also used to pay the costs of issuance of the bonds. These bonds are special and limited obligations of the City payable from and secured solely by the proceeds of a property tax levied at a rate of three and four-fifths mills.

24 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 5. Bonds and Loan Payable (Continued) Limited Tax Bonds - Series 1997 In December 1996, the Commission received a commitment to purchase its $4,500,000 Improvement and Refunding Bonds, Series 1997. The proceeds of the issue were used to advance refund $1,895,000 in Series 1979 and 1988 Improvement Bonds, and provide $2.5 million for capital improvements at Audubon Zoo. The advance refunding included escrowing $1,943,500 into an irrevocable trust to provide for future debt service on the defeased bonds.

Debt service applicable to the limited tax bonds is held by the Board of Liquidation, City Debt (BOL). No tax bonds may be sold without approval of the BOL. Property taxes levied by the City of New Orleans and dedicated to the payment of these limited tax bonds are collected by the City of New Orieans and, as required by law, paid to the Board of Liquidation as collected. The millages for these limited tax bonds were established at the time the bonds were issued, based upon the approval of the City's voters. The property taxes are recorded as non-operating revenue for the appropriate fund. Revenue Bonds - Series 1997 In December 1997, the Commission issued its $16,380,000 Aquarium Revenue Refunding Bonds, Series 1997 to advance refund its $14,200,000 Series 1992 A Aquarium Revenue Bonds. The advance refunding included escrowing $16,048,000 into an irrevocable trust to provide for all future debt service payments on the Series 1992 A Bonds, therefore, the 1992 A Bonds were removed from the statement of net position. The reacquisition price exceeded the recorded book value by $2.2 million which is reported in the financial statements as a deduction to bonds payable and is being charged to interest expense in equal annual amounts through 2012.

Gulf Opportunity Zone Act Loan In July 2006, pursuant to the Public Law 109-135 of the United States Congress, the Gulf Opportunity Zone Act of 2005 was enacted to provide tax relief and tax credit bond authority designed to aid the State with recovery efforts from Hurricane Katrina and Hurricane Rita. Accordingly, the State of Louisiana, Office of Community Development loaned the Commission $4,907,500 to make the scheduled debt payments for the Aquarium Revenue Refunding Bonds, Series 1997 and $11,851,006 to make scheduled debt payments for the Improvement and Refunding Zoo Bonds, Series 1997, Aquarium Refunding Bonds, Series 2001 A, Aquarium Bonds, Series 2001 B and Aquarium Refunding Bonds, Series 2003 A through 2009. Per the agreement the funds shall be maintained at the State identified trustee and disbursed according to the debt schedule of the bonds identified above. Once funds are disbursed by the State, the debt service payments are made with the proceeds and amounts are recorded as loans payable by the Commission. The agreement matures 20 years from the date of the delivery of the loan which was on July 19, 2006. No principal or interest is payable during the initial five year period of the loan. After the expiration of the initial five year period of the loan, the loan shall bear interest at a fixed rate of 4.64%. An extension was requested in 2011 to defer the payment of principal and interest for an additional five years, but was denied. As a result, principal and interest shall be repaid over the remaining 15 year period based on level annual amortization of principal and interest.

25 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 5. Bonds and Loan Payable (Continued)

Gulf Opportunity Zone Act Loan (Continued) The loan balance may be prepaid at any time, in whole or in part, by the Commission without penalty or premium. The total amount of interest to accrue over the 20 year period of the loan is $6,874,054. As of December 31, 2012 and 2011, the combined principal and interest liability under the loan was $18,086,361 and $18,666,226, respectively.

The Commission and the Institute are related through the interaction of their Boards of Directors and contractual management agreements under which the Institute manages and operates Commission facilities. The management agreement was extended to a new ten year term beginning January 26, 2011 through January 25, 2021. As of December 31, 2012 and 2011, amounts due to the Institute totaled $6,521,477 and $7,560,378, respectively, and have been classified as a long-term liability based on the Commission's evaluation of the timing of the anticipated repayment of these amounts. There is no scheduled maturity date and the Institute has no plans in the next 12 months to demand payment on the amounts receivable from the Commission at December 31, 2012 (see Note 7).

A summary of changes in long-term liabilities during 2012 and 2011, is as follows:

Limited Gulf Tax Revenue Due to Opportunity Bonds Bonds thie Institute Zone Loan Total Balance January 1, 2012 $ 31,895,000 $ 1,520,000 $ 7,560,378 $ 16,758,506 $ 57,733,884 Additions - - - - - Reductions (2,855,000) (1,520,000) (1,038,901) (564,252) (5,978,153)

Balance December 31, 2012 $ 29,040,000 $ $ 6,521,477 $ 16,194,254 $51,755,731

Due witiiin One Year s 3,005,000 $ $ $ 1,068,589 $ 4,073,589

Limited Gulf Tax Revenue Due to Opportunity Bonds Bonds the Institute ZDne Loan Total Balance January 1, 2011 29,143,572 $ 2,980,000 $ 7,470,007 $16,758,506 $56,352,085 Additions 25,000,000 - 90,371 - 25,090,371 Reductions (22,248,572) (1,460,000) : (23,708.572)

Balance December 31, 2011 31.895.000 $ 1.520.000 $ 7.560.378 $16.758.506 $57.733.884

Due witiiin One Year $ 2,855,000 $ 1,520.000 $ $ 797.909 $ 5.172.909

26 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 5. Bonds and Loan Payable (Continued)

Expected debt service requirements, excluding deferred losses on refinancing, on all bonds outstanding as of December 31, 2012, are as follows:

Year Ending Limited Tax Bonds Gulf Opportunity Zone Loan Total December 31, Principal Interest Principal Interest Principal Interest 2013 $ 3,005,000 $ 1,304,550 $ 1,068,589 $ 968.280 $ 4,073,589 $ 2,272,830 2014 3,030,000 1,153,680 873,673 701.831 3.903,673 1,855.511 2015 3,145,000 1,063,820 914,212 661.292 4,059,212 1.725.112 2016 3,245,000 961,880 956,631 618,873 4.201,631 1,580.753 2017 3,025,000 798,900 1,001,019 574,485 4.026,019 1,373,385 2018 to 2022 13,590,000 1,704,400 5,746,434 2,131.086 19,336,434 3,835,486 2023 to 2026 - - 5.633,696 668.320 5,633.696 668.320 Total $ 29,040,000 $ 6,987,230 A. 16,194,254 $ 6.324.167 _i. 45,234,254 $ 13.311.397

Note 6. Retirement System

Employees of the Institute that provide services for the Commission in accordance with the terms of the management agreement may participate on an optional basis in a tax- deferred annuity plan established by the Institute for the benefit of all full-time employees. The plan provides for the purchase of annuities which qualify for tax deferral. Participating employees contribute between 2% and 15% of their salary, not to exceed $16,500, and the Commission, through its management agreement with the Institute, matches employee contributions up to 3% of base salary. The retirement expense provision for 2012 and 2011 amounted to approximately $449,000 and $537,000, respectively.

Note 7. Related Party Transactions

The Commission and the Institute are related through the interaction of their Boards of Directors and contractual management agreements under which the Institute manages and operates Commission facilities. To assure efficiencies through economies of scale, these entities often engage in operations through one organization that benefit the other organization. One example of this is the use of common or central bank and investment accounts. The Commission received additional financial support from the Institute in the form of specific gifts and grants of $4,201,347 and $3,306,057 and distributions from the Institute's Endowment Fund amounting to $1,380,926 and $1,098,634 (included in interest income) during 2012 and 2011, respectively. As of December 31, 2012 and 2011, amounts due to the Institute totaled $6,521,477 and $7,560,378, respectively, and have been classified as a long-term liability based on the Commission's evaluation of the timing of the anticipated repayment of these amounts. The Institute has committed to the Commission that it has the intent and ability to continue funding the operations of the Commission through operating advances, donations and grants, if necessary, in order to provide the required level of financial support to enable the Commission to discharge its liabilities in the normal course of business as they become due through January 1, 2014. The Institute has no plans in the next 12 months to demand payment on the amounts receivable from the Commission at December 31, 2012.

27 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 8. Commitments and Contingencies

Long-Term Leases The Commission leases its Audubon Insectarium premises under an operating lease. A three year step rent plan was introduced in August 2009. The rent will be reset to market every five years, beginning August 2014, instead of 10 years as stated in the lease. The Commission also leases two additional properties in Jefferson and Orieans Parishes.

Future lease payments required under the operating lease are as follows:

Years Ending Lease December 31, Payments 2013 $ 738,673 2014 464,721 2015 100,000 2016 100,000 2017 100,000 Thereafter 500.000

Total $ 2,003,394

As of December 31, 2012, the Commission was obligated under various capital leases, each with non-cancelable terms in excess of one year. The assets under capital lease as of December 31, 2012 have a cost of $681,743 and accumulated amortization of $172,083. Future minimum least payments as of December 31, 2012, are as follows:

Years Ending Lease December 31, Payments 2013 $ 169,777 2014 148,301 2015 83,873 2016 190.084

Total Minimum Lease Payments 592,035

Less: Amounts Representing Interest 65,671

Present Value of Future Minimum Lease Payments 526,364

Less: Current Portion of Capital Leases Obligation 140,566

Capital Lease Obligations, Excluding Current Portion $ 385,798

28 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Notes to Financial Statements

Note 8. Commitments and Contingencies (Continued)

Construction in Progress As of December 31, 2012, the Commission has approximately $2 million remaining on a construction project still ongoing.

Note 9. Litigation

Certain claims and suits have been filed against the Commission. The majority of these claims are covered by insurance and, based on all available information and consultation with the Commission's legal counsel, management does not believe the ultimate resolution of these matters will have a significant effect on the Commission's financiai position, results of operations, or cash flows.

Note 10. Subsequent Events

The Commission completed its subsequent events review through May 31, 2013, the date on which the financial statements were available to be issued. There were no events that required adjustments to, or disclosures in, the financial statements.

29 i^Ar OR.TE 111 Veterans Blvd. I Suirc 600 CPA. t austNESs ADViso«6 MeCalric, LA 70005 504.835.5522 | Tax 504.835.5535 La Porte, com

Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards

Independent Auditor's Report

To the Board of Directors of Audubon Commission

We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of Audubon Commission (the Commission) which comprise the statement of net position as of and for the year ended December 31, 2012, and the related statements of activities and cash flows for the year then ended, and the related notes to the financial statements, and have issued our report thereon dated May 31, 2013.

Internal Control Over Financial Reporting

In planning and performing our audit of the financial statements, we considered the Commission's internal control over financial reporting (internal controls) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness ofthe Commission's internal control. Accordingly, we do not express an opinion on the effectiveness ofthe Commission's internal control.

A deficiency in internal 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 on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a 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.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be maternal weaknesses. However, material weaknesses may exist that have not been identified.

NEW ORLEANS HOUSTON BATON ROUGE COVINGTON An Independent!)' Owned Member, iMcGladrey Alliance TheKicG^rey Aliarv:e \s a premiff afliliaton ol irdapgniJant accounling and consulting firms. TlieMcGadrey/yiiarce member firms manlain Ihsir name, autonomy and irrJecenctencs and areiespon^bJefortfeir own dent fee arrarigements.ddive^dsew^esarKl tttai^enarce oi OO r^Knt r^alianslipa. wU Compliance and Other Matters

As part of obtaining reasonable assurance about whether the Commission's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of this Report

The purpose of this report is solely to describe the scope of our testing of internal control and compliance with the results of that testing, and not to provide an opinion on the effectiveness of the Commission's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Commission's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Under Louisiana Revised Statute 24:513, this report is distributed by the Louisiana Legislative Auditor as a public document.

A Professional Accounting Corporation

Metairie, LA May 31, 2013

31 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Schedule of Findings and Responses For the Year Ended December 31, 2012

Part I - Summary of Auditor's Results

Financial Statement Section

1. Type of Auditor's Report Issued Unqualified

2. Internal Control Over Financial Reporting: a. Material Weakness(es) Identified? No b. Significant Deficiency(ies) Identified not Considered to be Material Weaknesses? No

c. Noncompliance Material to Financial Statements Noted? No

3. Management Letter Comment Provided None

Federal Awards Section

Not applicable

Part II - Financial Statement Findings Section

None

Part III - Federal Award Findings and Questioned Costs Section

None

32 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Summary Schedule of Prior Year Audit Findings For the Year Ended December 31, 2012

Part I - Financial Statement Findings Section

Significant Deficiency- Recording of 2001B Capital Appreciation Bonds

Condition and Recommendation: During 2011, it was discovered that the Commission did not record accreted interest through the date of the Series 2001B bond defeasance on October 1, 2011. Generally accepted accounting principles at the time of the issuance of the 2001B bonds did not require recording of the accreted interest liability, however, current GAAP in effect since 2002 require that the capital appreciation bonds accreted interest be recorded as a liability on the financial statements. It was recommended that the appropriate level of accounting personnel review the accuracy of the bond accounting relative to the terms of a bond indenture as well as review the amortization schedules ofthe various bond components.

Current Status: Resolved.

Part II - Federal Award Findings and Questioned Costs Section

Not applicable

33 ADDITIONAL INFORMATION

34 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Additional Information Combining Schedule of Net Position December 31, 2012

Aquarium Species Survival and Audubon Audubon Center/ Louisiana Riverfront Audubon Zoo Golf Research Nature Park Insectarium and Park Course Center Center Total Current Unrestricted Assets Cash and Temporary Investments 1,312,031 $ 25,000 $ 84775 $ 2,250 $ 250 - $ 1,424,306 Accounts Receivable, Net of Allowance for Uncollectible Accounts of $49,376 484,188 23,533 30,963 96 209,269 . 748,049 Inventory 407,962 170,309 716,313 140,719 - - 1,435,303 Prepaid Expenses 411,661 10,794 531,544 9,633 70,191 - 1,033,823

Total Unrestricted Current Assets 2,615,842 229,636 1.363,595 152,698 279,710 4,641,481

Current Restricted Assets Designated for Capital Projects 2,306,878 2,306,878 Debt Service and Bond Reserve Investments 551,257 331,199 - - 882,456 Accounts Receivable for Capital Improvements 462,892 (1) 1,062,675 1,525,566

Total Restricted Current Assets 3,321,027 (1) 1,393,874 4714,900

Total Current Assets 5,936,869 229,635 2,757,469 152,698 279,710 9,356,381

Capital Assets Land 800,000 800,000 Buildings and Fixed Exhibitory 91,730,829 24,471,566 72,353,548 10,728,838 21,920,885 221,205,666 Equipment 7,759,435 1,288,267 7,247,941 1,171,131 2,579,358 20,046,132 Construction in Progress 663,574 3,353,170 59,439 4,076,183 Less: Accumulated Depreciation (59,165,180) (6,343,537) (37.179,270) (2,961,029) (11,273,593) (116,922,609)

Net Capital Assets 40,988,658 19,416,296 46,575,389 8,938,940 13,226,650 59,439 129,205,372

Other Assets Prepaid Rent - Dock Board Film Cost - Net of Accumulated Amortization 8,568,404 8,568,404 Receivable - Riverfront Economic Development Agreement 531,268 531,268 Bond Issue Costs 234,247 234,247 Debt Service and Bond Reserve Investments - Restricted Noncurrent

Total Other Assets 9,333,919 9,333,919

Total $ 56,259,446 $ 19.645.931 $ 49,332,858 $ 9,091,638 $ 13,506.360 $ 59,439 S 147.895,672

See independent auditor's report. 35 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Additional Information Combining Schedule of Net Position (Continued) December 31, 2012

Aquarium Species Survival and Audubon Audubon Center/ Louisiana Riverfront Audubon Zoo Go if Research Nature Park Insectarium and Park Course Center Center Total Nonrestricted Current Liabilities Accounts Payable and Other Accrued Liabilities $ 2.190,744 $ 304,384 $ 3,060,668 $ 220,882 $ 91,834 $ $ 5,868,512 Capital Lease Obligation 140,566 140,566

Total Nonrestricted Current Liabilities 2,190,744 304,384 3,060,668 361,448 91.834 6.009.078

Current Liabilities Payable from Restricted Assets Accrued Interest 1,285,712 48,222 1,333,934 Revenue Bonds, Current Portion Limited Tax Bonds, Current Portion 2,477,724 310,000 2,787,724 Gulf Opportunity Zone Loan. Current Portion 1,014,222 54,367 1,068,589 Construction Payables 500,517 6,883 1,020,686 57,426 339,395 1,924,907

Total Current Liabilities Payable from Restricted Assets 5,278,175 6,883 1,433,275 57.426 339,395 7,115,154

Total Current Liabilities 7,468,919 311,267 4,493,943 361,448 149,260 339,395 13,124,232

Noncurrent Liabilities Accrued Interest 864,231 59,599 923,830 Limited Tax Bonds 24,519,723 1,035,000 25,554,723 Unamortized Premium, Net 2,061,370 2,061,370 Gulf Opportunity Zone Loan 14,140,757 984,908 15,125,665 Due to Audubon Nature Institute (6,502,054) (1,109,019) 10,824,715 857,362 2,353,242 97,231 6,521,477 Capital Lease Obligation 385,798 385,798

Total Noncurrent Liabilities 35,084,027 (1,109,019) 12,904,222 1,243,160 2,353,242 97,231 50,572,863

Total Liabilities 42,552,946 (797,752) 17,398,165 1,604,608 2,502,502 436,626 63,697,095

Net Position Net Investment in Capital Assets (2,320,323) 19,409,412 44,456,480 8,412,576 13,169,223 (279,956) 82,847,412 Unrestricted 16,026,823 1,034,271 (12,521,787) (925,546) (2,165,365) (97,231) 1,351,165

Total Net Position 13,706,500 20,443,683 31,934,693 7,487,030 11,003,858 (377,187) 84,198,577

Total S 56.259,446 S 19.645,931 S 49,332,858 $ 9,091,638 S 13,506,360 S 59,439 $ 147,895,672

See independent auditor's report. 36 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Additional Information Combining Schedule of Revenues, Expenses and Changes in Net Position For the Year Ended December 31, 2012

Aquarium Species Survival and Audubon Audubon Center/ Louisiana Riverfront Audubon Zoo Golf Research Nature Park Insectarium and Park Course Center Center Total Operating Revenues Charges for Services 15,170,186 2,307,112 17,941,651 1,715,204 37,134,153 Other Revenues 430,670 453,347 400,649 (299) 8,797 169 1,293,333

Total Operating Revenues 15,600,856 2,760,459 18,342,300 1,714,905 8,797 169 38,427,486

Operating Expenses Salaries and Benefits 7,179,969 1,598.732 11,867,143 1,112,274 912,749 22,670,867 Contractual Services, Materials, Supplies and Other 7,688,093 1,842.773 10,183,139 694,000 763,531 21,171,536 Depreciation and Amortization 3.357,512 1,350,274 2,845,685 405,073 777,272 8,735,816

Total Operating Expenses 18,225,574 4,791.779 24,895,967 2,211,347 2,453,552 52,578,219

Operating Loss (2,624,718) (2,031.320) (6,553,667) (496.442) (2,444,755) 169 (14,150,733)

Nonoperating Revenues (Expenses) Audubon Nature Institute Grants for Capital Projects and Education Programs 1,549,194 1,031,465 653,336 967,352 4,201,347 Dedicated Tax Revenues 7,567,090 234.902 835,528 8,637,520 Intergovernmental Grants for Capital Projects 683,777 - 1,135,046 460,391 2,279,214 Interest Income 466,025 - 854,378 65,750 1,386,153 Interest Expense (2,111,634) - (126,059) (21,120) (2,258,813) Grant Expenses (109,536) - (111,790) (210,796) (432,122) Amortization - Debt Costs (91,294) - (1,000) (92,294)

Total Nonoperating Revenues, Net 7,953,622 1,266,367 3,239,439 (21,120) 1,282,697 13,721,005

Change in Net Position 5,328,904 (764,953) (3,314,228) (517,562) (1,162,058) 169 (429,728)

Net Position, Beginning of Year 8,377,596 21,208,636 35,248,921 8,004,592 12,165,916 (377,356) 84,628,305

Net Position, End of Year $ 13.706,500 $ 20,443.683 $ 31.934,693 $ 7,487.030 $ 11.003,858 $ (377,187) $ 84,198,577

See independent auditor's report. 37 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Additional Information Combining Schedule of Cash Flows For the Year Ended December 31, 2012

Aquarium Species Survival and Audubon Audubon Center/ Louisiana Riverfront Audubon Zoo Golf Research Nature Park Insectarium and Park Course Center Center Total Cash Flows from Operating Activities Cash Received from Customers 15,348,375 $ 2,802,390 18,483,171 ; 1,717,866 $ (188,429) 169 38,163,542 Cash Paid to or on Behalf of Employees (7,137,500) (1,588,559) (11,776,221) (1,103,582) (907,726) (22,513,588) Cash Paid for Supplies and Services (12,844,695) (2,166,737) (7,099,958) (635,647) (184,479) (280,125) (23,211,641)

Net Cash Used in Operating Activities (4,633,820) (952,906) (393,008) (21,363) (1,280,634) (279,956) (7,561,687)

Cash Flows from Capital and Related Financing Activities Grants from the Institute for Capital Projects, Education and Operating Support 1,549,194 1,031,465 653,336 967,352 4,201,347 Payments for Projects' Design, Construction and Equipment Purchases (1,224,365) (368,708) (2,163,856) 42,484 (2,062) 279,956 (3,436,551) Decrease (Increase) in Restricted Assets 1,595,808 55,208 (329,731) 1,321,285 Increase in Restricted Liabilities 216,036 (16,025) 200,011 Dedicated Tax Revenues 7,567,090 234,902 835,528 8,637,520 Interest Expense (2,111,634) (126,059) (21,120) (2,258,813) Payment of Bond Principal (4,597,297) (341,956) (4,939,253) Interest Income 466,025 854,378 65,750 1,386,153 Intergovernmental and Other Grants 683,777 1,135,046 460,391 2,279,214 Grant Expenses (109,536) (111,790) (210,796) (432,122) Other 165,452 (1) (998) (1) (1) - 164,451

Net Cash Provided by Capital and Related Financing Activities 4,200,550 952,866 387,873 21,363 1,280,634 279,956 7,123,242

Net Decrease in Cash and Temporary Investments (433,270) (40) (5,135) - (438,445)

Cash and Temporary Investments, Beginning of Year 1,745,301 25,040 89,910 2,250 250 1,862,751 Cash and Temporary Investments, End of Year ? 1,312,031 $ 25,000 ? 84,775 ? 2,250 ? 250 $ - $ 1.424.306

See independent auditor's report. 38 AUDUBON COMMISSION (A Discretely Presented Component Unit ofthe City of New Orleans, Louisiana)

Additional Information Combining Schedule of Cash Flows (Continued) For the Year Ended December 31, 2012

Aquarium Species Survival and Audubon Audubon Center/ Louisiana Riverfront Audubon Zoo Golf Research Nature Park Insectarium and Park Course Center Center Total Reconciliation of Operating (Loss) Income to Net Cash Used in Operating Activities Operating (Loss) Income $ (2,624,718) $ (2,031,320) $ (6,553,667) $ (496,442) $(2,444,755) $ 169 $ (14,150,733) Adjustments to Reconcile Operating (Loss) Income to Net Cash Used in Operating Activities Depreciation and Amortization 3,357,512 1,350,274 2,845,685 405,073 777,272 8,735,816 (Increase) Decrease in Accounts Receivable and Other Current Assets (278,392) 45,981 34,716 (21,000) (211,552) (430,247) (Decrease) Increase in Accounts Payable and Other Current Liabilities (5,088,222) (317,841) 3.280.258 91.006 598,401 (280.125) (1.716.523)

Net Cash Provided by Operating Activities s (4,633,820) $ (952,906) $ (393,008) $ (21,363) $(1,280,634) $ (279,956) $ (7,561,687)

Noncash Items Capital Lease Obligation s $ $ $ 526,364 $ $ $ 526,364

Purchases for Projects' Design, Construction, and Equipment in Accounts Payable and Other Current Liabilities JL 500,517 $ 6,883 $ 1.020.686 $ $ 57,426 $ 339.395 $ 1.924.907

See independent auditor's report. 39