HomeMy WebLinkAbout2024 - Tri-County Aging Consortium TCOA Report on Financial Statements Audit Final
TRI-COUNTY AGING CONSORTIUM
LANSING, MICHIGAN
REPORT ON FINANCIAL STATEMENTS
(with required and other
supplementary information)
YEAR ENDED SEPTEMBER 30, 2024
TABLE OF CONTENTS
Page INDEPENDENT AUDITOR’S REPORT ......................................................................................................................................... 1-3 MANAGEMENT’S DISCUSSION AND ANALYSIS .................................................................................................................... 4-8 BASIC FINANCIAL STATEMENTS ...................................................................................................................................................9 Government-wide Financial Statements Statement of Net Position ........................................................................................................................................................ 10 Statement of Activities .............................................................................................................................................................. 11 Fund Financial Statements Governmental Funds Balance Sheet............................................................................................................................................................................ 12 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position ................ 13 Statement of Revenues, Expenditures, and Changes in Fund Balances .......................................................... 14 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of the Governmental Funds to the Statement of Activities ................................................................................. 15 Note to Financial Statements .................................................................................................................................................. 16-34 REQUIRED SUPPLEMENTARY INFORMATION ...................................................................................................................... 35 General Operating Fund Budgetary Comparison Schedule - General Fund ......................................................................................................... 36 Budgetary Comparison Schedule - Grants Special Revenue Fund ......................................................................... 37 Defined Benefit Pension Plan Schedule of Changes in Employer’s Net Pension Liability and Related Ratios ....................................................... 38 Schedule of Employer Contributions.................................................................................................................................. 39 Notes to Required Supplementary Information ............................................................................................................. 40-41 OTHER SUPPLEMENTARY INFORMATION .............................................................................................................................. 42 Schedule of Revenues, Expenditures, and Changes in Fund Balance - Grants Special Revenue Fund - by Program ................................................................................................................... 43-50 Supplemental Schedule: Funded Service Categories by Source ............................................................................. 51-57 Schedule of Expenditures of Federal Awards .................................................................................................................. 58-59 Notes to Schedule of Expenditures of Federal Awards ................................................................................................... 60 INDEPENDENT AUDITOR’S 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 .............................................................................................................................. 61-62 INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE ............................................................................................................................ 63-65
TABLE OF CONTENTS
Page Schedule of Findings and Questioned Costs ............................................................................................................................ 66 Summary Schedule of Prior Year Audit Findings .................................................................................................................. 67
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INDEPENDENT AUDITOR’S REPORT To the Board of Directors of the Tri-County Aging Consortium Lansing, Michigan
Report on the Audit of the Financial Statements
Opinions We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Tri-County Aging Consortium, as of and for the year ended September 30, 2024 and the related notes to the financial statements, which collectively comprise the Tri-County Aging Consortium’s basic financial statements as listed in the table of contents. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the Tri-County Aging Consortium, as of September 30, 2024, and the respective changes in financial position thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
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. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Tri-County Aging Consortium and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
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, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Tri-County Aging Consortium’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
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Auditor’s Responsibility for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government
Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards and Government Auditing
Standards, we:
➢ Exercise professional judgment and maintain professional skepticism throughout the audit.
➢ Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
➢ Obtain an understanding of internal control relevant to the audit 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 Tri-County Aging Consortium’s internal control. Accordingly, no such opinion is expressed.
➢ Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
➢ Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Tri-County Aging Consortium’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison schedules, and historical pension information, as identified in the table of contents, 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.
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Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Consortium’s basic financial statements. The accompanying other supplementary information, as listed in the table of contents, including the schedule of expenditures of federal awards, as required by Title 2 U.S. Code of
Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for
Federal Awards, is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the other supplementary information, including the schedule of expenditures of federal awards, is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 7, 2025, on our consideration of the Tri-County Aging Consortium’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, 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 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 Tri-County Aging Consortium’s internal control over financial reporting and compliance. March 7, 2025
TRI-COUNTY AGING CONSORTIUM
MANAGEMENT’S DISCUSSION AND ANALYSIS
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This section of the annual financial statements, titled Management’s Discussion and Analysis, represents the administration’s review of the Tri-County Aging Consortium’s (the Consortium’s) financial performance during the fiscal year ended September 30, 2024. The Management’s Discussion and Analysis is intended to be read in conjunction with the Consortium’s financial statements. Generally accepted accounting principles (GAAP) require the reporting of two types of financial statements: government-wide financial statements and fund level financial statements.
Financial Highlights
➢ The assets and deferred outflows of resources of the Consortium exceeded its liabilities and deferred inflows of resources at September 30, 2024, by $7,751,428 at the government-wide level. Unrestricted net position was $7,577,928 at September 30, 2024.
➢ The Consortium’s total net position decreased $1,298,605 as a result of this year’s operations.
➢ As of September 30, 2024, the Consortium’s governmental funds reported ending fund balances of $8,892,453, a decrease of $972,122.
➢ As of September 30, 2024, the General Fund unassigned fund balance was $575,693, or approximately 54% of total fund expenditures and other financing uses.
Overview of the Financial Statements
The Tri-County Aging Consortium’s basic financial statements comprise three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves.
Government-wide Financial Statements: The government-wide financial statements provide information about the activities of the entire Consortium. They present an overall view of the Consortium’s finances, reporting the assets and liabilities on fiscal year ending September 30, 2024. The statement of net position presents information on all of the Tri-County Aging Consortium’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources, with the difference between them reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the Consortium is improving or deteriorating. The statement of activities presents information showing how the government’s net position changed during fiscal year 2023/2024. All changes in net position are reported as soon as the change occurs, regardless of the timing of related cash flows. All of the Tri-County Aging Consortium’s activities are supported by intergovernmental revenues, governmental grants, fees and charges for services, interest, local revenues, and contributions. The governmental activities of the Consortium are all considered health and welfare programs. The Consortium does not operate any programs that are intended to recover all or a significant portion of their costs through user fees and charges.
Fund Financial Statements: A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The Tri-County Aging Consortium uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. The Consortium operates with three funds, General, Grants Special Revenue, and Capital Projects, which are considered governmental funds.
TRI-COUNTY AGING CONSORTIUM
MANAGEMENT’S DISCUSSION AND ANALYSIS
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Governmental Funds: Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental funds balance sheet and governmental funds statement of revenues, expenditures, and changes in fund balance provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The Tri-County Aging Consortium adopts an annual appropriated budget for its General and Grants Special Revenue Funds. Budgetary comparison statements have been provided for these funds to demonstrate compliance with the budget. The basic financial statements can be found on pages 10-15 of this report.
Notes to the Financial Statements: The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 16-34 of this report.
Other Information: In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning budgeted revenues and expenditures, schedule of changes in net pension liability and related ratios, and schedule of employer contributions on pages 36-39. Other supplementary information concerning support services and expenditures of federal awards can be found on pages 43-60 of this report.
TRI-COUNTY AGING CONSORTIUM
MANAGEMENT’S DISCUSSION AND ANALYSIS
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Government-wide Financial Analysis
As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the Tri-County Aging Consortium, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $7,751,428. A comparative analysis of net position as of September 30, 2024 and 2023 are presented below: 2024 2023ASSETSCurrent and other assets 14,108,357$ 14,386,422$ Capital assets, net 751,310 976,651 TOTAL ASSETS 14,859,667 15,363,073 DEFERRED OUTFLOWS OF RESOURCES 2,062,121 2,426,869 LIABILITIESCurrent liabilities 4,612,829 4,243,468 Noncurrent liabilities 4,487,722 4,370,370 TOTAL LIABILITIES 9,100,551 8,613,838 DEFERRED INFLOWS OF RESOURCES 69,809 126,071 NET POSITIONNet investment in capital assets 40,599 69,030 Restricted 132,901 108,034 Unrestricted 7,577,928 8,872,969 TOTAL NET POSITION 7,751,428$ 9,050,033$ Unrestricted net position (the part of net position that can be used to finance day to day operations) decreased by $1,295,041. This is within our desired range. The following table shows the changes in net position as of September 30, 2024 and 2023. 2024 2023REVENUESProgram revenuesCharges for services 188,570$ 205,065$ Operating grants and contributions 47,237,140 40,499,688 General revenueMunicipal appropriations 277,591 248,851 Investment earnings 283,670 147,583 TOTAL REVENUES 47,986,971 41,101,187 EXPENSESHealth and welfare 49,245,486 43,452,132 Interest on long-term debt 40,090 49,488 TOTAL EXPENSES 49,285,576 43,501,620 Changes in net position (1,298,605)$ (2,400,433)$
TRI-COUNTY AGING CONSORTIUM
MANAGEMENT’S DISCUSSION AND ANALYSIS
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The increase in funding and contributions of $6,737,452 were partially due to due to American Rescue Plan Act (ARPA) funding received to support aging programs in FY2024. Also contributing to the increase in revenue was additional funding provided through a tax millage for elder services through Ingham County. Total expenses increased $5,783,956 or 13% from last year partially due to additional participants enrolled in the Medicaid Waiver Program (MI Choice) and the cost of providing services to the increased population. Additional expenses were also incurred by any programs that received additional funding to provide services to our participants.
Financial Analysis of the Government’s Funds The general fund revenue was less then expenditures and other financing uses, leading to a $4,232 decrease in fund balance during the year. Ending fund balance was $702,499, with $2,299 nonspendable and $124,507 assigned. The balance of $575,693 was unassigned. The grants special revenue fund experienced a decrease in fund balance of $1,004,940 primarily due to higher costs associated with providing essential in-home services to participants in the MI Choice program. In fiscal year 2024, the Michigan Department of Health and Human Services (MDHHS) allocated additional slots to the program, allowing for increased enrollment. The total slots available for the year reached approximately 1,248, with actual enrollment at 971 as of September 30, 2024. It is important to note that MI Choice operates as a managed care program under a full-risk contract. Reimbursement is capitated and determined by an actuarial entity across six rate cells. As a result, annual revenues may exceed expenditures or vice versa, reflecting the nature of a managed care system. The remaining fund balance from fiscal year 2024 will be reserved for future periods when expenditures may surpass revenues. The Consortium and the MDHHS are still in the process of reconciling claims for fiscal years 2023 and 2024. The Consortium is monitoring the open claims for these fiscal years to ensure that a satisfactory resolution is obtained, and management is confident that the outcome will be adequate and complete.
General Fund Budgetary Highlights
Over the course of the year the Consortium’s Board of Directors amended the budget to take into account events that occurred during the year. Total revenue budget was increased by $128,121, or about 14%, primarily due to increased investment earnings and contributions received during the year. Actual revenue exceeded the amended budget by $9,238. Budgeted expenditures and other financing uses were increased only $38,600, or less than 3%, primarily related to subcontractor expenditures. Actual expenditures and other financing uses were $311,812 less than the amended budget.
Capital Asset and Debt Administration
Capital Assets: The Consortium’s investment in capital assets as of September 30, 2024, amounts to $751,310 (net of accumulated depreciation/amortization). During the year, the Consortium disposed of equipment that was fully depreciated totaling $9,675. Additional details related to capital assets are presented in Note 3 to the financial statements.
Long-term Obligations: The Consortium has a long-term obligations related to a lease payable and compensation (e.g., unused vacation and sick leave). The long-term obligation at September 30, 2024, amounted to $967,269. Additional details related to long-term obligations are presented in Note 4 to the financial statements.
TRI-COUNTY AGING CONSORTIUM
MANAGEMENT’S DISCUSSION AND ANALYSIS
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Economic Factors and Next Year’s Budget and Rates The Consortium’s funding is determined at the federal, state, and local levels. Federal and state funding cuts, while not foreseen at this time, could be made at any time and could have a significant impact on the Consortium's financial position or operations depending on the severity of the cuts. Consortium Senior Leadership is continuing to monitor all aspects of revenues and expenses to ensure the Consortium is positioned to provide quality services to our target populations.
Requests for Information This financial report is designed to provide a general overview of the Tri-County Aging Consortium’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to: Finance Department Tri-County Aging Consortium 5303 S. Cedar Street, Suite 1 Lansing, MI 48911
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BASIC FINANCIAL STATEMENTS
TRI-COUNTY AGING CONSORTIUM
STATEMENT OF NET POSITION
SEPTEMBER 30, 2024
See accompanying notes to financial statements. 10
GovernmentalActivitiesASSETSCurrent assetsCash and cash equivalents 10,641,673$ Cash and cash equivalents - restricted 132,901 Accounts receivable 844,587 Due from other governmental units 2,154,559 Prepaids 333,337 Inventory 1,300 Total current assets 14,108,357 Noncurrent assetsCapital assets, net of accumulated depreciation/amortization 751,310 TOTAL ASSETS 14,859,667 DEFERRED OUTFLOWS OF RESOURCESDeferred outflows of resources related to pensions 2,062,121 LIABILITIESCurrent liabilitiesAccounts payable 3,898,368 Accrued payroll 266,170 Unearned revenue 138,890 Current portion of long-term debt 206,778 Current portion of compensated absences 102,623 Total current liabilities 4,612,829 Noncurrent liabilitiesNet pension liability 3,829,854 Noncurrent portion of long-term debt 503,933 Noncurrent portion of compensated absences 153,935 Total noncurrent liabilities 4,487,722 TOTAL LIABILITIES 9,100,551 DEFERRED INFLOWS OF RESOURCESDeferred inflows of resources related to pensions 69,809NET POSITIONNet investment in capital assets 40,599 Restricted for capital campaignNonexpendable 70,255 Expendable 62,646 Unrestricted 7,577,928 TOTAL NET POSITION 7,751,428$
TRI-COUNTY AGING CONSORTIUM
STATEMENT OF ACTIVITIES
YEAR ENDED SEPTEMBER 30, 2024
See accompanying notes to financial statements. 11
Net (Expenses)Operating Revenues andCharges for Grants and Change inExpensesServicesContributionsNet PositionGovernmental activitiesHealth and welfare 49,245,486$ 188,570$ 47,237,140$ (1,819,776)$ Interest on long-term debt 40,090 - - (40,090) Total 49,285,576$ 188,570$ 47,237,140$ (1,859,866) General revenuesMunicipal appropriations 277,591Investment income 283,670Total general revenues 561,261 Change in net position (1,298,605) Net position, beginning of year 9,050,033 Net position, end of year 7,751,428$
Program Revenues
Functions/Programs
TRI-COUNTY AGING CONSORTIUM
GOVERNMENTAL FUNDS
BALANCE SHEET
SEPTEMBER 30, 2024
See accompanying notes to financial statements. 12
Capital ProjectsGrants(CapitalSpecialCampaign)General Revenue (Nonmajor Fund)TotalASSETSCash and cash equivalents 825,424$ 9,633,167$ 183,082$ 10,641,673$ Cash and cash equivalents - restricted - - 132,901 132,901 Accounts receivable 478 844,109 - 844,587 Due from other governmental units - 2,154,559 - 2,154,559 Prepaids 999 332,338 - 333,337 Inventory 1,300 - - 1,300 TOTAL ASSETS 828,201$ 12,964,173$ 315,983$ 14,108,357$ LIABILITIES, DEFERRED INFLOWS OFRESOURCES, AND FUD BALANCESLIABILITIESAccounts payable 84,437$ 3,813,931$ -$ 3,898,368$ Accrued payroll 17,741 248,429 - 266,170 Unearned revenue 23,524 115,366 - 138,890 TOTAL LIABILITIES 125,702 4,177,726 - 4,303,428 DEFERRED INFLOWS OF RESOURCESUnavailable revenue - 912,476 - 912,476 FUND BALANCES NonspendablePrepaids and inventory 2,299 332,338 - 334,637 Permanent corpus - - 70,255 70,255 RestrictedCapital campaign - - 62,646 62,646 CommittedHCBS - Waiver - 7,541,633 - 7,541,633 AssignedCapital campaign - - 183,082 183,082 Friends of Independence 124,507 - - 124,507 Unassigned 575,693 - - 575,693 TOTAL FUND BALANCES 702,499 7,873,971 315,983 8,892,453 TOTAL LIABILITIES, DEFERREDINFLOWS OF RESOURCES,AND FUND BALANCES 828,201$ 12,964,173$ 315,983$ 14,108,357$
TRI-COUNTY AGING CONSORTIUM
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE
SHEET TO THE STATEMENT OF NET POSITION
SEPTEMBER 30, 2024
See accompanying notes to financial statements. 13
Total fund balances - governmental funds 8,892,453$
The cost of capital assets is 1,737,416$ Accumulated depreciation/amortization is (986,106) Capital assets, net 751,310
912,476
Deferred outflows of resources related to pension 2,062,121Deferred inflows of resources related to pension (69,809) 1,992,312
Compensated absences (256,558) Lease payable (710,711) Net pension liability (3,829,854)(4,797,123)
Net position of governmental activities 7,751,428$
Governmental funds report actual pension expenditures for the fiscal year, whereas thegovernmental activities will recognize the net pension liability as of the measurementdate. Pension contributions subsequent to the measurement date will be deferred in thestatementofnet position.In addition, resources related to changes of assumptions,differences between expected and actual experience, and differences between projectedand actual pension plan investment earnings will be deferred over time in thegovernment-wide financial statements. These amounts consist of:
Long-term liabilities are not due and payable in the current period and therefore are notreported as liabilities in the funds. Long-term liabilities at year-end consist of:
Capital assets used in governmental activities are not financial resources and thereforeare not reported as assets in the governmental funds.
Long-term receivables are not expected to be collected within 60 days of year end andare not available to pay for current expenditures.
Amounts reported for the governmental activities in the statement of net position aredifferent because:
TRI-COUNTY AGING CONSORTIUM
GOVERNMENTAL FUNDS
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
YEAR ENDED SEPTEMBER 30, 2024
See accompanying notes to financial statements. 14
Capital Projects(CapitalGrants Special Campaign)General Revenue (Nonmajor Fund)TotalREVENUESIntergovernmentalFederal-$ 2,425,353$ -$ 2,425,353$ State - 2,475,145 - 2,475,145 Medicaid waiver program - 37,950,327 - 37,950,327 Municipal appropriations 277,591 - - 277,591 Local grants 415,389 3,572,495 - 3,987,884 Program revenues - 189,874 - 189,874 Investment income 244,794 - 38,876 283,670 Contributions 124,432 101,616 350 226,398 TOTAL REVENUES 1,062,206 46,714,810 39,226 47,816,242 EXPENDITURESCurrentHealth and welfare 767,051 47,782,137 2,176 48,551,364 Debt service 37,919 199,081 - 237,000 TOTAL EXPENDITURES 804,970 47,981,218 2,176 48,788,364 EXCESS OF REVENUES OVER(UNDER) EXPENDITURES 257,236 (1,266,408) 37,050 (972,122) OTHER FINANCING SOURCES (USES)Transfers in - 261,468 - 261,468 Transfers out (261,468) - - (261,468) TOTAL OTHER FINANCINGSOURCES (USES)(261,468) 261,468 - - NET CHANGE IN FUND BALANCES (4,232) (1,004,940) 37,050 (972,122) Fund balances, beginning of year 706,731 8,878,911 278,933 9,864,575 Fund balances, end of year 702,499$ 7,873,971$ 315,983$ 8,892,453$
TRI-COUNTY AGING CONSORTIUM
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN
FUND BALANCES OF THE GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
YEAR ENDED SEPTEMBER 30, 2024
See accompanying notes to financial statements. 15
Net change in fund balances - total governmental funds (972,122)$
Depreciation/amortization expense (225,341)
170,729
Decrease in compensated absences 34,832$ Decrease in lease payable 196,910 (Increase) in net pension liability (195,127) (Decrease) in deferred outflows of resources related to pension (364,748) Decrease in deferred inflows of resources related to pension 56,262 (271,871)
Change in net position of governmental activities (1,298,605)$
Some items reported in the statement of activities do not require the use of currentfinancial resources and therefore are not reported as expenditures in governmentalfunds. These activities consist of:
Capital outlays are reported as expenditures in governmental funds.In the statement ofactivities, the cost of capital assets is allocated over their estimated useful lives asdepreciation/amortization expense. In the current period, these amounts are:
Revenues in the statement of activities that do not provide current financial resourcesare not reported as revenues in the funds. The change in unavailable revenue is:
Amounts reported for governmental activities in the statement of activities are differentbecause:
TRI-COUNTY AGING CONSORTIUM
NOTES TO FINANCIAL STATEMENTS
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NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Tri-County Aging Consortium (the “Consortium”) is the designated Area Agency on Aging (AAA) for Region VI of Michigan. The Consortium members are as follows: City of East Lansing, City of Lansing, and Clinton, Eaton, and Ingham Counties. As an AAA, the Consortium is responsible for regional planning and coordination of services for older people. This designation dates back to April 1974, when the first Area Plan for this region was approved by the State of Michigan Office of Services to the Aging. The Consortium began in 1972 when a grant from the State Commission on Aging was awarded to the Lansing Planning Department to conduct a needs survey for Lansing elderly. As a result of this research, the Lansing City Council created a Senior Citizens Department in January 1974. Later that year, the Department secured the necessary two-thirds approvals of the Boards of Commissioners of Ingham, Clinton, and Eaton Counties to apply for designation as an Area Agency on Aging under the Older Americans Act. The Consortium Board, the policy-making body for the agency, was established under the Urban Cooperation Act of 1967. The Consortium’s twelve-member board features the combined input and representation from the Lansing Mayor’s Office, Lansing City Council, East Lansing City Council, and the Boards of Commissioners of Clinton, Eaton, and Ingham Counties. Each of the governmental bodies contributes local funds which finance a portion of the Consortium’s activities. The Consortium then pursues other funding sources to bring tax dollars back into the region for the purpose of providing services to senior citizens. The financial statements of the Consortium have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The Consortium’s more significant accounting policies are discussed below. The primary revenues of the Consortium are charges for services, Federal and State grants, and municipal appropriations. Reporting Entity As required by accounting principles generally accepted in the United States of America, these financial statements are exclusive presentations of the financial condition and results of operations of the Tri-County Aging Consortium. The Consortium is not considered to be a component unit of any other governmental unit. In addition, the Consortium’s reporting entity does not contain any component units as defined by GASB. Basis of Presentation GOVERNMENT-WIDE FINANCIAL STATEMENTS The statement of net position and the statement of activities (the government-wide financial statements) present information for the Consortium as a whole. The statement of activities presents the direct functional expenses of the Consortium and the program revenues that support them. Direct expenses are specifically associated with a service, program, or department and are therefore clearly identifiable to a particular function. Program revenues are associated with specific functions and include charges to recipients for goods or services and grants and contributions that are restricted to meeting the operational or capital requirements of that function. Revenues that are not required to be presented as program revenues are general revenues. This includes interest and all municipal appropriations and shows how governmental functions are either self-financing or supported by the general revenues of the Consortium.
TRI-COUNTY AGING CONSORTIUM
NOTES TO FINANCIAL STATEMENTS
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NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Basis of Presentation (continued) FUND FINANCIAL STATEMENTS The Consortium uses three funds to maintain its financial records during the year. A fund is defined as a fiscal and accounting entity with a self-balancing set of accounts. The governmental fund financial statements present the Consortium’s major and nonmajor funds. The Major Funds of the Consortium are: a. General Fund - This fund is the Consortium’s primary operating fund. It accounts for all financial resources of the general government except for those that are required to be accounted for in another fund. b. Grants Special Revenue Fund - This fund reports grant program revenues and expenditures of Federal and State grant monies primarily passed through the Aging and Adult Services Agency (AASA) as well as amounts passed through from local and private sources. Measurement Focus The government-wide financial statements are presented using the economic resources measurement focus, similar to that used by business enterprises or not-for-profit organizations. Because another measurement focus is used in the governmental fund financial statements, reconciliations to the government-wide financial statements are provided that explain the differences in detail. The governmental fund financial statements are presented using the current financial resources measurement focus. With this measurement focus, only current assets, deferred outflows of resources, current liabilities, and deferred inflows of resources generally are included on the balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in fund balance. Basis of Accounting Basis of accounting refers to the timing under which transactions are recognized for financial reporting purposes. Governmental fund financial statements use the modified accrual basis of accounting. The government-wide financial statements are prepared using the accrual basis of accounting. Under the accrual basis of accounting, revenue is recorded in the period in which it is earned, and expenses are recorded when incurred, regardless of the timing of related cash flows. Revenues for grants and contributions are recognized when all eligibility requirements imposed by the provider have been met. Unearned revenue is recorded when resources are received by the Consortium before it has legal claim to them, such as when grant monies are received prior to the incurrence of qualified expenses.
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NOTES TO FINANCIAL STATEMENTS
18
NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Basis of Accounting (continued) Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become both measurable and available). “Measurable” means the amount of the transaction can be determined and “available” means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. For this purpose, the Consortium considers revenues to be available if they are collected within 60 days of the end of the current period. Revenues susceptible to accrual include state and federal grants and interest revenue. Other revenues are not susceptible to accrual because generally they are not measurable until received in cash. Expenditures are recorded when the related fund liability is incurred, except for principal and interest on general long-term debt which are recorded when due. Budgets and Budgetary Accounting The annual budget of the Consortium is prepared by the Consortium’s management and approved by the Board at the total expenditure level. Any revisions to the original budget are approved by the Board before the end of the fiscal year. Cash and Cash Equivalents Cash and cash equivalents consist of the Consortium’s checking and savings accounts, imprest cash, money market funds, and uncategorized pooled investment accounts. In addition, the Consortium’s restricted cash and cash equivalents consist of an endowment fund held by the Capital Region Community Foundation for building and equipment purchases by the Meals on Wheels program. These funds may be requested by the Consortium at any time except for the permanent corpus of the funds. The fund balance for that portion of the endowment has been appropriately reported as nonspendable. In accordance with Michigan Compiled Laws, the Consortium is authorized to invest in the following investment vehicles: a. Bonds, securities, and other obligations of the United States or an agency or instrumentality of the United States. b. Certificates of deposit, savings accounts, deposit accounts, or depository receipts of a State or nationally chartered bank or a State or Federally chartered savings and loan association, savings bank, or credit union whose deposits are insured by an agency of the United States government and which maintains a principal office or branch office located in this State under the laws of this State or the United States, but only if the bank, savings and loan association, savings bank or credit union is eligible to be a depository of surplus funds belonging to the State under Section 6 of 1855 PA 105, MCL 21.146. c. Commercial paper rated at the time of purchase within the three highest classifications established by not less than two standard rating services, and which matures not more than 270 days after the date of purchase.
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19
NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Cash and Cash Equivalents (continued) d. The United States government or Federal agency obligations repurchase agreements. e. Bankers acceptances of United States Banks. f. Mutual funds composed of investment vehicles, which are legal for direct investment by local units of government in Michigan. Receivables and Unearned Revenue Receivables consist of amounts due from governmental units for various grant programs and accounts receivable for charges for services to clients and other organizations. The Consortium has recognized the revenue related to charges for services at the time the services are performed and billed to the extent such amounts are estimated to be received. Contractual adjustments by third-party payers are treated as a reduction to revenues. Unearned revenues arise when the Consortium receives resources before it has a legal claim to them. In subsequent periods, when the revenue meets both the “measurable” and “available” criteria for recognition, the liability for unearned revenue is removed from the statement of net position and balance sheet, respectively, and revenue is recognized. Inventories and Prepaids Inventories are valued at cost, on a first-in, first-out basis. Inventories are recorded as expenditures when consumed rather than when purchased. Payments made to vendors for services that will benefit future periods are recorded as prepaid expenditures/expenses. Reported inventories and prepaid expenditures are equally offset by nonspendable fund balance which indicates they do not constitute “available spendable resources” even though they are a component of equity. Capital Assets Capital assets are recorded (net of accumulated depreciation, if applicable) in the government-wide financial statements. Capital assets are those with an initial individual cost of $5,000 or more, with estimated useful lives of more than one year. Capital assets are not recorded in the governmental fund. Instead, capital acquisitions are reflected as expenditures in the governmental fund, and the related assets are reported in the government-wide financial statements. All purchased capital assets are valued at cost where historical records are available and at an estimated historical cost where no historical records exist. The measurement of intangible right-to-use assets is discussed below under the heading “leases”. Donated capital assets are valued at their estimated acquisition cost on the date received.
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20
NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Capital Assets (continued) The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Right-to-use assets of the Consortium are amortized using the straight-line method over the shorter of the lease period or the estimated useful lives. Depreciation is computed using the straight-line method over the following useful lives: Leasehold improvements 15 years Vehicles 6 years Equipment 10 years Right-to-use - leased space 5 years Long-Term Obligations Long-term debt and other long-term obligations are recognized as a liability in the government-wide financial statements when incurred. The portion of those liabilities expected to be paid within the next year is a current liability with the remaining amounts shown as noncurrent. Long-term debt is recognized as a liability of a governmental fund when due or when resources have been accumulated in a Debt Service Fund for payment early in the following year. For other long-term obligations, only that portion expected to be financed from expendable available financial resources is reported as a fund liability of a governmental fund. Compensated Absences The Consortium employees are granted vacation and sick leave in varying amounts. In the event of termination, an employee is paid for certain portions of unused accumulated vacation and personal time. This amount, along with related payroll taxes has been recorded in the government-wide financial statements. Net Pension Liability The Consortium offers a defined benefit pension plan to its employees. The Consortium records a net pension liability for the difference between the total pension liability calculated by the actuary and the pension plan’s fiduciary net position. For the purpose of measuring the net pension liability, deferred outflows of resources, deferred inflows of resources, and pension expense, information about the fiduciary net position have been determined on the same basis as they are reported by the pension plan. Leases Lessee: The Consortium is a lessee for a noncancelable lease of office space. The Consortium recognizes a lease liability and an intangible right-to-use lease asset in the government-wide financial statements. The Consortium recognizes lease liabilities with an initial, individual value of $5,000 or more.
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NOTES TO FINANCIAL STATEMENTS
21
NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Leases (continued) At the commencement of a lease, the Consortium initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of lease payments made. The lease asset is initially measured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commencement date, plus certain initial direct costs. Subsequently, the lease asset is amortized on a straight-line basis over its useful life. Key estimates and judgements related to leases include how the Consortium determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments.
➢ The Consortium uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the Consortium generally uses its estimated incremental borrowing rate as the discount rate for leases.
➢ The lease term includes the noncancelable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the Consortium is reasonably certain to exercise. The Consortium monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability. Lease assets are reported with other capital assets and lease liabilities are reported with long-term obligations on the statement of net position. Deferred Outflows/Inflows of Resources In addition to assets, the statement of net position and balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of
resources, represents a consumption of net position/fund balance that applies to a future period and so will not be recognized as an outflow of resources (expense/expenditure) until that time. In addition to liabilities, the statement of net position and balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of
resources, represents an acquisition of net position/fund balance that applies to a future period and so will not be recognized as an inflow of resources (revenue) until that time. The Consortium reports deferred inflows of resources on the balance sheet in connection with long-term receivables that are not considered available to liquidate liabilities of the current period. The Consortium also reports deferred outflows of resources and deferred inflows of resources on the statement of net position which correspond to the Consortium’s net pension liability and are related to differences in experience, differences in assumptions, differences between projected and actual pension plan investment earnings and contributions made subsequent to the measurement date. These amounts are deferred and recognized as an outflow of resources or an inflow of resources in the period to which they apply.
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NOTES TO FINANCIAL STATEMENTS
22
NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Unavailable Revenue Governmental funds report unavailable revenues in connection with receivables for revenue that is not considered available to liquidate liabilities of the current period. Fund Balance Classifications Fund balance classifications comprise a hierarchy based primarily on the extent to which a government is bound to observe constraints imposed upon the use of the resources reported in governmental funds. The following are the five classifications of fund balance:
Nonspendable - assets that are not available in a spendable form such as inventory, prepaid expenditures, and long-term receivables not expected to be converted to cash in the near term. It also includes funds that are legally or contractually required to be maintained intact such as the corpus of a permanent fund or foundation.
Restricted - amounts that are required by external parties to be used for a specific purpose. Constraints are externally imposed by creditors, grantors, contributors or laws, regulations or enabling legislation.
Committed - amounts constrained on use imposed by formal action of the government’s highest level of decision-making authority (i.e., Board, Council, etc.).
Assigned - amounts intended to be used for specific purposes. This is determined by the governing body, the budget or finance committee or a delegated municipality official.
Unassigned - all other resources; the remaining fund balance after nonspendable, restrictions, commitments, and assignments. This class only occurs in the General Fund, except for cases of negative fund balances. Negative fund balances are always reported as unassigned, no matter which fund the deficit occurs in. Fund Balance Classification Policies and Procedures For committed fund balance, the Consortium’s highest level of decision-making authority is the Board of Directors. The formal action that is required to be taken to establish a fund balance commitment is the adoption of a Board resolution. For assigned fund balance, the Tri-County Aging Consortium has not approved a policy indicating who is authorized to assign amounts to a specific purpose, therefore the authority for assigning fund balance remains with the Consortium’s Board of Directors. For the classification of fund balances, the Tri-County Aging Consortium considers restricted amounts to have been spent first when an expenditure is incurred for the purposes for which both restricted and unrestricted fund balance is available. Also, for the classification of fund balances, the Tri-County Aging Consortium considers committed, assigned, or unassigned amounts to have been spent in succession when an expenditure is incurred for purposes for which amounts in any of those fund balance classifications could be used.
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NOTES TO FINANCIAL STATEMENTS
23
NOTE 1 - DESCRIPTION OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Interfund Transactions During the course of normal operations, the Consortium has numerous transactions between funds, including expenditures and transfers of resources to provide services. The accompanying financial statements generally reflect such transactions as operating transfers. Use of Estimates The preparation of basic financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, deferred inflows and outflows of resources and disclosure of contingent assets and liabilities at the date of the basic financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
NOTE 2 - DEPOSITS AND INVESTMENTS As of September 30, 2024, the Consortium had deposits and investments subject to the following risk: Custodial Credit Risk - Deposits In the case of deposits, this is the risk that in the event of a bank failure, the Consortium’s deposits may not be returned to it. As of September 30, 2024, $10,364,675 of the Consortium’s bank balance of $10,677,657 was exposed to custodial credit risk because it was uninsured and uncollateralized. The carrying value on the books for deposits was $10,641,173. The cash and cash equivalents balances reported in the basic financial statements include $132,901 in an endowment fund held by the Capital Region Community Foundation. Custodial Credit Risk - Investments For an investment, this is the risk that, in the event of the failure of the counterparty, the Consortium will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The Consortium will minimize custodial credit risk, which is the risk of loss due to the failure of the security issuer or backer, by limiting investments to the types of securities authorized by the Board and pre-qualifying the financial institutions, broker/dealers, intermediaries, and advisors with which the Consortium will do business in accordance with Board approved policy.
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NOTES TO FINANCIAL STATEMENTS
24
NOTE 2 - DEPOSITS AND INVESTMENTS (continued) Credit Risk State law limits investments in certain types of investments to a prime or better rating issued by nationally recognized statistical rating organizations (NRSRO’s). Obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality. As of September 30, 2024, the Consortium’s investments were rated as follows: Standard &Investment Type Fair Value Poor's RatingMichigan CLASS Investment Pool 500$ AAAm Interest Rate Risk The Consortium will minimize interest rate risk, which is the risk that the market value of securities in the portfolio will fall due to changes in market interest rates, by structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities in the open market and investing operating funds primarily in shorter-term securities, liquid asset funds, money market mutual funds, or similar investment pools and limiting the average maturity in accordance with the Consortium’s cash requirements.
Fair Value Weighted Average MaturityMichigan CLASS Investment Pool 500$ 32 Days Concentration of Credit Risk The Consortium will minimize concentration of credit risk, which is the risk of loss attributed to the magnitude of the Consortium’s investment in a single issuer, by diversifying the investment portfolio so that the impact of potential losses from any one type of security or issuer will be minimized. Foreign Currency Risk The Consortium is not authorized to invest in investments which have this type of risk.
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NOTES TO FINANCIAL STATEMENTS
25
NOTE 2 - DEPOSITS AND INVESTMENTS (continued) Fair Value Measurements The Consortium categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. Investments that are measured at fair value using the net ass t value per share (or its equivalent) as a practical expedient are not classified in the fair value hierarchy. In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Authority’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability. Investments in Entities that Calculate Net Asset Value per Share The Consortium holds shares in the Michigan CLASS investment pool where the fair value of the investments is measured on a recurring basis using net asset value per share (or its equivalent) of the investment companies as a practical expedient. The Michigan CLASS investment pool invests in U.S. Treasury obligations, federal agency obligations of the U.S. government, high-grade commercial paper (rated “A1” or better), collateralized bank deposits, repurchase agreements (collateralized at 102 percent by treasuries and agencies), and approved money market funds. The program is designed to meet the needs of Michigan public sector investors. It purchases securities that are legally permissible under state statutes and are available for investment by Michigan counties, cities, townships, school districts, authorities, and other public agencies. At the year ended September 30, 2024, the fair value, unfunded commitments, and redemption rules of those investments are as follows: RedemptionUnfundedFrequency,RedemptionFair Value Commitments if Eligible Notice PeriodMichigan CLASS Investment Pool 500$ -$ No restrictions None
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NOTES TO FINANCIAL STATEMENTS
26
NOTE 3 - CAPITAL ASSETS The following provides a summary of the changes in capital assets for the year ended September 30, 2024: Balance BalanceOct. 1, 2023 Additions Deletions Sept. 30, 2024Capital assets being depreciated/amortizedVehicles 120,898$ -$ -$ 120,898$ Equipment 352,496 - (9,675) 342,821 Right-to-use building 1,273,697 - - 1,273,697 Total 1,747,091 - (9,675) 1,737,416 Less accumulated depreciation/ amortization for:Vehicles (75,237) (11,387) - (86,624) Equipment (287,619) (10,162) 9,675 (288,106) Right-to-use building (407,584) (203,792) - (611,376) Total (770,440) (225,341) 9,675 (986,106) Capital assets, net 976,651$ (225,341)$ -$ 751,310$
NOTE 4 - LONG-TERM OBLIGATIONS The following is a summary of changes in long-term obligations (including current portion) of the Consortium for the year ended September 30, 2024: AmountsBalanceBalanceDue WithinOct. 1, 2023 Additions Deletions Sept. 30, 2024 One YearDirect borrowings and direct placementsLease payable 907,621$ -$ (196,910)$ 710,711$ 206,778$ Other long-term obligationsCompensated absences 291,390 240,056 (274,888) 256,558 102,623 1,199,011$ 240,056$ (471,798)$ 967,269$ 309,401$ Significant details regarding outstanding long-term obligations (including current portion) are presented below: Lease Payable $1,878,304 2018 Lease payable for office space, dated August 8, 2018, due in monthly installments ranging from $16,044 to $19,670 through December 1, 2027, with interest of 4.90%, payable monthly.710,711$
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NOTES TO FINANCIAL STATEMENTS
27
NOTE 4 - LONG-TERM OBLIGATIONS (continued) The annual requirements to pay the long-term obligations as of September 30, 2024, including interest are as follows: Year EndingSeptember 30,Principal Interest2025206,778$ 30,222$ 2026 217,140 19,860 2027 228,023 8,977 2028 58,770 480 710,711$ 59,539$
Direct Borrowings andDirect Placements
The Consortium’s outstanding obligations from direct borrowings and direct placements of $710,711 contains provisions that in an event of default, either by (1) unable to make principal or interest payments (2) false or misrepresentation is made to the lender (3) become insolvent or make an assignment for the benefit of its creditors (4) if the lender at any time in good faith believes that the prospect of payment of any indebtedness is impaired. Upon the occurrence of any default event, the outstanding amounts, including accrued interest become immediately due and payable. Compensated Absences In accordance with Consortium personnel policies, individual employees have vested rights upon termination of employment to receive payment for unused vacation under formulas and conditions specified in their personnel policies handbook. Accumulated sick and vacation leave represents a liability to the Consortium, which is presented in a current and noncurrent portion of the liability. For this reason, the total liability is reported in the government-wide financial statements and represents a current liability of $102,623 and a noncurrent liability of $153,935 at September 30, 2024. Payments to employees for sick and vacation leave are recorded as expenditures in the funds when they are used, and payments are actually made to the employees.
NOTE 5 - INTERFUND TRANSFERS Permanent reallocations of resources between funds of the reporting entity are classified as interfund transfers. For the purpose of the statement of activities, all interfund transfers between individual governmental funds have been eliminated. Transfers to Grants Special Revenue Fund from:General Fund 261,468$ The transfers move unrestricted revenues collected in the General Fund to finance various programs accounted for in the Grants Special Revenue Funds in accordance with budgetary authorizations.
28
TRI-COUNTY AGING CONSORTIUM
NOTES TO FINANCIAL STATEMENTS
NOTE 6 - DEFINED BENEFIT PENSION PLAN Plan Description The Consortium’s defined benefit pension plan provides certain retirement, disability, and death benefits to plan members and beneficiaries. The Consortium participates in the Municipal Employees’ Retirement System (MERS) of Michigan. MERS is an agent multiple-employer, statewide public employee pension plan established by the Michigan’s Legislature under Public Act 135 of 1945 and administered by a nine-member Retirement Board. MERS issues a publicly available financial report that includes financial statements and required supplementary information. This report may be obtained by accessing MERS website at www.mersofmich.com. Summary of Significant Accounting Policies For the purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Municipal Employees’ Retirement System of Michigan and additions to/deductions from MERS’ fiduciary net position have been determined on the same basis as they are reported by MERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. Benefits Provided Public Act 427 of 1984, as amended, established, and amends the benefit provisions of the participants in MERS. The MERS plan covers all eligible full-time general employees at the Consortium. Retirement benefits for Consortium employees are calculated at 2.00% of the employee’s five-year final average compensation times the employee’s years of service with no maximum. Normal retirement age is 60 with an unreduced benefit at age 55 with 25 years of service or a reduced benefit at age 50 with 25 years of service or age 55 with 15 years of service. Deferred retirement benefits vest after 10 years of credited service but are not paid until the date retirement would have occurred had the member remained an employee. Employees are eligible for non-duty disability benefits after 6 years of service and for duty related disability benefits upon hire. Disability benefits are determined in the same manner as retirement benefits but are payable immediately and if duty-related without an actuarial reduction for retirement before age 60 is not applied. An employee who leaves service may withdraw his or her contributions, plus any accrued interest. Benefit terms, within the parameters established by MERS, are generally established and amended by authority of the Board of Directors. At the December 31, 2023, valuation date, the following employees were covered by the benefit terms: Inactive employees or beneficiaries receiving benefits 84 Inactive employees entitled to but not yet receiving benefits 14 Active employees 104 202
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NOTES TO FINANCIAL STATEMENTS
29
NOTE 6 - DEFINED BENEFIT PENSION PLAN (continued)
Contributions Article 9, Section 24 of the State of Michigan constitution requires that financial benefits arising on account of employee service rendered in each year be funded during that year. Accordingly, MERS retains an independent actuary to determine the annual contribution. The employer is required to contribute amounts at least equal to the actuarially determined rate, as established by the MERS retirement board. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by plan members during the year, with an additional amount to finance any unfunded accrued liability. The employer may establish contribution rates to be paid by its covered employees.
Employer contributions were 11.96% based on annual payroll for the open division. Payable to the Pension Plan At September 30, 2024, there were no amounts outstanding by the Consortium for contributions to the pension plan required for the year ended September 30, 2024. Net Pension Liability The net pension liability reported at September 30, 2024 was determined using a measure of the total pension liability and the pension net position as of December 31, 2023. The December 31, 2023 total pension liability was determined by an actuarial valuation performed as of that date. Actuarial Assumptions The total pension liability in the December 31, 2023, annual actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement: Inflation: 2.5% Salary increases: 3.00% in the long-term plus a percentage based on age related scale to reflect merit, longevity, and promotional pay increases. Investment rate of return: 7.18%, net of investment and administration expense including inflation. Although no specific price inflation assumptions are needed for the valuation, the 3.00% long-term wage inflation assumption would be consistent with a price inflation of 3.00 - 4.00%. Mortality rates used were based on a version of Pub-2010 and fully generational MP-2019. The actuarial assumptions used in the valuation were based on the results of the most recent actuarial experience study of 2014-2018. Projected Cash Flows Based on these assumptions, the pension plan’s fiduciary net position was projected to be available to pay all projected future benefit payments of current active and inactive employees. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
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NOTES TO FINANCIAL STATEMENTS
30
NOTE 6 - DEFINED BENEFIT PENSION PLAN (continued) Projected Cash Flows (continued) The long-term expected rate of return on pension plan investments was determined using a model method in which the best-estimate ranges of expected future real rates of return (expected returns, net of investment and administrative expenses and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: Long-Term Long-termExpected Gross Expected RealAsset Class Target Allocation Rate of Return Rate of ReturnGlobal Equity 60.00%4.38%2.63%Global Fixed Income 20.00%2.00%0.40%Private Investments 20.00%7.00%1.40%100.00%4.43%Inflation 2.50%Administration expenses netted above 0.25%Investment rate of return (discount rate)7.18% Discount Rate The discount rate used to measure the total pension liability is 7.18%. The current discount rate shown for GASB 68 purposes is higher than the MERS assumed rate of return. This is because, for GASB 68 purposes, the discount rate must be gross of administrative expenses, whereas for funding purposes, it is net of administrative expenses. The projection of cash flows used to determine the discount rate assumes that employer and employee contributions will be made at the rates agreed upon for employees and the actuarially determined rates for employers. Based on these assumptions, the pension plan’s fiduciary net position was projected to be available to pay all projected future benefit payments of current active and inactive employees. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
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NOTES TO FINANCIAL STATEMENTS
31
NOTE 6 - DEFINED BENEFIT PENSION PLAN (continued) Changes in the net pension liability during the measurement year were as follows: Total Pension Plan Fiduciary Net PensionLiabilityNet Position Liability(a)(b)(a)-(b)Balances at December 31, 2022 14,226,018$ 10,591,291$ 3,634,727$ Changes for the yearService cost 501,471 - 501,471 Interest on total pension liability 1,021,851 - 1,021,851 Difference between expected and actual experience 436,401 - 436,401 Changes in assumptions 122,324 - 122,324 Employer contributions - 733,183 (733,183) Net investment income - 1,178,722 (1,178,722) Benefit payments, including employee refunds (764,503) (764,503) - Administrative expense - (24,985) 24,985 Net changes 1,317,544 1,122,417 195,127 Balances at December 31, 2023 15,543,562$ 11,713,708$ 3,829,854$
Increase (Decrease)
Changes in Net Pension Liability
Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the Consortium, calculated using the discount rates of 7.18%, as well as what the Consortium’s net pension liability would be using a discount rate that is 1% lower or 1% higher than the current rate. Current1% Decrease Discount Rate 1% IncreaseNet pension liability 5,760,458$ 3,829,854$ 2,219,172$
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NOTES TO FINANCIAL STATEMENTS
32
NOTE 6 - DEFINED BENEFIT PENSION PLAN (continued) Pension Expenses and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended September 30, 2024, the Consortium recognized pension expense of $1,229,852. The Consortium reported deferred outflows and inflows of resources related to pensions from the following sources: Deferred DeferredOutflows of Inflows ofResourcesResourcesDifferences in experience 513,533$ 69,809$ Differences in assumptions 404,532 - Excess (deficit) investment returns 604,301 - Contributions subsequent to the measurement date*539,755 - Total 2,062,121$ 69,809$ * The amount reported as deferred outflows of resources resulting from contributions subsequent to the measurement date will be recognized as a reduction in the net pension liability for the year ending September 30, 2025. Amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: Year Ending PensionSeptember 30,Expense2025513,349$ 2026 480,584 2027 541,202 2028 (82,578) 1,452,557$ Change in Assumptions Change in discount rate from 7.25% to 7.18%. Changes in Benefits There were no changes of benefit terms during plan year 2023.
NOTE 7 - RISK MANAGEMENT The Consortium is exposed to various risks of loss related to torts, theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters for which they carry commercial insurance. The Consortium has had no settled claims resulting from these risks that exceeded their commercial coverage in any of the past three years.
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NOTES TO FINANCIAL STATEMENTS
33
NOTE 8 - CONTINGENT LIABILITIES The Consortium participates in a number of Federal and State assisted grant programs which are subject to compliance audits. The periodic program compliance audits of many of the programs have not yet been completed or final resolution has not been received. Accordingly, the Consortium’s compliance with applicable grant requirements will be established at some future date. The amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time although the Consortium expects such amounts, if any, to be immaterial.
NOTE 9 - UPCOMING ACCOUNTING PRONOUNCEMENTS In June 2022, the GASB issued Statement No. 101, Compensated Absences. This Statement requires that liabilities for compensated absences be recognized for (1) leave that has not been used and (2) leave that has been used but not yet paid in cash or settled through noncash means. A liability should be recognized for leave that has not been used if (a) the leave is attributable to services already rendered, (b) the leave accumulates, and (c) the leave is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means. This Statement also establishes guidance for measuring a liability for leave that has not been used, generally using an employee’s pay rate as of the date of the financial statements. The Consortium is currently evaluating the impact this standard will have on the financial statements when adopted during the 2024-2025 fiscal year. In December 2023, the GASB issued Statement No. 102, Certain Risk Disclosures. This Statement requires a government to assess whether a concentration or constraint makes the government vulnerable to the risk of a substantial impact. Additionally, this Statement requires a government to assess whether an event or events associated with a concentration or constraint that could cause the substantial impact have occurred, have begun to occur, or are more likely than not to begin to occur within 12 months of the date the financial statements are issued. If a government determines that those criteria for disclosure have been met for a concentration or constraint, it should disclose information in notes to financial statements in sufficient detail to enable users of financial statements to understand the nature of circumstances disclosed and the government’s vulnerability to the risk of substantial impact. The Consortium is currently evaluating the impact this standard will have on the financial statements when adopted during the 2024-2025 fiscal year. In April 2024, the GASB issued Statement No. 103, Financial Reporting Model Improvements. This Statement establishes new accounting and financial reporting requirements - or modifies existing requirements - related to the following: a. Management’s discussion and analysis (MD&A); i. Requires that the information presented in MD&A be limited to the related topics discussed in five specific sections: 1) Overview of the Financial Statements, 2) Financial Summary, 3) Detailed Analyses, 4) Significant Capital Asset and Long-Term Financing Activity, 5) Currently Known Facts, Decisions, or Conditions; ii. Stresses detailed analyses should explain why balances and results of operations changed rather than simply presenting the amounts or percentages by which they changed; iii. Removes the requirement for discussion of significant variations between original and final budget amounts and between final budget amounts and actual results;
TRI-COUNTY AGING CONSORTIUM
NOTES TO FINANCIAL STATEMENTS
34
NOTE 9 - UPCOMING ACCOUNTING PRONOUNCEMENTS (continued) b.Unusual or infrequent items;c.Presentation of the proprietary fund statement of revenues, expenses, and changes in fund net position;i.Requires that the proprietary fund statement of revenues, expenses, and changes in fund netposition continue to distinguish between operating and nonoperating revenues and expensesand clarifies the definition of operating and nonoperating revenues and expenses;ii.Requires that a subtotal for operating income (loss) and noncapital subsidies be presented beforereporting other nonoperating revenues and expenses and defines subsidies;d.Information about major component units in basic financial statements should be presented separately inthe statement of net position and statement of activities unless it reduces the readability of the statementsin which case combining statements of should be presented after the fund financial statements;e.Budgetary comparison information should include variances between original and final budget amountsand variances between final budget and actual amounts with explanations of significant variancesrequired to be presented in the notes to RSI.The Consortium is currently evaluating the impact this standard will have on the financial statements when adopted during the 2025-2026 fiscal year. In September 2024, the GASB issued Statement No. 104, Disclosure of Certain Capital Assets. This Statement requires certain types of capital assets to be disclosed separately in the capital assets note disclosures required by Statement No. 34. Lease assets recognized in accordance with Statement No. 87, Leases, and intangible right-to-use assets recognized in accordance with Statement No. 94, Public-Private and Public-Public Partnerships and
Availability Payment Arrangements, should be disclosed separately by major class of underlying asset in the capital assets note disclosures. Subscription assets recognized in accordance with Statement No. 96,
Subscription-based Information Technology Arrangements, also should be separately disclosed. In addition, this Statement requires intangible assets other than those three types to be disclosed separately by major class. This Statement also requires additional disclosures for capital assets held for sale. The Consortium is currently evaluating the impact this standard will have on the financial statements when adopted during the 2025-2026 fiscal year.
35
REQUIRED SUPPLEMENTARY INFORMATION
TRI-COUNTY AGING CONSORTIUM
GENERAL FUND
BUDGETARY COMPARISON SCHEDULE
YEAR ENDED SEPTEMBER 30, 2024
36
Variance withBudgeted Amounts Final BudgetPositiveOriginalFinalActual(Negative)REVENUESLocal grants 439,228$ 432,849 415,389$ (17,460)$ Municipal appropriationsCity of Lansing 70,000 75,000 75,000 - City of East Lansing 16,613 16,613 16,310 (303) Ingham County 76,048 76,048 76,048 - Clinton County 43,580 43,580 43,580 - Eaton County 66,653 66,653 66,653 - Interest 136,100 220,100 244,794 24,694 Contributions 76,625 122,125 124,432 2,307 TOTAL REVENUES 924,847 1,052,968 1,062,206 9,238 EXPENDITURESCurrentHealth and welfareSalaries and wages 486,100 492,500 353,923 138,577 Fringe benefits 223,500 227,000 124,970 102,030 Operating expenditures 213,500 227,000 188,270 38,730 Professional services 84,000 89,000 85,103 3,897 Subcontractor expenditures - 25,000 12,401 12,599 Travel and training 2,550 2,750 2,384 366 Total health and welfare 1,009,650 1,063,250 767,051 296,199 Debt service 45,000 30,000 37,919 (7,919) TOTAL EXPENDITURES 1,054,650 1,093,250 804,970 288,280 EXCESS OF REVENUES OVER(UNDER) EXPENDITURES (129,803) (40,282) 257,236 297,518 OTHER FINANCING (USES)Transfers out (285,000) (285,000) (261,468) 23,532 NET CHANGE IN FUND BALANCE (414,803) (325,282) (4,232) 321,050 Fund balance, beginning of year 706,731 706,731 706,731 - Fund balance, end of year 291,928$ 381,449$ 702,499$ 321,050$
TRI-COUNTY AGING CONSORTIUM
GRANTS SPECIAL REVENUE FUND
BUDGETARY COMPARISON SCHEDULE
YEAR ENDED SEPTEMBER 30, 2024
37
Variance withBudgeted Amounts Final BudgetPositiveOriginalFinalActual(Negative)REVENUESIntergovernmentalFederal 2,607,145$ 3,098,531$ 2,425,353$ (673,178)$ State 2,386,444 2,556,831 2,475,145 (81,686) Medicaid waiver program 34,705,000 36,500,000 37,950,327 1,450,327 Local grants 3,233,793 3,344,919 3,572,495 227,576 Charges for services 198,800 197,100 189,874 (7,226) Interest 500 500 - (500) Contributions 265,915 312,775 101,616 (211,159) TOTAL REVENUES 43,397,597 46,010,656 46,714,810 704,154 EXPENDITURESCurrentHealth and welfareSalaries and wages 5,271,122 5,385,922 5,144,029 241,893 Fringe benefits 2,045,315 2,113,175 2,154,076 (40,901) Operating expenditures 3,010,590 3,242,115 2,706,895 535,220 Professional services 186,025 197,500 199,706 (2,206) Subcontractor expenditures 33,926,119 36,139,219 37,433,279 (1,294,060) Travel and training 130,500 134,000 144,152 (10,152) Total health and welfare 44,569,671 47,211,931 47,782,137 (570,206) Debt service 209,500 209,500 199,081 10,419 TOTAL EXPENDITURES 44,779,171 47,421,431 47,981,218 (559,787) EXCESS OF REVENUES(UNDER) EXPENDITURES (1,381,574) (1,410,775) (1,266,408) 144,367 OTHER FINANCING SOURCESTransfers in 304,600 288,330 261,468 (26,862) NET CHANGE IN FUND BALANCE (1,076,974) (1,122,445) (1,004,940) 117,505 Fund balance, beginning of year 8,878,911 8,878,911 8,878,911 - Fund balance, end of year 7,801,937$ 7,756,466$ 7,873,971$ 117,505$
TRI-COUNTY AGING CONSORTIUM
SCHEDULE OF CHANGES IN EMPLOYER’S NET PENSION LIABILITY AND RELATED RATIOS
LAST TEN MEASUREMENT YEARS
(AMOUNTS WERE DETERMINED AS OF 12/31 OF EACH FISCAL YEAR)
38
2023 2022 2021 2020 2019 2018 2017 2016 2015 2014Total Pension LiabilityService cost 501,471$ 464,264$ 383,409$ 356,603$ 322,495$ 298,029$ 284,237$ 305,341$ 283,247$ 293,888$ Interest 1,021,851 952,503 920,802 816,673 797,254 752,719 706,464 681,540 625,436 581,328 Difference between expected and actual experience 436,401 235,924 (174,524) 223,382 (106,777) 15,570 33,059 (285,593) (77,380) - Changes of assumptions 122,324 - 498,268 567,411 312,716 - - - 450,517 - Benefit payments, including employee refunds (764,503) (665,007) (627,456) (587,268) (538,175) (505,519) (399,430) (358,945) (350,399) (320,094) Net Change in Total Pension Liability 1,317,544 987,684 1,000,499 1,376,801 787,513 560,799 624,330 342,343 931,421 555,122 Total Pension Liability, beginning 14,226,018 13,238,334 12,237,835 10,861,034 10,073,521 9,512,722 8,888,392 8,546,049 7,614,628 7,059,506 Total Pension Liability, ending 15,543,562$ 14,226,018$ 13,238,334$ 12,237,835$ 10,861,034$ 10,073,521$ 9,512,722$ 8,888,392$ 8,546,049$ 7,614,628$ Plan Fiduciary Net PositionContributions - employer 733,183$ 588,535$ 648,535$ 416,705$ 355,254$ 333,749$ 337,721$ 368,807$ 283,411$ 263,114$ Contributions - employee - - - 25,958 12,058 - 35,427 - 35,531 23,334 Net investment income (loss)1,178,722 (1,317,619) 1,430,516 1,335,262 1,146,505 (351,718) 1,065,022 823,433 (111,727) 438,821 Benefit payments, including employee refunds (764,503) (665,007) (627,456) (587,268) (538,175) (505,519) (399,430) (358,945) (350,399) (320,094) Administrative expense (24,985) (22,003) (16,901) (18,944) (19,754) (17,429) (16,842) (16,238) (16,137) (16,148) Net Change in Plan Fiduciary Net Position 1,122,417 (1,416,094) 1,434,694 1,171,713 955,888 (540,917) 1,021,898 817,057 (159,321) 389,027 Plan Fiduciary Net Position, beginning 10,591,291 12,007,385 10,572,691 9,400,978 8,445,090 8,986,007 7,964,109 7,147,052 7,306,373 6,917,346 Plan Fiduciary Net Position, ending 11,713,708$ 10,591,291$ 12,007,385$ 10,572,691$ 9,400,978$ 8,445,090$ 8,986,007$ 7,964,109$ 7,147,052$ 7,306,373$ Employer's Net Pension Liability 3,829,854$ 3,634,727$ 1,230,949$ 1,665,144$ 1,460,056$ 1,628,431$ 526,715$ 924,283$ 1,398,997$ 308,255$ Plan Fiduciary Net Position as a percentage of the Total Pension Liability 75%74%91%86%87%84%94%90%84%96%Covered payroll 4,979,977$ 4,582,245$ 4,110,647$ 4,007,554$ 3,709,456$ 3,431,432$ 3,315,387$ 3,638,975$ 3,480,095$ 3,612,252$ Employer's Net Pension Liability as apercentage of covered payroll 77%79%30%42%39%47%16%25%40%9%
TRI-COUNTY AGING CONSORTIUM
SCHEDULE OF EMPLOYER CONTRIBUTIONS
LAST TEN FISCAL YEARS
(AMOUNTS WERE DETERMINED AS OF 9/30 OF EACH FISCAL YEAR)
39
2024 2023 2022 2021 2020 2019 2018 2017 2016 2015Actuarially determined contributions 726,599$ 716,762$ 544,943$ 450,821$ 390,259$ 346,264$ 250,517$ 245,572$ 246,191$ 286,134$ Contributions in relation to the actuariallydetermined contribution 726,599 716,762 544,943 625,821 390,259 346,264 250,517 245,572 246,191 286,134 Contribution deficiency (excess)-$ -$ -$ (175,000)$ -$ -$ -$ -$ -$ -$ Covered payroll 5,238,917$ 4,974,289$ 4,383,837$ 4,040,921$ 3,853,013$ 3,617,532$ 3,426,150$ 3,554,559$ 3,740,817$ 3,599,973$ Contributions as a percentageof covered payroll 14%14%12%15%9%10%7%7%7%8%
TRI-COUNTY AGING CONSORTIUM
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION (CONTINUED)
YEAR ENDED SEPTEMBER 30, 2024
40
NOTE 1 - EMPLOYEE RETIREMENT PLAN Actuarial Assumptions Actuarial valuation information relative to the determination of contributions:Valuation date:December 31, 2023Measurment date:December 31, 2023Methods and assumptions used to determine contribution rates:Actuarial cost method Entry Age NormalAmortization method Level percentage of payAsset valuation method 5 year smoothingRemaining amortization period 15 yearsInvestment rates of return 6.93% (net of investment expenses, including inflation)Discount rate 7.18Salary rate increase 3.00 in the long-term plus merit and longevityInflation rate 2.50%Mortality Pub-2010 and fully generational MP-2019 Changes in assumptions: Plan Year2023 Discount rate was lowered from 7.25% to 7.18%.Investment rate of return was lowered from 7.00%to 6.93%,net of administrative andinvestment expenses.2022 Discount rate was lowered from 7.60% to 7.25%.Investment rate of return was lowered from 7.35%to 7.00%,net of administrative andinvestment expenses.2021 Mortality rates were updated to be based on the Pub-2010 mortality tables.2020 Increases in merit and longevity pay assumptions.2019 Salary increase was decreased from 3.75% to 3.00%.Discount rate was lowered from 8.00% to 7.60%.Investment rate of return was lowered from 7.75%to 7.35%,net of administrative andinvestment expenses.2015 Mortality rates were updated to be based on the RP-2014 group mortality tables.Salary increase was decreased from 4.50% to 3.75%.Discount rate was lowered from 8.25% to 8.00%.Investment rate of return was lowered from 8.00%to 7.75%,net of administrative andinvestment expenses. Changes of benefits terms: Plan Year2021 Changes to service credit qualifications and included employees2016Changes to service credit purchase estimates
TRI-COUNTY AGING CONSORTIUM
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION (CONTINUED)
YEAR ENDED SEPTEMBER 30, 2024
41
NOTE 2 - EXCESS OF EXPENDITURES OVER APPROPRIATIONS The Consortium’s budgeted expenditures in the General and Special Revenue funds have been shown at the activity level. The approved budgets of the Consortium have been adopted at the total expenditure level for the General and Special Revenue funds. During the year ended September 30, 2024, the Consortium incurred expenditures in excess of the amounts appropriated as follows: Amounts Appropriated Amounts Expended VarianceGrants Special Revenue Fund 47,421,431$ 47,981,218$ (559,787)$
42
OTHER SUPPLEMENTARY INFORMATION
TRI-COUNTY AGING CONSORTIUM
GRANTS SPECIAL REVENUE FUND - BY PROGRAM
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE
YEAR ENDED SEPTEMBER 30, 2024
43
Title III C2State HomeTitle III Title III B Title III C1 DeliveredAdministrativeServicesNutritionMealsREVENUESIntergovernmentalFederal179,458$ 402,147$ 237,129$ 479,882$ State 31,244 - 9,321 501,493 Medicaid waiver program - - - - Local grants - - - 39,904 Program revenues - - 49,975 126,525 Contributions 1,651 100 - 91,379 TOTAL REVENUES 212,353 402,247 296,425 1,239,183 EXPENDITURESCurrentHealth and welfareSalaries and wages 128,542 112,767 129,865 440,647 Fringe benefits 71,584 73,968 43,712 157,391 Operating expenditures 7,979 5,094 124,121 876,564 Professional services 370 1,483 4,549 32,352 Subcontractor expenditures - 168,413 - - Travel and training - 4,936 4,282 48,821 Total health and welfare 208,475 366,661 306,529 1,555,775 Debt service 3,878 - 11,945 87,596 TOTAL EXPENDITURES 212,353 366,661 318,474 1,643,371 EXCESS OF REVENUES OVER(UNDER) EXPENDITURES - 35,586 (22,049) (404,188) OTHER FINANCING SOURCES (USES)Transfers in - - 30,000 429,743 Transfers out - (35,586) - - TOTAL OTHER FINANCINGSOURCES (USES)- (35,586) 30,000 429,743 NET CHANGE IN FUND BALANCE - - 7,951 25,555 Fund balance, beginning of year - - (185,385) 153,771 Fund balance, end of year -$ -$ (177,434)$ 179,326$
44
Title III C2Supplemental Title III D Crisis HCBS Alternative CareNutritionServicesManagementWaiverCareManagement
-$ 19,427$ -$ -$ -$ -$ 263,352 - - - 142,137 215,913 - - - 37,950,327 - - 571,177 - - 41,869 - - - - - - - - - - 400 - - 3,028 834,529 19,427 400 37,992,196 142,137 218,941
73,354 - - 3,252,909 - 124,410 31,788 - - 1,350,576 - 43,928 442,228 - - 429,693 - 22,833 - - - 147,430 - 8,386 - 19,427 154,472 33,516,760 142,137 80,985 - - - 65,239 - 3,288 547,370 19,427 154,472 38,762,607 142,137 283,830 - - - 85,320 - 7,111 547,370 19,427 154,472 38,847,927 142,137 290,941
287,159 - (154,072) (855,731) - (72,000)
- - 154,072 - - 72,000 (287,159) - - (72,000) - -
(287,159) - 154,072 (72,000) - 72,000 - - - (927,731) - - - - - 8,761,687 - - -$ -$ -$ 7,833,956$ -$ -$
TRI-COUNTY AGING CONSORTIUM
GRANTS SPECIAL REVENUE FUND - BY PROGRAM
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE (continued)
YEAR ENDED SEPTEMBER 30, 2024
45
REVENUESIntergovernmentalFederalStateMedicaid waiver programLocal grantsProgram revenuesContributionsTOTAL REVENUES EXPENDITURESCurrentHealth and welfareSalaries and wagesFringe benefitsOperating expendituresProfessional servicesSubcontractor expendituresTravel and trainingTotal health and welfareDebt serviceTOTAL EXPENDITURESEXCESS OF REVENUES OVER(UNDER) EXPENDITURESOTHER FINANCING SOURCES (USES)Transfers inTransfers outTOTAL OTHER FINANCINGSOURCES (USES)NET CHANGE IN FUND BALANCEFund balance, beginning of yearFund balance, end of year
Medicare/Medicaid Title III E StateRespiteAssistanceServicesIn-Home Care
-$ 78,130$ 124,808$ -$ 164,325 - - 754,147 - - - - - - - - 2,041 - - - - - - 3,682 166,366 78,130 124,808 757,829
- 50,364 67,431 - - 13,222 30,286 - - 1,976 3,615 - - - 388 - 166,366 - 11,030 731,793 - - 2,508 - 166,366 65,562 115,258 731,793 - - - - 166,366 65,562 115,258 731,793
- 12,568 9,550 26,036
- - - - - - (9,550) (26,036)
- - (9,550) (26,036) - 12,568 - - - 139,480 - - -$ 152,048$ -$ -$
46
Evidence Merit AgingState Access Title VII A Title VII Based Award NetworkServicesServicesElder Abuse Programs Respite Services
-$ 3,246$ 7,611$ -$ -$ -$ 28,842 - - 81,384 127,872 44,977 - - - - - - - - - 12,935 - - - - - 7,034 2,415 - - - - - - - 28,842 3,246 7,611 101,353 130,287 44,977
18,972 - - 39,970 - 24,090 8,576 - - 17,720 - 19,349 982 - - 45,680 11,508 840 100 - - 2,661 - 177 - 3,246 7,611 - 118,779 - 212 - - 1,306 - 521 28,842 3,246 7,611 107,337 130,287 44,977 - - - - - - 28,842 3,246 7,611 107,337 130,287 44,977
- - - (5,984) - -
- - - 5,984 - - - - - - - -
- - - 5,984 - - - - - - - - - - - - - - -$ -$ -$ -$ -$ -$
TRI-COUNTY AGING CONSORTIUM
GRANTS SPECIAL REVENUE FUND - BY PROGRAM
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE (continued)
YEAR ENDED SEPTEMBER 30, 2024
47
REVENUESIntergovernmentalFederalStateMedicaid waiver programLocal grantsProgram revenuesContributionsTOTAL REVENUES EXPENDITURESCurrentHealth and welfareSalaries and wagesFringe benefitsOperating expendituresProfessional servicesSubcontractor expendituresTravel and trainingTotal health and welfareDebt serviceTOTAL EXPENDITURESEXCESS OF REVENUES OVER(UNDER) EXPENDITURESOTHER FINANCING SOURCES (USES)Transfers inTransfers outTOTAL OTHER FINANCINGSOURCES (USES)NET CHANGE IN FUND BALANCEFund balance, beginning of yearFund balance, end of year
State ARPACaregiverElder Senior Title III B ARPASupportMillageAdministrativeTitle III B
-$ -$ 83,197$ 309,912$ 15,777 - 16,639 18,230 - - - - - 2,906,610 - - - 1,884 - - - - - - 15,777 2,908,494 99,836 328,142
- 446,024 62,089 67,009 - 197,425 27,029 23,098 - 386,648 8,580 340 - 1,017 227 129 15,777 1,990,044 - 236,560 - 10,619 56 1,006 15,777 3,031,777 97,981 328,142 - - 1,855 - 15,777 3,031,777 99,836 328,142
- (123,283) - -
- - - - - - - -
- - - - - (123,283) - - - 9,358 - - -$ (113,925)$ -$ -$
48
ARPA ARPA ARPA ARPA Title IIIARPANutritionNutritionTitle VII A Title III D AdminTitle III E Congregate MOW Ombudsman Health Promo ARP 2
128,175$ 50,332$ 228,820$ 7,718$ 33,053$ 5,231$ 25,635 2,961 13,460 - - 1,744 - - - - - - - - - - - - - - - - - - - 1,376 - - - - 153,810 54,669 242,280 7,718 33,053 6,975
91,258 - - - - 6,975 37,871 - - - - - 2,098 53,293 242,280 - - - 375 - - - - - 21,500 - - 7,718 33,053 - 708 - - - - - 153,810 53,293 242,280 7,718 33,053 6,975 - 1,376 - - - - 153,810 54,669 242,280 7,718 33,053 6,975
- - - - - -
- - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - -$ -$ -$ -$ -$ -$
TRI-COUNTY AGING CONSORTIUM
GRANTS SPECIAL REVENUE FUND - BY PROGRAM
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE (continued)
YEAR ENDED SEPTEMBER 30, 2024
49
REVENUESIntergovernmentalFederalStateMedicaid waiver programLocal grantsProgram revenuesContributionsTOTAL REVENUES EXPENDITURESCurrentHealth and welfareSalaries and wagesFringe benefitsOperating expendituresProfessional servicesSubcontractor expendituresTravel and trainingTotal health and welfareDebt serviceTOTAL EXPENDITURESEXCESS OF REVENUES OVER(UNDER) EXPENDITURESOTHER FINANCING SOURCES (USES)Transfers inTransfers outTOTAL OTHER FINANCINGSOURCES (USES)NET CHANGE IN FUND BALANCEFund balance, beginning of yearFund balance, end of year
Title III B Title III E Nutrition NutritionServicesServicesCongregateMOWARP 2 ARP 2 ARP 2 ARP 2
11,056$ 5,706$ 12,126$ 18,189$ 3,685 1,902 4,042 6,063 - - - - - - - - - - - - - - - - 14,741 7,608 16,168 24,252
7,353 - - - 6,553 - - - 123 - 16,168 24,252 62 - - - - 7,608 - - 650 - - - 14,741 7,608 16,168 24,252 - - - - 14,741 7,608 16,168 24,252
- - - -
- - - - - - - -
- - - - - - - - - - - - -$ -$ -$ -$
50
Eliminations Total
-$ 2,425,353$ - 2,475,145 - 37,950,327 - 3,572,495 - 189,874 - 101,616 - 46,714,810
- 5,144,029 - 2,154,076 - 2,706,895 - 199,706 - 37,433,279 - 144,152 - 47,782,137 - 199,081 - 47,981,218
- (1,266,408)
(430,331) 261,468 430,331 -
- 261,468 - (1,004,940) - 8,878,911 -$ 7,873,971$
TRI-COUNTY AGING CONSORTIUM
SUPPLEMENTAL SCHEDULE: FUNDED SERVICE CATEGORIES BY SOURCE
YEAR ENDED SEPTEMBER 30, 2024
51
Part B Part C1 Part C2 Part DCare Management -$ -$ -$ -$ Personal Care 29,124 - - - Homemaker 101,868 - - - Home Delivered Meals - - 328,571 - In Home Respite - - - - Case Coordination and Support 96,821 - - - Congregate Meals - 199,301 - - Kinship Respite Care - - - - Transportation 16,637 - - - Legal Assistance 3,835 - - - Information and Assistance 2,500 - - - Adult Day Care - - - - Elder Abuse Prevention - - - - Friendly Reassurance 8,854 - - - Caregiver Training 2,612 - - - Caregiver Information and Assistance - - - - Caregiver Outreach 7,500 - - - Disease Prevention/Health 9,550 - - 19,427 Program Development 82,300 - - - Crisis Services for the Elderly (RSD)26,036 - - - Ombudsman 8,360 - - - Options Counseling 6,150 - - - Administration (AAA)46,652 65,441 44,601 - 448,799$ 264,742$ 373,172$ 19,427$
52
StatePart E Part EAP Part VII A NSIP State Access In-Home-$ -$ -$ -$ -$ -$ - - - - - - - - - - - 728,111 - - - 151,311 - - - - - - - - - - - - - - - - - 37,828 - - 11,030 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 7,611 - - - - - - - - - - - - - - 28,842 - 14,230 - - - - - 45,000 - - - - - 9,550 - - - - - - - - - - - - - - - - 26,036 - - 3,246 - - - 44,998 - - - - - 22,764 - - - - - 147,572$ 7,611$ 3,246$ 189,139$ 28,842$ 754,147$
TRI-COUNTY AGING CONSORTIUM
SUPPLEMENTAL SCHEDULE: FUNDED SERVICE CATEGORIES BY SOURCE (continued)
YEAR ENDED SEPTEMBER 30, 2024
53
Care ManagementPersonal CareHomemakerHome Delivered MealsIn Home RespiteCase Coordination and SupportCongregate MealsKinship Respite CareTransportationLegal AssistanceInformation and AssistanceAdult Day CareElder Abuse PreventionFriendly ReassuranceCaregiver TrainingCaregiver Information and AssistanceCaregiver OutreachDisease Prevention/HealthProgram DevelopmentCrisis Services for the Elderly (RSD)OmbudsmanOptions CounselingAdministration (AAA)
State State HomeCongregateDeliveredMealsMeals State NHO State Alt Care-$ -$ -$ -$ - - - - - - - 113,131 - 501,493 - - - -- - - -- - 9,321 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 19,268 - - - -- - 25,493 - 5,751 9,321$ 526,986$ 19,268$ 118,882$
54
StateState Care State Merit Caregiver StateState MSO Management Award Support Respite Care State ANS-$ 215,913$ -$ -$ -$ -$ - - - - - - - - - - - - - - - - - - - - 1,000 15,777 125,048 - - - -- - 17,024 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 27,953 - - 115,364 - 39,277 - - - - - -- - - - - -- - - - - -- - - - - -- - - - - -- - - - - -- - - - - -- - - - - -- 9,738 - - - -- - - - - -- - - 11,508 - -- 9,738$ 215,913$ 127,872$ 15,777$ 164,325$ 44,977$
TRI-COUNTY AGING CONSORTIUM
SUPPLEMENTAL SCHEDULE: FUNDED SERVICE CATEGORIES BY SOURCE (continued)
YEAR ENDED SEPTEMBER 30, 2024
55
Care ManagementPersonal CareHomemakerHome Delivered MealsIn Home RespiteCase Coordination and SupportCongregate MealsKinship Respite CareTransportationLegal AssistanceInformation and AssistanceAdult Day CareElder Abuse PreventionFriendly ReassuranceCaregiver TrainingCaregiver Information and AssistanceCaregiver OutreachDisease Prevention/HealthProgram DevelopmentCrisis Services for the Elderly (RSD)OmbudsmanOptions CounselingAdministration (AAA)
Program Income Cash Match In-kind Match Total-$ 23,991$ -$ 239,904$ - - - 29,124 3,682 - 69,480 1,016,272 55,270 - 55,722 1,092,367 4,456 - 16,027 162,308 - - 1,893 115,738 1,174 - 1,036 248,660 - - - 11,030 - - - 16,637 - - - 3,835 - - 3,106 33,559 - - 8,364 163,005 - - - 7,611 - - - 8,854 - - - 31,454 - - - 14,230 - - - 52,500 - - - 38,527 - - 3,205 85,505 - - 2,893 54,965 - - 3,223 43,835 - - - 51,148 - - - 222,210 64,582$ 23,991$ 164,949$ 3,743,278$
TRI-COUNTY AGING CONSORTIUM
SUPPLEMENTAL SCHEDULE: FUNDED SERVICE CATEGORIES BY SOURCE (continued)
YEAR ENDED SEPTEMBER 30, 2024
56
American Rescue Plan Act (ARPA) Title III B Title III C1 Title III C2 Title III DPersonal Care 18,000$ -$ -$ -$ Homemaker 91,335 - - - Home Delivered Meals - - 266,532 - In Home Respite - - - - Case Coordination and Support 69,823 - - - Congregate Meals - 69,461 - - Kinship Respite Care - - - - Legal Assistance 23,225 - - - Information and Assistance 72,500 - - - Friendly Reassurance 29,100 - - - Caregiver Transportation 2,400 - - - Disease Prevention/Health - - - 33,053 Program Development 36,500 - - - CLP/ADRC - - - - Ombudsman - - - - Administration (AAA)35,647 23,944 35,904 - TOTAL EXPENDITURES 378,530$ 93,405$ 302,436$ 33,053$
57
Title III E Title VII In-kind Match ARPA Total-$ -$ 2,000$ 20,000$ - - 10,148 101,483 - - 26,921 293,453 24,508 - 2,389 26,897 - - 6,120 75,943 - - 5,922 75,383 4,600 - - 4,600 - - 2,581 25,806 92,179 - 18,298 182,977 - - 3,233 32,333 - - 267 2,667 - - - 33,053 - - 4,056 40,556 40,131 - 4,459 44,590 - 7,718 - 7,718 11,316 - 11,094 117,905 172,734$ 7,718$ 97,488$ 1,085,364$
TRI-COUNTY AGING CONSORTIUM
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED SEPTEMBER 30, 2024
58
Assistance Pass-ThroughListingGrantor's FederalNumberNumberExpendituresU.S. DEPARTMENT OF HEALTH AND HUMAN SERVICESPassed through Michigan Aging and Adult Services AgencyTitle VII Elder Abuse Prevention 93.041 20243444 7,611$ Title VIIA Services - LTC Ombudsman 93.042Regular 20243444 3,246COVID-19 Regular - ARP 20243444 7,718 10,964 Special Programs for the Aging, Title III, Part DDisease Prevention and Health Promotion Services 93.043Regular 20243444 19,427 COVID-19 - ARP 20243444 33,053 52,480 Aging Cluster (a)(b)Special Programs for the Aging, Title III, Part B Grants for Supportive Services and Senior Centers 93.044Regular 20243444 402,147COVID-19 Regular - ARP 20243444 309,912 Administration 20243444 46,652 COVID-19 Administration - ARP 20243444 28,342 COVID-19 Administration - ARP2 20243444 1,228 COVID-19 Supportive Services - ARP2 20243444 11,056 799,337 Special Programs for the Aging, Title III, Part CNutrition Services 93.045Administration 20243444 110,042Congregate Meals 20243444 199,301COVID-19 Congregate Meals - ARP 20243444 50,332 Home Delivered Meals 20243444 328,571 COVID-19 Home Delivered Meals - ARP 20243444 228,820 COVID-19 Administration - ARP 20243444 46,131 COVID-19 Administration - ARP2 20243444 3,368 COVID-19 Congregate Meals - ARP2 20243444 12,126 COVID-19 Home Delivered Meals - ARP2 20243444 18,189 996,880 Nutrition Services Incentive Program 93.053Home Delivered Meals 20243444 151,311 Congregate Meals 20243444 37,828 189,139Total Aging Cluster 1,985,356 National Caregiver Support, Title III, Part E 93.052Regular 20243444 124,808COVID-19 Regular - ARP 20243444 128,175 COVID-19 Family Caregivers - ARP2 20243444 5,706 COVID-19 Administration - ARP 20243444 8,724 COVID-19 Administration - ARP2 20243444 635 Administration 20243444 22,764 290,812Total passed through Michigan Aging and Adult Services Agency 2,347,223
Program or Cluster TitleFederal Grantor/Pass-Through Grantor/
The accompanying notes are an integral partof this schedule.
TRI-COUNTY AGING CONSORTIUM
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (continued)
YEAR ENDED SEPTEMBER 30, 2024
59
Assistance Pass-ThroughListingGrantor's FederalNumberNumberExpendituresU.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES (continued)Passed through MMAP, Inc.Special Programs for the Aging, Title IV and Title II Discretionary Projects 93.048Senior Medicare Patrol 90MPPG0039 26,982$ Medicare Enrollment Assistance Programs 93.071Medicare Improvements for Patients and Providers Act 2201MIMISH/2201IMIMIAA 14,309 State Health Insurance Assistance 93.324Centers for Medicare and Medicaid Services 90SAPG0090 36,839 Total passed through MMAP, Inc.78,130 TOTAL FEDERAL AWARD EXPENDITURES 2,425,353$
Federal Grantor/Pass-Through Grantor/Program or Cluster Title
The accompanying notes are an integral partof this schedule.
TRI-COUNTY AGING CONSORTIUM
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
YEAR ENDED SEPTEMBER 30, 2024
60
NOTE 1 - BASIS OF PRESENTATION The accompanying Schedule of Expenditures of Federal Awards (the “Schedule”) includes the federal grant activity of the Tri-County Aging Consortium (the Consortium) under programs of the federal government for the year ended September 30, 2024. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Consortium, it is not intended to and does not present the financial position or changes in net position of the Tri-County Aging Consortium.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts (if any) shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. The Tri-County Aging Consortium has elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.
NOTE 3 - SUBRECIPIENTS No Federal Awards were passed through by the Consortium to any subrecipients during the year.
NOTE 4 - SUMMARY OF SIGNIFICANT EXPLANATIONS OF SCHEDULE The following descriptions identified below as (a) - (b) represent explanations that cross reference to amounts on the Schedule of Expenditures of Federal Awards: (a)Denotes programs tested as “major programs”.(b)Denotes programs required to be clustered by United States Department of Health and Human Services.
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INDEPENDENT AUDITOR’S 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 To the Board of Directors of the Tri-County Aging Consortium Lansing, Michigan 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 the governmental activities, each major fund, and the aggregate remaining fund information of the Tri-County Aging Consortium (the Consortium), as of and for the year ended September 30, 2024, and the related notes to the financial statements, which collectively comprise the Consortium’s basic financial statements and have issued our report thereon dated March 7, 2025.
Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the Consortium’s internal control over financial reporting (internal control) 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 of the Consortium’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Consortium’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 a 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 the limitations, during the audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
62
Compliance and Other Matters As part of obtaining reasonable assurance about whether the Consortium’s financial statements are free from 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 and the results of that testing, and not to provide an opinion on the effectiveness of the entity’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 entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. March 7, 2025
63
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM
AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE To the Board of Directors of the Tri-County Aging Consortium Lansing, Michigan
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program We have audited the Tri-County Aging Consortium’s (the Consortium) compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on the Consortium’s major federal programs for the year ended September 30, 2024. The Consortium’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs. In our opinion, the Tri-County Aging Consortium complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended September 30, 2024.
Basis for Opinion on Each Major Federal Program We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal
Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal
Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report. We are required to be independent of the Consortium and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal determination of the Consortium’s compliance with the compliance requirements referred to above.
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the Consortium’s federal programs.
64
Auditor’s Responsibilities for the Audit of Compliance Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the Consortium’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the Consortium’s compliance with the requirements of each major federal program as a whole. In performing an audit in accordance with generally accepted auditing standards, Government Auditing
Standards, and the Uniform Guidance, we:
➢ Exercise professional judgment and maintain professional skepticism throughout the audit.
➢ Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the Consortium’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.
➢ Obtain an understanding of the Consortium’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of the Consortium’s internal control over compliance. Accordingly, no such opinion is expressed. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.
Report on Internal Control Over Compliance A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.
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Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose. March 7, 2025
TRI-COUNTY AGING CONSORTIUM
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
YEAR ENDED SEPTEMBER 30, 2024
66
Section I - Summary of Auditor’s Results
Financial Statements Type of auditor’s report issued based on financial statements prepared in accordance with generally accepted accounting principles: Unmodified Internal control over financial reporting:
➢ Material weakness(es) identified? Yes X No
➢ Significant deficiency(ies) identified? Yes X None reported Noncompliance material to financial statements noted? Yes X No
Federal Awards Internal control over major programs:
➢ Material weakness(es) identified? Yes X No
➢ Significant deficiency(ies) identified? Yes X None reported Type of auditor’s report issued on compliance for major programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)? Yes X No Identification of major programs: Assistance Listing Number(s) Name of Federal Program or Cluster 93.044, 93.045, 93.053 Aging Cluster Dollar threshold used to distinguish between Type A and Type B programs: $ 750,000 Auditee qualified as low-risk auditee? X Yes No
Section II - Financial Statement Findings None noted.
Section III - Federal Award Findings and Questioned Costs None noted.
TRI-COUNTY AGING CONSORTIUM
SUMMARY SCHEDULE OF PRIOR YEAR AUDIT FINDINGS
YEAR ENDED SEPTEMBER 30, 2024
67
FINDINGS/COMPLIANCE Control Deficiencies and Material Weaknesses Related to Internal Controls Over the Financial Statements. No prior audit findings noted. Findings Related to Compliance with Requirements Applicable to the Financial Statements. No prior audit findings noted. Findings Related to Compliance with Requirements Applicable to Federal Awards and Internal Control Over Compliance in Accordance with the Uniform Guidance. No prior audit findings noted.