The URL can be used to link to this page

2008-2009 Arena Audit?r,F�NiNNRr DRAPOT SUBJECT TO REVISION STMA ARENA, INC. FINANCIAL STATEMENTS JUNE 30, 2009 AND 2008 SCHLENNER WENNER & CO. Certified Public Accountants & Business Consultants STMA ARENA, INC. TABLE OF CONTENTS P REUMINARY DRAFT INDEPENDENT AUDITORS' REPORTS ............................. ,.., es.... R -0-N ....................... EQUIRED SUPPLEMENTARY INFORMATION. Management's Discussion and Analysis ......................................................................................... ............................... 2 BASIC FINANCIAL STATEMENTS: Statementsof Net Assets ................................................................................................................ ............................... 5 Statements of Revenues, Expenses and Changesin Net Assets ............................................................................................................. ............................... 6 Statementsof Cash Flows ............................................................................................................... ............................... 7 Notes to Basic Financial Statements ............................................................................................... ............................... 8 OTHER REPORTS: INDEPENDENT AUDITORS' REPORTS ON LEGAL COMPLIANCE ............................ ............................... 17 11 10 f INDEPENDENT AUDITS 'E � 1 I'l M_ ay 27,; 2008 Board of Directors STMA Arena, Inc. Albertville, Minnesota We have audited the accompanying statements ofnet assets of STMA Arena, Inc. (the Arena), as of and for the fiscal years ended June 30, 2009 and 2008, and the related statements of revenues, expenses and changes in net assets and cash flows for the years then ended. These financial statements are the responsibility of the Arena's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of STMA Arena, Inc., as of June 30, 2009 and 2008, and the changes in its net assets and its cash flows thereof for the years then ended in conformity with accounting principles generally accepted in the United States of America. The management's discussion and analysis on pages two through four are not a required part of the basic financial statements but are supplementary information required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries ofmanagement regarding the methods ofineasurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. SCHLENNER WENNER & CO. St. Cloud, Minnesota STMA ARENA�INC. V' MANAGEMENT'S DISCUSSIq AWD�A�N FOR THE YEAR ENDED NE 3.iS'Z°0 vI ,Vd Our discussion and analysis of STMA Arena, Inc.'s financial performance provides an overview of the Arena's financial activities for the fiscal years ended June 30, 2009 and 2008. Please read it in conjunction with the transmittal letter on page one and the Arena's financial statements, which begin on page five. FINANCIAL HIGHLIGHTS • The Arena's net assets increased approximately $220,000 compared to the prior year as a result of this year's operations. • During the year, the Arena's total operating revenues increased approximately $36,000 due largely to increased ice time and additional advertising revenue. Operating expenses increased approximately $30,000 due largely to an increase in utilities and professional fees. Nonoperating revenues include approximately $217,000 related to debt forgiveness unique to the current year. USING THIS ANNUAL REPORT This annual report consists of a series of financial statements. The Statements of Net Assets and the Statements of Revenues, Expenses and Changes in Net Assets (on pages five and six) provide information about the activities of the Arena as a whole and present a view of the Arena's finances. Since the Arena has only business -type activities, only enterprise fund financial statements are required. The information provided in this discussion and analysis is based on the fact that only fund financial statements are prepared. Reporting the Arena Our analysis of the Arena begins on page five. One of the most important questions asked about the Arena's finances is, "Is the Arena as a whole better off or worse off as a result of the year's activities ? ". The Statements of Net Assets and the Statements of Revenues, Expenses and Changes in Net Assets report information about the Arena and about its activities in a way that helps answer this question. These statements include all assets and liabilities using the accrual basis of accounting, which is similar to the accounting used by most private- sector companies. All of the current year's revenues and expenses are taken into account regardless of when cash is received or paid. These two statements report the Arena's net assets and changes in them. You can think of the Arena's net assets (the difference between assets and liabilities) as one way to measure the Arena's financial health, or financial position. Over time, increases or decreases in the Arena's net assets are one indicator of whether its financial health is improving or deteriorating. You will need to consider other nonfinancial factors, however, such as the condition of the Arena's fixed assets, to assess the overall health of the Arena. The Arena charges a fee to customers to help it cover all or most of the cost of certain services it provides. The Arena's combined net assets increased approximately $220,000 from a year ago. Our analysis below focuses on the net assets (Table 1) and changes in net assets (Table 2). STMA ARENA, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENIE 00 y D P1. 1 Table 1- Net' s1`FC' � $. 1 2008 U%�ii�a 0i Current Assets $ 42,536 $ 82,105 Net Capital Assets 1,307,292 1,327,243 Total Assets 1,349,828 1,409,348 Current Liabilities 60,159 71,958 Long -Term Liabilities - 267,489 Total Liabilities 60,159 339,447 Net Assets: Invested in Capital Assets, Net of Debt Unrestricted Net Assets Total Net Assets 1,257,138 994,345 32,531 75,556 $ 1,289,669 $ 1,069,901 The net assets of the Arena's activities increased by approximately $220,000 or 20.5 %. This increase is generally due to forgiveness of debt and contributions not typically recognized by the Arena on a yearly basis. Table 2 - Changes in Net Assets Inno IMR Operating Revenues $ 318,801 $ 283,105 Expenses Operating Expenses 311,468 281,620 Interest Expense 4,899 10,673 Total Program Expenses 316,367 292,293 Net Income (Loss) 2,434 (9,188) Other Income 217,334 - Change in Net Assets $ 219,768 $ (9,188) The Arena's total operating revenues increased by approximately $36,000 or 12.6 %. The total cost of all services increased by approximately $24,000 or 8.2% primarily due to increased utility and professional fees. Other, nonoperating revenue, increased approximately $217,000 due to debt forgiveness during the current fiscal year as compared to the prior year. The Arena did not add any new services during the current year. As the Arena completed the year, the Arena reported combined net assets of approximately $1,289,700 compared to $1,069,900 at the end of the prior year. Operations and activities are very similar for the Arena for both years presented except as discussed above with regard to forgiveness of debt. 3 STMA ARENAJI.SC. MANAGEMENT'S DISCUSS FOR THE YEAR ENDE 'AF i iJ ��j � CAPITAL ASSET AND DEBT ADMINISTRATION 10 REV11S!'vniv i, Capital Assets At the end of June 30, 2009, the Arena had approximately $1,877,000 invested in a broad range of capital assets including land, land improvements, building and improvements, and equipment. Please refer to Table 3 below. Land Land Improvements Buildings & Improvements Equipment Construction in Progress Totals Table 3 - Capital Assets at Year -End 2009 2008 102,000 $ 102,000 7,795 7,795 1,590,826 1,567,128 164,687 164,687 12,000 9,000 $ 1,877,308 $ 1,850,610 Long -term, the Arena is pursing ice expansion for projected costs of $4.5 million. The Arena is currently pursuing funding for such an expansion. More detailed information about the Arena's capital assets is presented in Note 1 to the financial statements. Debt As shown in Table 4, the Arena has approximately $50,000 in debt outstanding at June 30, 2009, versus $333,000 last year. This is a decrease of approximately $283,000. The decrease relates to regular payments and forgiveness of debt of approximately $217,000 during the current year. Long -Term Debt Table 4 - Outstanding Debt at Year -End 2009 2008 $ 50,154 $ 332,898 Management does foresee debt issuance in the future for ice expansion planned in the next two to three years. ECONOMIC FACTORS AND NEXT YEAR'S ANTICIPATED RESULTS The Arena's officials considered many factors when setting the fiscal year 2009 budget (which is not required to be disclosed under accounting principles generally accepted in the United States of America). The Arena anticipates revenues and related expenses for fiscal year 2010 to be similar to that of fiscal year 2009 with the exception of the debt forgiveness during the current year. CONTACTING THE ARENA'S FINANCIAL MANAGEMENT This financial report is designed to provide our customers and creditors with a general overview of the Arena's finances and to show the Arena's accountability for the money it receives. If you have questions about this report or need additional financial information, contact the Arena's internal accountant, Barb Kolling at 763 - 497 -3180. R E S UBJEC T TO REVISit'llill FINANCIAL STATEMENTS The financial statements include integrated sets of financial statements as required by the GASB. The sets of statements include: Statements of Net Assets Statements of Revenues, Expenses and Changes in Net Assets Statements of Cash Flows In addition, the notes to the financial statements are included to provide information that is essential to a user's understanding of the financial statements. STMA �I py 1 D A, STATEMENf`i ij�� JUNE 30, 8 JE 2009 2008 ASSETS CURRENT ASSETS Cash Accounts Receivable Prepaid Insurance Total Current Assets CAPITAL ASSETS (NET) TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Accounts Payable Accrued Salaries and Wages Current Portion of Long -Term Debt Total Current Liabilities LONG -TERM LIABILITIES Long -Term Debt, Net of Current Portion Total Long -Term Liabilities TOTAL LIABILITIES NET ASSETS Invested in Capital Assets, Net of Related Debt Unrestricted Net Assets TOTAL NET ASSETS $ 14,063 $ 74,280 22,352 1,740 6,121 6,085 42,536 82,105 1,307,292 1,327,243 1,349,828 1,409,348 8,530 4,762 1,475 1,787 50,154 65,409 60,159 71,958 267,489 - 267,489 60,159 339,447 1,257,138 994,345 32,531 75,556 $ 1,289,669 $ 1,069,901 See accompanying notes. 5 STMA ARENA, IrNC�.! STATEMENTS OF REVENUES, EXPENSE AND' bIA1�i0EkSI1iNEE T'#A9SETIIS FOR THE YEARS ENDED 01 09�1' " 2008 f t�l UU li` OPERATING REVENUES Ice Time Concessions Admissions Advertising Income Contributions Miscellaneous TOTAL OPERATING REVENUES OPERATING EXPENSES Wages, Benefits and Taxes Professional Fees Concessions Depreciation Ice Resurfacer Expense Insurance License and Permits Office Supplies Repairs and Maintenance Telephone Gas and Electric Refuse Water Miscellaneous TOTAL OPERATING EXPENSES NET OPERATING INCOME NONOPERATING REVENUES AND (EXPENSE) Forgiveness of Debt Interest Expense TOTAL NONOPERATING REVENUES AND (EXPENSE) NET INCOME (LOSS) NET ASSETS, BEGINNING OF YEAR NET ASSETS, END OF YEAR 2009 2008 $ 252,707 $ 201,897 27,273 25,284 10,206 9,669 11,033 37,593 15,498 - 2,084 8,662 318,801 283,105 102,351 98,384 9,974 1,497 13,184 9,053 46,649 47,090 4,491 4,063 8,517 7,486 445 430 5,881 4,105 25,507 30,541 1,538 1,507 73,070 64,507 1,397 1,632 15,310 9,377 3,154 1,948 311,468 281,620 7,333 1,485 217,334 - (4,899) (10,673) 212,435 (10,673) 219,768 (9,188) 1,069,901 1,079,089 $ 1,289,669 $ 1,069,901 See accompanying notes. 6 STMA ARENA, INC. STATEMENTS 0 FOR THE YEARS ENDED ` `N VVRAR , �o@R A F T SUBJECT TO RE�0 1 10,N 2008 CASH FLOWS - OPERATING ACTIVITIES: Cash Received from Customers and Donors $ 298,189 $ 308,673 Cash Paid to Suppliers (158,736) (137,934) Cash Paid to Employees (102,663) (96,597) Net Cash Flows - Operating Activities 36,790 74,142 CASH FLOWS - CAPITAL AND RELATED FINANCING ACTIVITIES: Interest Paid on Capital Debt (4,899) (10,672) Purchase of Capital Assets (26,698) (9,000) Payment of Capital Debt (65,410) (103,067) Net Cash Flows - Capital and Related Financing Activities (97,007) (122,739) Net Change in Cash (60,217) (48,597) Cash, Beginning of Year Cash, End of Year CASH FLOWS - OPERATING ACTIVITIES: Net Income Adjustments to Reconcile Net Income to Net Cash Flows - Operating Activities Depreciation Expense Change in Assets and Liabilities: Accounts Receivable Prepaid Insurance Pledges Receivable Accounts Payable Accrued Salaries and Wages Deferred Revenue NET CASH FLOWS - OPERATING ACTIVITIES: NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES: Forgiveness of Debt Contsrution in Progress put into Buildings & Improvements due to completion of project 74,280 122,877 $ 14,063 $ 74,280 $ 7,333 $ 1,485 46,649 47,090 (20,612) (36) 3,768 (312) $ 36,790 8,889 (1,086) 35,439 (702) 1,787 (18,760) $ 74,142 $ 217,334 $ $ 9,000 $ See accompanying notes. 7 STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STATE E a INDEX j' t f � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING P �' o +>�U A. Financial Reporting Entity B. Measurement Focus and Basis of Accounting C. Use of Estimates D. Assets, Liabilities, and Equity E. Revenues, Expenditures, and Expenses NOTE 2 STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY A. Fund Accounting Requirements B. Deposit Compliance NOTE 3 DETAIL NOTES ON TRANSACTION CLASSES /ACCOUNTS A. Cash and Investments B. Restricted Assets C. Capital Assets D. Long Term Debt E. Equipment Under Capital Leases NOTE 4 OTHER NOTES A. Related Party Transactions B. Defined Benefit Pension Plans — Statewide C. Risk Management D. Commitments STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STATEMEN6 *Y; JUNE 30,200A n I- 1 J !,A I m NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTIN I o STMA Arena, Inc. (the Arena), complies with generally accepted accounting principles (GAAP). GAAP includes all relevant Governmental Accounting Standards Board (GASB) pronouncements. In the fund financial statements for the proprietary funds, Financial Accounting Standards Board (FASB) pronouncements and Accounting Principles Board (APB) opinions issued on or before November 30, 1989, have been applied unless those pronouncements conflict with or contradict GASB pronouncements, in which case GASB prevails. For enterprise funds, GASB Statement Nos. 20 and 34 provide the Arena the option of electing to apply FASB pronouncements issued after November 30, 1989. The Arena has elected not to apply those pronouncements. The accounting and reporting framework and the more significant accounting policies are discussed in subsequent subsections of this Note. I.A. FINANCIAL REPORTING ENTITY The Arena's financial reporting entity is comprised of an enterprise fund for the Joint Power operations of an ice arena that is owned one -third each by the City of St. Michael, the City of Albertville, and Independent School District No. 885 (the Joint Powers). The Arena and its operations are located in the City of Albertville, Minnesota. The Arena is a business -type only proprietary fund which only requires the fund financial statements to be presented along with the Management Discussion and Analysis (unaudited), the Notes to the financial statements and Required Supplementary Information, if applicable. 1.11. MEASUREMENT FOCUS AND BASIS OF ACCOUNTING Measurement focus is a term used to describe "which" transactions are recorded within the various financial statements. Basis of accounting refers to "when" transactions are recorded regardless of the measurement focus applied. Measurement Focus The Arena utilizes an "economic resources" measurement focus. The accounting objectives of this measurement focus are the determination of operating income, changes in net assets (or cost recovery), financial position, and cash flows. All assets and liabilities (whether current or noncurrent) associated with their activities are reported. Equity for the Arena is classified as net assets. Basis of Accounting The financial statements are presented using the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or economic asset used. Revenues, expenses, gains, losses, assets, and liabilities resulting from exchange and exchange -like transactions are recognized when the exchange takes place. I.C. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2009 �! r � NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLL S",- in e 4 j l ► ►� 1.1). ASSETS, LIABILITIES, AND EQUITY 60 Q 6 V Cash For purposes of the Statements of Net Assets, "cash" includes all demand and savings accounts for the Arena. For the purpose of the Statements of Cash Flows, "cash" includes all demand and savings accounts. The Arena does not currently carry any investments. Receivables Accounts receivables consist of all revenues earned at year -end and not yet received. Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging of accounts receivable. Receivables are invoiced approximately every 30 days. Prepaid Insurance Prepaid insurance represents expenses paid during the current year to be recognized in future periods. Capital Assets Capital assets are valued at historical cost. Many assets maintained on the Arena's financial statements were purchased by any one of the three joint powers and therefore may be legally titled to such entity. Depreciation of all exhaustible capital assets is recorded as an allocated expense in the statements of revenues, expenses and changes in net assets, with accumulated deprecation reflected in the statements of net assets. Depreciation is provided over the estimated useful lives of the assets using the straight -line method of depreciation. The range of estimated useful lives by type of asset is as follows: Buildings & Improvements 7 -40 years Land Improvements 15 years Equipment 3 -7 years Classification of depreciation on assets acquired under capital leases: The depreciation expense on assets acquired under capital leases is included with depreciation expense on owned assets. 9 STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STATEMENTS JUNE 30, 2009 1 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTINGiP6 h t u \ 1.13. ASSETS LIABILITIES AND (Continued) EQUITY n Q tmued) � � � y Equity Classifications Equity is classified as net assets and displayed in three components: a. Invested in capital assets, net of related debt - Consists of capital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. b. Restricted net assets - Consists of net assets with constraints placed on the use either by 1) external groups such as creditors, grantors, contributors, or laws or regulations of other governments; or 2) law through constitutional provisions or enabling legislation. The Arena does not have any such equity at June 30, 2009 and 2008. c. Unrestricted net assets - All other net assets that do not meet the definition of "restricted" or "invested in capital assets, net of related debt." I.E. REVENUES, EXPENDITURES, AND EXPENSES Operating Revenues and Expenses Operating revenues for proprietary funds are those that result from providing services and producing and delivering goods and/or services. Operating revenues consist of those associated with the principal activity of the Arena, use of the ice arena and related services. Operating expenses are defined as expenses directly related to, or incurred in support of, the services provided. All other expenses are classified as nonoperating expenses. NOTE 2 STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY 2.A. FUND ACCOUNTING REQUIREMENTS By its nature as a government unit, the Arena is subject to various federal, state, and local laws and contractual regulations. The Arena complies with all state and local laws and regulations requiring the use of separate funds. 2.B. DEPOSIT COMPLIANCE In accordance with state law, all uninsured deposits of municipal funds in financial institutions must be secured with acceptable collateral valued at the lower of market or par. NOTE 3 DETAIL NOTES ON TRANSACTION CLASSES /ACCOUNTS The following notes present detail information to support the amounts reported in the financial statements for its various assets, liabilities, net assets, revenues, and expenses. 3.A. CASH AND INVESTMENTS Deposits In accordance with applicable Minnesota Statutes, the Arena maintains deposits at depository banks authorized by the Arena's Board. 10 STMA ARENA, INC.', e NOTES TO THE BASIC FINANCIAL STATE P( JUNE 30, 2009 NOTE 3 DETAIL NOTES ON TRANSACTION CLASSES /AC S0 tinued) 3.A. CASH AND INVESTMENTS (Continued) Deposits (Continued) Minnesota Statutes require that all Arena deposits be protected by insurance, surety bond, or collateral. The market value of collateral pledged must equal 110% of the deposits not covered by insurance or bonds. Authorized collateral includes treasury bills, notes, and bonds; issues of U.S. governmental agencies; general obligations rated "A" or better; revenue obligations rated "AA" or better; irrevocable standard letters of credit issued by the Federal Home Loan Bank and certificates of deposit. Minnesota Statutes require that securities pledged as collateral be held in safekeeping in a restricted account at the Federal Reserve bank or in an account at a trust department of a commercial bank or other financial institution that is not owned or controlled by the financial institution furnishing the collateral. The Arena does not have any deposit policies that would further limit deposit choices. At June 30, 2009 and 2008, the carrying amount of the Arena's cash deposits with financial institutions is $14,063 and $74,280 and the bank balance is $87,885 and $85,802, respectively. At June 30, 2009 and 2008, the bank balances are covered by federally insured limits (FDIC). Custodial Credit risk is the risk in the event of bank failure, the Arena's deposits may be returned to the Arena. The Arena's deposit policy for custodial credit risk requires compliance with the provisions of state law. In compliance with this policy, the Arena maintains deposits at depository banks authorized by the Arena's Board. 3.B. RESTRICTED ASSETS The Arena does not carry any restricted assets on its financial statements as of June 30, 2009 and 2008 NOTE 3 DETAIL NOTES ON TRANSACTION CLASSES /ACCOUNTS (Continued) 3.C. CAPITAL ASSETS Capital asset activity for the fiscal year ended June 30, 2009 is as follows: Land Land Improvements Buildings & Improvements Equipment Construction in Progress Totals at Historical Cost Less: Accumulated Depreciation Buildings & Improvements Land Improvements Equipment Total Accumulated Depreciation Capital Assets, Net Balance at Balance at July 01, 2008 Additions Disposals June 30, 2009 $ 102,000 $ - $ - $ 102,000 7,795 - - 7,795 1,567,128 23,698 - 1,590,826 164,687 - - 164,687 9,000 12,000 9,000 12,000 1,841,610 35,698 9,000 1,877,308 373,638 36,915 - 410,553 1,039 520 1,559 148,690 9,214 - 157,904 523,367 46,649 570,016 $ 1,318,243 $ (10,951) $ 9,000 $ 1,307,292 11 STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STATE r . �NT JUNE 30, 2009 NOTE 3 DETAIL NOTES ON TRANSACTION CLASSES /A CO'Y . Y9 t ued) 3.C. CAPITAL ASSETS (Continued) Capital asset activity for the fiscal year ended June 30, 2008 is as follows: Land Land Improvements Buildings & Improvements Equipment Construction in Progress Totals at Historical Cost Less: Accumulated Depreciation Buildings & Improvements Land Improvements Equipment Total Accumulated Depreciation Capital Assets, Net 3.D. LONG -TERM DEBT Balance at Balance at July 01, 2007 Additions Disposals June 30, 2008 $ 102,000 $ - $ - $ 102,000 7,795 - - 7,795 1,567,128 - - 1,567,128 164,687 - - 164,687 - 9,000 - 9,000 1,841,610 9,000 - 1,850,610 337,449 36,189 - 373,638 520 519 - 1,039 138,308 10,382 - 148,690 476,277 47,090 - 523,367 $ 1,365,333 $ (38,090) $ - $ 1,327,243 As of June 30, 2009 and 2008, long -term debt consists of the following: 1996 Debt Due to Joint Power (a related party). 2004 Capital Lease Payable - Due in full in May 2009. Interest rate was 7.00 %. Payments were due each May and December and amounted to $8,502 which included principal and interest. 2007 Note Payable - Joint Power City of Albertville (a related party). Interest rate is 4.0 %. Payments due each April and range from $52,198 to $55,277 which include principal and interest. Total Long -Term Debt Current Portion Noncurrent Portion Total Long -Term Debt 2009 2008 $ - $ 217,334 16,156 50,154 99,408 $ 50,154 $ 332,898 $ 50,154 $ 65,409 - 267,489 $ 50,154 $ 332,898 The 1996 debt due to the Joint Powers had no stated interest rate or payment schedule. The 1996 debt due to the Joint Powers was forgiven in October 2008. 12 STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STA NT s1 JUNE 30, 2009 +� NOTE 3 DETAIL NOTES ON TRANSACTION CLASSES /ACS, ( tint) Changes in Long -Term Debt The following is a summary of changes in long -term debt for the fiscal year ended June 30, 2009: Balance Type of Debt July 01, 2008 Additions Business -Type Activities: 1996 Due to Joint Power $ 217,334 $ 2004 Capital Lease Payable 16,156 2007 Note Paybale to Balance Due Within Deductions June 30, 2009 One Year - $ (217,334) $ - $ (16,156) - Joint Power 99,408 - (49,254) 50,154 50,154 Totals $ 332,898 $ - $ (282,744) $ 50,154 $ 50,154 The following is a summary of changes in long -term debt for the year ended June 30, 2008: Balance Type of Debt July 01, 2007 Additions Business -Type Activities: 1996 Due to Joint Power $ 217,334 $ - $ 2004 Capital Lease Payable 31,297 - 2007 Note Paybale to Balance Due Within Deductions June 30, 2008 One Year - $ 217,334 $ - (15,141) 16,156 16,156 Joint Power 187,334 - (87,926) 99,408 49,253 Totals $ 435,965 $ - $ (103,067) $ 332,898 $ 65,409 Annual Debt Service Requirements At June 30, 2009, the estimated annual debt service requirements to maturity, including principal and interest, are as follows: Business -Type Activities Long -Term Debt Payable Years Ending June 30, Principal Interest Total 2010 $ 50,154 $ 2,043 $ 52,197 13 STMA ARENA, INC. NOTES TO THE BASIC FINANCIA ,X JUNE 3Q, ��0 '! i� � ,0 NOTE 3 DETAIL NOTES ON TRANSACTION CLA�SSE • / Continued 3.E. EQUIPMENT UNDER CAPITAL LEASES The Arena leases certain capital assets under agreements that are classified as capital leases which are included in the details of Note 3.C. The cost of capital assets under capital leases is included in the Statements of Net Assets as capital assets and amounts to $118,835 at both June 30, 2009 and 2008. Accumulated amortization of the leased equipment at June 30, 2009 and 2008, is $52,465 and $44,162, respectively. Amortization of assets under capital leases is included in depreciation expense. As of June 30, 2009, all capital leases have been paid in full. NOTE 4 OTHER NOTES 4.A. RELATED PARTY TRANSACTIONS The Arena engaged in transactions with the City of Albertville, City of St. Michael and ISD #885 which are related by the joint powers agreement. The Arena has the following related party balances reflected in its statements of net assets: June 30, 2009 2008 Accounts Payable $ 1,159 $ 3,243 Long -Term Debt $ 50,154 $ 316,742 The Arena had the following transactions with related parties: Expenses Forgiveness of Debt June 30, 2009 2008 $ 19,555 $ 11,385 $ 217,334 $ - The Arena's related parties consist of the three entities which consist of two cities and an independent school district. 4.11. DEFINED BENEFIT PENSION PLANS - STATEWIDE Plan Description All full -time and certain part-time employees of STMA Arena, Inc., Minnesota are covered by defined benefit plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA administers the Public Employees Retirement Fund (PERF), and the Public Employees Police and Fire Fund (PEPFF), and the Local Government Correctional Service Retirement Fund, called the Public Employees Correctional Fund (PECF), which are cost - sharing, multiple - employer retirement plans. These plans are established and administered in accordance with Minnesota Statutes, Chapters 353 and 356. PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members are covered by Social Security and Basic Plan members are not. All new members must participate in the Coordinated Plan. All police officers, fire- fighters and peace officers who qualify for membership by statute are covered by the PEPFF. Members who are employed in a county correctional institution as a correctional guard or officer, a joint jailer /dispatcher, or as a supervisor of correctional guards or officers or of joint jailers /dispatchers and are directly responsible for the direct security, custody, and control of the county correctional institution and its inmates are covered by the PELF. PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors upon death of eligible members. Benefits are established by State Statute, and vest after three years of credited service. The defined retirement benefits are based on a member's highest average salary for any five successive years of allowable service, age, and years of credit at termination of service. 14 STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STATEMENIS JUNE 30, 2009 �o N AA NOTE 4 OTHER NOTES (Continued) 4.11. DEFINED BENEFIT PENSION PLANS - 11A y Aritinde� Plan Description (Continued) Two methods are used to compute benefits for PERA's Coordinated and Basic Plan members. The retiring member receives the higher of a step -rate benefit accrual formula (Method 1) or a level accrual formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan member is 2.2 percent of average salary for each of the first 10 years of service and 2.7 percent for each remaining year. The annuity accrual rate for a Coordinated Plan member is 1.2 percent of average salary for each of the first 10 years and 1.7 percent for each remaining year. Under Method 2, the annuity accrual rate is 2.7 percent of average salary for Basic Plan members and 1.7 percent for Coordinated Plan members for each year of service. For PEPFF members, the annuity accrual rate is 3.0 percent for each year of service. The annuity accrual rate is 1.9 percent for each year of service for PECF members. For all PEPFF, PECF, and PERF members hired prior to July 1, 1989 whose annuity is calculated using Method 1, a full annuity is available when age plus years of service equal 90. Normal retirement age is 55 for PEPFF and PECF members and 65 for Basic and Coordinated members hired prior to July 1, 1989. Normal retirement age is the age for unreduced Social Security benefits capped at 66 for Coordinated members hired on or after July 1, 1989. A reduced retirement annuity is also available to eligible members seeking early retirement. There are different types of annuities available to members upon retirement. A single -life annuity is a lifetime annuity that ceases upon the death of the retiree -no survivor annuity is payable. There are also various types of joint and survivor annuity options available which will be payable over joint lives. Members may also leave their contributions in the fund upon termination of public service in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who leave public service, but before retirement benefits begin. The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. PERA issues a publicly available financial report that includes financial statements and required supplementary information for PERF, PEPFF, and PECF. That report may be obtained on the web at mnpera.org, by writing to PERA, 60 Empire Drive #200, St. Paul, Minnesota, 55103 -2088 or by calling (651) 296 -7460 or 1- 800 - 652 -9026. Funding Policy Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The Arena makes annual contributions to the pension plans equal to the amount required by state statutes. PERF Basic Plan members and Coordinated Plan members are required to contribute 9.1% and 6.0 %, respectively, of their annual covered salary in 2008. PEPFF members are required to contribute 8.6% of their annual covered salary in 2008. That rate will increase to 9.4% in 2009. STMA Arena, Inc., Minnesota is required to contribute the following percentages of annual covered payroll: 11.78% for Basic Plan PERF members, 6.5% for Coordinated Plan PERF members, 12.9% for PEPFF, and 8.75% for PECF members. Employer contribution rates for the Coordinated Plan and PEPFF will increase to 6.75% and 14.1 % respectively, effective January 1, 2009. The Arena's contribution to the Public Employees Retirement Fund for the fiscal years ended June 30, 2009 and 2008 are $3,180 and $3,031, respectively. The Arena's contributions are equal to the contractually required contributions as set by state statute. 4.C. RISK MANAGEMENT The Arena 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. To manage these risks, the Arena purchases commercial insurance. The Arena retains risk for the deductible portions of the insurance. The amounts of these deductibles are considered immaterial to the financial statements. There were no significant reductions in insurance from the previous year settlements in excess of insurance for any of the past two years. 15 STMA ARENA, INC. NOTES TO THE BASIC FINANCIAL STTI1ITTS JUNE 30 0 ti,1, 11 4.1). COMMITMENTS The Arena has contracted with a third party to assist with' �rtisih sa es. The agreement was made in June 2007 and will remain in effect for the length of three years at which that timthe contract will be reviewed to determine the continuation of the contract. 16 OTHER REPORT NIA A i3X� INDEPENDENT AUDITO ORTS ON LEGAL COMPLIANCE May 27, 2008 Board of Directors STMA Arena, Inc. Albertville, Minnesota We have audited the financial statements of STMA Arena, Inc., as of and for the years ended June 30, 2009 and 2008 and have issued our reports thereon dated May, 27, 200,8. We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the provisions of the Minnesota Legal Compliance Audit Guide for Local Government, promulgated by the State Auditor pursuant to Minnesota Statute 6.65. Accordingly, the audits included such tests of the accounting records and such other auditing procedures, as we considered necessary in the circumstances. The Minnesota Legal Compliance Audit Guide for Local Government contains six main categories of compliance to be tested: contracting and bidding, deposits and investments, conflicts of interest, claims and disbursements, public indebtedness, and miscellaneous provisions. Our study included all of the listed categories, except that we did not test for compliance in claims and disbursements because it does not apply to the Arena as the Arena is not defined as a municipality and therefore the section does not apply. The results of our tests indicate that for the items listed above, STMA Arena, Inc. complied with the material terms and conditions of applicable legal provisions. We no certain immaterial instances of noncompliance that we have reported to management of the Arena in a separate letter dated May 27, 20081; This report is intended solely for the information and use of management and the Board of Directors of STMA Arena, Inc., and is not intended to be and should not be used by anyone other than those specified party. SCHLENNER WENNER & CO. St. Cloud, Minnesota :, STMA ARENA, INC. COMMUNICATION OF SIGNIFICANT DEFICIENCIES AND MATERIAL WEAKNESSES JUNE 30, 2009 t 1Y U { `LT 14 REVISION Board of Directors STMA Arena, Inc. Albertville, Minnesota In planning and performing our audits of the financial statements of STMA Arena, Inc. (the Arena) as of and for the year ended June 30, 2009 and 2008, in accordance with auditing standards generally accepted in the United States of America, we considered the Organization's internal control over financial reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing an opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Organization's internal control. Accordingly, we do not express an opinion on the effectiveness of the Organization's internal control for either year. Our consideration of internal control was for the limited purpose described in the preceding paragraph and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. However, as discussed below, we identified certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies. A control deficiency 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 misstatements on a timely basis. A deficiency in design exists when a control necessary to meet the control objective is missing, or when an existing control is not properly designed so that even if the control operates as designed, the control objective is not always met. A deficiency in operation exists when a properly designed control does not operate as designed or when the person performing the control does not possess the necessary authority or qualifications to perform the control effectively. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the Organization's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the entity's financial statements that is more than inconsequential will not be prevented or detected. We consider the following control deficiencies to be significant deficiencies: Segregation of Duties Due to limited staff, the Arena lacks proper segregation of duties. Material Audit Adjustments J t T TO U I"N IG During the course of our engagement, we proposed material audit adjustments that we believe would not have been identified as a result of the Arena's existing internal controls, and therefore could have resulted in a material misstatement of the Arena's financial statements. In order to ensure the financial statements were free from material misstatement, audit adjustments were required in the following areas: • Miscoded Transactions • Debt and Interest Expense • Various Accrual Balances • Capital Assets and Depreciation Preparation of Financial Statements Schlenner Wenner & Co. drafted the financial statements for the Arena. These financial statements, including disclosures, were reviewed by management and management has taken responsibility for them. However, we believe personnel of the Arena would require additional training in accounting principles generally accepted in the United States of America to adequately apply such standards internally. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected. We consider the following control deficiencies to be material weaknesses: Lack of segregation of duties, Material audit adjustments, and Preparation of financial statements. This communication is intended solely for the information and use of management and the Board of Directors of STMA Arena, Inc. and is not intended to be and should not be used by anyone other than these specified parties. SCHLENNER WENNER & CO. St. Cloud, Minnesota STMA \A #; CONTROL DEF�ICIE T !PS LETTER q �"E`30, 2009 h ' `. + Board of Directors STMA Arena, Inc. Albertville, Minnesota In connection with our audits of the financial statements of STMA Arena, Inc. (the Arena) as of and for the years ended June 30, 2009 and 2008, we identified deficiencies in internal control over financial reporting (control deficiencies). A control deficiency 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 financial statement misstatements on a timely basis. A deficiency in design exists when a control necessary to meet the control objective is missing, or when an existing control is not properly designed so that even if the control operates as designed, the control objective is not always met. A deficiency in operation exists when a properly designed control does not operate as designed or when the person performing the control does not possess the necessary authority or qualifications to perform the control effectively. A significant deficiency is a control deficiency, or a combination of control deficiencies, that adversely affect the entity's ability to authorize, initiate, record, process or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the entity's financial statements that is more than inconsequential will not be prevented or detected. A material weakness is a significant deficiency, or a combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected. We have separately communicated, to you identified deficiencies that we determined to be significant deficiencies or material weaknesses. Certain control deficiencies that have been previously communicated to you, in writing, by us or by others within your organization are not repeated herein. Following are descriptions of other identified control deficiencies that we determined did not constitute significant deficiencies or material weaknesses: Password During our current and prior year procedures, we noted there is no password required to access the QuickBooks accounting program and data. Again, to ensure data is safe, we recommend management install a password to restrict access to the accounting records. Checks t I During our current year audit procedures, we noted there qre no copies,,o jt c make up deposits that are maintained or in the bank statements. To strengthen documentahori an c su p r�fb `Mat trinsactiohs, we recommend management make copies of checks that support the deposifs in the future. Accounting Policy and Procedure Manual During our current and prior year procedures, we noted the Arena did not have a written accounting policies and procedures manual. Written procedures, instructions, and assignments of duties help prevent or reduce misunderstandings, errors, inefficient or wasted effort, duplicated or omitted procedures, and other situations that can result in inaccurate or untimely accounting records. A well- devised manual can also help ensure that all similar transactions are treated consistently, that accounting principles used are proper, and that records are produced in the form desired by management. A good policies and procedures manual should aid in the training of new employees and are necessary when there is employee turnover. It will take some time and effort for management to develop a manual; however, we believe this time will be more than offset by time saved later in training and supervising accounting personnel. Also, in the process of the comprehensive review of existing accounting policies and procedures for the purpose of developing the manual, management might discover procedures that can be eliminated or improved to make the system more efficient and effective. It is our understanding that management has started writing such a manual. We commend management on its efforts. Controls Over Legal Compliance During our current and prior year procedures, we noted a lack of compliance with Minnesota Statutes pertaining to the following: Public Indebtedness Form During prior year and current year audit procedures, we noted the Arena did not file the required form "Report of Outstanding Indebtedness" with the county auditor. According to MN Statute 471.70, the Arena is required to report outstanding obligations on or before February first each year to the county auditor. We recommend the Arena begin filing the required reporting with the county auditor on a yearly basis. Pam During current year audit procedures, we noted the Arena was paying for a Christmas Party. According to MN Statutes, the Arena is required to refrain from paying for such parties. Record Retention During current year audit procedures, we noted the Arena did not have a forma Record Retention policy as to the destruction of documents. We recommend the Arena create a formal Record Retention and destruction policy. This communication is intended solely for the information and use of management and the Board of Directors of STMA Arena, Inc. and is not intended to be and should not be used by anyone other than these specified parties. SCHLENNER WENNER & CO. St. Cloud, Minnesota ?fiELIMINBRY DRAFT �c?JECT TO REVISION STMA ARENA, INC. MANAGEMENT LETTER JUNE 30, 2009 PRELIMINARY DRAFT 23JECT i0 REVISION Board of Directors STMA Arena, Inc. Albertville, Minnesota This letter includes comments and suggestions with respect to matters that came to our attention in connection with our audits of the financial statements of STMA Arena, Inc. (the Arena) for the years ended June 30, 2009 and 2008. These items are offered as constructive suggestions to be considered part of the ongoing process of modifying and improving the Arena's practices and procedures. Bank Accounts During current year audit procedures, we noted the Arena contacted the bank and changed the name to the legal name of STMA Arena, Inc. on a bank account named incorrectly previously. We commend management for taking such action. Agreements /Asset Titles in Proper Names During our current and prior year procedures, we noted leased equipment and new equipment recorded on the books and records of the Arena are under names other than the Arena. Specifically, the lease with Krause Anderson Capital, Inc. and the lease with Lease Financial Group is under the name ISD 4885. There are also inconsistencies with title to assets of the locker room addition. It is assumed, at this point, that various equipment is titled to ISD #885 and the City of Albertville as well. Again, we recommend agreements, titles, etc. are under the appropriate entity names in the future and that such are corrected for agreements and assets already obtained. Capitalization Policy During our current and prior year procedures, we noted the Arena does not have a written capitalization policy for fixed assets. We continue to recommend the Board develop a capitalization policy whereby capitalizable items with useful lives of more than one year and a cost over a certain dollar threshold are capitalized and depreciated. Items not meeting such criteria should be expensed. Again, we recommend management consider a dollar threshold of $1,000 for fixed assets, and that all invoices pertaining to fixed assets be retained indefinitely. Reconciliations During our current year audit procedures, we noted there are no timely account reconciliation schedules prepared to tie out ad revenue. We recommend management prepare a reconciliation process to ensure the Arena is receiving all appropriate ad revenue. The reconciliation should be prepared by one person and reviewed and approved by another to improve internal controls. Employee Reimbursements During our current year audit procedures, we noted instances where proper authorization for employee reimbursements was not obtained prior to payment and instances where employees authorized their own reimbursement. We recommend management develop a policy regarding proper authorization for employee reimbursements forms to improve internal controls. PRELIMINARY DRAFT Credit Cards 4t R receipts Durin our current year audit procedures we noted the invoice foh` Crtib i I for the items that were purchased per the credit card invoice. To ensure expenses are legitimate and to strengthen internal controls, we recommend receipts be maintained for all credit card purchases and attached to the monthly statements. Further, we recommend management establish a credit card policy that covers, at minimum: authorized chargers, authorized maximum charge amounts, appropriate documentation, and appropriate approval for payment. We will review the status of these comments during our next audit engagement. We will be pleased to discuss these comments in further detail at your convenience, to perform any additional study of these matters, or to assist you in implementing any recommendations we have. We wish to take this opportunity to express our sincere appreciation for all the courtesies and cooperation extended to us by Grant Fitch, Barb Kolling, and Diana Berning. We would also like to thank you for the opportunity to serve you. We look forward to serving you in the future. This communication is intended solely for the information and use of management and the Board of Directors of STMA Arena, Inc., and is not intended to be and should not be used by anyone other than these specified parties SCHLENNER WENNER & CO. St. Cloud, Minnesota Client: 3664 - STMA Arena, Inc. f IREL Engagement: 06 -09 AUD - STMA Arena, Inc. ! IN R DRAFT Period Ending: Trial Balance: 6/30/2009 3000.00 -TB� TO Workpaper: 0204.00 -Reclassifying Journal Entries l epo°t�t REVISION Account Description W/P Ref Debit Credit Reclassifying Journal Entries JE # 1 To reclassify forgiveness of debt 410 Contributions Income 217,334.00 780 Forgivness of Debt 217,334.00 Total 217,334.00 217,334.00 10/2/2009 10:19 AM 1 of 1 3:29 PM 10101109 STMA ARENA INC Journal R ELMNARY � `. J n 30 2009 1 i Dt Trans # ae Num SUBJEC1.110 REVISION Memo it Credit 6,647 06130/2009 sw 09 -01 To write off loan 220 - Due to STMA ISD 217,334.00 To write off loan 410 - Contributions Income 217,334.00 217,334.00 217,334.00 6,649 06/30/2009 sw 09 -02 To reclassify debt payments on capital lease 580 - Miscellaneous 8,502.37 To reclassify debt payments on capital lease 580 - Miscellaneous 8,502.37 To reclassify debt payments on capital lease 211 • Current Portion Long Term Debt 16,155.56 To reclassify debt payments on capital lease 612 • Interest Expense 849.18 17,004.74 17,004.74 6,650 06/30/2009 sw 09 -03 to reverse prior year ap 230 • Accounts Payable - Trade 4,761.94 to reverse prior year ap 730 • Gas and Electric 402.39 to reverse prior year ap 666 • Legal Fees 36.25 to reverse prior year ap 660 - Building Repairs 2,000.00 to reverse prior year ap 580 • Miscellaneous 277.94 to reverse prior year ap 500 • ARENA MONITORING 30.27 to reverse prior year ap 730 • Gas and Electric 474.23 to reverse prior year ap 740 • Water 79.81 to reverse prior year ap 666 • Legal Fees 1,461.05 4,761.94 4,761.94 6,651 06/30/2009 sw 09 -04 To record prepaid insurance 130 • Prepaid Insurance 36.00 To record prepaid insurance 550. Insurance 36.00 36.00 36.00 6,652 06/3012009 sw 09 -05 To reclassify debt payment and record cpltd 580 • Miscellaneous 53,303.13 To reclassify debt payment and record cpltd 211 - Current Portion Long Term Debt 49,253.11 To reclassify debt payment and record cpltd 612. Interest Expense 4,050.02 To reclassify debt payment and record cpltd 265 • City of Albertville -Locker 50,154.54 To reclassify debt payment and record cpltd 211 - Current Portion Long Term Debt 50,154.54 103,457.67 103, 457.67 6,653 06/30/2009 sw 09 -06 to reclassify to proper revenue account 410 • Contributions Income 57.00 to reclassify to proper revenue account 460 - Contributions Income (Donations 57.00 57.00 57.00 6,654 06/30/2009 sw 09 -07 to reclassify to proper account 518 • DONATION 163.95 to reclassify to proper account 460 • Contributions Income (Donations 163.95 163.95 163.95 6,655 06/30/2009 sw 09 -08 To reclassify to correct account 608 • Professional Fees 1,341.25 To reclassify to correct account 608 • Professional Fees 285.00 To reclassify to correct account 666 - Legal Fees 1,341.25 To reclassify to correct account 613 • Licenses and Permits 285.00 1,626.25 1,626.25 6,656 06130/2009 sw 09 -09 to reclassify youth hockey contribution 440 • Miscellaneous Income 15,000.00 to reclassify youth hockey contribution 410 • Contributions Income 15,000.00 to reclassify to contributions 440 • Miscellaneous Income 471.66 to reclassify to contdbutions 410 - Contributions Income 471.66 15,471.66 15,471.66 6,661 06/30/2009 SW 09 -10 to record wages payable and reclassify from office supplies account 603 • WAGES - HOURLY 1,719.38 to record wages payable and reclassify from office supplies account 2101 • Pay. Liabilities 1,159.69 to record wages payable and reclassify from office supplies account 620 • Office Supplies 2,346.13 to record wages payable and reclassify from office supplies account 2101 • Pay. Liabilities 1,786.44 3,505.82 3,505.82 6,662 06130/2009 SW 09 -11 to reclassify capital expenditures 660 • Building Repairs 12,821.00 to reclassify capital expenditures 660 • Building Repairs 1,876.86 to reclassify capital expenditures 160 • Land & Building 14,697.88 14,697.88 14,697.88 Page 1 of 2 Page 2 of 2 v A A 3:29 PM 10/01/09 STMA ARENA INC Journal June 30, 2009 SUBJECT TO REVISION 6,663 06/30/2009 09 -12 To record accounts payable and adjust for payroll liabilities 230 • Accounts Payable - Trade 8,529.83 To record accounts payable and adjust for payroll liabilities 730 • Gas and Electric 63.66 To record accounts payable and adjust for payroll liabilities 520 - CONCESSIONS - FOOD 27.00 To record accounts payable and adjust for payroll liabilities 660 • Building Repairs 40.75 To record accounts payable and adjust for payroll liabilities 760 • ICE RESURFACER EXPENSE 175.79 To record accounts payable and adjust for payroll liabilities 760 • ICE RESURFACER EXPENSE 67.50 To record accounts payable and adjust for payroll liabilities 608 • Professional Fees 1,875.00 To record accounts payable and adjust for payroll liabilities 660 • Building Repairs 1,050.56 To record accounts payable and adjust for payroll liabilities 520 • CONCESSIONS - FOOD 198.12 To record accounts payable and adjust for payroll liabilities 730 • Gas and Electric 5,031.45 To record accounts payable and adjust for payroll liabilities 2100 • Payroll Liabilities 315.00 To record accounts payable and adjust for payroll liabilities 603 - WAGES- HOURLY 315.00 8,844.83 8,844.83 6,664 06/30/2009 SW 09 -13 to reclassify from misc expense 580 • Miscellaneous 32,396.41 to reclassify from misc expense 608 • Professional Fees 5,475.00 to reclassify from misc expense 608- Professional Fees 1,475.00 to reclassify from misc expense 760 - ICE RESURFACER EXPENSE 225.83 to reclassify from misc expense 570 - MEMBERSHIP DUES 140.00 to reclassify from misc expense 440 - Miscellaneous Income 17.05 to reclassify from misc expense 170 - Construction In Progress 12,000.00 to reclassify from misc expense 660 • Building Repairs 9,352.22 to reclassify from misc expense 620. Office Supplies 2,348.19 to reclassify from misc expense 745 - Refuse 1,397.22 32,413.46 32,413.46 6,665 06/30/2009 SW 09 -14 to post ad income 1201 - A/R - SW 9,702.00 to post ad income 470 • Advertising Income 9,702.00 9,702.00 9,702.00 6,666 06/30/2009 SW 09 -15 to record receivables 1201 • A/R - SW 10,909.68 to record receivables 430 • Ice Time Income 10,236.68 to record receivables 520 • CONCESSIONS - FOOD 17.00 to record receivables 404 • Admissions 575.00 to record receivables 436 • SKATE SHARPENING 21.00 to record receivables 460 - Contributions Income (Donations 60.00 10,909.68 10,909.68 6,667 06/30/2009 SW 09 -16 to reclassify capital assets and post depreciation 170 • Construction In Progress 9,000.00 to reclassify capital assets and post depreciation 160 • Land & Building 9,000.00 to reclassify capital assets and post depreciation 525 • Depreciation Expense 46,649.00 to reclassify capital assets and post depreciation 180 - Accum Depreciation 46,649.00 55,649.00 55,649.00 495,635.88 496,636.88 Page 2 of 2 3:29 PM STMA ARENA INC 70/01109 IOUCIal PRELIMINARY DRAr ; June'32 Trans # Date Num Memo Credit 6,450 06/30/2008 SW 08 -01 SW AJEtoremove old ap and credits from account 100 i M 9 SW AJE to remove old ap and credits from account 580 Miscellaneous 2.00 2.00 2.00 6,452 06130/2008 sw 08 -02 To reclassify debt, interest expense and record current portion 580 • Miscellaneous 8,502.37 To reclassify debt, interest expense and record current portion 760 • ICE RESURFACER EXPENSE 8,502.37 To reclassify debt, interest expense and record current portion 211 - Current Portion Long Term Debt 15,141.49 To reclassify debt, interest expense and record current portion 612- Interest Expense 1,863.25 To reclassify debt, interest expense and record current portion 211 - Current Portion Long Tenn Debt 16,156.00 To reclassify debt, interest expense and record current portion 250 • Note Payable - Kraus Anderson 16,156.00 33,160.74 33,160.74 6,453 06/30/2008 sw 08 -03 To remove prior year ap and reclassify expenses 230 - Accounts Payable - Trade 2,094.43 To remove prior year ap and reclassify expenses 502 • ACCOUNTANTS/TRAINING 4,160.00 To remove prior year ap and r 760 • ICE RESURFACER EXPENSE 2,065.57 4,160.00 4,160.00 6,454 06130/2008 sw 08 -04 To record current year accounts payable 230 • Accounts Payable - Trade 4,761.94 To record current year accounts payable 730 • Gas and Electric 402.39 To record current year accounts payable 666 • Legal Fees 36.25 To record current year accounts payable 660 • Building Repairs 2,000.00 To record current year accounts payable 580 • Miscellaneous 277.94 To record current year accounts payable 500 • ARENA MONITORING 30.27 To record current year accounts payable 730 - Gas and Electric 474.23 To record current year accounts payable 740 • Water 79.81 To record current year accounts payable 608 • Professional Fees 1,461.05 4,761.94 4,761.94 6,455 06/30/2008 sw 08 -05 To reverse prior year accounts receivable 1201 • A/R - SW 10,629.51 To reverse prior year accounts receivable 430 • Ice Time Income 10,629.51 10,629.51 10,629.51 6,456 06/30/2008 sw 08 -06 To adjust prepaids to actual 130 - Prepaid Insurance 1,086.00 To adjust prepaids to actual 550 • Insurance 1,086.00 1,086.00 1,086.00 6,457 06/30/2008 sw 08 -07 To record receipt to actual accounts 137 - Pledge Receivable- Hocky Assn 35,000.00 To record receipt to actual accounts 460 • Contributions Income (Donations 35,000.00 35,000.00 35,000.00 6,458 06/3012008 sw 08 -08 To reclassify City of Albertville Debt and record CPLTD 580 • Miscellaneous 41,458.88 To reclassify City of Albertville Debt and record CPLTD 580 • Miscellaneous 55,277.32 To reclassify City of Albertville Debt and record CPLTD 612 • Interest Expense 8,809.74 To reclassify City of Albertville Debt and record CPLTD 265 • City of Albertville - Locker 87,926.46 To reclassify City of Albertville Debt and record CPLTD 211 - Current Portion Long Term Debt 12,096.00 To reclassify City of Albertville Debt and record CPLTD 265 • City of Albertville - Locker 12,096.00 --708,832.20 108, 832.20 6,459 06/30/2008 sw 08 -09 to reclassify fixed assets and record depreciation 170 • Construction In Progress 9,000.00 to reclassify fixed assets and record depreciation 580 • Miscellaneous 9,000.00 to reclassify fixed assets and record depreciation 525 • Depreciation Expense 47,090.00 to reclassify fixed assets and record depreciation 180 • Accum Depreciation 47,090.00 56,090.00 56,090.00 6,460 06/30/2008 sw 08 -10 to reclassify to proper income accounts 410 • Contributions Income 11,636.61 to reclassify to proper income accounts 470 • Advertising Income 8,004.00 to reclassify to proper income accounts 460 • Contributions Income (Donations 28100 to reclassify to proper income accounts 400 • Concession Income 3,110.12 to reclassify to proper income accounts 440 • Miscellaneous Income 239.49 11,636.61 11,636.61 6,461 06/30/2008 sw 08 -11 to reclassify to appropriate accounts 440 - Miscellaneous Income 2,541.87 to reclassify to appropriate accounts 700-TAXES 380.00 to reclassify to appropriate accounts 460. Contributions Income (Donations 525.00 to reclassify to appropriate accounts 470 - Advertising Income 1,100.00 to reclassify to appropriate accounts 760 • ICE RESURFACER EXPENSE 126.27 to reclassify to appropriate accounts 460 • Contributions Income (Donations 428.41 to reclassify to appropriate accounts 580 • Miscellaneous 17.81 2,559.68 2,559.68 Pagel of 3 3:29 PM 10/01/09 6,462 0613012008 sw 08 -12 to reclassify to appropriate accounts to reclassify to appropriate accounts to reclassify to appropriate accounts to reclassify to appropriate accounts 6,463 06/30/2008 sw 08 -13 to reclassify to appropriate accounts to reclassify to appropriate accounts 6,464 06/30/2008 sw 08 -14 to reclassify to appropriate accounts to reclassify to appropriate accounts to reclassify to appropriate accounts to reclassify to appropriate accounts to reclassify to appropriate accounts 6,465 06/30/2008 sw 08 -15 to reclassify to appropriate accounts to reclassify to appropriate accounts 6,466 06/30/2008 sw 08 -16 to reclassify to appropriate accounts to reclassify to appropriate accounts STM4,ARENA 1� J06rhk IN, INJECT TOSEYJIS,Jbf� 440 • Miscellaneous Income 440 • Miscellaneous Income 460 - Contributions Income (Donations 6,601 06/3012008 sw 08 -01 VOID: SWAJE to remove old ap and credits from account SWAJE to remove old ap and credits from account 6,602 06/30/2008 sw 08 -02 VOID: To reclassify debt, interest expense and record current portion To reclassify debt, interest expense and record current portion To reclassify debt, interest expense and record current portion To reclassify debt, interest expense and record current portion To reclassify debt, interest expense and record current portion To reclassify debt, interest expense and record current portion 6,603 06/30/2008 sw 08 -03 VOID: To remove prior year ap and reclassify expenses To remove prior year ap and reclassify expenses To remove prior year ap 6,604 06/30/2008 sw OB -04 VOID: To record current year accounts payables To record current year accounts payables To record current year accounts payables To record current year accounts payables To record current year accounts payables To record current year accounts payables To record current year accounts payables To record current year accounts payables To record current year accounts payables 6,605 06/3012008 sw 08 -05 VOID: To revert prior year accounts receivable To revert prior year accounts receivable 6,606 06/30/2008 sw 08 -06 VOID: To adjust prepaids to actual To adjust prepaids to actual 6,607 06/30/2008 sw 08 -07 VOID: To record receipt to actual accounts To record receipts to actual accounts 6,608 06/30/2008 sw 08 -08 VOID: To reclassify City of Albertville Debt and record CPLTD To reclassify City of Albertville Debt and record CPLTD To reclassify City of Albertville debt and record CPLTD To reclassify City of Albertville debt and record CPLTD To reclassify City of Albertville debt and record CPLTD To reclassify City of Albertville debt and record CPLTD 520 • CONCESSIONS - FOOD 400 • Concession Income 745 • Refuse 660 Building Repairs 620. Office Supplies 440 • Miscellaneous Income 580 • Miscellaneous 660 • Building Repairs 740 • Water 660 • Building Repairs 745 • Refuse 100 • Premier Banks 580 Miscellaneous 580 • Miscellaneous 760 - ICE RESURFACER EXPENSE 211 • Current Portion Long Term Debt 612 • Interest Expense 211 • Current Portion Long Tenn Debt 250 - Note Payable - Kraus Anderson 230 • Accounts Payable - Trade 502 • ACCOUNTANTS/TRAINING 760. ICE RESURFACER EXPENSE 230 • Accounts Payable - Trade 730 • Gas and Electric 666 - Legal Fees 660 - Building Repairs 580 • Miscellaneous 500 • ARENA MONITORING 730 • Gas and Electric 740 • Water 608 • Professional Fees 1201 • A/R - SW 430 - Ice Time Income 130 • Prepaid Insurance 550-Insurance 137 • Pledge Receivable - Hocky Assn 460 • Contributions Income (Donations 580 • Miscellaneous 580 • Miscellaneous 612 • Interest Expense 265 • City of Albertville - Locker 211 • Curren/ Portion Long Term Debt 265 • City of Albertville - Locker 5,008.00 167.29 1,200.00 6,375.29 6,375.29 6,375.29 2,576.57 2,576.57 2,576.57 2,576.57 1,571.40 4,921.67 2,385.47 16.20 8,862.34 8;878.54 8,878.54 108.14 108.14 108.14 108.14 60.55 60.55 60.55 60.55 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Page 2 of 3 3:29 PM 10/01/09 6,609 06130/2008 sw 08 -09 6,610 0613012008 sw 08 -10 6,611 06130/2008 sw 08 -11 STMi4 ARENA INC "Journal Jun' e0, 2008 �i 1I VOID: To reclassify fxe assets an�ecor R rYa7fio� To reclassify fixed assets and record depreciation To reclassify fixed assets and record depreciation To reclassify fixed assets and record depreciation VOID: To reclassify to proper income accounts To reclassify to proper income accounts To reclassify to proepr income accounts To reclassify to proper income accounts To reclassify to proepr income accounts VOID: to reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts 6,612 06/30/2008 sw 08 -12 VOID: To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts 6,613 0613012008 sw 08 -13 VOID: To reclassify to appropriate accounts To reclassify to appropriate accounts 6,614 06/30/2008 sw08 -14 VOID: To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts To reclassify to appropriate accounts 6,615 06/30/2008 sw 08 -15 VOID: To reclassify to appropriate accounts To reclassify to appropriate accounts 6,616 06/30/2008 sw 08 -16 VOID: To reclassify to appropriate accounts To reclassify to appropriate accounts 6,657 06/30/2008 SW 08 -17 Barb services for 111/07 - 6/30108 Barb services for 1/1/07 - 6/30/08 6,658 0613012008 SW 08 -18 to reclassify receivable that was satisfied per grant and barb to reclassify receivable that was satisfied per grant and barb 6,659 06/30/2008 SW 08 -19 to remove deferred revenue to remove deferred revenue to remove deferred revenue 6,660 06/30/2008 SW 08 -20 To record Franklin receivable To record Franklin receivable 170 • Construction In Progress 580 • Miscellaneous 525 - Depreciation Expense 180 • Accum Depreciation 410 • Contributions Income 470 • Advertising Income 460 • Contributions Income (Donations 400 • Concession Income 440 - Miscellaneous Income 440 • Miscellaneous Income 700•TAXES 460 • Contributions Income (Donations 470 • Advertising Income 760. ICE RESURFACER EXPENSE 460 • Contributions Income (Donations 580 • Miscellaneous 470 - Advertising Income 440 - Miscellaneous Income 440 - Miscellaneous Income 460 • Contributions Income (Donations 520 • CONCESSIONS - FOOD 400 Concession Income 745 • Refuse 660 • Building Repairs 620. Office Supplies 440 • Miscellaneous Income 580 - Miscellaneous 660 - Building Repairs 740 • Water 660 - Building Repairs 745 • Refuse 603 - WAGES - HOURLY 2101 • Pay. Liabilities 137 • Pledge Receivable - Hooky Assn 460 Contributions Income (Donations 216 - Current Deferred Revenue 215 • Deferred Revenue 470 - Advertising Income 1201 - A/R - SW 470 • Advertising Income 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1,786.44 1,786.44 1,786.44 1,786.44 439.00 439.00 439.00 439.00 9,920.00 8,840.00 18,760.00 18,760.00 18,760.00 1,740.00 1,740.00 1,740.00 1,740.00 308,643.21 308,643.21 Page 3 of 3