STATE OF MISSISSIPPI STEVEN A. PATTERSON State Auditor WILLIAM S. JONES, CPA Director, Department of Audit ED P. YARBOROUGH, CPA Director, Division of County Audits _part2 potx

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JEFFERSON DAVIS COUNTY Exhibit B
Combined Statement of Revenues, Expenditures and Changes in Fund Balances -
All Governmental Fund Types and Expendable Trust Funds
For the Year Ended September 30, 1995
Totals
Governmental Fiduciary Memorandum
Fund Types Fund Type Only
Special Debt Expendable Primary
General Revenue Service Trust Government
Revenues
Property taxes $ 1,365,180 904,916 25,433 2,295,529
Licenses, commissions and
other revenue 56,058 132,815 188,873
Fines and forfeitures 61,614 61,614
Intergovernmental revenues:
Federal sources 545,069 545,069
State and local sources 531,208 482,872 1,014,080
Charges for services 52,205 52,205
Use of money and property 154,569 154,569
Miscellaneous revenues 13,398 3,361 16,759
Total Revenues 2,234,232 2,069,033 25,433 0 4,328,698
Expenditures
Current:
General government 1,130,334 257,801 92 1,388,227
Public safety 512,247 512,247
Public works 8,750 1,273,820 1,282,570
Health & welfare 200,074 200,074
Culture & recreation 13,158 55,407 68,565
Conservation of natural resources 47,483 47,483
Economic development & assistance 27,882 27,882

Capital projects 188,648 529,678 718,326
Debt service:
Principal retirement 20,000 20,000
Interest and fiscal charges 2,477 2,477
Other costs 39 39
Total Expenditures 2,128,615 2,116,706 22,477 92 4,267,890
Excess of Revenues over
(under) Expenditures 105,617 (47,673) 2,956 (92) 60,808
Other Financing Sources (Uses)
Insurance recoveries 7,890 7,890
Operating transfers in 21,323 286,188 92 307,603
Operating transfers out (217,023) (100,580) (317,603)
Total Other Financing
Sources (Uses) (187,810) 185,608 0 92 (2,110)
Excess of Revenues and Other
Sources over (under)
Expenditures and Other Uses (82,193) 137,935 2,956 0 58,698
Fund Balances
Beginning of year 1,642,939 1,011,771 4,198 1,742 2,660,650
End of year $ 1,560,746 1,149,706 7,154 1,742 2,719,348
The notes to the financial statements are an integral part of this statement.
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JEFFERSON DAVIS COUNTY
Combined Statement of Revenues, Expenditures and Changes in Fund Balances -
Budget (Non-GAAP Budgetary Basis) and Actual - All Governmental Fund Types
For the Year Ended September 30, l995
General Special
Fund Revenue Funds
Variance Variance
Favorable Favorable

Budget Actual (Unfavorable) Budget Actual (Unfavorable)
Revenues
Property taxes $ 1,362,749 1,361,784 (965) 900,055 900,055
Licenses, commissions and
other revenue 52,816 53,780 964 132,445 132,445
Fines and forfeitures 61,614 61,614
Intergovernmental revenues:
Federal sources 545,045 545,045
State and local sources 988,078 988,078 644,081 488,337 (155,744)
Charges for services 52,205 52,205
Use of money and property 154,083 154,083
Miscellaneous revenues 26,304 27,059 755 921 3,361 2,440
Total Revenues 2,697,849 2,698,603 754 2,222,547 2,069,243 (153,304)
Expenditures
General government 1,057,053 1,057,053 266,742 266,742
Public safety 514,108 514,108
Public works 5,000 5,000 1,474,968 1,354,276 120,692
Health and welfare 197,014 197,014
Culture and recreation 12,338 13,047 (709) 54,044 54,044
Education 470,907 470,907
Conservation of natural resources 47,755 47,755
Economic development and assistance 31,395 31,395
Capital projects 189,358 188,648 710 686,029 530,278 155,751
Debt service
Other costs 275,618 104,961 170,657
Total Expenditures 2,800,546 2,629,888 170,658 2,481,783 2,205,340 276,443
Excess of Revenues over (under)
Expenditures (102,697) 68,715 171,412 (259,236) (136,097) 123,139
Other Financing Sources (Uses) (16,544) (187,276) (170,732) 308,743 185,606 (123,137)
Excess of Revenues and Other

Sources over (under) Expenditures
and Other Uses (119,241) (118,561) 680 49,507 49,509 2
Fund Balances
Beginning of year 1,717,863 1,717,863 1,136,379 1,136,380
End of year $ 1,598,622 1,599,302 1,185,886 1,185,889
The notes to the financial statements are an integral part of this statement.
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Exhibit C
Debt
Service Funds
Variance
Favorable
Budget Actual (Unfavorable)
25,291 25,291
25,291 25,291 0
22,477 22,477
22,477 22,477 0
2,814 2,814 0
0 0 0
2,814 2,814 0
3,735 3,735
6,549 6,549
JEFFERSON DAVIS COUNTY
Notes to Financial Statements
For the Year Ended September 30, 1995
10
(1) Significant Accounting Policies.
A. Financial Reporting Entity.
Jefferson Davis County is a political subdivision of the State of Mississippi. The county is governed by an
elected five-member Board of Supervisors. Generally accepted accounting principles require

Jefferson Davis County to present these financial statements on the primary government and its
component units which have significant operational or financial relationships with the county.
Management has chosen to omit from these financial statements the following component unit which has
a significant operational or financial relationship with the county. Accordingly, the financial statements
do not include the data of this component unit necessary for reporting in conformity with generally
accepted accounting principles.
• Jefferson Davis County Hospital
State law pertaining to county government provides for the independent election of county officials. The
following officials are all part of the county legal entity and therefore are reported as part of the primary
government financial statements.
• Board of Supervisors
• Chancery Clerk
• Circuit Clerk
• Justice Court Clerk
• Purchase Clerk
• Tax Assessor-Collector
• Sheriff
B. Basis of Presentation.
The accompanying financial statements of the primary government have been prepared in conformity with
generally accepted accounting principles as prescribed by the Governmental Accounting Standards
Board. However, the primary government financial statements, because they do not include the financial
data of the county's component units, do not present fairly, in all material respects, the financial position
and results of operations for the entire reporting entity.
C. Account Classifications.
The account classifications used in the financial statements conform to the broad classifications
recommended in Governmental Accounting, Auditing and Financial Reporting as issued in 1988 by the
Government Finance Officers Association and the Mississippi County Financial Accounting Manual as
revised in 1993 by the Office of the State Auditor.
JEFFERSON DAVIS COUNTY
Notes to Financial Statements

For the Year Ended September 30, 1995
11
D. Fund Accounting.
The financial activities of the county are recorded in individual funds and account groups used to report
financial position and results of operations. Fund accounting is used to demonstrate legal compliance and
to aid financial management by segregating transactions relating to certain government functions or
activities. A fund is a separate accounting entity with a self-balancing set of accounts, segregated for the
purpose of carrying on specific activities or attaining certain objectives in accordance with specific
regulations, restrictions or limitations. An account group is a financial reporting device designated to
provide accountability for certain assets and liabilities that are not recorded in funds because they do not
directly affect net expendable available financial resources. Account groups are presented for general
fixed assets and general long-term obligations. The following fund categories, which are further
subdivided into separate "fund types", are utilized by the county:
GOVERNMENTAL FUND TYPES
General Fund - This fund is used to account for all activities of the general government for which a
separate fund has not been established.
Special Revenue Funds - These funds are used to account for the proceeds of specific revenue sources
(other than expendable trusts) that are legally restricted to expenditures for specified purposes. Special
Revenue Funds account for, among others, certain federal grant programs, taxes levied with statutorily
defined distributions and other resources restricted as to purpose.
Debt Service Funds - These funds are used to account for the accumulation of resources for, and the
payment of, general long-term debt principal, interest and related costs.
FIDUCIARY FUND TYPES
Expendable Trust Funds - These funds are used to account for assets held by the county in a formal trustee
capacity where the principal and income may be expended in the course of designated operations.
Agency Funds - These funds account for various taxes, deposits and other monies collected or held by the
county, acting in the capacity of an agent, for distribution to other governmental units or designated
beneficiaries.
ACCOUNT GROUPS
General Fixed Assets - The General Fixed Assets Account Group is used to account for the fixed assets of

the county.
General Long-term Debt - The General Long-term Debt Account Group is used to account for all
long-term debt of the county.
E. Basis of Accounting/Measurement Focus.
Governmental Fund Types and Expendable Trust and Agency Funds - All Governmental Funds and
Expendable Trust Funds are accounted for using a current financial resources measurement focus. With
this measurement focus, only current assets and current liabilities are generally 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 net current assets.
JEFFERSON DAVIS COUNTY
Notes to Financial Statements
For the Year Ended September 30, 1995
12
The modified accrual basis of accounting is used by all Governmental Fund Types, Expendable Trust
Funds and Agency Funds. Under this method, revenues are recognized in the accounting period in which
they become both available and measurable to finance operations during the year or to liquidate liabilities
existing at the end of the year. Available means collected in the current year or soon enough after year
end to liquidate liabilities existing at the end of the year. Significant revenue sources which are
susceptible to accrual include intergovernmental revenues, consisting of grants, entitlements and shared
revenues and charges for services. Expenditures are recognized in the accounting period in which the
fund liability is incurred. Modifications to the accrual basis of accounting include:
• Licenses, fees, fines and forfeits and other miscellaneous revenues are recognized when received
since they normally are only measurable at that time.
• Property taxes are recognized as revenue when received because the remaining delinquent
property taxes not collected before the close of the fiscal year are considered immaterial. See
Note 1L for further explanation.
• Principal and interest on general long-term debt are recognized when due.
F. Budgetary Process and Accounting.
Process:
Statutory requirements dictate how and when the county's budget is to be prepared. Generally, in the

month of August, prior to the ensuing fiscal year beginning each October 1, the Board of Supervisors of
the county, using historical and anticipated fiscal data and proposed budgets submitted by the Sheriff and
the Tax Assessor-Collector for his or her respective department, prepares an original budget for each of
the Governmental Funds for said fiscal year. The completed budget for the fiscal year includes for each
fund every source of revenue, each general item of expenditure and the unencumbered cash and
investment balances. When during the fiscal year it appears to the Board of Supervisors that budgetary
estimates will not be met, it may make revisions to the budget.
Accounting:
The county's budget is prepared principally on the cash basis of accounting. All appropriations lapse at
year end and there are no encumbrances to budget because state law does not require that funds be
available when goods or services are ordered, only when payment is made.
G. Cash and Investments.
State law authorizes the county to invest in interest bearing time certificates of deposit for periods of
fourteen days to one year with depositories and in obligations of the U.S. Treasury, State of Mississippi, or
any county, municipality or school district of this state. Further, the county may invest in certain
repurchase agreements that have a term of less than fourteen days.
Cash includes amounts in demand deposits, all certificates of deposit and cash equivalents, which are
short-term highly liquid investments that are readily convertible to cash (generally three months or less).
Investments in governmental securities are stated at cost or amortized cost. However, the county did not
invest in any governmental securities during the audited fiscal year.
JEFFERSON DAVIS COUNTY
Notes to Financial Statements
For the Year Ended September 30, 1995
13
H. Receivables.
Receivables are reported net of allowances for uncollectible accounts, where applicable.
I. Interfund Receivables/Payables.
Interfund receivables and payables arise principally from loans and advances between county funds and
transactions that have not resulted in the actual transfer of cash at the end of the fiscal year. Interfund
loans due in the subsequent fiscal year are reported as "Due To" and "Due From Other Funds" and

noncurrent portions of interfund receivables and payables are reported as "Advances To" and "Advances
From Other Funds" on the combined balance sheet. The county has no interfund advances outstanding at
the end of the fiscal year.
J. Fixed Assets.
Fixed assets are not capitalized in the funds used to acquire or construct them. Instead, capital acquisition
and construction are reflected as expenditures in Governmental Funds and the related assets are reported
in the General Fixed Assets Account Group. All purchased fixed assets are stated at cost where historical
records are available and at an estimated historical cost where no historical records exist. Donated assets
are valued at market value at the time of donation. The costs of normal maintenance and repairs that do
not add to the value of assets or materially extend their respective lives are not capitalized; however,
improvements are capitalized. Interest expenditures are not capitalized on general fixed assets. Public
domain (infrastructure) fixed assets consisting of certain improvements other than buildings, such as
roads, bridges, sidewalks, drainage systems, lighting systems and similar assets that are immovable and of
value only to the county, are not capitalized. Depreciation is not provided on general fixed assets.
K. Fund Equity.
Governmental Fund Equity.
The unreserved fund balances represent the amount available for budgeting future operations. The
reserved fund balances represent the amount that has been legally restricted to a specific purpose or that is
not available for appropriation or expenditure. The county had the following reserved fund balance at
year end:
Reserved for Debt Service - An account used to segregate a portion of fund balance for debt
service resources legally restricted to the payment of general long-term debt principal and interest
amounts maturing in future years.
L. Property Tax Revenues.
Numerous statutes exist under which the Board of Supervisors may levy property taxes. The selection of
authorities is made based on the objectives and responsibilities of the county. Restrictions associated with
property tax levies vary with the statutory authority. The amount of increase in certain property taxes is
limited by state law. Generally, this restriction provides that these tax levies shall produce no more than
110% of the amount which resulted from the assessments of the previous year.
JEFFERSON DAVIS COUNTY

Notes to Financial Statements
For the Year Ended September 30, 1995
14
The Board of Supervisors, each year at a meeting in September, levies property taxes for the ensuing fiscal
year which begins on October 1. Real property taxes become a lien on January 1 of the current year and
personal property taxes become a lien on March 1 of the current year. Taxes on both real and personal
property, however, are due on or before February 1 of the next succeeding year. Taxes on motor vehicles
and mobile homes become a lien and are due in the month that coincides with the month of original
purchase.
Generally accepted accounting principles require property taxes to be recognized at the levy date if
measurable and available. All property taxes are recognized as revenue when received. Real property
taxes are recognized as revenue when received because most delinquent real property taxes are collected
by selling real property for taxes, together with all fees, penalties and damages accruing until date of sale,
before the close of the fiscal year. The remaining amount of real property not sold for taxes at the tax sale
is considered immaterial; therefore, no end of year delinquent taxes receivable is recorded. The amount of
delinquent personal property taxes unpaid at year end is also considered immaterial. Motor vehicle and
mobile home taxes do not meet the measurability and collectibility criteria for property tax recognition
because the lien and due date cannot be established until the date of original purchase occurs.
M. Intergovernmental Revenues in Governmental Funds.
Intergovernmental revenues, consisting of grants, entitlements and shared revenues, are usually recorded
in Governmental Funds when measurable and available. However, the "available" criterion applies for
certain federal grants and shared revenues when the expenditure is made because expenditure is the prime
factor for determining eligibility. Similarly, if cost sharing or matching requirements exist, revenue
recognition depends on compliance with these requirements.
N. Deferred Revenue.
Deferred revenues arise when resources are received by the government before it has a legal claim to
them, as when federal grant monies are received prior to the incurrence of qualifying expenditures. In
subsequent periods, when the revenue recognition criterion is met or when the government has a legal
claim to the resources, the liability for deferred revenue is removed from the combined balance sheet and
revenue is recognized.

O. Interfund Transfers.
Interfund transfers are segregated from revenues and expenditures in the county's financial statements.
Reimbursements of expenditures made between funds are not recorded as interfund transfers but are
recorded as expenditures in the reimbursing fund and as a reduction of expenditures in the reimbursed
fund. The county reported the following type of interfund transaction:
Operating Transfers - Legally authorized and routine transfers between funds are reported as
operating transfers. Operating transfers are reported as "Other Financing Sources (Uses)" in the
Combined Statement of Revenues, Expenditures and Changes in Fund Balances (for
Governmental and Expendable Trust Funds).
JEFFERSON DAVIS COUNTY
Notes to Financial Statements
For the Year Ended September 30, 1995
15
P. Total Column on Primary Government Financial Statements.
The total column on the primary government financial statements is captioned "Memorandum Only" to
indicate that it is presented only to facilitate financial analysis. Data in this column does not present
financial position and results of operations in conformity with generally accepted accounting principles.
Neither is such data comparable to a consolidation. Interfund eliminations have not been made in the
aggregation of this data.
(2) Budgetary Basis vs. GAAP.
The accompanying Combined Statement of Revenues, Expenditures and Changes in Fund Balances - Budget
(Non-GAAP Budgetary Basis) and Actual - All Governmental Fund Types presents comparisons of the legally
adopted budget with actual data on a budgetary basis. Since the budgetary and GAAP presentations of actual data
differ, a reconciliation of the results of operations for the year follows:
Excess of Revenues and Other Sources Over (Under) Expenditures and Other Uses
Governmental Fund Types
Special Debt
General Revenue Service
Budget (Cash Basis) $ (118,561) 49,509 2,814
Increase (Decrease)

Net adjustment for revenue accruals 53,294 (23,190) 142
Net adjustment for expenditure accruals (16,926) 111,616
GAAP Basis $ (82,193) 137,935 2,956
(3) Intergovernmental Revenues.
Intergovernmental revenues consisted of the following at September 30, 1995:
Governmental Fund Types
Special
General Revenue
Federal Sources:
Community development block grants $ 542,829
Bridge inspection program 2,240
Total Federal Sources $ 0 545,069
State Sources:
State Grants:
Reimbursement for food stamps, welfare $ 20,769
Reimbursement for homestead exemption 182,900
Reimbursement for state aid roads 36,811
Reimbursement for law enforcement 3,431
Total State Grants $ 207,100 36,811
JEFFERSON DAVIS COUNTY
Notes to Financial Statements
For the Year Ended September 30, 1995
16
Governmental Fund Types
Special
General Revenue
State Shared Revenues:
Motor vehicle fuel tax $ 367,175
Motor vehicle licenses 24,667 33,384
Severance taxes 240,717

Insurance premium tax distribution 55,863
Grand Gulf tax 2,109
Railcar tax 22,672
Harvest permit 22,830
Other state shared revenues 752
Total State Shared Revenues $ 324,108 446,061
(4) Deposits and Investments.
Deposits:
The county's cash and other deposits with financial institutions as of September 30, 1995, were entirely covered by
federal depository insurance or by collateral held by the county or its agent in the county's name.
The Financial Institution Reform, Recovery, and Enforcement Act (FIRREA) requires a collateral security
agreement to be executed between the county and the depository bank. The agreement was not executed. Since the
requirements of FIRREA have not been met pursuant to an executed collateral security agreement, the county may
not have a perfected security interest in the collateral in case of default by the depository institution.
Investments:
At year end, the carrying amount of the county's investments was $5,000,000, which approximates market value.
The county's investments at year end consisted entirely of negotiable certificates of deposits (CDs) purchased in a
secondary market from the proceeds of urban renewal revenue notes issued on December 30, 1992. The CDs are
registered in the name of the counterparty's custodial agent but are held by the agent in the county's name.
(5) Deferred Compensation Plan.
The county offers its employees a deferred compensation plan created in accordance with Internal Revenue Code
Section 457. The plan, available to all employees of the county, permits participants to defer a portion of their
salary until future years, thereby deferring taxation on the portion deferred. The deferred compensation is not
available to employees until they are separated from service or face an unforeseeable financial emergency.
All amounts of compensation deferred under the plan, all property rights purchased with those amounts and all
income attributable to those amounts, property or rights are (until paid or made available to the employee or his
beneficiary) solely the property of the employer (without being restricted to the provisions of benefits under the
plan), subject only to the claims of the employer's general creditors. Participants' rights under the plan are equal to
those of the employer's general creditors in an amount equal to the fair market value of the deferred account for
each participant.