Auditors: ABC Board in good financial shape
Published 12:00 am Thursday, October 18, 2012
By Karissa Minn
SALISBURY – The Rowan-Kannapolis ABC Board’s financial fitness is the best it’s been in years, according to accountants who conducted an annual audit.
Sam Leder and Daniel Morrow of Potter and Co., P.A., on Thursday presented the report and financial statements, which compare the ABC system’s finances on June 30, 2012, and June 30, 2011.
The accounting firm has issued a clean, unqualified audit opinion, meaning that it believes the financial statements are materially correct.
“Of all the years I’ve been here, this was the best year financially that the ABC board has had,” Leder said at the board meeting.
Cash and cash equivalents increased by more than $219,000 to a total of $910,000. Inventory value decreased by about $62,000 to a total of $658,000.
The system has now paid down all of its long-term debt, after just $2,790 remained on June 30, 2011.
The ABC board has agreed to distribute all of its profits to local governments, and those total distributions increased from $114,243 last year to $383,200 this year.
“Basically, you’ve had an increase in net income of $269,000,” Morrow said.
Leder called that number “impressive” and added, “That’s why I say you’ve had a good year.”
In its 2011-12 budget – the first balanced budget it was required to pass – the board underestimated its total sales by nearly $573,000. That’s good for revenue, but the board also underestimated its taxes and costs from those sales, along with credit card expenses and distribution amounts.
Alcohol sales rose from $9.34 million to $9.81 million in the year ending June 30. At the same time, the cost of sales grew from $4.94 million to $5.17 million, and total taxes rose from $2.15 million to $2.25 million.
“With your new budget, you do need to look at revising it during the year,” Leder said. “Sales were so much higher this year, and that led to some other stuff being up, too.”
The ABC system’s operating expenses decreased from $2.08 million to $2.01 million.
“I’d like to commend our employees for their reduction in operating expenses,” said board member Ken Argo. “They have taken hold of it, and they know what our goals are.”
Chairman David McCoy asked what the board could do to increase its segregation of duties, which is one of the recommendations made by the auditing firm.
“I think you’re doing a fantastic job for the number of people you have, and I don’t want you to go hire two more people to segregate duties,” Leder said.
Board member Linda Lowman offered to go over the financial statements each month, and Leder said that could help prevent the issue from coming up again next year.
Also at Thursday’s meeting, the board heard a monthly report from finance officer Julie Eller.
Total sales in September were about $757,000, down from more than $762,000 at the same time last year. The system saw a decrease in sales of $5,558, or about 1 percent.
Bottled liquor sales rose slightly compared to September 2011, from more than $698,000 to nearly $701,000. Liquor by the drink sales decreased by 12 percent from $64,000 to $56,000.
Contact reporter Karissa Minn at 704-797-4222.