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Cabarrus County, North Carolina Notes to the Financial Statements For the Year Ended June 30, 2012 Period Fraction Prior to 10/1/97 Two thirty -first (2/31) 10/1/97 to 9/30/98 One - fifteenth (1/15) 10/1/98 to 9/30/99 Two twenty- ninths (2/29) 10/1/99 to 9/30/00 One fourteenth (1/14) After 9/30/00 Five sixty- ninths (5/69) The corporate income taxes deposited into the Fund are allocated to the County on the basis of its average daily membership (ADM) as determined by the North Carolina State Board of Education. The Office of State Budget and Management established and maintains an ADM allocation account for the County. At June 30, 2012 the balance of the County's ADM allocation account was $125. The County must match this balance on the basis of one dollar for every three dollars of state funds for financing the school unit's facilities capital needs. The local school technology plan does not require a County match. After approving a school capital project authorized by the Act, the Office of State Budget and Management will transfer funds from the County's ADM allocation account to its disbursing account maintained with the State Treasurer. At that time, the ADM allocation transferred is considered to be "available" and is recognized in the Public School Building Capital Fund as intergovernmental revenue. At June 30, 2012 the County's disbursing account had a $0 balance. O. Benefit payments Issued by the State The following amounts listed under the columns labeled "Federal" and "State" were paid by the State of North Carolina from federal and state moneys directly to individual recipients on behalf of Cabarrus County and Cabarrus Health Alliance and are not included in the County's or the Federal State Medical assistance $97,108,550 $55,316,944 Temporary assistance to needy families 706,930 - Special assistance to adults - 1,142,077 Refugee 4,912 - Adoption assistance 591,198 157,347 Total $98,411,590 $56,616,368 Alliance's financial statements since the County and the Alliance have no primary responsibilities beyond making eligibility determinations. P. Internal Service The County has two internal service funds for self- insured hospitalization insurance and workers compensation. The self- insured hospitalization insurance fund accumulates premiums and pays all claims and related expenses health insurance activities. The Workers Compensation fund previously handled the premiums and the claims for workers compensation prior to transferring the majority of the liability to the Carolina Governmental Alliance, Inc. during FY2011. In early FY2012, the remaining $350,000 of the liability was transferred and the fund was closed. At June 30, 2012, the workers compensation internal service fund had an unrestricted net asset balance of $0 and the self- insured hospitalization internal service fund had an unrestricted net asset balance of $2,269,491. In the basic financial statements, the net assets and activities have been allocated to all governmental fund types, and business types as applicable. This surplus is being retained for anticipated future catastrophic losses. Note 3. Other Information 1. Risk Management The County 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. The County participates in a liability program which is financed using a combination of self- funding and participation in the Carolina Governmental Alliance, Inc., a governmental corporation. The County retains the first $350,000 in liability claims and claims expenses which are payable by the Carolina Governmental Alliance, Inc. Excess liability insurance above the $350,000 retention is purchased up to a total limit of $2,000,000 per occurrence and $5,000,000 aggregate. The property insurance program is financed using a combination of self- funding and participation in the Carolina Governmental Alliance, Inc., a governmental corporation. Excess property insurance above a $25,000 deductible is purchased based on estimated replacement values, submitted to the Excess Property Company each year. 66 Attachment number 1 1 -3 Page 322