|
Cabarrus County, North Carolina
<br />Notes to the Financial Statements
<br />For the Year Ended June 30, 2012
<br />On July 1, 1994, the County chose to establish a Workers Compensation Fund (an internal service fund) for risk
<br />associated with the workers compensation plan. The Workers Compensation Fund is where assets are set aside
<br />for claim settlements. The risk retention for Workers' Compensation is $400,000 per occurrence. The County has
<br />purchased excess workers compensation insurance for claims in excess of that amount.
<br />On June 30, 2011, the County transferred the workers compensation program to the Carolina Governmental
<br />Alliance, Inc., a governmental corporation. The change was to streamline the administration of both the liability and
<br />the workers compensation programs by placing them both under the same corporation. The remaining liability was
<br />transferred during FY 2012.
<br />On July 1, 2004, the County chose to establish a Self- Insured Health Insurance Fund (an internal service fund) for
<br />risk associated with the health insurance plan. The Health Insurance Fund is where assets are set aside for claim
<br />settlements. A premium is charged to each fund that accounts for full -time employees plus this benefit is also
<br />offered to retired employees who meet specific criteria. The total charge to each fund is based on actual calculated
<br />cost which includes but is not limited to fixed cost, mature claim cost, expected monthly liability and the number of
<br />projected employees who will be covered by insurance.
<br />The uninsured risk retention per claim is $100,000 with an aggregate stop loss of 125 %. This coverage is for
<br />claims incurred and paid in 12 months. The benefits covered are Medical MH /SA Pharmacy and Vision.
<br />A liability for a claim is established if
<br />information indicates that it is
<br />probable that a liability has been
<br />incurred at the date of the financial
<br />statements and the amount of the
<br />loss is reasonably estimable. The
<br />current claims liability for fiscal year
<br />ended June 30, 2012 is shown at
<br />right.
<br />Self- Insured Health Insurance
<br />6/30/2012
<br />Unpaid claims, beginning of fiscal year $1,305,556
<br />Incurred claims 9,202,869
<br />Claim payments (8,622,047)
<br />Unpaid claims, end of fiscal year $1.886.378
<br />6/30/2011
<br />$ 1,235,482
<br />6,594,192
<br />(6,524,118)
<br />$1.305.556
<br />In accordance with G.S. 159 -29, the County's employees that have access to $100 or more at any given time of the
<br />County's funds are performance bonded through a commercial surety bond. The Director of Finance and Tax
<br />Collector are each individually bonded for $100,000 each. The remaining employees that have access to funds are
<br />bonded under a blanket bond for $200,000.
<br />The County carries commercial coverage for all other risks of loss including flood loss. There have been no
<br />significant reductions in insurance coverage from the previous year and settled claims have not exceeded coverage
<br />in any of the past three fiscal years.
<br />The Alliance is exposed to various risks of loss related to torts, theft of, damage to, and destruction of assets, errors
<br />and omissions, and natural disasters. The Alliance has property, general liability, auto liability, workers'
<br />compensation and medical malpractice liability coverage through an outside agent.
<br />2. Contingent Liabilities
<br />The County has received proceeds from several federal and state grants. Periodic audits of these grants are
<br />required and certain costs may be questioned as not being appropriate expenditures under the grant agreements.
<br />Such audits could result in the refund of grant moneys to the grantor agencies. The amount, if any, of such refunds
<br />cannot be determined at this time although management believes that such amounts would be immaterial. No
<br />provision has been made in the accompanying financial statements for the refund of grant funds.
<br />At June 30, 2011, the County was a defendant in various lawsuits. Although the outcome of these lawsuits is not
<br />presently determinable, it is the opinion of the government's counsel that resolution of these matters will not have a
<br />material adverse effect on the financial condition of the government. Two of the lawsuits are described below.
<br />Charlotte Motor Speedway, LLC and Speedway Motorsports, Inc. vs. City of Concord and County of Cabarrus,
<br />there is no litigation pending or, to the best of the County's knowledge, threatened, against or affecting the County
<br />67 Attachment number 1
<br />1 -3 Page 323
<br />
|