PLYMOUTH TOWNSHIP, PENNSYLVANIA FINANCIAL STATEMENTS. Year Ended December 31, 2015

Transcription

1 PLYMOUTH TOWNSHIP, PENNSYLVANIA FINANCIAL STATEMENTS Year Ended December 31, 2015

2 TABLE OF CONTENTS Page Number 1 2 Table of Contents 3 5 Independent Auditor s Report Required Supplementary Information 6 14 Management s Discussion and Analysis Government-wide Financial Statements 15 Statement of Net Position 16 Statement of Activities Fund Financial Statements 17 Balance Sheet Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds 20 Budgetary Comparison Statement General Fund 21 Budgetary Comparison Statement Capital Reserve Fund 22 Budgetary Comparison Statement Highway Aid Fund 23 Budgetary Comparison Statement Health and Welfare Fund 24 Statement of Net Position Proprietary Funds 25 Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds 26 Statement of Cash Flows Proprietary Funds 27 Statement of Fiduciary Net Position 28 Statement of Changes in Fiduciary Net Position Notes to the Basic Financial Statements (Continued) THIS IS PAGE 1 OF A REPORT OF 80 PAGES

3 TABLE OF CONTENTS (CONTINUED) Page Number Required Supplementary Information 63 Schedule of Changes in the Township s Net Pension Liability and Related Ratios Police Pension Plan 64 Schedule of Changes in the Township s Net Pension Liability and Related Ratios Non-uniformed Employees Pension Plan 65 Schedule of Township Contributions Police Pension Plan 66 Schedule of Township Contributions Non-uniformed Employees Pension Plan 67 Schedule of Investment Returns Police Pension Plan and Non- Uniformed Employees' Pension Plan Other Supplementary Information 68 Schedule of Revenues General Fund Comparison of Budgeted and Actual Expenditures and Other Financing Uses General Fund 78 Statement of Revenues, Expenses, and Changes in Net Position Greater Plymouth Community Center 79 Combining Statement of Net Position Component Units 80 Combining Statement of Revenues, Expenses, and Changes in Net Position Component Units THIS IS PAGE 2 OF A REPORT OF 80 PAGES

4 DRESLIN AND COMPANY, INC. 190 W. GERMANTOWN PIKE, SUITE 150 EAST NORRITON, PA PHONE: (610) FAX: (610) THE BAXTER BUILDING, SUITE WEST CHESTER PIKE WEST CHESTER, PA PHONE: (610) FAX: (610) A PROFESSIONAL CORPORATION CERTIFIED PUBLIC ACCOUNTANTS PAUL E. FARRELL, CPA LOUIS J. PEDANTE, CPA RONALD L. MINNINGER, CPA To the Council Members of Plymouth Township Plymouth Meeting, Pennsylvania INDEPENDENT AUDITOR S REPORT We have audited the accompanying financial statements of the governmental activities, the businesstype activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of Plymouth Township, Pennsylvania, as of and for the year ended December 31, 2015, and the related notes to the financial statements, which collectively comprise the Township s basic financial statements as listed in the table of contents. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit 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 from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. THIS IS PAGE 3 OF A REPORT OF 80 PAGES

5 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of Plymouth Township, Pennsylvania, as of December 31, 2015, and the respective changes in financial position and, where applicable, cash flows thereof, and the respective budgetary comparisons for the General Fund and the Capital Reserve Fund, Highway Aid Fund, and Health and Welfare Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Change in Accounting Principle As described in Note 1 to the financial statements, beginning for the year ended December 31, 2015, Plymouth Township adopted GASB Statement No. 68, Accounting and Financial Reporting for Pensions, and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date. To comply with GASB Statements No. 68 and No. 71, the net position of the governmental activities has been restated as of January 1, 2015 to include the actuarially-determined net pension liability as of December 31, Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management s discussion and analysis on pages 5 through 13 and the supplemental pension schedules on pages 63 to 67 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise Plymouth Township, Pennsylvania s basic financial statements. The other supplementary information listed in the table of contents is presented for purposes of additional analysis and is not a required part of the basic financial statements. The other supplementary information is the responsibility of management and was derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and THIS IS PAGE 4 OF A REPORT OF 80 PAGES

6 other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. West Chester, Pennsylvania August 5, 2016 THIS IS PAGE 5 OF A REPORT OF 80 PAGES

7 PLYMOUTH TOWNSHIP Management s Discussion and Analysis Our discussion and analysis of Plymouth Township s financial performance provides an overview of the Township s financial activities for the fiscal year ended December 31, Please read it in conjunction with the Township s financial statements, which begin on page 15. FINANCIAL HIGHLIGHTS The Township continues to report adequate unrestricted net position balances for both governmental activities and business-type activities. The Township is reporting a General Fund budgetary fund balance of $8.31 million. The Township has no outstanding bonded debt. Total net position decreased by approximately $5.81 million during fiscal This is primarily attributable to: 1) depreciation expense recognized for accounting purposes exceeded capital expenditures by $492,890 2) an accrued liability for post-retirement health care and pensions was recorded in the amount of $2.18 million 3) a net use of Capital Reserve fund balance of $2.17 million. USING THIS ANNUAL REPORT This annual report consists of a series of financial statements. The Statement of Net Position and the Statement of Activities (on pages 15 and 16) provide information about the activities of the Township as a whole and present a longer-term view of the Township s finances. Fund financial statements start on page 17. For governmental activities, these statements tell how these services were financed in the short term as well as what remains for future spending. Fund financial statements also report the Township s operations in more detail than the government-wide statements by providing information about the Township s most significant funds. The remaining statements provide financial information about activities for which the Township acts solely as a trustee or agent for the benefit of those outside of the government. Reporting the Township as a Whole The Statement of Net Position and the Statement of Activities Our analysis of the Township as a whole begins on page 8. One of the most important questions asked about the Township s finances is, Is the Township as a whole better off or worse off as a result of the year s activities? The Statement of Net Position and the Statement of Activities report information about the Township as a whole 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 THIS IS PAGE 6 OF A REPORT OF 80 PAGES

8 PLYMOUTH TOWNSHIP Management s Discussion and Analysis current year s revenues and expenses are taken into account regardless of when cash is received or paid. These two statements report the Township s net position and changes in net position. You can think of the Township s net position the difference between assets and liabilities as one way to measure the Township s financial health, or financial position. Over time, increases or decreases in the Township s net position are one indicator of whether its financial health is improving or deteriorating. You will need to consider other non-financial factors, however, such as changes in the Township s tax base and the condition of the Township s infrastructure, to assess the overall health of the Township. In the Statement of Net Position and the Statement of Activities, we divide the Township into three kinds of activities: Governmental activities Most of the Township s basic services are reported here, including general administration, public safety, public works, and parks and recreation. Property taxes, the earned income tax, and business taxes finance most of these activities. Business-type activities The Township charges a fee to customers to help it cover all or most of the cost of certain services it provides. The Township s sewer system and Community Center are reported here. Component units The Township includes three separate legal entities in its report, Harmonville Fire Company, Plymouth Fire Company, and the Plymouth Township Parks Recreation and Facilities Fund (a 501(c)(3) nonprofit organization). Although legally separate, these component units are important because the Township is financially accountable for them. Reporting the Township s Most Significant Funds Fund Financial Statements Our analysis of the Township s major funds begins on page 11. The fund financial statements begin on page 17 and provide detailed information about the most significant funds not the Township as a whole. Plymouth Township Council establishes funds to help it control and manage money for particular purposes or to show that it is meeting legal responsibilities. The Township s two kinds of funds governmental and proprietary use different accounting approaches. Governmental funds Most of the Township s basic services are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end that are available for spending. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the Township s general government operations and the basic services it provides. Governmental fund information helps you determine whether there are more or fewer financial resources that can be spent in the near future to finance the Township s programs. We describe the differences between governmental activities (reported in the Statement of Net Position THIS IS PAGE 7 OF A REPORT OF 80 PAGES

9 PLYMOUTH TOWNSHIP Management s Discussion and Analysis and the Statement of Activities) and governmental funds in a reconciliation at the bottom of the fund financial statements. Proprietary funds When the Township charges customers for the services it provides, these services are generally reported in proprietary funds. Proprietary funds are reported in the same way that all activities are reported in the Statement of Net Position and the Statement of Activities. The Township as Trustee Reporting the Township s Fiduciary Responsibilities The Township is the trustee, or fiduciary, for its employees pension funds, post-retirement healthcare fund, and the deferred compensation fund. Because of trust agreements and legal restrictions, these funds can only be used for the designated beneficiaries. All of the Township s fiduciary activities are reported in separate Statements of Fiduciary Net Position and Changes in Fiduciary Net Position on pages 27 and 28. We exclude these activities from the Township s other financial statements because the Township cannot use these assets to finance its operations. The Township is responsible for ensuring that the assets reported in these funds are used for their intended purposes. THE TOWNSHIP AS A WHOLE Tables 1 and 2 that follow present a summarization of Plymouth Township s Net Position and Changes in Net Position for fiscal year Table 1 Net Position (in millions) Total Governmental Business-type Primary Activities Activities Government Current Assets $21.1 $23.7 $7.2 $7.5 $28.2 $31.1 Capital Assets Total Assets Deferred Outflows of Resources 3.9 * 0.0 * 3.9 * Total Assets and Deferred Outflows Current Liabilities Noncurrent Liabilities Total Liabilities Deferred Inflows of Resources 0.9 * 0.0 * 0.9 * Net Position: Invested in Capital Assets, Net of Debt Restricted Unrestricted Total Net Position Total Liabilities, Deferred Inflows and Net Position $50.8 $50.0 $19.1 $19.6 $69.9 $69.6 * GASB 68, implemented in 2015, requires new reporting of Deferred Inflows & Outflows. Comparative amounts not presented for THIS IS PAGE 8 OF A REPORT OF 80 PAGES

10 PLYMOUTH TOWNSHIP Management s Discussion and Analysis The Township has a significant investment in capital assets for both its governmental and business-type activities. Also, the Township is reporting a balance of unrestricted net position the portion of resources that can be used to finance day-to-day operations without constraints established by debt covenants, enabling legislation, or other legal requirements. For its governmental and business-type activities, unrestricted net position represents 21% and 49% respectively of the annual operating expenses for those activities. Table 2 Changes in Net Position (actual dollars) Total Governmental Business-type Primary Activities Activities Government Revenues Program revenues: Charges for services $3,206,757 $3,135,195 $4,774,028 $4,569,395 $7,980,785 $7,704,590 Operating grants 891, , , ,636 Capital grants 335, , , ,100 General revenues: Earned income tax 6,352,768 6,230,617 6,352,768 6,230,617 Real estate tax 3,070,593 2,605,889 3,070,593 2,605,889 Business taxes 8,886,430 8,895,231 8,886,430 8,895,231 Other taxes 35,954 37,364 35,954 37,364 Unrestricted grants Other general revenues 132, ,512 18,434 23, , ,609 Total revenues 22,912,111 22,205,544 4,792,462 4,592,492 27,704,573 26,798,036 Program expenses General government 3,638,094 2,502,079 3,638,094 2,502,079 Public safety 9,481,934 8,707,302 9,481,934 8,707,302 Public works 5,297,833 5,028,278 5,297,833 5,028,278 Culture and recreation 581,723 1,670, ,723 1,670,006 Employee Benefits 9,342,981 8,567,945 9,342,981 8,567,945 Interest on debt 0 0 Sewer 2,567,882 2,431,362 2,567,882 2,431,362 Ply Community Center 2,600,750 2,442,408 2,600,750 2,442,408 Total expenses 28,342,565 26,475,610 5,168,632 4,873,770 33,511,197 31,349,380 Excess before transfers (5,430,454) (4,270,066) (376,170) (281,278) (5,806,624) (4,551,344) Transfers 296,260 (145,075) (296,260) 145, Increase (decrease) in net assets ($5,134,194) ($4,415,141) ($672,430) ($136,203) ($5,806,624) ($4,551,344) THIS IS PAGE 9 OF A REPORT OF 80 PAGES

11 PLYMOUTH TOWNSHIP Management s Discussion and Analysis Governmental Activities For governmental activities, there was a $5.13 million decrease in net position during fiscal This is attributable to several factors. Depreciation expense recognized for governmental activities exceeded capital expenditures by $492,890. In addition, there was a net use of Capital Reserve fund balance of $2.17 million. Net assets were also decreased by a Governmental Funds accrual for post-retirement health care and pension costs of $2.18 million. The cost of all governmental activities this year was $28.3 million. However, as shown in the Statement of Activities on page 16, the amount our taxpayers ultimately financed for these activities through Township taxes was $23.9 million because some of the cost was paid by those who directly benefited from the programs ($3.2 million) or by other governments and organizations that subsidized certain programs with grants and contributions ($1.2 million). Overall, the Township s governmental program revenues, including intergovernmental aid and fees for services, amounted to $4.4 million in fiscal The Township paid for the remaining public benefit portion of governmental activities with $18.8 million in taxes and other revenue, such as interest and unrestricted grants. Table 3 presents the cost of each of the Township s largest programs as well as each program s net cost (total cost less revenues generated by the activities). The net cost shows the financial burden that was placed on the Township s taxpayers by each of these functions. Business Activities Table 3 Governmental Activities (actual dollars) Total Cost Net Cost of Services of Services General government $3,638,094 $2,502,079 $2,371,538 $1,331,867 Public safety 9,481,934 8,707,302 8,288,527 7,542,420 Public works 5,297,833 5,028,278 4,239,367 3,983,939 Culture and recreation 581,723 1,670, ,365 1,371,855 Employee benefits 9,342,981 8,567,945 8,729,116 7,961,598 Totals $28,342,565 $26,475,610 $23,908,913 $22,191,679 For business-type activities, net position decreased during fiscal 2015 by $672,430. The aim of the business activities is that services be priced to cover costs. Revenue from sewer activities was $127,248 more than costs primarily because quarterly sewer rates were set slightly higher than the cost of running the system. Revenue from Community Center activities was $521,852 less than costs primarily because membership rates are not structured to recover depreciation. Overall, business-type activities generated revenue of approximately $4.8 million and expenses of approximately $5.2 million. There were other miscellaneous amounts recorded for interest income and fund transfers which resulted in net additional cost of $277,826. THIS IS PAGE 10 OF A REPORT OF 80 PAGES

12 PLYMOUTH TOWNSHIP Management s Discussion and Analysis THE TOWNSHIP S FUNDS As the Township completed the fiscal year, its governmental funds (as presented in the balance sheet on page 17) reported a combined fund balance of $20.1 million which is a decrease of $2.2 million from last year s total of $22.3 million. As noted on page 18, the Capital Reserve, Highway Aid and Health and Welfare funds reported decreases in fund balance of $2,174,833, $27,015 and $101,857, respectively. The fund balance of the General Fund increased by $120,756. General Fund Budgetary Highlights The 2015 budget, as adopted, did not require any subsequent changes by Township Council. The General Fund Budgetary Comparison Statement on page 20 reflects that the Township ended fiscal 2015 with a budgetary fund balance of approximately $8.31 million of which $6.25 million was in the form of cash (page 17), the balance consisting mostly of taxes receivable. There were some significant variations between budgeted and actual amounts for For the purpose of discussing budget variances, significant variations will be considered those where the actual expenditure or revenue for a line item differs from the budget by $100,000 or more. Overall, revenue was better than projected in several areas resulting in a positive variance of $1,485,988. This is primarily a result of the fact that Earned Income Tax collections, which are closely tied to the performance of the national economy, grew significantly from the prior year. Earned Income Tax was $699,015 more than budgeted. Business Privilege Tax collections were $129,943 less than budgeted because our budget anticipated a greater growth of the service sector within the Township than what actually occurred. Real Estate Transfer Tax was $263,342 more than budgeted due to the sale of several large commercial properties in the Township. Revenue from the Solid Waste Disposal Tax was $470,066 more than budgeted. After the dissolution of the Waste System Authority of Eastern Montgomery County in 2015, we had anticipated lower tonnage at the local trash to steam plant from which we receive $2 per ton. However, the plant was able to find replacement customers for the local governments it lost in Montgomery County. Charges for Services were $100,374 higher than budgeted due to increased demand for building permit inspection services. There were some other positive and negative revenue variances, none of which exceeded $100,000. Overall, actual expenditures in 2015 for the General Fund were $622,201 million more than the original budget. Transfers to Other Funds were $500,000 more than budgeted because of a year-end transfer to the Capital Fund which was not included in the original budget. Under Administration, expenditures were $197,000 more than budgeted because of the unanticipated need to purchase a large computer server and power back up and higher than expected insurance claim deductibles. Under Tax Collection, expenditures were $174,658 more than budgeted due to higher than anticipated real estate tax refunds issued as a result of assessment appeals. Under Police Protection, expenditures were $110,646 less than budgeted due to temporarily unfilled positions and underspending in numerous other budget categories. There were some other positive and negative expenditure variances, none of which exceeded $100,000. THIS IS PAGE 11 OF A REPORT OF 80 PAGES

13 PLYMOUTH TOWNSHIP Management s Discussion and Analysis CAPITAL ASSET AND DEBT ADMINISTRATION Capital Assets At the end of 2015, the Township had $37.7 million invested in a broad range of capital assets including police and public works equipment, municipal buildings and land, park facilities, roads, bridges, sanitary sewers, and storm sewers. This 2015 net asset amount represents a net decrease of $0.9 million, or 2.3%, compared to the previous year. The decrease was caused primarily by the accounting recognition of a full year of depreciation on Township assets. Table 4 Capital Assets at Year-end (Net of depreciation, in millions) Governmental Business-type Activities Activities Totals Construction in progress Land Buildings Improvements Machinery and equipment Infrastructure Totals $25.8 $26.4 $11.9 $12.2 $37.7 $38.6 The Township expended $2,438,275 to acquire and construct capital assets during Capital expenditures were made to purchase police and public works vehicles, to construct and improve recreational facilities, for intersection improvements and street paving, and for replacement of sanitary sewer infrastructure. The Township s fiscal 2016 capital budget calls for $5.12 million in capital expenditures. The bulk of the expenditures will be for intersection improvements, upgrades to Township buildings and mechanical systems, sanitary sewer projects, street paving, and storm water projects. The Township has no plans to issue debt to finance any capital projects. Projects will be financed from monies previously reserved in the Capital Fund. More detailed information about the Township s capital assets is presented in the Notes to the Basic Financial Statements. THIS IS PAGE 12 OF A REPORT OF 80 PAGES

14 PLYMOUTH TOWNSHIP Management s Discussion and Analysis Debt, Pension and Postemployment Benefit Obligations At December 31, 2015, the Township had no outstanding bonded debt. The last remaining bond issue was redeemed in full during fiscal year The Township has a long-term liability for accrued employee leave time amounting to $328,343. The Township has also recorded a liability in the Statement of Net Position for other postemployment benefits in the amount of $12,828,801. This is an actuarially calculated number representing the cost of postemployment health care benefits that should have been funded since the implementation of Governmental Accounting Standards Board Statement 45 but were not. As of December 31, 2014, the most recent actuarial valuation date, the total accrued liability for benefits was $38,370,532, the market value of assets in the Post-Retirement Health Care Trust Fund was $18,857,957 and the unfunded actuarial accrued liability was $19,512,575. In 2015, the Township made a contribution of $1,109,008 toward the cost of postretirement healthcare benefits for retirees. The Township has reported a Net Pension Liability in the amount of $4,116,595. More detailed information about the Township s long-term liabilities is presented in the Notes to the Basic Financial Statements. ECONOMIC FACTORS AND THE 2016 BUDGETS AND RATES The Township s elected and appointed officials considered many factors when setting the fiscal year 2016 budget. One of those factors was the economy. Because the national economy is continuing to recover from a period of sluggish growth, business tax revenues for the Township were expected to remain relatively flat. Inflation was expected to be in the 2.0% to 2.5% range and interest rates were expected to remain at historically low levels during These indicators were taken into account when adopting the General Fund budget for Overall, General Fund revenue was estimated at $22.7 million, which represents a $1.6 million increase from the amount budgeted for Revenue from the Real Estate Tax is expected to increase only slightly as receipts generated from new construction are being offset by a large volume of assessment appeals. Earned Income Tax collections should continue to grow and the amount budgeted was increased by $775,000 for Business taxes collections were anticipated to decrease slightly. The estimate of Mercantile Tax revenue for 2016 was decreased by $83,800 and the estimate of Business Privilege Tax revenue for 2016 was decreased by $77,000 from the prior year budget. The Township expects to earn interest of only 0.25% to 0.85% on its short-term and medium-term investments and the amount budgeted for Interest Earnings for 2016 reflects this. Revenue from all other revenue sources for 2016 is expected to be roughly the same as amounts budgeted in Budgeted General Fund expenditures for 2016 increased by $1.1 million from the amount budgeted in the prior year. The increase is the result of 1) filling several previously vacant positions 2) contractual salary increases for employees and 3) rising health care and pension costs. The Township has added no major new programs or initiatives to the 2016 budget. THIS IS PAGE 13 OF A REPORT OF 80 PAGES

15 PLYMOUTH TOWNSHIP Management s Discussion and Analysis As for the Township s business-type activities, we expect that the 2016 results will be consistent with the prior years. For the Sewer Fund, it is anticipated that there may be a small rate increase in 2016 to ensure the rate structure is sufficient to cover all operating and capital costs. For the Community Center Fund, the rate structure for member passes can be revised should revenue fall short of expenditures. The Community Center also periodically revises its services and programs to generate additional revenue. CONTACTING THE TOWNSHIP S FINANCIAL MANAGEMENT This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors with a general overview of the Township s finances and to show the Township s accountability for the money it receives. If you have questions about this report or need additional financial information, contact the Finance Director, Plymouth Township, 700 Belvoir Road, Plymouth Meeting, PA THIS IS PAGE 14 OF A REPORT OF 80 PAGES

16 PLYMOUTH TOWNSHIP Statement of Net Position December 31, 2015 Primary Government Governmental Business-type Component Activities Activities Total Units ASSETS Current Assets: Cash and Cash Equivalents $ 324,956 $ 2,294,699 $ 2,619,655 $ 1,623,848 Equity in Pooled Cash and Investments 17,853,474 4,129,318 21,982,792 14,929 Investments ,583,676 Accrued Interest 61,883 13,772 75, Internal Balances (87,465) 87, Due from Primary Government Taxes Receivable 2,710,864-2,710,864 - Other Receivables 187, , ,233 - Total Current Assets 21,051,344 7,183,855 28,235,199 3,222,500 Noncurrent Assets: Capital Assets: Land and Improvements (Non Depreciable) 4,997, ,002 5,927, ,001 Other Capital Assets, Net of Depreciation 20,869,388 10,969,930 31,839,318 3,464,460 Total Capital Assets 25,866,420 11,899,932 37,766,352 3,604,461 Total Noncurrent Assets 25,866,420 11,899,932 37,766,352 3,604,461 Total Assets 46,917,764 19,083,787 66,001,551 6,826,961 DEFERRED OUTFLOWS OF RESOURCES Pensions 3,895,968-3,895,968 - Total Assets and Deferred Outflows of Resources $ 50,813,732 $ 19,083,787 $ 69,897,519 $ 6,826,961 LIABILITIES Current Liabilities: Accounts Payable and Accrued Expenses $ 479,229 $ 335,060 $ 814,289 $ - Due to Component Unit Payroll Taxes ,118 Unearned Revenue 150, , ,000 - Total Current Liabilities 629, ,060 1,065,323 5,118 Noncurrent Liabilities: Liability for Compensated Absences 328, ,343 - Net Other Post-employment Benefits Obligation 12,828,801-12,828,801 - Net Pension Liabilities 4,116,595-4,116,595 - Total Noncurrent Liabilities 17,273,739-17,273,739 - Total Liabilities 17,903, ,060 18,339,062 5,118 DEFERRED INFLOWS OF RESOURCES Pensions 910, ,449 - NET POSITION Invested in Capital Assets, Net of Related Debt 25,866,420 11,899,932 37,766,352 3,604,461 Restricted - 4,193,609 4,193,609 - Unrestricted 6,133,861 2,554,186 8,688,047 3,217,382 Total Net Position 32,000,281 18,647,727 50,648,008 6,821,843 Total Liabilities, Deferred Inflows of Resources, and Net Position $ 50,813,732 $ 19,083,787 $ 69,897,519 $ 6,826,961 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 15 OF A REPORT OF 80 PAGES

17 PLYMOUTH TOWNSHIP Statement of Activities For the Year Ended December 31, 2015 Program Revenues Net (Expense) Revenue and Changes in Net Assets Primary Government Operating Capital Business- Charges for Grants and Grants and Governmental type Component Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Units PRIMARY GOVERNMENT: Governmental Activities: General Government $ 3,638,094 $ 1,266,556 $ - $ - $ (2,371,538) $ (2,371,538) Public Safety 9,481,934 1,013, ,236 - (8,288,527) (8,288,527) Public Works 5,297, ,672 97, ,000 (4,239,367) (4,239,367) Culture and Recreation 426, , (124,745) (124,745) Conservation of Natural Resources 155, (155,620) (155,620) Employee Benefits 9,342, ,865 - (8,729,116) (8,729,116) Total Governmental Activities 28,342,565 3,206, , ,000 (23,908,913) (23,908,913) Business-type Activities: Sewer 2,567,882 2,695, $ 127, ,248 Greater Plymouth Community Center 2,600,750 2,078, (521,852) (521,852) Total Business-type Activities 5,168,632 4,774, (394,604) (394,604) Total Primary Government $ 33,511,197 $ 7,980,785 $ 891,895 $ 335,000 (23,908,913) (394,604) (24,303,517) COMPONENT UNITS: Fire Companies $ 1,024,276 $ 28,419 $ 1,558,469 $ - $ 562,612 Non-profit Entities 235-7,357-7,122 Total Component Units $ 1,024,511 $ 28,419 $ 1,565,826 $ - 569,734 General Revenues: Taxes: Earned Income Tax 6,352,768-6,352,768 - Real Estate Taxes 3,070,593-3,070,593 - Business Privilege Taxes 3,647,057-3,647,057 - Mercantile Taxes 2,450,831-2,450,831 - Real Estate Transfer Taxes 703, ,342 - Local Services Tax 960, ,344 - Solid Waste Disposal Tax 1,124,856-1,124,856 - Other Taxes 35,954-35,954 - Unrestricted Investment Earnings 78,811 18,434 97,245 (24,101) Gain on Sale of Equipment ,298 Miscellaneous 53,903-53,903 15,299 Transfers 296,260 (296,260) - - Total General Revenues and Transfers 18,774,719 (277,826) 18,496,893 19,496 Change in Net Position (5,134,194) (672,430) (5,806,624) 589,230 Net Position - Beginning of Year (As Restated) 37,134,475 19,320,157 56,454,632 6,232,613 Net Position - End of Year $ 32,000,281 $ 18,647,727 $ 50,648,008 $ 6,821,843 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 16 OF A REPORT OF 80 PAGES

18 Health Total Capital Highway and Governmental General Reserve Aid Welfare Funds ASSETS Cash and Cash Equivalents $ 285,070 $ 4,907 $ 3,255 $ 31,724 $ 324,956 Equity in Pooled Cash and Investments 5,968,451 11,298,156 63, ,933 17,853,474 Accrued Interest 8,329 10, ,632 Taxes Receivable 2,710, ,710,864 Other Receivables 187, ,632 Total Assets $ 9,160,346 $ 11,313,278 $ 67,277 $ 554,657 $ 21,095,558 LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES PLYMOUTH TOWNSHIP Balance Sheet Governmental Funds December 31, 2015 LIABILITIES Accounts Payable and Accrued Expenses 473,123 $ 2,692 $ - $ 3,414 $ 479,229 Interfund Payables 87, ,465 Due to Component Unit Unearned Revenue - 150, ,000 Total Liabilities 560, ,692-3, ,728 DEFERRED INFLOWS OF RESOURCES Deferred Tax Revenues 286, ,121 Total Deferred Inflows of Resources 286, ,121 FUND BALANCES Restricted - 3,504,017 67,277-3,571,294 Assigned - 7,656, ,243 8,207,812 Unassigned 8,313, ,313,603 Total Fund Balances 8,313,603 11,160,586 67, ,243 20,092,709 Total Liabilities, Deferred Inflows of Resources, and Fund Balances $ 9,160,346 $ 11,313,278 $ 67,277 $ 554,657 $ 21,095,558 Reconciliation of the fund balances of governmental funds to net position of governmental activities: Total Fund Balances - Total Governmental Funds $ 20,092,709 Amounts reported for governmental activities in the Statement of Net Position are different because: Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds, net of accumulated depreciation of $559,685,184 25,866,420 Accrued interest income that is not available to pay liabilities of the current period does not represent available spendable financial resources, and is therefore not reported in the funds 43,251 Long-term liabilities are not due and payable in the current period and therefore are not reported in the funds: Compensated Absences (328,343) Net Other Post-employment Benefits (12,828,801) Net Pension Liability, Net of Related Deferred Outflows and Deferred Inflows (1,131,076) Earned income tax revenue collected beyond 90 days of year-end are included in net position of governmental activities, but are not accrued as income in the funds 286,121 Net Position of Governmental Activities $ 32,000,281 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 17 OF A REPORT OF 80 PAGES

19 PLYMOUTH TOWNSHIP Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Year Ended December 31, 2015 Health Total Capital Highway and Governmental General Reserve Aid Welfare Funds REVENUES Earned Income Tax $ 6,684,015 $ - $ - $ - $ 6,684,015 Real Estate Taxes 3,070, ,070,593 Business Privilege Taxes 3,647, ,647,057 Mercantile Taxes 2,450, ,450,831 Real Estate Transfer Taxes 703, ,342 Local Services Tax 1,016, ,016,902 Solid Waste Disposal Tax 1,124, ,124,856 Other Taxes 35, ,954 Licenses and Permits 1,375, ,375,329 Fines and Forfeits 243, ,369 Interest Income and Investment Earnings 17,518 17, ,560 Rental Income - 25, ,000 Intergovernmental 891, , ,243-1,600,138 Charges for Services 961, ,924 Assessments and Fees - 227, ,892 Miscellaneous 53, ,903 Total Revenues 22,277, , , ,256,665 EXPENDITURES General Government 2,735,059 1,239, ,974,642 Public Safety 8,733, , ,527,876 Public Works 2,037,729 1,141, ,792-3,579,522 Culture and Recreation 1,161, , ,338,285 Conservation of Natural Resources - 155, ,620 Employee Benefits 2,934, ,225,746 7,159,929 Total Expenditures 17,601,316 3,508, ,792 4,225,746 25,735,874 Excess of Revenues Over (Under) Expenditures 4,676,172 (2,902,627) (27,015) (4,225,739) (2,479,209) OTHER FINANCING SOURCES (USES) Transfers In 268, ,000-4,123,882 5,182,348 Transfers Out (4,823,882) (62,206) - - (4,886,088) Total Other Financing Sources and (Uses) (4,555,416) 727,794-4,123, ,260 Net Change in Fund Balances 120,756 (2,174,833) (27,015) (101,857) (2,182,949) Fund Balances - Beginning of Year 8,192,847 13,335,419 94, ,100 22,275,658 Fund Balances - End of Year $ 8,313,603 $ 11,160,586 $ 67,277 $ 551,243 $ 20,092,709 (Continued) THIS IS PAGE 18 OF A REPORT OF 80 PAGES

20 PLYMOUTH TOWNSHIP Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds (Continued) For the Year Ended December 31, 2015 Reconciliation of the change in fund balances - total governmental funds to the change in net position of governmental activities: Net Change in Fund Balances - Total Governmental Funds $ (2,182,949) Amounts reported for governmental activities in the Statement of Activities are different because: Governmental funds report capital outlays as expenditures while governmental activities report depreciation expense to allocate those expenditures over the life of the assets: Capital Asset Purchases Capitalized 2,292,458 Depreciation Expense (2,785,348) The following changes in long-term liabilities affect expenses in the Statement of Activities, but are not reflected in the Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds: Liability for Compensated Absences 69,251 Net Other Post-employment Benefits Obligation (1,637,342) Net Pension Liability, Net of Related Deferred Outflows and Deferred Inflows (545,710) The change in accrued interest income that is not available to pay liabilities of the current period does not represent available spendable financial resources, and is therefore not reported in the funds 43,251 The change in deferred inflow of resources for earned income taxes collected beyond 90 days of year-end is reflected in the Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds, but does not affect revenues recognized in the Statement of Activities (387,805) Change in Net Position of Governmental Activities $ (5,134,194) The accompanying notes are an integral part of these financial statements. THIS IS PAGE 19 OF A REPORT OF 80 PAGES

21 PLYMOUTH TOWNSHIP Budgetary Comparison Statement - General Fund For the Year Ended December 31, 2015 Original Favorable and Final Actual (Unfavorable) Budget Amounts Variance Revenue and Other Financing Sources: Earned Income Tax $ 5,985,000 $ 6,684,015 $ 699,015 Real Estate Taxes 3,003,000 3,070,593 67,593 Business Privilege Taxes 3,777,000 3,647,057 (129,943) Mercantile Taxes 2,543,800 2,450,831 (92,969) Real Estate Transfer Taxes 440, , ,342 Local Services Tax 1,075,000 1,016,902 (58,098) Solid Waste Disposal Tax 654,790 1,124, ,066 Other Taxes 37,500 35,954 (1,546) Licenses and Permits 1,287,915 1,375,329 87,414 Fines and Forfeits 186, ,369 57,119 Interest Income 8,000 17,518 9,518 Intergovernmental 908, ,895 (16,300) Charges for Services 861, , ,374 Miscellaneous 23,500 53,903 30,403 Transfers from Other Funds 268, ,466 - Total Revenue and Other Financing Sources 21,059,966 22,545,954 1,485,988 Expenditures and Other Financing Uses: General Government: Manager's Office 513, ,376 (11,228) Administration 1,052,947 1,249,947 (197,000) Tax Collection 204, ,533 (174,658) Township Building 292, ,388 (10,521) Reimbursable Costs 240, ,815 (37,815) Public Safety: Police Protection 6,817,334 6,706, ,646 Fire Protection 1,243,194 1,157,709 85,485 Zoning 121, ,892 (1,412) Building 571, ,749 (66,748) Code Enforcement 133, ,216 25,609 Public Works: Sanitation 999, ,702 43,398 Administration 392, ,594 9,956 Street Maintenance 108, ,288 (8,438) Highway Services 310, ,051 56,449 Equipment Maintenance and Purchases 314, ,094 (14,094) Culture and Recreation: Buildings and Grounds 693, ,849 4,451 Parks and Recreation 551, ,242 79,263 Employee Benefits 2,919,139 2,934,183 (15,044) Transfers to Other Funds 4,323,882 4,823,882 (500,000) Total Expenditures and Other Financing Uses 21,803,497 22,425,198 (621,701) Net Change in Fund Balance $ (743,531) 120,756 $ 864,287 Fund Balance - Beginning of Year 8,192,847 Fund Balance - End of Year $ 8,313,603 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 20 OF A REPORT OF 80 PAGES

22 PLYMOUTH TOWNSHIP Budgetary Comparison Statement - Capital Reserve Fund For the Year Ended December 31, 2015 Original Favorable and Final Actual (Unfavorable) Budget Amounts Variance Revenue and Other Financing Sources: Interest Income $ 55,375 $ 17,501 $ (37,874) Rental Income - 25,000 25,000 Intergovernmental 542, ,000 (207,175) Assessments and Fees 14, , ,892 Transfers from Other Funds 90, , ,000 Total Revenue and Other Financing Sources 701,550 1,395, ,843 Expenditures and Other Financing Uses: General Government 1,216,500 1,239,583 (23,083) Public Safety: Police Protection - 1,975 (1,975) Fire Protection - 778,497 (778,497) Planning and Zoning 17,000 14,150 2,850 Public Works: Traffic Control Devices 3,138, ,173 2,583,079 Highways, Roads, and Streets - 585,828 (585,828) Culture and Recreation: Parks and Recreation 194,537 95,219 99,318 Other - 81,975 (81,975) Conservation of Natural Resources - 155,620 (155,620) Transfers to Other Funds - 62,206 (62,206) Total Expenditures and Other Financing Uses 4,566,289 3,570, ,063 Net Change in Fund Balance $ (3,864,739) (2,174,833) $ 1,689,906 Fund Balance - Beginning of Year 13,335,419 Fund Balance - End of Year $ 11,160,586 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 21 OF A REPORT OF 80 PAGES

23 PLYMOUTH TOWNSHIP Budgetary Comparison Statement - Highway Aid Fund For the Year Ended December 31, 2015 Original Favorable and Final Actual (Unfavorable) Budget Amounts Variance Revenue: Interest Income $ 500 $ 534 $ 34 Intergovernmental 361, ,243 11,582 Total Revenue 362, ,777 11,616 Expenditures: Public Works - Highways, Roads, and Streets 415, ,792 14,855 Total Expenditures 415, ,792 14,855 Net Change in Fund Balance $ (53,486) (27,015) $ 26,471 Fund Balance - Beginning of Year 94,292 Fund Balance - End of Year $ 67,277 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 22 OF A REPORT OF 80 PAGES

24 PLYMOUTH TOWNSHIP Budgetary Comparison Statement - Health and Welfare Fund For the Year Ended December 31, 2015 Original Favorable and Final Actual (Unfavorable) Budget Amounts Variance Revenue and Other Financing Sources: Investment Earnings 10 7 (3) Transfers from Other Funds 4,123,882 4,123,882 - Total Revenue and Other Financing Sources 4,123,892 4,123,889 (3) Expenditures: Employee Benefits 4,123,892 4,225,746 (101,854) Total Expenditures 4,123,892 4,225,746 (101,854) Net Change in Fund Balance $ - (101,857) $ (101,857) Fund Balance - Beginning of Year 653,100 Fund Balance - End of Year $ 551,243 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 23 OF A REPORT OF 80 PAGES

25 PLYMOUTH TOWNSHIP Statement of Net Position Proprietary Funds December 31, 2015 Enterprise Funds Greater Sewer Plymouth Revenue Community and Reserve Center Totals ASSETS Current Assets: Cash and Cash Equivalents $ 699,126 $ 1,595,573 $ 2,294,699 Equity in Pooled Cash and Investments 4,027, ,644 4,129,318 Accrued Interest 13, ,772 Sewer Rents Receivable 658, ,601 Interfund Receivables - 87,465 87,465 Total Current Assets 5,398,770 1,785,085 7,183,855 Noncurrent Assets: Capital Assets: Land 2 930, ,002 Construction and Extensions - Sewer System 6,654,296-6,654,296 Building and Equipment 908,250 11,376,928 12,285,178 Less Accumulated Depreciation (4,083,217) (3,886,327) (7,969,544) Total Noncurrent Assets 3,479,331 8,420,601 11,899,932 Total Assets $ 8,878,101 $ 10,205,686 $ 19,083,787 LIABILITIES AND NET POSITION LIABILITIES Current Liabilities: Accounts Payable and Accrued Expenses $ 238,896 96,164 $ 335,060 Unearned Revenue - 101, ,000 Total (Current) Liabilities 238, , ,060 NET POSITION Invested in Capital Assets 3,479,331 8,420,601 11,899,932 Restricted 4,193,609-4,193,609 Unrestricted 966,265 1,587,921 2,554,186 Total Net Position 8,639,205 10,008,522 18,647,727 Total Liabilities and Net Position $ 8,878,101 $ 10,205,686 $ 19,083,787 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 24 OF A REPORT OF 80 PAGES

26 PLYMOUTH TOWNSHIP Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds For the Year Ended December 31, 2015 Enterprise Funds Greater Sewer Plymouth Revenue Community and Reserve Center Totals OPERATING REVENUES Charges for Services $ 2,689,405 $ 2,078,898 $ 4,768,303 Special Assessments 5,725-5,725 Total Operating Revenues 2,695,130 2,078,898 4,774,028 OPERATING EXPENSES Sewage Collection and Treatment 2,459,091-2,459,091 Culture and Recreation - 2,313,428 2,313,428 Depreciation 108, , ,113 Total Operating Expenses 2,567,882 2,600,750 5,168,632 Operating Income (Loss) 127,248 (521,852) (394,604) NON-OPERATING REVENUES Interest Income 18,628 (194) 18,434 Income (Loss) Before Transfers 145,876 (522,046) (376,170) TRANSFERS IN - 62,206 62,206 TRANSFERS OUT (268,466) (90,000) (358,466) Change in Net Position (122,590) (549,840) (672,430) Total Net Position - Beginning of Year 8,761,795 10,558,362 19,320,157 Total Net Position - End of Year $ 8,639,205 $ 10,008,522 $ 18,647,727 The accompanying notes are an integral part of these financial statements. THIS IS PAGE 25 OF A REPORT OF 80 PAGES