Golf course loses money, but at a slower pace

The Atchafalaya Golf Course Commission lost about $184,000 during the fiscal year ending in 2014, and also had a total net position deficit of about $1.2 million, according to its audit report. The report was released Monday on the state legislative auditor’s website.
The commission operates The Atchafalaya at Idlewild golf course near Patterson. The Pitts & Matte CPA firm performed the commission’s audit for the year ended Sept. 30, 2014.
The audit report showed the golf course commission’s operating expenses exceeded income by $184,438 for the year ended Sept. 30, 2014. The Atchafalaya Golf Course Commission received a $250,000 grant from the St. Mary Parish Council to help cover that operating loss, according to the audit.
The previous year’s operating deficit was about $260,000.
The course, its clubhouse and certain maintenance equipment are owned by the Parish Council. Debt related to the building of the course, construction of the clubhouse and purchase of certain equipment is funded by the council, according to the audit.
The council established the commission to maintain and operate the course on behalf of the council and the public, the audit stated. The course is economically dependent upon the council.
Much of the total net position deficit is due to about $1.34 million, listed as a long-term liability. The commission owed the council for salary and benefit reimbursements incurred through Sept. 30, 2014, the report stated. The audit report says the commission agreed to reimburse the council for the salaries and other costs of the course’s staff.
The council agreed to defer repayment of the $1.34 million by the commission until December 2015, when the council may again defer repayment, according to the audit report.
Because the council recognizes the great recreational and economic benefits provided by the course, the council committed to continue funding a portion of the course’s salaries and benefits, as necessary to ensure continuing the course’s ongoing operations, the audit report said.
In the report, the auditors issue an unmodified, or clean, opinion on the commission’s financial statements.
St. Mary Parish Chief Administrative Officer Henry “Bo” LaGrange said the commission has done a great job of working hard “to maximize the revenue stream and the play at the course as much as it can.” One of the biggest avenues for revenues is the amount of tournaments the golf course is able to attract, LaGrange said.
“They’ve really done a great job of keeping controls and minimizing the expenses for the operation and maintenance, up to a point, without harming the reputation or the integrity of the course,” LaGrange said.
In the 2013-14 audit report, auditors said internal control over golf course sales revenue has four main areas including sales and collection, close out and reconciliation of register, deposit of funds and recording in accounting records.
During auditors’ test of revenues and related internal controls, they selected a sample of revenue and collections for 40 days at random. Out of 40 days activity, auditors found errors in two instances, the report said. Both errors occurred in the area of “close out and reconciliation of register,” the report stated.
Auditors did not find any instances where revenue was improperly recorded nor did they find instances of missing funds, the report stated. One “End of Shift Report” was missing and one “End of Day Audit Trail Report” did not agree to the “End of Shift Report,” according to auditors.
According to the control system in place by the golf course the following “close out and reconciliation of register” steps are to be performed daily, the report stated.
The commission’s internal control procedures require all close out documents, end of shift reports and individual cashier reports to be completed and deposited into the safe at the end of each shift, the audit stated. Lack of documentation or incomplete documentation could result in possible misstatement of revenue, according to the audit.
One document appears to have been properly completed but subsequently lost, auditors said. One document was not properly completed, auditors said.
Auditors recommended that commission employees follow all control steps, properly complete all documents, and retain all documents related to these steps. Additionally, auditors recommended that the “Individual Cashier Report” be modified to include a section for voids and a related explanation.
Management stated in the audit that it will be diligent in the future in following all procedures and make sure all required documents are properly designed, completed and retained.
While performing audit tests and inquiring about internal control, auditors discovered little segregation of duties within some of the commission’s accounting functions, which is identified as a material weakness, according to the audit report.
The finding resulted from the commission’s limited payroll. The audit suggested that the commission should determine if the improvement in internal control gained by hiring additional personnel in the accounting area justifies the additional payroll cost.
Management said it reviewed the situation and decided that additional personnel costs outweighed the internal controls derived by employing an additional person for bookkeeping.