Dec. 27, 2012 — According to the results of an audit revealed at the Lassen Municipal Utility District’s Dec. 18 meeting, the publicly owned utility district is a “very well run, very health utility,” according to a telephonic presentation by J.T. Friedl, CPA, a manager for the Baker Tilly firm.

Friedl said the district staff was prepared and ready for the audit and all the fieldwork went smoothly.

Friedl recommended improvements should be made to the district’s inventory adjustment and unit pricing procedures; continuing property records practices may need to be revised because of potential overstatement of values; review work order process to ensure costs are properly tracked; and comply with GASB 51 policy.

Friedl said the most of the numbers included in the 2012 audit reflect, “Exactly what we expected to happen” and made “total sense to us.”

The district’s operating revenues declined from $10.6 million in 2011 to $9.9 million in 2012. Domestic and commercial sales make up 89 percent of the district’s revenue, and those numbers declined by about 7 percent this year.

Operating expenses fell from $9.7 million in 2011 to $8.7 million in 2012 resulting in an operating income of $3 million in 2011 and $2 million in 2012.

According to Friedl, “$2 million is still very, very strong for a utility of this size.”

The district sold 129.9 million kilowatts of power in 2011 and 129.6 kWh in 2012. In 2011 each kWh generated 13.6 cents compared with 12.1 cents in 2012.

The district has $40.2 million in total net assets in 2012 compared to $38.2 million in 2011.

The district also enjoys 6.91 months of unrestricted cash in 2012 compared to 5.48 months of unrestricted cash in 2011.

General Manager Bill Stewart noted the auditors do not consider some of the district’s restricted funds as restricted because the board could change the status of those funds at any time. He said the district is currently accumulating cash in restricted funds to pay for planned future projects, but the auditors classified those funds as unrestricted.

While the auditor suggests the utility have three months of unrestricted cash in reserve, the district exceeds that number because of these accounting practices.