2023d ABC Board Minutes - Laserfiche WebLink

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ORANGE COUNTY ALCOHOLIC BEVERAGE CONTROL BOARD (a component unit of Orange County Government) NOTES TO FINANCIAL STATEMENTS June 30,2023 and 2022 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES[cont'dj G. Assets,Liabilities,and Net Position[cont'd] At June 30, 2023, the Board's deposits had a carrying amount of$3,714,166 and a bank balance of $3,851,221. At June 30, 2022, the Board's deposits had a carrying amount of$3,815,113 and a bank balance of $3,925,897. All of the bank balance was covered by the Federal Deposit Insurance Corporation("FDIC"). All of the ABC Board's deposits are either insured or collateralized by using one of two (2) methods. Under the Dedicated Method, all deposits over the FDIC coverage are collateralized with securities held by the ABC Board's agent in the ABC Board's name. Under the Pooling Method, a collateral pool, all uninsured deposits are collateralized with securities held by the State Treasurer's agent in the name of the State Treasurer. Since the State Treasurer is acting in a fiduciary capacity for the ABC Board, these deposits are considered to be held by the ABC Board's agent in the ABC Board's name. The amount of the pledged collateral is based on an approved averaging method for non-interest- bearing deposits and the actual current balance for interest bearing deposits. Depositories using the Pooling Method report to the State Treasurer the adequacy of their pooled collateral covering uninsured deposits. The State Treasurer does not confirm this information with the ABC Board or the escrow agent. Because of the inability to measure the exact amount of collateral pledged for the ABC Board under the Pooling Method, the potential exists for under collateralization, and this risk may increase in periods of high cash flows. However, the State Treasurer of North Carolina enforces strict standards of financial stability for each Pooling Method depository that collateralizes public deposits under the Pooling Method. The ABC Board has deposits in Pooling Method banks only. Cash For purposes of the statement of cash flows, the ABC Board considers all highly liquid investments, with a maturity of three(3)months or less when purchased,to be cash. Accounts Receivable The amounts shown on the statement of net position for receivables is net of$0 allowance for doubtful accounts. The direct write-off method for bad debts is used for financial reporting, which is not materially different from the allowance method. Inventories Inventories are valued at the lower of cost(FIFO)or market and are summarized below,as of June 30: 2023 2022 Liquor in stores $ 2,905,144 $ 2,616,347 Liquor in warehouse 952,887 1,398,154 Wine 3,413 9,059 Bags 51,323 33,222 $ 3,912,767 $ 4,056,782 j -17- I