VILLAGE OF ARDEN, INC. BASIC FINANCIAL STATEMENTS

VILLAGE OF ARDEN, INC.ARDEN, DELAWAREMANAGEMENT'S DISCUSSION AND ANALYSIS- UNAUDITED (CONTD)MARCH 24, 2015The Statement of Net Position presents information on all of the Village's assets and liabilities, with thedifference between the two reported as net position. Over time, increases or decreases in net positionmay serve as a useful indicator of whether the financial position of the Village is improving ordeteriorating.The Statement of Activities presents information showing how the government's net position changedduring the most recent fiscal year. All changes in net position are reported as soon as the underlyingevent giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenueand expenses are reported in this statement for some items that will result in cash flows only in futurefiscal periods.The entity-wide financial statements distinguish functions of the Village that are supported principallyby land rental allocations, franchise fees, and grant revenues.Governmental Activities- All of the Village's basic services are reported in this category. Landrental allocations, franchise fees, grants, and intergovernmental revenues generally supportthese services. Services provided include general government, public works - highways andstreets, sanitation, cemetery, culture and recreation, and community and economicdevelopment.Fund Financial Statements: The fund financial statements provide detailed information about thegeneral operating and special revenue accounts. A fund is a fiscal and accounting entity with a selfbalancing set of accounts that the Village uses to keep track of specific sources of funding andspending for a particular purpose. All of the funds of the Village can be divided into two categories:general and special revenue.General Fund - Most of the Village's basic services are reported in the general fund, whichfocuses on how money flows into and out of those funds and the balances left at year end thatare available for future spending . The general fund and special revenue funds are reported inthe governmental fund financial statements.Special Revenue Funds - When the Village receives special revenue through grant and otherfunding that must be dedicated for certain expenditures, those funds are kept in segregatedaccounts. All earned interest is posted as income to the appropriate dedicated account.Dedicated grant funded accounts include Municipal Street Aid, Natural Spaces, CapitalMaintenance and Repair, Memorial Garden, Lecture Series, Renovation, Buckingham GreenSettlement, and the Vacant Dwelling funds.The governmental fund financial statements provide a detailed short-term view of the Village's generalgovernment operations and the basic services it provides. Governmental fund information helps todetermine whether there are more or fewer financial resources that can be spent in the near future tofinance the Village's programs. Because this information does not encompass the additional longterm focus of the entity-wide statements, reconciliations are provided to reconcile betweenthe Governmental Funds Balance Sheet and the Statement of Net Position, and between the- 5-

VILLAGE OF ARDEN, INC.ARDEN, DELAWAREMANAGEMENT'S DISCUSSION AND ANALYSIS - UNAUDITED (CONTD)MARCH 24, 2015Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances and theStatement of Activities. These funds are reported using the modified accrual basis of accounting,which primarily measures cash and other financial assets usable in the short term.Notes to Basic Financial Statements: The notes provide additional information that is essential to a fullunderstanding of the data provided in the entity-wide and fund financial statements. The notes to thefinancial statements can be found beginning on page 16 of this report.Other Information: This information includes combining financial statements for nonmajor governmental funds. The funds are added together by fund type and presented in single columns in thebasic financial statements but are not reported individually, as with major funds, on the governmentalfund financial statements.Table A-1Net PositionMarch 24, 2015 and 2014Governmental Activities2015ASSETSCurrent and other assetsNoncurrent assets TOTAL ASSETS 1,525,089LIABILITIESCurrent and other liabilitiesNoncurrent liabilitiesTotal Liabilities NET POSITIONNet investment in capital assetsRestrictedUnrestrictedTotal Net PositionTOTAL LIABILITIES AND NET POSITION665,710859,37925,71335,06460,7772014 544,581859,379 1,403,960 8,772426,232110,3951,335,399 1,525,089 1,403,960Changes in Net Position. A schedule of changes in activity is provided on the following page. TheVillage's combined net position increased by 128,913.- 6-

VILlAGE OF ARDEN, INC.ARDEN, DElAWAREMANAGEMENT'S DISCUSSION AND ANALYSIS - UNAUDITED (CONT'D)MARCH 24, 2015TableA-2Changes in Net PositionFor the Years Ended March 24, 2015 and 2014Governmental Activities2015RevenuesProgram revenues:Charges for servicesOperating grants and contributionsGeneral revenuesTotal Revenues ExpensesGeneral governmentPublic works- highways and streetsPublic works- sanitationPublic works- memorial gardenCulture and recreationCommunity and economic developmentInterestTotal Expenses31,47228,384278,819338,6752014 48,91381,77756,5761,9685,90010,7733,855209,762 Increase in Net 61255,0513,8185,90011 ,9914,686204,329 19,578Total revenues increased compared to the prior year due primarily due to a 48,263 increase in theamount of land rent revenue received, as well as a one-time payment from the Trustees of Arden for 62,795, representing funds received from the Buckingham Green Settlement and designated forfuture use as determined by the Forest Committee.Financial Analysis of the Village's FundsGovernmental FundsThe net change in the balance of the general fund from 2014 to 2015 was an increase of 38,912,reflecting an increase in revenues received as described above. Expenditures were fairly consistentwith the prior year.The net change in the Village's special revenue funds showed a combined increase of 77,676.Except for the increase in the Buckingham Green Settlement, the largest increases related to theRenovation and Vacant Dwelling funds, which increased 7,215 and 8,385, respectively. Thisincrease is offset by a decrease of 10,155 in the Municipal Street Aid fund .- 7-

VILLAGE OF ARDEN, INC.ARDEN, DELAWAREMANAGEMENf S DISCUSSION AND ANALYSIS - UNAUDITED (CONT'D)MARCH 24, 2015Budget. All budgets lapse at year end . For 2015, minor budget amendments to several line itemswere made. There were no significant differences between the original and final budget.Capital Asset and Debt Administration. As of March 24, 2015 and 2014, the Village had invested 859,379 in a tract of land. The land is known as Sherwood Forest and was purchased in April 2004.The purchase of the property was partially financed with a loan in the amount of 150,000. The totalbalance due as of March 24, 2015 and 2014 was 48,282 and 60,607, respectively.Economic FactorsArden is a village of 439 residents and approximately 229 households, according to the 2010 U.S.Census. The Village occupies about 160 acres, with half kept as open land.The Village's housing is primarily single family residences. There are a few structures dedicated tocultural and recreational activities for the enjoyment of the residents.Requests for lnfonnatlonThis financial report is designed to provide a general overview of the Village of Arden, Inc.'s financesto the Village's residents and other users of such data. Requests for additional copies of this report,questions concerning any of the information in this report, and requests for additional financialinformation should be addressed to the Village Treasurer at 2119 The Highway, Arden, DE 19810.-8 -

VILLAGE OF ARDEN, INC.STATEMENTS OF NET POSITION· GOVERNMENTAL ACTIVITIESMARCH 24,2015 AND 201420152014ASSETSCash and cash equivalentsLand 665,710859,379 544,581859,379TOTAL ASSETS 1,525,089 1,403,960 8,5586793,258 7,416538LIABILITIES AND NET POSITIONLIABILITIES:Accounts payablePayroll taxes payableDeposits for facility rentalPortion due or payable within one year:Note payablePortion due or payable after one year:Note payableTOTAL LIABILITIESNET POSITION:Net investment in capital assetsRestrictedUnrestrictedTOTAL NET POSITION TOTAL LIABILITIES AND NET ,39911525,089The accompanying notes are an integral part of these financial statements .- 9- 11403,960

762( 149,906}(149,906} 3,855}(46,338}(65,042)(56,576}(1 ,968)34,646(10,773)- 10-NET POSITION, EN D OF YEARNET POSITION, BEGINNING OF YEAR 1,464,3121,335 ,399128,913 CHANGE IN NET POSITION28,384- 201562,795189,26324,4272,334278,81931 47228,38431,4722,57516,7359,074 31,472--CapitalGrants 2,631162,057(142,479)(142,479) 4,686)(45 ,271)(56,880}(55,051)(3,818)35,218(11 ,991 ) 1.335,399 2014Net (Expense) Revenue andChanges in Net PositionGENERAL REVENUESBuckingham Green SettlementLand rentFranchise and registration feesInterestTOTAL GENERAL REVENUES The accompanying notes are an integral part of these financial statements.TOTAL PRIMARY GOVERNMENTGOVERNMENTAL ACTIVITIES:General governmentPublic works - highways and streetsPublic works - sanitationPublic works- memorial gardenCulture and recreationCommunity and economic developmentInterest on loanTOTAL GOVERNMENTAL ACTIVITIESExpensesCharges forServicesProgram RevenuesOperatingGrants andContributionsVILLAGE OF ARDEN, INC.STATEMENT OF ACTIVITIES- GOVERNMENTAL ACTIVITIESFOR THE YEAR ENDED MARCH 24,2015(With Summarized Comparative Data for the Year Ended March 24, 2014)

- 11 -17,660 401,768401,76817,66090,24990,249102,744---401,768 ----401,768 17,660 401,768 Natural§ aces Fund-8,5586793,25812,49517,66017,660The accompanying notes are an integral part of these financial statements.TOTAL LIABILITIES AND FUNDBALANCESFUND BALANCES:RestrictedAssignedUnassignedTOTAL FUND BALANCES 102,744 TOTAL ASSETSLIABILITIES AND FUND BALANCESLIABILITIES :Accounts payablePayroll taxes payableDeposits for facility rentalTOTAL LIABILITIES 102,744 MunicipalStreet AidFundASSETSCash and cash equivalentsGeneralFund 143,538143,538-143,538----143,538 143,538 Non majorFundsVILLAGE OF ARDEN, INC.BALANCESHEET-GOVERNMENTALFUNDSMARCH 24, 2015(With Summarized Comparative Data for March 24, 5665,710665,710 665,710 92544,581544,581 544,581 12014

VILLAGE OF ARDEN, INC.RECONCILIATION OF BALANCE SHEET- GOVERNMENTAL FUNDS TOSTATEMENT OF NET POSITIONMARCH 24, 2015TOTAL GOVERNMENTAL FUND BALANCE 653,215Amounts reported for governmental activities in the statement of net positionare different because:Capital assets used in governmental activities are not financial resourcesand, therefore, are not reported in the funds.859,379Long-term liabilities are not due and payable in the current period and,therefore, are not reported in the funds.(48,282)NET POSITION OF GOVERNMENTAL ACTIVITIES 1,464,312The accompanying notes are an integral part of these financial statements.- 12-

-38,91251,33790,249NET CHANGE IN FUND BALANCESFUND BALANCE, BEGINNING OF YEARFUND BALANCE, END OF YEARThe accompanying notes are an integral part of these financial statements.(4,687)OTHER FINANCING SOURCES (USES)Transfers in (out)5,9008,40416,1 80190,860-48,91354,88756,576- -16,735-234,459 MunicipalStreet AidFund-16,2272,575510187,2632,07225,81243,599 EXCESS (DEFICIENCY) OF REVENUES OVER(UNDER) EXPENDITURESEXPENDITURESGeneral governmentPublic works - highways and streetsPublic works - sanitationPublic works - cemeteryCulture and recreationCommunity and economic developmentDebt serviceTOTAL EXPENDITURESREVENUESBuckingham Green SettlementFranchise feesGovernmental grantsInterestLand rental allocationsLocal donationsRentVacant property registration feesTOTAL 1,586-- 401 ,768 9-1,968--2382,0007,0025,6608,20085,895--62,795 143,538 761,9685,90010,77316,180222,08762, 79516,22719,31 02,334189,2639,07431,4728,200338,675 653,215 2015VILLAGE OF ARDEN, INC.STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES- GOVERNMENTAL FUNDSFOR THE YEAR ENDED MARCH 24,2015(With Summarized Comparative Data for the Year Ended March 24, 85,90011 292,600223,907 536,627 2014

VILLAGE OF ARDEN, INC.RECONCILIATION OF STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUNDBALANCES- GOVERNMENTAL FUNDS TO STATEMENT OF ACTIVITIESFOR THE YEAR ENDED MARCH 24, 2015NET CHANGES IN FUND BALANCES- GOVERNMENTAL FUNDS The repayment of the principal of the note payable consumes the currentresources of governmental funds. This amount is the net effect of thedifferences in the treatment of these items.CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIESThe accompanying notes are an integral part of these financial statements.- 14-116,58812,325 128,913

VILLAGE OF ARDEN, INC.BUDGETARY COMPARISON STATEMENT- GENERAL FUNDFOR THE YEAR ENDED MARCH 24, 2015Bud Jeted AmountsOriginalFinalREVENUESFranchise feesGrantsInterestLand rental allocationsLocal donationsRentTOTAL REVENUES 15,100EXPENDITURESGeneral government:Office expensesProfessional feesRepairs and maintenanceSalaries, wages, and payroll taxesUtilitiesPublic works highways and streets:Ground maintenanceRoad maintenancePublic works - sanitation:Trash servicesCulture and recreation:DonationsCommunity and economic development:Program expensesDebt service:PrincipalInterestContingencyTOTAL EXPENDITURESEXCESS OF REVENUE OVER EXPENDITURES 15,100 VariancePositive(Negative) 16,227 1,1272,575(1 4,45911 0027,3325,8892,06343,59941 ,536{4,687){4,687)1,980175,425OTHER FINANCING USESTransfers outNET CHANGE IN FUND BALANCEActualAmounts(BudgetaryBasis)5,889 2,06338,91251,337FUND BALANCE, BEGINNING OF YEAR 90,249FUND BALANCE, END OF YEARThe accompanying notes are an integral part of these financial statements.- 15-1,236 36,849

VILLAGE OF ARDEN, INC.NOTES TO FINANCIAL STATEMENTSNOTE 1SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESThe accounting and reporting policies of the Village of Arden, Inc. ("the Village") conform in allmaterial respects to generally accepted accounting principles ("GAAP") as applicable togovernments. The Governmental Accounting Standards Board ("GASB") is the accepted standardsetting body for establishing governmental accounting and financial reporting principles, whichare set forth primarily in the GASB's Codification of Governmental Accounting and FinancialReporting standards ("GASB Codification"). The following summarizes the Village's significantaccounting policies.Reporting EntitvIn evaluating how to define the government for financial reporting purposes, management hasconsidered all potential component units. The decision to include a potential component unit inthe reporting entity was made by applying the criteria set forth in GAAP. The basic- but not theonly- criterion for including a potential component unit within the reporting entity is the governingbody's ability to exercise oversight responsibility. The most significant manifestation of this ability isfinancial interdependency. Other manifestations of the ability to exercise oversight responsibilityinclude, but are not limited to, the selection of governing authority, the designation ofmanagement, the ability to significantly influence operations, and accountability for fiscalmatters. A second criterion used in evaluating potential component units is the scope of publicservice. Application of this criterion involves considering whether the activity benefits thegovernment and/or its citizens, or whether the activity is conducted within the geographicboundaries of the government and is generally available to its citizens. A third criterion used toevaluate potential component units for inclusion or exclusion from the reporting entity is theexistence of special financing relationships, regardless of whether the government is able toexercise oversight responsibilities. Based upon the application of these criteria, the Village ofArden, Inc. is considered to be an independent reporting entity and has no component units.Entity-wide and Fund Financial StatementsThe entity-wide financial statements (i.e ., the statement of net position and the statement ofactivities) report information on all of the activities of the Village (the primary government). Forthe most part, the effect of interfund activity has been removed from these statements.The statement of activities demonstrates the degree to which the direct expenses of a g ivenfunction or segment is offset by program revenues. Direct expenses are those that are clearlyidentifiable with a specific function or segment. Program revenues include (1) charges tocustomers who purchase, use, or directly benefit from goods, services, or privileges provided by afunction or segment; and (2) grants and contributions that are restricted to meeting theoperational or capital requirements of a function or segment. Land rent, franchise fees, andother items not properly included among program revenues are reported instead as generalrevenues.- 16-

VILLAGE OF ARDEN, INC.NOTES TO FINANCIAL STATEMENTSNOTE 1SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)Measurement Focus. Basis of Accounting. and Financial Statement PresentationMeasurement focus refers to what is being measured; basis of accounting refers to whenrevenues and expenditures are recognized in the accounts and reported in the financialstatements. Basis of accounting relates to the timing of the measurement made, regardless of themeasurement focus applied.The entity-wide financial statements report net position in one of three components. Netinvestment in capital assets consists of capital assets, net of accumulated depreciation andreduced by the outstanding balances of borrowing attributable to acquiring, constructing, orimproving those assets. Net position is reported as restricted when constraints placed on their useare either externally imposed

Overview of the Financial Statements The Village's basic financial statements are comprised of three components: 1) entity-wide financial statements; 2) fund financial statements; and 3) notes to the basic financial statements. This report also contains supplementary information in addition to the basic financial statements themselves.