Opinion ID: 2787659
Heading Depth: 4
Heading Rank: 1

Heading: Testimony of Scott Hodges

Text: ¶29. Hodges explained that “[t]he contracts existed, but the contracts did not require all of those expenditures. The contracts only required continued use of the parks for recreational purposes.” Hodges further explained that the historical costs the District used to calculate the perpetual operating costs “were not required by those contracts. Those costs were incurred, but they were not required by the contracts.” And Hodges noted that “[i]t’s availability of use, not a spending of money that the [District’s] contract[s] require[ ].” Hodges elaborated on the point: 12 If [the perpetual park operating costs are] within their control, it’s not an obligation. An obligation is something that . . . an outside force is obligating you to do[,] not within your control. It’s not your decision. You’re obligated by contract to do it. So by definition, if it’s within their control, it’s not an obligation. ¶30. Hodges further explained, “[i]f an entity has a contractual obligation, it should be disclosed in the annual financial statements.” The perpetual park operating costs were never included in the District’s financial statements before Lamar County’s withdrawal. ¶31. Finally, in explaining Tann, Brown & Russ’s role in the process, Hodges testified: “[o]ur job was to determine if it was in accordance with the statute. And so, that’s what we did, is determine that [the perpetual park operating costs] that [the District] included was not in accordance with the statute.” Hodges reiterated that the main focus of the audit was to calculate what Lamar County owed under Section 51-15-118, which was paramount in his mind to either Financial Accounting Standards Board or Governmental Accounting Standards Board standards.