MARTIN STARNES & ASSOCIATES, CPAs, P.A. HICKORY, NC

Audit Highlights Unqualified opinion General fund cash (total)$ 6,578,854 General fund revenues$ 10,878,506 General fund expenditures$ 10,692,979

Audit Highlights Increase in GF fund balance $ 1,119,381 Fund balance – GF $ 9,945,933 Unreserved fund balance $ 6,859,833 Unreserved fund balance is 64% of general fund expenditures.

Audit Highlights 2007 Property tax revenues $ 4,482, Property tax revenues $ 4,440, Collection rate % 2006 Collection rate 99.97%

Fund Balance History

Property Valuation History

Comparative Averages for NC Municipalities Without Electrical Systems and Permanent Population of 2,500 – 9,999 Town Nags Head Average Available GF fund bal. $ 6,859,833 $ 2,199,906* Expenditures $ 10,692,979 $ 3,512,822* * Reference: LGC memos # 1050 (6/30/06 averages) Note: Town of Nags Head’s figures are as of 6/30/07, except as noted. Amounts are not adjusted for coastal/seasonal adjustments in population from tourism.

Comparative Averages for NC Municipalities Without Electrical Systems and Permanent Population of 2,500 – 9,999 Town of Nags Head Average Property Tax Rate.1475%.2921%* Tax Collection %’s 99.96% 96.72%* * Reference: LGC memos # 1050 (6/30/06 averages) Note: Town of Nags Head’s figures are as of 6/30/07, except as noted. Amounts are not adjusted for coastal/seasonal adjustments in population from tourism.

Net Cost of Services Provided – Governmental Activities

General Fund Revenues

General Fund Revenues 2006 and 2007

General Fund Expenditures

General Fund Expenditures 2006 and 2007

Water Fund Operating revenues 2006 $ 2,556,310 Operating revenues 2007 $ 2,636, Operating Loss $ 223, Operating Loss $ 169,561

Storm Water Fund Operating revenues 2006 $ 110,796 Operating revenues 2007 $ 141, Operating Income $ 10, Operating Income $ 34,278

MARTIN STARNES & ASSOCIATES, CPAs, P.A. HICKORY, NC