Citizens Bancshares Corporation and Subsidiary

Report on Consolidated Financial Statements

As of and for the years ended December 31, 2021 and 2020

Citizens Bancshares Corporation and Subsidiary

Contents

Page

Independent Auditor's Report .............................................................................................................................. 1‐2

Consolidated Financial Statements

Consolidated Balance Sheets ............................................................................................................................... 3

Consolidated Statements of Income .................................................................................................................... 4

Consolidated Statements of Comprehensive Income ......................................................................................... 5

Consolidated Statements of Changes in Stockholders' Equity ............................................................................ 6

Consolidated Statements of Cash Flows .............................................................................................................. 7

Notes to Consolidated Financial Statements ................................................................................................. 8‐45

Independent Auditor's Report

The Board of Directors

Citizens Bancshares Corporation and Subsidiary Columbia, South Carolina

Opinion

We have audited the consolidated financial statements of Citizens Bancshares Corporation and Subsidiary (the "Company"), which comprise the consolidated balance sheets as of December 31, 2021, and 2020, the related consolidated statements of income, comprehensive income, changes in stockholders' equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements (collectively, the "financial statements").

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021, and 2020, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable).

elliottdavis.com

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:

  • Exercise professional judgment and maintain professional skepticism throughout the audit.

  • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

  • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, no such opinion is expressed.

  • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

  • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

Columbia, South Carolina April 22, 2022

Citizens Bancshares Corporation and Subsidiary

Consolidated Balance Sheets

As of December 31, 2021 and 2020

2021

2020

Assets

Cash and due from banks

$

2,182,046

  • $ 1,849,514

    • Federal funds sold 32,005,887 36,930,486

    • Interest bearing deposits with banks 230,370,530 156,661,882

    • Cash and cash equivalents 264,558,463 195,441,882

    Certificates of deposit

    Investment securities available for sale at fair value (amortized cost of $95,475,729 and $62,161,548 at December 31, 2021 and 2020, respectively)

    Other investments

    Loans receivable, net of allowance for loan losses of $3,010,674

    350,000

    850,000

    95,294,098 681,050

    64,019,061 769,750

    at December 31, 2021 and $3,160,895 at December 31, 2020 281,750,342 284,334,181

    Premises and equipment, net

    6,750,439 7,154,463

    Cash surrender value of life insurance 11,334,349 11,056,200

    Other real estate owned Right‐of‐use asset Other assets

    Total assets

    Liabilities

    Deposits

    Noninterest‐bearing deposits

    ‐

    161,000

    1,720,603 1,959,770 6,480,040 6,180,066

    $

    668,919,384

  • $ 571,926,373

    $

    227,251,563

  • $ 195,283,299

Interest‐bearing deposits 354,169,330 315,098,132

Total deposits 581,420,893 510,381,431

Accrued expenses and other liabilities Bank owned life insurance liability Lease liability

Notes payable

Advances from Federal Home Loan Bank

Total liabilities

Commitments and contingencies (Note 9)

Stockholders' equity

Common stock $1 par value; 20,000,000 shares authorized; 2,343,676 and 2,327,401 shares issued and outstanding at

December 31, 2021 and 2020, respectively

Nonvoting common stock, $1 par value; 5,000,000 shares authorized; 90,000 shares issued and outstanding at December 31, 2021 and 2020, respectively

Preferred stock, $1,000 par value; 10,000,000 shares authorized; 22,000 shares issued and outstanding at December 31, 2021 and none outstanding at December 31, 2020

Nonvested restricted common stock Additional paid‐in capital

Retained earnings

Treasury stock, at cost, 457,461 and 436,028 shares at

December 31, 2021 and 2020, respectively

Accumulated other comprehensive (loss) income, net of income taxes

Total stockholders' equity

Total liabilities and stockholders' equity

See Notes to Consolidated Financial Statements

6,444,095 2,838,179 3,424,607 3,168,616 2,083,613 2,355,888 ‐ 1,150,000

109,945

$ 593,483,153

$ 520,025,905

2,343,676

2,327,401

90,000

90,000

22,000,000

‐

(226,916)

(163,704)

8,909,098

8,636,623

46,730,201

43,603,498

(4,314,547)

(4,088,600)

(95,281)

1,495,250

75,436,231

51,900,468

$ 668,919,384

$ 571,926,373

131,791

This is an excerpt of the original content. To continue reading it, access the original document here.

Attachments

  • Original Link
  • Original Document
  • Permalink

Disclaimer

Citizens Bancshares Corporation published this content on 29 April 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 April 2022 18:37:11 UTC.