2A, 2010 Audit Presentation - Laserfiche WebLink

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EN HILLS MEMORANDUM DATE: June 27, 2011 TO: Honorable Mayor and City Council Patrick Klaers, City Administrator FROM: Sue Iverson, Director of Finance and Administrative Services SUBJECT: 2010 City Financial Statements Background/Discussion: The City's 2010 Financial Statements have been completed and submitted to both the State Auditor and the GFOA. The City's auditor will be present at the June 27, 2011 City Council meeting to give an overview and answer questions. The auditors have issued an unqualified ("clean") opinion on our financial statements for the year ended December 31, 2010. The total general fund balance at December _ 31, 2010 was $1,763,192 or 50.4% of total general fund expenditures for 2010. The general fund balance decreased by$59,068 as revenues were less than expected due to the economy. The City's total net assets increased by $2,124,555 and the combined ending fund balances for governmental funds were $10,775,679, and combined ending working capital balance for enterprise funds were $2,621,579. We have completed the report in the form prescribed by the Government Finance Officers Association of United States and Canada (GFOA) for their Certificate of Achievement for Excellence in Financial Reporting. In order to qualify for this, the report has to be published in an easily readable and efficiently organized Comprehensive Annual Financial Report (CAFR) that satisfies both accounting principles generally accepted in the United States of America and applicable legal requirements As a note of information, the Auditing Standards are constantly increasing and changing. With these changes, you will see increased findings. This does not mean that the City has done anything wrong compared to previous years, only that the reporting requirements have become much stricter. Many cities are experiencing these findings, and the findings are expected to increase for all cities as these standards become stricter. We continue to have the finding related to"Segregation of Duties". The"Segregation of Duties" finding is common to organizations of our size. Staff continues to review and make improvements to its internal control structure on an ongoing basis and attempts to maximize the segregation of duties in all areas within the limits of the staff available. We did get a finding on not having enough pledged collateral with an investment at Affinity Plus Federal Credit Union. This was due to a number of staff changes at Affinity Plus as the pledged collateral note expired and new pledged collateral was not in place before December 31, 2010. This has been corrected and the new pledged collateral has been set to run the term of the investment. We are pleased with the outcome of the audit.