Laserfiche WebLink
<br /> May 15, 2006 2 <br /> . Mr. McDonald said that local governments are required by state statute to have an audit <br /> completed on a yearly basis. Also, the City's bonding rating can be affected by an audit. It is <br /> also good to have an outside source review your processes and procedures for handling financial <br /> transactions. <br /> Mayor Aplikowski said that the separation of duties is very important in an organization like <br /> Arden Hills. <br /> Coul1cilmember Larson asked about the increased number of journal entries at the end of this <br /> past year. <br /> Chief Financial Officer Murtuza Siddiqui stated that the majority of the entries are standard year <br /> end entries. A few adjustments were made in relation to the reclassification of the of the object <br /> codes. <br /> Councilmember Larson recommended that the City Council adopt a policy that ensures that the <br /> City has a reserve of 40% of its general fund balance on a yearly basis. The City could designate <br /> any reserves to the PIR fund. <br /> Chief Financial Officer Siddiqui noted that the City should consider developing a fund balance <br /> . policy covering all of the City funds. <br /> Mr. Steve McDonald completed an overview of the City's different fund balances for the City <br /> Council. <br /> Members of the City Council agreed to have the financial audit report placed on the consent <br /> agenda at a future City Council meeting. <br /> Account Code Restructure <br /> Chief Financial Officer Murtuza Siddiqui reported that the City's current financial system has <br /> been in placc for over ten years. The current system consists of five major fund categories and <br /> multiple departments. Within each department there are numerous categories and object codes. <br /> A majority of these codes were created for specific purposes to track the expenses of a particular <br /> vendor or object code. <br /> Due to the City's recent fraud case, Chief Financial Officer Siddiqui recommended to the City <br /> Council that the City explore the possibility of reducing the number of account codes for the <br /> City. This may help the City in identifying potential fraud in the future and also assist in the <br /> management of reviewing monthly reports. <br /> City Administrator Wolfe said that the City of Arden Hills current budget code system is very <br /> cumbersome. It is difficult for staff members to track their expenditures using this system. It is <br /> a critical part of a department heads job to track expenditures. The transition to the proposed <br /> . changes in the City's accounting system may be a challenge at first, but it should be worth it in <br /> the end. <br />