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City of Centerville <br />March 24, 2011 <br />Page 2 <br />Compliance and Other Matters <br />As part of obtaining reasonable assurance about whether the City’s financial statements are free of material misstatement, we <br />performed tests of compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could <br />have a direct and material effect on the determination of financial statement amounts. However providing an opinion on <br />compliance with those provisions was not an objective of our audit. While our audit provides a reasonable basis for our opinion, it <br />does not provide a legal determination on the City’s compliance with those requirements.We noted noinstancesof <br />noncompliance with Minnesota statutes. <br />Summary of Prior Year Findings <br />2009-1:Segregation of Duties over Utility Billing <br />Condition: <br />During our audit we reviewed procedures over cash receipts, cash disbursements, payroll, <br />utility billing and investments. The City was found to have limited segregation of duties in the <br />transaction cycle relating to utility billing. <br />Criteria: <br />There are four general categories of duties: authorization, custody, record keeping and <br />reconciliation. In an ideal system, different employees perform each of these four major <br />functions. In other words, no one person has control of two or more of these responsibilities. <br />Current Year Status: <br />The Finance Director reviews adjustments with utility billing and utility billing registers. <br /> <br />