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CITY OF GEM LAKE, MINNESOTA SCHEDULE OF FINDINGS AND RESPONSES (CONTINUED) YEAR ENDED DECEMBER 31, 2017 (39) OTHER ITEM FOR CONSIDERATION – MINNESOTA LEGAL COMPLIANCE 2017-004: Prompt Payment of Local Government Bills Criteria: Minnesota Statute §471.425, Subd. 2, requires Cities to pay each vendor obligation according to terms of the contract or, if no contract terms apply, within the standard payment period unless the municipality in good faith disputes the obligation. For municipalities who have governing boards which have regularly scheduled meetings at least once a month, the standard payment period is defined as within 35 days of the date of receipt. Condition: The City paid one invoice outside of the 35 days as defined by the Minnesota Statue. The invoice was paid approximately 5 days after it was due. Effect: The City is not in compliance with the Minnesota Statute requiring prompt payment of local government bills. Cause: The City paid the invoice outside of the due date as required by the Minnesota Statue. Recommendation: We recommend City management closely monitor payment of invoices to ensure that they are paid in a timely manner. Management Response: City management is aware of this requirement and will continue to monitor the requirement to ensure that payment continue to be made as required. 2017-005: Annual Report of Outstanding Obligations Criteria: Minnesota Statute §471.70, on or before February 1st each year, it shall be the duty of the principal accounting officer of each municipality to report to the auditor of each county in which such municipality is situate, the total amount of outstanding obligations, and the purpose for which issued as of December 31 of the preceding year. Condition: The City did not submit to Ramsey County the Outstanding Obligations as of February 1 2018. It was submitted on February 6, 2018. Effect: The City is not in compliance with the Minnesota Statute requiring the submittal of the Outstanding Obligations as of February 1 of each year. Cause: The City has provided the Outstanding Obligations report in the past but did not submit report by the deadline for 2017. Recommendation: We recommend City management implement a process to trigger the submission of the Outstanding Obligations report prior to the February 1 deadline each year. Management Response: City management is aware of this requirement and will continue to monitor the requirement to ensure the Outstanding Obligations report is submitted prior to the deadline.