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6M R CERTIFIED PUBLIC. ACCOUNTANTS INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL PRINCIPALS Thomas A. Karnowski, CPA Paul A. Radosevich, CPA William J. Lauer, CPA James H.. Eichten, CI'A Aaron J. Nielsm.'CPA Victoria L. Holiaka, CPAJCMA Jadyn M.:Huegel, CPA Koen T. Kamowtki...CPA OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the City Council and Management City of Gem Lake, Minnesota We have audited, in accordance with addifing standards :generally accepted in the United States of .America: and the standards.applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States., the financial statements of. the governmental activities, the.business-type actiyities,:and eacl} major fund.of the City of Gem j, -ake, Minnesota (the City) as :.of and for the year ended.December 31, 2020, and: the related notes to the f nancial statements, which collectively comprise the City's basic financial statements, and have issued our report thereon June 22, 2021. INTERNAL CONTROL OVER RNANCIAL REPORTING In planning and performing our audit of the financial statements, we considered the City's internal. control over financial. reporting (infernal control) as a basis for designing acidit procedures that are..appropriate in the -circumstances for the purpose of expressing our opinions on the financial. statements, but not for.the purpose of expressing an opinion on the effectiveness nfe City's internal control. Accordingly, We:do not-express.an opinion on.the effectiveness of the City's internal control: A defictetrcy In internal eonteol exists* when the design or .operation of a control does not allow management or�employees, in ihe:normal course: of performing their assigned functions, to prevent,,. or detect and correct, misstatements on a.timely basis. A material weakness is a deficiency, or a.combination of deficiencies; in internal control such that there is a reasonable. possibility that a material misstatement of the City's financial' statements will not be prevented, or detected and. corrected, on a timely basis. A significant deficiency is a deficiency, *or a combination :of def ciencies, in internal control -that is less severe than it material. weakness, yet important enough to rnerit attention by those. chargedwith governance. Our consideration of internal. control was for the limited purpose described in the .first paragraph of this section and was not designed to identify all deficiencies in internal control that: might be. material weaknesses w significant def lencies and, therefore, material. weaknesses or significantdefic!.enc'i.es.may exist that have not been identified: We did identify one deficiency in internal %control, described in. the accompanying Schedule of :Findings and Responses. as finding .2.020-a01, that. we consider to be a material weakness. (continued) =29= Malloy, Montague, Karnowski; Radosevich & Co., P.A. 53:53. Wayzat.a..Boulevard. 9 Suite 41.0 , Minneapolis -,'MN 5.5-416 • Phone.! 952=545 424 •• Fax: 952-5.45.-G569 www.mmkr.com