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M V <br />MKR <br />CERTIFIED PU.BL€C <br />.AC-COUNTANTS. <br />INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL <br />PRINCIPALS <br />Thomas A. Karnowski, CPA <br />Patd.A: Radwevich, CPA <br />William J. Lauer, CPA <br />James H.. Ekhren,: CPA <br />Aaron J. Niiclsen,.CPA <br />Victoria L. Holinka. CPAICMA <br />Jaclyn M. Huegel; CPA <br />Kalen T. Kamowski.:CPA <br />OVER FINANCIAL REPORTING AND ONCOMPLIANCE AND OTHER MATTERS <br />BASED ON AN. AUDIT OF FINANCIAL STATEMENTS.PERFO.RMED IN <br />ACCORDANCE._ WITH GOVERNMENT AUDITING STANDARDS <br />To -the City Council and Management <br />City of Gem Lake, Minnesota <br />% have. audited,. in accordance with auditing standards generally accepted in the United States. of <br />America* and the standards applicable to. financial audits contained in hover ninem Auditing. Standards, <br />issued by. the Comptroller General of the United States, the'financial statements of the governmental <br />activities, the -business -type activities, and each major fund of the City of Gem Lake, Minnesota (the City) <br />as of and for the year ended December 31, 2021, and the related notes to the financial statements, which <br />collectively comprise the City's basic financial statements; and have issued our report .thereon dated <br />July 27, 2022, <br />REPORT ON INTERNAJ. COIITROL.OVER FIiVANCIAL REPORTING <br />In plannina.and performiq. our audit of the financial statements; we considered the City's internal control <br />over financial reporting (intethal control) as'a basis for designing audit procedures that are appropriate in <br />the circumstances for the purpose of expressing our opinions on the financial statements, but not for the <br />purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly,.we do <br />not express an opinion on the effectiveness of the City's. internal -control. <br />A defficiency in .internal control exists when the design or operation of .a control does. not allow <br />management or employees, in the normal course of performing their assigned functions, to prevent,: or <br />detect and correct, misstatements on:a.timely-basis. A tizaterlal ieakness is -a defciency,;oi a combination <br />of deficiencies,. in internal control such thai there is a t'easbnabte pdssibility that a materittl-misstateinent <br />of the City's financial statements will not be prevented, or detectod and corrected., on a: timely basis. A <br />significant deficiency is a deficiency,. or a. combination of deficiencies, in internal coptrol.46t is .less <br />severe than a material weakness, yet important enough to merit attention by those charged with <br />governance. <br />Our consideration of internal control was for the.. limited purpose. tlescribed in the first paragraph of this <br />section and Was not: designed to identify all deficiencies in internal control that might be inaterial <br />weaknesses or significant deficiencies -and, therefore, material weaknesses *or significant deficiencies may <br />exist that have not been identified: We identified one deficiency in internal .control, described in the <br />accompanying Schedule -of Findings and Responses as finding 202-1-001, that we consider io be a <br />material. weakness. <br />.(continued) <br />-31- <br />Malloy, Montague, Karnowski, Radosevi.ch & Co.., P.A. <br />5353. Wayzata Boulevard • Suite 410 Mi.n.neapolis, MN 554:16 ! P•hone:.952-545-0424 - Pitz: 9.52-545-0569• 9 -www.mmkr,cQm <br />