2007 FINANCIAL STATEMENTS - Laserfiche WebLink

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LarsenAflen LLP CPAs, Consultants & Advisors ; www.larsonalian:com REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AU ©IT OF FINANCIAL STATEMENTS PERFORMED iN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Honorable Mayor and Members of the City Council City of Gem Lake, Minnesota We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of Gem Lake, Minnesota as of and for the year ended. December 31, 2007, which collectively comprise the City's basic financial 1 statements and have issued our report thereon dated August 29, 2008. We conducted our audit in accordance with U.S. generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, j Internal Control Over Financial Reporting In planning and performing our audit, we considered the City's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements and not to provide an opinion on the internal control over financial. reporting.. Accordingly, we do not express an opinion on the effectiveness of the City's internal control over financial reporting. A control deficiency exists when the. design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a. timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies., that adversely affects the City's ability to initiate, authorize,. record, process; or report financial data reliably in accordance with U.S. generally accepted accounting principles such that there is more: than a remote likelihood that a misstatement of the City's financial statements that is more than inconsequential will not be prevented or detected by the City's internal control over financial reporting. A material weakness is a significant deficiency, or combination of significant deficiencies; that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the City's internal control. Our consideration of internal control was for the limited purpose described in the first paragraph and would not necessarily identify all deficiencies in internal control that might be. significant deficiencies or material weaknesses. However, as discussed below, we identified the following deficiencies in internal .control that we consider to be material weaknesses. (33} LarsonAllen LLP is a member ofNexia Intemational, a woridwide network orindependent accounting and consulting firms. rVTFRNATt[)NM1r. .. .