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City of Roseville, Minnesota <br />Communication With Those Charged With Governance <br />Page 2 <br />the estimates used to calculate the net pension liability, the pension related <br />deferred outflows and inflows of resources, and pension expense <br />These estimates are based on the City of Roseville, MinnesotaÓs estimated <br />incremental borrowing rate, likelihood of lease renewals and actuarial studies. We <br />evaluated the key factors and assumptions used to develop the estimates in <br />determining that they are reasonable in relation to the financial statements taken as <br />a whole. <br />Certain financial statement disclosures are particularly sensitive because of their <br />significance to financial statement users. Determining sensitivity is subjective, <br />however, we believe the disclosures most likely to be considered sensitive is Note <br />4C Î Employee retirement systems and defined benefit pension plans. <br />The financial statement disclosures are neutral, consistent, and clear. <br />Difficulties Encountered in Performing the Audit <br />We encountered no difficulties in dealing with management in performing and <br />completing our audit. <br />Corrected and Uncorrected Misstatements <br />Professional standards require us to accumulate all known and likely misstatements <br />identified during the audit, other than those that are clearly trivial, and communicate <br />them to the appropriate level of management. One of these known uncorrected <br />misstatements of the financial statements is as follows: <br />Payroll expenses related to compensated absences in the golf course fund <br />were overstated by approximately $21,000 in 2023 due to an understatement <br />of accrued compensated absences in 2022. <br />Management has determined that their effects are immaterial, both individually and <br />in the aggregate, to the financial statements taken as a whole. The uncorrected <br />misstatements or the matters underlying them could potentially cause future period <br />financial statements to be materially misstated, even though, in our judgment, such <br />uncorrected misstatements are immaterial to the financial statements under audit. <br />The following material misstatement detected as a result of audit procedures was <br />corrected by management: <br />Intergovernmental revenues and related expenditures were decreased by <br />$572,000 related to 2022 activity that was recorded in 2023. The adjustment <br />had a net zero impact on the fund balance and net position for 2022 and <br />2023. <br />12 <br />Qbhf!288!pg!494 <br /> <br />