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Regular City Council Meeting Monday, May 12, 2008 Page 16 b. Consider Fire Department Supervisor Position This item was removed from tonight's agenda at the request of City Manager Ma- linen. 13. Business Items -Presentations, Discussions a. Presentation of Audited Financial Statements City Finance Director Chris Miller introduced Jim Eichten of the City's inde- pendent auditor firm: Malloy, Montague, Karnowski and Radosevich and Com- pany, P.A. Mr. Eichten presented and summarized the "Comprehensive Annual Financial Report for the fiscal year ended December 31, 2007;" the Management Report for the city of Roseville, MN -December 31, 2007;" and the "Special Purpose Audit Reports on Internal Controls and Compliance with Laws and Regulations;" all based on recent revisions to review standards and monitoring standards of the Minnesota State Auditor, federal regulations, and other applicable regulatory bod- ies. Mr. Eichten specifically reviewed the Management Report and findings, all re- lated to new accounting standards, and spoke to each finding. Specific findings included; internal control criteria, conditions, causes, effects, recommendations, and management responses to payroll segregation of duties; skating center segre- gation of duties; capital assets internal controls; reimbursable contract costs inter- nal controls; Minnesota legal compliance audit (payment of invoices; claims dec- laration; and collateral). Discussion between Mr. Eichten, City Finance Director Chris Miller, and Coun- cilmembers included role and responsibility of each party in addressing recom- mendations and/or correcting findings; and the need for formal, written account- ing standards, not a current practice of most cities, with staff having spent consid- erable time to-date in developing those procedures and defining them for future staff to follow, and allowing for cross-training. Mr. Eichten clarified that the pro- cedures were still in draft form, pending their formal presentation to the City Council in the near future. Mr. Eichten commended staff in their development of the written accounting procedures; and the amount of thought staff had given to information technology contingency planning to-date, recommending further re- finement and formal documentation for alternative processing in the event of loss or interruption of IT functions. Mr. Miller advised that the process had been initiated, but was not yet completed; with Mr. Eichten opining that the City was further along that many cities in this contingency planning process.