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,� � - ■ ► � i - 1 `� � � ��1�;':. : '1::�.:: '1' 2 Tp: Mayor �d Cot�cil BiII Malinen, City Manage:r 4 From: C�is Mill�r, Financ� Da�ecta� � * reprinted frorn 6/11/07 meeting �` �` s na��: �� , zoa� 6 Re. Financial Statea�z�ent �'resentation of the Twin Lalces Letter of Credit Proceec�s 9 �aekgrou�d 10 At �he May 21; 2Q�7 City Council �nee�ing, �%e Co�ncil received �he presentation of tkze 2006 11 Auc�it az�ci Ann�xal Financial Report fro� .�zz� Eic�ter�, Partner with the City's A�dit Fzrzn o� 12 MaI�Qy, Mor�tag�e, Karriowski, and Radosevic�, and Corr�pany, P.A., 13 14 �.s prese�ated, t�e 2006 Annuai Financial Repart z�c�udes a separate �ine-itexn denol;ing the c�za�vv- � 5 dovm of th� Letier a� Credit suppliec� hy t�ie �'orzr�er dev�laper o� Twi� Lakes. This is fo�nd nn J 6 the �'irst set of �'inaz�c�al stateznents wi�ich begin on Page 26 of t�e Report. The lizze-ite�n is %�nd 17 on page 27. 18 19 During #he �resentation, a Cauncil��mber �•aised a coneern as to w�ether ��e �nancial 20 staie�z�ents p�'operly reported the Letter of Cxed.zt �roceeds and whetla�r ihe� suffciently 21 identified what i%e proceeds �vere for. The City's A�d'ztor's respanse ta th�s �nq�iry was that �he 22 Lettar o� Cred�t p�oce�ds were properly clisclosed �rader Generally Acce�ting Accounting 23 Principles, 2� 25 Discussian Iterns 26 City Staff would add that while additional docurr�e�taiion. regardi�g t1�e Letter o� Credii proceeds 27 can be added, it wo�ld axguably ad�. 1it�Ie value tn the reader. This conclusian is based on the 28 following: z� 30 •e• The ite�z� is already sepa�'ate�y and specially denoted in t�e Atanual Report — signi�ying 31 that tha� is non-recuz-xzng in na�ure anc� in no way a determinant of the City's futur� fiscal 32 condit;ion 33 34 35 36 37 38 ❖ Wh�le the iniended at�dience of t�e C�ty's Az��ual �ir�aricial Report can be broad, xn practice zt is li�ited to the City Counci�, Staff, technical analysts at bo�.d ra��ng agencies ar�d tl�e Office of the Minu�esata Sta�e Auditor. One notable exception includes a�aca1 residez�t who holds a CPA Certi�'icate and is we11-versed ir� the City's financial rnatters.