07-26-2023 Council Packet - Laserfiche WebLink

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further conversations the auditors concluded that this audit finding is necessary to bring awareness to City Council about the risk surrounding existing limited segregation of duties. To effectively implement strong segregation of duties, it would require additional staffing. City staff does not recommend increasing the staff in order to remove the finding since additional costs of implementing the necessary controls outweigh the benefits that would be derived. The finance team will continue to utilize all of the existing resources to help mitigate this risk in all of its finance processes.  Material Audit Adjustment – This finding was a result of an error in the Finance department. One payment at year was processed as a 2023 transaction rather than a 2022 transaction. The finance team always strives to identify all of the transactions at year end that should be moved to prior year, however due to the large volume transactions at year-end this one was missed.  Public Purpose Policy – This finding was generated as a result of the auditor’s close review of the 2022 expenditures related to Employee and Volunteer Recognition events. In particular, the expenses incurred for the 2022 volunteer appreciation event and holiday party in December triggered this finding. The City’s Public Purpose Policy adopted in 2015 includes language related to holiday parties which is in violation of Minnesota legal compliance guidelines and the City policy does not meet the standards of public purpose. Staff will provide a revised version of the Public Purpose Policy for consideration at an upcoming City Council meeting. The City Council will have the opportunity to ask questions after the presentation. STAFF RECOMMENDATION Receive and accept the 2022 Annual Comprehensive Financial Report. ATTACHMENTS  2022 Annual Comprehensive Financial Report  Internal Control Letter  Legal Compliance Letter  Governance Communication