12-11-1991 Council Agenda - Laserfiche WebLink

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City of Little Canada November 25, 1991 Page 2 As you and I have discussed on numerous occasions, the existing situation is no longer the best situation for the City today. Your ability to provide financial management expertise for the City is dependent upon the level of internal accounting expertise of your staff. The better situation for your City today would be increased internal accounting expertise and decreased external accounting (i.e. my firm). After the City acquires increased internal accounting expertise, my role (and cost) will automatically decline. The initial purpose of this letter was to provide you with a revised audit proposal especially in the area of accounting assistance. Accordingly, I am enclosing a list of "City to Prepare" items for the 1991 audit/accounting services. The more of these items accomplished by the City, the less my staff will have to do. However, I do not anticipate that City staff will be able to perform the entire year -end closing process. I do anticipate a joint effort by City staff and audit staff. Accordingly, these efforts must be coordinated. We must meet within the next few week to provide such coordination. We have been employed as the City's external auditors and financial advisors for a long time. We recognize the present situation of limited internal accounting expertise and the fact that this situation cannot be changed for the 1991 audit. We also recognize that the City (and all Minnesota cities) are under some very difficult budget constraints. Accordingly, we know our duty is to assist the City in every way possible Description 1990 1991 Actual Estimated Regular financial audit; management report; and capital project report $23,917 $23,917 State legal compliance audit 1,475 1,475 Special report relating to MSA 2,091 1,000 Accounting assistance 10,036 5,018 Totals $37,519 $31,410 1) We agree to effectively freeze our hourly rates by limiting our 1991 fees for the regular audit and the compliance audit at the 1990 levels as shown above. The City may consider these amounts as not to exceed amounts for 1991 audit. 2) We agree to update the special reporting relating to MSA at a cost not to exceed $1,000. The City may consider this amount as a not to exceed amount. 3) We will work with you and other City staff to reduce the number of hours we spend for accounting assistance such that our 1991 fee will be reduced by 50% as shown above. Achieving this goal is contingent upon the efforts of audit staff and City personnel. Accordingly, we cannot make an absolute commitment in this area. We do, however, commit our best efforts towards achieving this goal. Page 47