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Vadnnis Lake Area Water Management Organization <br />March 19, 2008 <br />Page 5 <br />Difficulties Encountered in Performing the Audit <br />We encountered no significant difficulties in dealing with management in performing our audit. <br />Corrected and Uncorrected Misstatements <br />Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those <br />that are trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. <br />In total we prepared 14 journal entries, 5 of which are considered audit entries and the remaining year-end account entries. These <br />entries are necessary to adjust balances to the proper year end amount. It is important that the Organization understand these <br />entries and prepare to make them in the future. Internal preparation enhances the quality of internal information Following are <br />the audit entries: <br />Adjusting Journal Entries JE # 1 <br />Debit Credit <br />To correct beginning balances to agree with prior year audit report <br />10100 Checking -1987 $ 119.00 <br />22200 Undeposited Funds 2,604.00 <br />25300 Opening Bal Equity 147,881.00 <br />11500 Accounts Receivable $ 98,830.00 <br />20200 Wetland Mitigation Payable 4,085.00 <br />20201 Dillan Pond 1,493.00 <br />20300 Due to Other Governments 7,318.00 <br />22201 Deferred Revenues 38,878.00 <br />Total <br />Adjusting Journal Entries JE # 2 <br />$ 150,604.00 $ 150,604.00 <br />To remove effect of 380,000 entry made twice <br />25300 Opening Bal Equity $ 380,000.00 <br />12200 Storm Sewer Utility Fees $ 380,000.00 <br />Total $ 380,000.00 $ 380,000.00 <br />Adjusting Journal Entries JE # 8 <br />To reclass mitigation payout and interest earned against liability <br />20201 Dillan Pond $ 7,042.00 <br />36220 Mitigation Interest 80.00 <br />20201 Dillan Pond $ 80.00 <br />43100-306 7.0 • Uncategorized Expenses 7,042.00 <br />Total $ 7,122.00 $ 7,122.00 <br />952.835.9090 • Fax 952.835.3261 <br />www.aemcpas.com <br />