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City of Lino Lakes, Minnesota <br />Schedule of Findings and Responses <br />For The Year Ended December 31, 2021 <br /> <br /> <br /> <br /> <br />2021-1 Financial Statement Corrections <br /> <br />Criteria: The City’s internal controls should allow management or employees, in the normal <br />course of performing their assigned functions, to prevent or detect misstatements on a timely <br />basis. <br /> <br />Condition: Audit procedures detected a material misstatement related to police holiday pay <br />in the amount of $117,527. The holiday pay represents amounts earned in 2021. The <br />payment was appropriately made during January 2022, however, the expense was not <br />accrued back to 2021 prior to correction. <br /> <br />Cause: The item was not identified during the year-end close process. <br /> <br />Effect: Inadequate controls over the year-end closing process results in an increased risk <br />that financial statement misstatements may occur and not be detected on a timely basis. <br /> <br />Recommendation: We recommend staff review its year-end procedures in an attempt to <br />identify and correct any misstatements. <br /> <br />Views of Responsible Officials and Corrective Action Plan: We agree with this finding. Staff <br />have implemented procedures to ensure all accruals are appropriately identified and reported <br />going forward. <br /> <br /> <br />