Audit Report 12/31/1981 - Laserfiche WebLink

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A good system of internal accounting control contemplates an adequate segrega- tion of duties so that no one individual handles a transaction from its incep- tion to its completion. While we recognize that your office staff may not be large enough to permit an adequate segregation of duties in all respects for an effective system of internal accounting control, it is important that you be aware of this condition. This condition was considered in determining the nature, timing, and extent of the audit tests to be applied in our examination of the financial statements for the year ended December 31, 1981, and this report does not affect our report on those financial statements dated February 9, 1982. This report is intended solely for the use of management and should not be used for any other purpose. The following lists other areas warranting Board and /or administrative consideration. Water and Sewer Rates The Water and Sewer Fund reported a net loss of $5,192 for 1981. The rates charged consumers should be sufficient to cover all operating costs plus additional funds as needed to maintain property and plant. The rates should be reviewed and adjusted annually as necessary. Collateral We noted during the course of our audit that collateral required to secure deposits was inadequate at one of the City's depositories. We recommend maintaining a continuous record of collateral pledged by the depositories to insure that adequate collateral is provided in accor- dance with Minnesota Statutes, Section 118.01. Special Assessment Levies Our review of special assessments placed on the tax rolls for 1981 disclosed the omission of one parcel. We contacted the County and determined it was properly omitted for that year. The 1982 installment, however, had been omitted from the 1982 tax rolls in error. The County added the 1982 installment to the tax rolls as a result of our inquiry. It is essential that great care be taken in placing assessments on the tax rolls annually to ensure the assessment roll is correct and that all rolls are included. Delinquent Special Assessments and Taxes There were approximately $44,000 of delinquent special assessments and $44,000 of delinquent taxes receivable at year end, which represents significant amounts due to the City. A review of these delinquencies at the County auditor's office indi- cated that many of these parcels were "tax forfeit." The City should maintain an awareness of this situation in future budgeting and planning.