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• <br />Lars:nAllerf <br />CPAs, C.;onsuieancs & Advisors <br />www.larsonaIlen.com <br />March 30, 2005 <br />Mr. Alan Rolek, Director of Finance <br />City Council <br />City of Lino Lakes <br />1189 Main Street <br />Lino Lakes, MN 55014 <br />Dear Mr. Rolek, <br />You asked me to comment on the proper coding of expenditures of 51,532 spent on legal <br />fees to Kennedy and Graven in regards to charter questions during 2004. These costs <br />were coded to the Charter Commission department portion of your budget. <br />Each year the city budgets for costs related to the Charter. Within this department are line <br />items such as professional fees, municipal attorney, supplies and news letter. This is the <br />City's budget and the City Council has the discretion on how to use this budget <br />appropriation. Accordingly, legal costs related to researching and interpreting the Charter <br />would be appropriate expenditures charged to this department. Generally Accepted <br />Accounting Principals also require expenditures to be coded to the function that the cost <br />relates to. <br />It appears there has been some confusion related to this portion of the City's budget <br />where the Charter Commission felt this was the appropriation for the Commission and <br />that it was their budget to use at their discretion. As mentioned above, this is the City's <br />budget to be used at the discretion of the City Council. To avoid future confusion, you <br />should consider changing the department name to something like Charter Administration <br />and then have a line item within that department titled Charter Commission. You could <br />then show a budget for that Iine. Again the amount budgeted is at the City's discretion. <br />However, State Statutes indicate the Commission can spend up to 51,500 and the city <br />would have to pay these expenses. <br />Please feel free to contact me if you need more clarification. <br />Sincerely, <br />Larson, Alien Weishair & Co., LLP <br />Darwin Viker, CPA <br />109 North Main Street, PO Box 217, Austin, MN 55912, 507/434 - 7000, Fax 507/437 -8997 <br />Larson, Mkn, Weishair & Co., LLP 1 An lndencndcnt Member of Baker Tilly tncer tional <br />