Federal Financial Assistance 12/31/1995

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For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering federal financial assistance programs in the following categories: Federal Assistance Programs. Accounting Applications: General Requirements: Specific Requirements: Cash Disbursements Political Activity Types of Service Payroll Civil Rights Allowed or Unallowed Cash Management Federal Financial Reports Allowable Costs/Cost Principles Drug -Free Workplace Administrative Requirements For all of the internal control structure categories listed in the preceding paragraph, we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and we assessed control risk. During the year ended December 31, 1995, the City of Lino Lakes, Minnesota had no major federal financial assistance programs and expended 60.53% of its total federal financial assistance under the following nonmajor program: Community Development Block Grant Program. We performed tests of controls, as required by OMB Circular A -128, to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with specific requirements, general requirements, and requirements governing claims for advances and reimbursements and amounts claimed or used for matching that are applicable to the aforementioned nonmajor programs. Our procedures were less in scope than would be necessary �- to render an opinion on these internal control structure policies and procedures. Accordingly, we do not express such an opinion. We noted certain matters involving the internal control structure and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control structure that, in our judgment, could adversely affect the City of Lino Lakes, Minnesota's ability to administer federal financial assistance programs in accordance with applicable laws and regulations. _ The Lino Lakes Police Department has a drug testing program and has a written policy and procedures for a drug -free workplace. These policies however, have not been formally adopted by the Lino Lakes City Council and were not effective until January 1, 1996, the Federal grant period started March 1, 1995.