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Vow
<br />LarsonAlled
<br />CPAs, Consultants & Advisors
<br />www.larsonallen.com
<br />Honorable Mayor and
<br />Members of the City Council
<br />City of Lino Lakes, Minnesota
<br />In planning our audit of the financial statements of the City of Lino Lakes as of and for the year ended
<br />December 31, 2003, we considered its internal control in order to determine our auditing procedures for
<br />the purpose of expressing our opinion on the financial statements and not to provide assurance on the
<br />internal control.
<br />We noted no matters involving internal control and its operation that we consider to be reportable
<br />conditions under standards established by the American Institute of Certified Public Accountants.
<br />Reportable conditions involve matters coming to our attention relating to significant deficiencies in the
<br />design or operation of the internal control that, in our judgment, could adversely affect City's ability to
<br />initiate, record, process, and report financial data consistent with the assertions of management in the
<br />financial statements.
<br />Our consideration of internal control would not necessarily disclose all matters in internal control that
<br />might be reportable conditions and, accordingly, would not necessarily disclose all reportable conditions
<br />that are also considered to be material weaknesses as defined above.
<br />During the course of our audit, several items came to our attention that we feel could be addressed by
<br />the City of Lino Lakes to more efficiently run the City's operations or improve its internal controls. We
<br />herein submit the following suggestions to the City of Lino Lakes for their consideration.
<br />Auditor Comments:
<br />Capital Project Deficits
<br />The financial statements for the capital project funds are presented in Statements 3, 5, 12 and 13 of the
<br />2003 Annual Financial Report. As of December 31, 2003 many of the capital project funds have deficit
<br />fund balances. These deficits total $5,553,381. The fund balances at December 31, 2003 and 2002 for
<br />these funds are as follows:
<br />Fund
<br />Dedicated Parks
<br />MSA Construction
<br />1997 Construction
<br />1998 Construction
<br />Town Center Project
<br />Tax Increment # 1 -7
<br />Tax Increment # 1 -8
<br />Tax Increment # 1 -10
<br />Tax Increment # 1 -11
<br />Fund Balance (Deficit)
<br />December 31,
<br />2002
<br />$ (740,518) $
<br />(364,332)
<br />(698,540)
<br />(2,662,115)
<br />(1,081,320)
<br />(26,695)
<br />(14,428)
<br />2003
<br />(699,225)
<br />(391,389)
<br />(698,540)
<br />(2,662,115)
<br />(1,081,320)
<br />(13,060)
<br />(6,120)
<br />(1,612)
<br />$ (5,587,948) $ (5,553,381)
<br />(7)
<br />Larson, Allen, Weishair & Co., LLP 1 An Independent Member of Baker Tilly International
<br />Increase
<br />(Decrease)
<br />41,293
<br />(27,057)
<br />26,695
<br />1,368
<br />(6,120)
<br />(1,612)
<br />$ 34,567
<br />
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