Management Report and Recommendations 12/31/1992

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City of Lino Lakes, Minnesota Management Report, Page 13 The City collects special assessments through Anoka County. This agency arrangement has advantages to the City primarily in saving administrative time and effort required to bill and collect special assessments. A certain level of control however, is lost through the agency arrangement insofar as accounting records are located and maintained at both the County and the City. Correlation of these records is required to assure accurate tabulation of receivables and amounts received. The City has improved internal records with regard to deferred assessments and compares such records periodically to County records. However, Anoka County is not providing detail of delinquent balances. We recommend that the City request improved data from the County. Calculation of Special Assessments Audit procedures disclosed that special assessments are not consistently calculated for residents who originally opted out of improvement projects and later chose to hook up to the sewer and water system. The City's engineering firm has been calculating the assessments using a published index. City staff have been calculating the assessments using a simple interest calculation. We recommend that the City adopt a formal policy for calculating assessments on properties that originally opted out of improvement projects. Fixed Assets As discussed in prior management reports, the City does not maintain complete fixed asset accounting records. Advantages of maintaining such a system include the following: • Availability of insurable value amounts • Increased safeguarding of movable assets • Availability of database to determine capital equipment replacement needs • Improved financial reporting Our firm can assist the City in establishing fixed asset systems. Our assistance would include the following: 1) Plan the implementation. 2) Assist in taking physical inventories. 3) Assist in defining historical or estimated historical cost. 4) Enter all such assembled data into a specialized fixed asset system for governments. 5) Generate complete fixed asset reports as of the completion date of the engagement.