Agenda Packets - 1989/07/10 - Laserfiche WebLink

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` TO: Mayor & Council f7' if (ems FROM: Don Brager. Finance Director -Treasurer 6/1 DATE: June 17, 1989 F?: REQUEST OF VOTO, TAUTGES, REDPATH & CO.,LTD. FOR ADDITIONAL COMPENSATION FOR ASSISTANCE IN PREPARING 1988 FINANCIAL STATEMENTS Preparation of the 1988 Comprehensive .Annual Financial Report required substantially more effort on the part of staff and our auditing firm than was originally anticipated. Additional. work was required in two areas: establishing a fixed asset accounting system and preparing the Financial Report for submission for review to the Government Finance Officers Association's Certificate of Achievement for Excel'.,nce in Financial Reporting Program. Establishing a Fixed Asset Accounting System has been a goal that has been included in the Public Service Program of the Long Term Financial Plan for several years. During September and October 1988, Finance Department staff inventoried the fixed assets of various City departments. Assets that were acquired after 1985 were valued at actual purchased prices. Assets acquired prior to 1985 were valued at estimated purchased prices due to the difficulties in locating or:tyiral invoices for these assets. Our auditors are required to review the inventory and to conduct tests to determine the completeness and accuracy of the inventory as well as a review of the values assigned to the assets. The City's Fixed Asset Accounting System was judged by the auditors to be in conformity with generally accepted accounting principles. As a consequence the City has received a "clean opinion" on its 1988 Financial Statements. A "clean opinion" states that all of the City's Financial Statements present fairly the financial position of the City as of December 31, 1988 and that all have been prepared in conformity with generally accepted accounting principles. In previous years the City received a "qualified opinion". The "qualified opinion" stated that the City did not have a fixed asset accounting system, did not meet generally accepted accounting principles regarding fixed assets and as a consequence they could not audit City fixed asset records. Our auditors have requested additional compensation for their work in assisting with the establishment of our fixed asset accounting system. Their original request was $5,790. This request has proven to be difficult to deal with. Staff was aware that establishing a fixed asset system would require additional work on the part of the auditors, however, neither staff nor the auditors could predict in advance how much additional work would be required. Additionally our contract states that if additional work is to be performed the City is to be notified of this prior to the work being undertaken. As a consequence staff met with Robert Tautges of Voto, Tautges, Redpath & Co., LTD. and negotiated a compromise billing of $2,882.50. Staff recommends Council authorize payment of this billing fro,.. Contingency accounts of the General, Water and Sewer Funds.