9.a) Final Report to Members of GovernanceCITY OF SCANDIA, MINNESOTA
REPORT TO MEMBERS
OF GOVERNANCE
APRIL 8, 2014
CITE' OF SCANDIA, MINNESOTA
TABLE OF CONTENTS
IntroductoryLetter......................................................................................................................................................1
RequiredCommunications..........................................................................................................................................2
Exhibit A — Summary of Recorded Audit Adjustments
Exhibit B — Certain Written Communications Between Management and Our Firm
Exhibit B-1— Sample Management Representation Letter
SCHLENNER
WENNELR&CO.
CERTIFIED PUBLIC ACCOUNTANTS
& BUSINESS CONSULTANTS
April 8, 2014
Members of Governance
City of Scandia
Scandia, MN 55073
We are pleased to present this report related to our audit of the basic financial statements of the City of Scandia (the
City) for the year ended December 31, 2013. This report summarizes certain matters required by professional standards
to be communicated to you in your oversight responsibility for the City's financial reporting process.
This report is intended solely for the information and use of the members of governance and is not intended to be and
should not be used by anyone other than these specified parties. It will be our pleasure to respond to any questions you
have regarding this report. We appreciate the opportunity to continue to be of service to the City.
SCHLENNER WENNER & CO.
St. Cloud, Minnesota
An Independently Owned Member, McGladrey Alliance
St. Cloud
Little Falls
Albany
Maple Lake
Monticello
630 Roosevelt Rd. Ste. 201
109 E. Broadway
115 6th St.
220 Hwy. 55 North, Ste. 4
202 W. 3rd St.
P.O. Box 1496
P.O. Box 365
P.O. Box 268
P.O. Box 385
P.O. Box 755
St. Cloud, MN 56302
Little Falls, MN 56345
Albany, MN 56307
Maple Lake, MN 55358
Monticello, MN 55362
320.251,0286
320.632.6311
320.845.2940
320.963.5414
763.295.5070
CITY OF SCANDIA, MINNESOTA
REQUIRED COMMUNICATIONS
Generally accepted auditing standards (AU-C260, The Auditor's Communication with Those Charged with
Governance) require the auditor to promote effective two-way communication between the auditor and those charged
with governance. Consistent with this requirement, the following summarizes our responsibilities regarding the
financial statement audit as well as observations arising from our audit that are significant and relevant to your
responsibility to oversee the financial reporting process.
Auditor's Responsibility under Professional Standards
Our responsibilities under auditing standards generally accepted in the United States of America have been described to
you in our arrangement letter dated October 22, 2013.
Overview of the Planned Scone and Timin1l of the Financial Statement Audit
We have issued a separate communication regarding the planned scope and timing of our audit and have discussed with
you our identification of and planned audit response to significant risks of material misstatement.
Accounting Practices
Preferability of Accounting Policies and Practices
Under accounting principles generally accepted in the United States of America, in certain circumstances, management
may select among alternative accounting practices. In our view, in such circumstances, management has selected the
preferable accounting practice.
Adoption of, or Change in, Accounting Policies
Management has the ultimate responsibility for the appropriateness of the accounting policies used by the
City.
Effective December 31, 2013, the City adopted Governmental Accounting Standards Board (GASB) Statement No. 63,
Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position. This
statement establishes standards for reporting deferred outflows of resources, deferred inflows of resources, and net
position.
The City also adopted GASB Statement No. 65, Items Previously Reported as Assets and Liabilities. This statement
reclassifies certain items that were previously reported as assets and liabilities and deferred outflows resources, deferred
inflows of resources or current -period outflows and inflows.
Significant or Unusual Transactions
We did not identify any significant or unusual transactions or significant accounting policies in controversial or
emerging areas for which there is a lack of authoritative guidance or consensus.
Alternative Treatments Discussed with Mana ement
We did not discuss with management any alternative treatments within generally accepted accounting principles for
accounting policies and practices related to material items during the current audit period.
Management's Judgments and Accounting Estimates
Accounting estimates are an integral part of the preparation of financial statements and are based upon management's
current judgment. The process used by management encompasses their knowledge and experience about past and
current events and certain assumptions about future events. You may wish to monitor throughout the year the process
used to compute and record these accounting estimates.
K
CITY OF SCANDIA, MINNESOTA
REQUIRED COMMUNICATIONS
Audit Adjustments
Audit adjustments proposed by us and recorded by the City are shown on the attached Exhibit A.
Uncorrected Misstatements
Uncorrected misstatements are summarized in the Sample Management Representation Letter included in Exhibit B-1.
Disagreements with Mana eement
We encountered no disagreements with management over the application of significant accounting principles, the basis
for management's judgments on any significant matters, the scope of the audit, or significant disclosures to be included
in the financial statements.
Consultations with Other Accountants
We are not aware of any consultations management had with other accountants about accounting or auditing matters.
Significant Issues Discussed with Management
No significant issues arising from the audit were discussed or were the subject of correspondence with management.
Difficulties Encountered in Performing the Audit
We did not encounter any difficulties in dealing with management during the audit.
Letter Communicating Significant Deficiencies and Material Weaknesses
We have separately communicated the material weaknesses and significant deficiency identified during our audit of the
financial statements, and this communication is included within the compliance section of the City's financial report for
the year ended December 31, 2013.
Certain Written Communications Between Management and Our Firm
A copy of the draft representation letter to be provided to us by management is attached as Exhibit B-l.
EXHIBIT A
SUMMARY OF RECORDED
AUDIT ADJUSTMENTS
4/8/2014
4:24 PM
Client: 3559 - City of Scandia
Engagement: 12-13 and - City of Scandia
Period Ending: 1213112013
Trial Balance: 3000.00 - TB
Workpaper: 0204.00 - Adjusting Journal Entries Report
Account Description
Adjusting Journal Entries JE # 100
To adjust for miscellaneous the accounts receivable,
101-10425
Misc Receivables
101-10425
Misc Receivables
101-10100
Cash
101-41000-210
Operating Supplies
Total
Adjusting Journal Entries JE # 101
Minor corrections to accounts payable.
602-20200
Accounts Payable
612-20200
Accounts Payable
602-43210-386
Operation & Maintenance
612-43210-386
Operation & Maintenance
Total
Adjusting Journal Entries JE # 102
To record January 2014 settlement statement.
101-10500
Taxes Receivable -Current
101-41000-31000
Washington Cty, Tax Settlement
101-41110-31000
Washington Cty. Tax Settlement
101-41410-31000
Washington Cty. Tax Settlement
101-41910-31000
Washington Cty. Tax Settlement
101-42100-31000
Washington Cty. Tax Settlement
101-42200-31000
Washington Cty. Tax Settlement
101-43000-31000
Washington Cty. Tax Settlement
101-45000-31000
Washington Cty. Tax Settlement
101-45180-31000
Washington Cty. Tax Settlement
Total
Adjusting Journal Entries JE # 103
To adjust bond proceeds
313-10100
Cash
313-47000-304
Legal Services
406-48500-39350
Certificate of Indebtedness
313-47000-611
Long Term Debt Interest
313-48500-39350
NEW 2013 ACCT Certificates of Indebtedness
313-48500-39350
NEW 2013 ACCT Certificates of Indebtedness
406-10100
Cash
Total
Adjusting Journal Entries JE # 104
To record transfer of bond proceeds to capital project fund
313-48000-720 NEW 2013 ACCOUNT Operating Transfers
406-10100 Cash
313-10100 Cash
406-48500-39200 Interfund Operating Transfer
Total
Adjusting Journal Entries JE # 106
W/P Ref Debit Credit
93.00
4,897.00
4,897.00
93.00
4,990.00 4,990.00
811.00
341.00
811.00
341.00
1,162.00 1,162.00
32,424.00
5,925.00
373.00
9.00
357.00
2,233.00
5,452.00
16,621.00
857.00
597.00
32,424.00 32,424.00
560,670.00
9,690.00
560,570.00
260.00
9,430,00
560,570.00
560,570.00
1,130, 83 0.00
1,13 0, 830.00
544,454.00
644,454.00
544,454.00
544,454.00
1,088,908.00 1,088,908.00
1 of 7
4/8/2014
4:24 PM
Client: 3559 - City of Scandia
Engagement: 12-13 and - City of Scandia
Period Ending: 1213112013
Trial Balance: 3000.00 - TB
Workpaper: 0204.00 -Adjusting Journal Entries Report
Account Description W/P Ref
To reclass property taxes
311-10100
Cash
312-47000-31000
Washington Cty. Tax Settlement
311-47000-31000
Washington Cty. Tax Settlement
312-10100
Cash
Tota I
Adjusting Journal Entries JE # 106
To correct interest income allocation entry posted by client
101-10100 Cash
101-24400 Fund Balance For Quinnell
101-41000-36210 Interest Income
101-41000-36210 Interest Income
Total
Adjusting Journal Entries JE # 107
To adjust special assessment receivable to actual
307-22200 Special Assessment Revenue
602-43210-36100 Special Assessments
307-12300 Special Assess Rec-Deferred
602-12300 Special Assess Rec-Deferred
Tota l
Adjusting Journal Entries JE # 108
To tie out fund balance
101-10100 Cash
101-25300 Unreserved Fund Balance
612-25300 Unreserved Fund Balance
101-10700 Taxes Receivable -Delinquent
101-25300 Unreserved Fund Balance
612-10100 Cash
Total
Adjusting Journal Entries JE # 109
To adjust for driveway permits
101-41910-32210 Building Permits
101-20202 Deposits Payble
101-41910-439 Refunds Issued
Total
Adjusting Journal Entries JE # 110
To record unearned revenue for hall rental receipts per the client.
101-45180-34750 Facilities Rental
101-22202 DEFERRED REVENUE
Total
Adjusting Journal Entries JE # 111
To record prepaid health insurance.
101-16601 Prepaid Insurance
101-41000-131 Employer Paid Health
Debit Credit
2,100.00
2,100.00
2,100.00
2,100.00
4,200.00 4,200.00
619.00
619.00
619.00
619.00
1,238.00 1,238.00
19,633.00
4,226.00
19,633.00
4,226.00
23,859.00 23,869.00
2,133.00
292.00
2,133.00
4,558.00
292.00
2,133.00
2,133.00
4,568.00
4,995.00
1,250.00
3,745.00
4,995.00 4,995.00
635.00
635.00
636.00 636.00
2,962.00
582.00
2 of 7
4/8/2014
4:24 PM
Client: 3559 - City of Scandia
Engagement: 12-13 and - City of Scandia
Period Ending: 1213112013
Trial Balance: 3000.00 - TS
Workpaper: 0204.00 - Adjusting Journal Entries Report
Account Description W/P Ref
Debit
Credit
101-43000-131 Employer Paid Health
2,380.00
Total
2,962.00
2,962,00
Adjusting Journal Entries JE # 112 6200.06
To record accrued year end wages payable
101-41000-101 Regular Wages & Salaries
2,338.00
101-41000-121 PERA Coord, Employer Contribu.
144.00
101-41000-122 FICA Employer Contribution
2,552.00
101-41000-131 Employer Paid Health
207.00
101-41000-134 Employer Paid Life
37.00
101-41110-101 Regular Wages & Salaries
3,913.00
101-41110-126 MEDICARE Employer Contribution
59.00
101-41110-127 PERA Defined
206.00
101-42200-101 Regular Wages & Salaries
10,532.00
101-42200-122 FICA Employer Contribution
966.00
101-21600 Accrued Wages & Salaries Payab
16,257.00
101-21701 Federal Withholding
368.00
101-21702 State Withholding
157.00
101-21703 FICA Tax Withholding
3,578.00
101-21704 PERA
350.00
101-21706 Accrued Medical Ins
207.00
101-21710 Suppl. Life Ins. Employee Paid
37.00
Total
20,954.00
20,964.00
Adjusting Journal Entries JE # 113
To record receivables.
101-10425 Misc Receivables
21,847.00
602-10425 Misc Receivables
11,960.00
612-10425 Misc Receivables
2,101.00
101-41000-34102 Legal Services
253.00
101-41000-35101 Fines & Forfeitures
970.00
101-41000-38050 Cable TV Franchise Rebates
763.00
101-41910-32210 Building Permits
75.00
101-41910-32210 Building Permits
318.00
101-41910-34103 Zoning and Planning
4.00
101-41910-34103 Zoning and Planning
1,852.00
101-41910-34103 Zoning and Planning
3,448.00
101-43000-31701 Gravel Taxes
11,108.00
101-43000-34106 Engineering Fees
214.00
101-43000-34106 Engineering Fees
270.00
101-43000-34106 Engineering Fees
330.00
101-43000-36250 Misc. Refund
2,092.00
101-45180-34750 Facilities Rental
150.00
602-43210-34401 Sewer User Fees & Hookup
11,960.00
612-43210-34401 Sewer User Fees & Hookup
2,101.00
Total
36,908.00
36,908.00
Adjusting Journal Entries JE # 114
To adjust inventory to actual per the client.
101-14100 Inventory
1,410.00
101-43000-229 Salt
1,410.00
Total
1,410.00
1,410.00
Adjusting Journal Entries JE # 116
3of7
4/8/2014
4:24 PM
Client:
3559 - City of Scandia
Engagement:
12-13 and - City of Scandia
Period Ending:
1213112013
Trial Balance:
3000.00 - TB
Workpaper:
0204.00 - Adjusting Journal Entries Report
Account
Description W/P Ref
Debit
Credit
To reclassify interfund activity.
101-23000
DUE TO OTHER FUNDS
25,104.00
612-23901
LONG-TERM LIABILITY
2,640.00
101-20710
Due to Other Funds
25,104.00
612-43210-603
Short -Term Debt Principal
2,640.00
Total
27,744.00
27,744.00
Adjusting Journal Entries JE # 116
to correct client posted journal entry.
101-41910-312
Planning Services
14,088.00
101-20200
Accounts Payable
14,088.00
Total
14,088.00
14,088.00
Adjusting Journal Entries JE # 117
To record accounts
payable per listing provided by the client.
101-21710
Suppl. Life Ins. Employee Paid
9.00
101-41000-134
Employer Paid Life
2.00
101-41000-200
Office Supplies
168.00
101-41000-203
Printed Forms & Papers
284.00
101-41000-300
Assessor
7,906.00
101-41000-304
Legal Services
825.00
101-41000-304
Legal Services
1,363.00
101-41000-321
Telephone
59.00
101-41000-321
Telephone
189.00
101-41000-322
Postage
200.00
101-41000-331
Travel Expenses
23.00
101-41000-353
Sales Tax
12.00
101-41000-413
Equipment Rental
377.00
101-41000-437
Cable TV Franchise
763.00
101-41000-439
Refunds Issued
600.00
101-41000-439
Refunds Issued
500.00
101-41000-439
Refunds Issued
500.00
101-41000-439
Refunds Issued
1,000.00
101-41110-331
Travel Expenses
101.00
101-41910-311
Contract Permit Inspections
896.00
101-41910-311
Contract Permit Inspections
1,064.00
101-41910-312
Planning Services
1,284.00
101-41910-319
Other Services
15,980.00
101-42100-318
Police Contract
60,514.00
101-42200-210
Operating Supplies
79.00
101-42200-210
Operating Supplies
135.00
101-42200-210
Operating Supplies
155.00
101-42200-212
Fuel
53.00
101-42200-212
Fuel
306.00
101-42200-240
Small Tools and Minor Equip
1,011.00
101-42200-309
Software Support & Maintenance
850.00
101-42200-309
Software Support & Maintenance
2,400.00
101-42200-310
Medical Training
3,780.00
101-42200-321
Telephone
150.00
101-42200-353
Sales Tax
6.00
101-42200-353
Sales Tax
81.00
101-42200-384
Refuse/Garbage Disposal
64.00
101-42200-385
Sewer Pumping & Maintenance
237.00
101-42200-401
Building Maintenance/Repairs
60.00
101-42200-404
Repair Machinery/Equipment
89.00
4of7
4/8/2014
4:24 PM
Client: 3559 - City of Scandia
Engagement: 12-13 and - City of Scandia
Period Ending: 1213112013
Trial Balance: 3000.00 - TB
Workpaper: 0204.00 - Adjusting Journal Entries Report
Account Description W/P Ref Debit Credit
101-42200-407
Well Repair & Maintenance
90.00
101-42200-560
Furniture and Fixtures
-355.00
101-43000-134
Employer Paid Life
5.00
101-43000-200
Office Supplies
142.00
101-43000-210
Operating Supplies
11.00
101-43000-210
Operating Supplies
20.00
101-43000-210
Operating Supplies
22.00
101-43000-210
Operating Supplies
41.00
101-43000-210
Operating Supplies
79.00
101-43000-210
Operating Supplies
141.00
101-43000-212
Fuel
4,364.00
101-43000-221
Equipment Parts
224.00
101-43000-229
Salt
9,781.00
101-43000-240
Small Tools and Minor Equip
89.00
101-43000-240
Small Tools and Minor Equip
669.00
101-43000-302
Surveying
750.00
101-43000-303
Engineering Fees
1,934.00
101-43000-319
Other Services
55.00
101-43000-319
Other Services
107.00
101-43000-319
Other Services
117.00
101-43000-319
Other Services
121.00
101-43000-321
Telephone
88.00
101-43000-321
Telephone
413.00
101-43000-353
Sales Tax
1.00
101-43000-353
Sales Tax
2.00
101-43000-353
Sales Tax
5.00
101-43000-353
Sales Tax
6.00
101-43000-353
Sales Tax
27.00
101-43000-353
Sales Tax
155.00
101-43000-353
Sales Tax
672.00
101-43000-381
Utilities -Electric & Gas
2,298.00
101-43000-384
Refuse/Garbage Disposal
43.00
101-43000-385
Sewer Pumping & Maintenance
193.00
101-43000-387
Street Light Utilities
73.00
101-43000-387
Street Light Utilities
258.00
101-43000-401
Building Maintenance/Repairs
40.00
101-43000-401
Building Maintenance/Repairs
136.00
101-43000-438
Misc. Contractual
3,504.00
101-45000-141
Unemployment Compensation
740.00
101-45000-200
Office Supplies
4.00
101-45000-210
Operating Supplies
5.00
101-45000-210
Operating Supplies
202.00
101-45000-212
Fuel
100.00
101-45000-240
Small Tools and Minor Equip
267.00
101-45000-319
Other Services
48.00
101-45000-340
Advertising
150.00
101-45000-353
Sales Tax
1.00
101-45000-353
Sales Tax
19.00
101-45000-353
Sales Tax
32.00
101-45000-353
Sales Tax
33.00
101-45000-353
Sales Tax
67.00
101-45000-381
Utilities -Electric & Gas
17.00
101-45000-381
Utilities -Electric & Gas
526.00
101-45000-385
Sewer Pumping & Maintenance
125.00
101-45000-401
Building Maintenance/Repairs
485.00
101-45000-438
Misc. Contractual
768.00
101-45180-210
Operating Supplies
62.00
101-45180-210
Operating Supplies
159.00
5of7
4/8/2014
4:24 PM
Client:
3559 - City of Scandia
Engagement:
12-13 and - City of Scandia
Period Ending:
1213112013
Trial Balance:
3000.00 - TB
Workpaper:
0204.00 - Adjusting Journal Entries Report
Account
Description W/P Ref
Debit
Credit
101-45180-353
Sales Tax
24.00
101-45180-353
Sales Tax
27.00
101-45180-384
Refuse/Garbage Disposal
127.00
101-45180-385
Sewer Pumping & Maintenance
194.00
101-45180-401
Building Maintenance/Repairs
183.00
101-45180-401
Building Maintenance/Repairs
395.00
101-45180-407
Well Repair & Maintenance
90.00
401-48000-520
Capital Improvements to Bldgs
1,100.00
602-43210-200
Office Supplies
62.00
602-43210-321
Telephone
215.00
602-43210-381
Utilities -Electric & Gas
9.00
602-43210-381
Utilities -Electric & Gas
39.00
602-43210-386
Operation & Maintenance
1,622.00
612-43210-200
Office Supplies
21.00
612-43210-351
Legal Notices Publishing
56.00
612-43210-381
Utilities -Electric & Gas
58.00
612-43210-386
Operation &Maintenance
681.00
101-20200
Accounts Payable
135,856.00
401-20200
Accounts Payable
1,100.00
602-20200
Accounts Payable
1,947.00
612-20200
Accounts Payable
816.00
Total
139,719.00
139,719.00
Adjusting Journal Entries JE # 118
To adjust for delinquent
property taxes
101-10700
Taxes Receivable -Delinquent
9,935.00
101-41000-31000
Washington Cty. Tax Settlement
606.00
307-22201
Deferred Rev Delinquent Tax
15.00
307-47000-31000
Washington Cty. Tax Settlement
44.00
310-22201
Deferred Rev Delinquent Tax
6.00
310-47000-31000
Washington Cty. Tax Settlement
17.00
401-22201
Deferred Rev Delinquent Tax
2.00
401-48000-31000
Washington Cty, Tax Settlement
5.00
101-10500
Taxes Receivable -Current
7,205.00
101-10700
Taxes Receivable -Delinquent
606.00
101-22201
Deferred Rev Delinquent Tax
2,730.00
307-10700
Taxes Receivable -Delinquent
59.00
310-10700
Taxes Receivable -Delinquent
23.00
401-10700
Taxes Receivable -Delinquent
7.00
Total
10,630.00
10,630.00
Adjusting Journal Entries JE # 119
To zero out the balances
in the 304 fund, which has been closed.
304-25500
DESIGNATED FOR DEBT SERVICE
135,042.00
304-25300
Unreserved Fund Balance
135,042.00
Total
136,042.00
136,042.00
Adjusting Journal Entries JE # 120
To record depreciation expense in the proprietary funds.
602-43210-420
Depreciation Expense
30,000.00
612-43210-420
Depreciation Expense
4,877.00
602-16310
Accumulative Depreciation
30,000.00
612-16310
Accumulative Depreciation
4,877.00
Total
34,877.00
34,877.00
6 of 7
4/8/2014
4:24 PM
Client: 3559 - City of Scandia
Engagement: 12-13 and - City of Scandia
Period Ending: 1213112013
Trial Balance: 3000.00 - TB
Workpaper: 0204.00 - Adjusting Journal Entries Report
Account Description W/P Ref
Debit
Credit
Adjusting Journal Entries JE # 121
To record the revenue from the state paid directly to the City"s
Firefighter Retirement Plan.
101-42200-324 State of MN -Fire Relief
24,720.00
101-42200-33420 Fire Relief from Ins. Prem.
24,720.00
Total
24,720.00
24,720.00
Adjusting Journal Entries JE # 122
Per Colleen - to record an additional payable at 12/31/13.
101-42200-310 Medical Training
7,200.00
101-20200 Accounts Payable
7,200.00
Total
7,200.00
7,200.00
Adjusting Journal Entries JE # 123
Per the client - to record a refund the City received in 2014 from BCBS
for 2013 premiums paid. The City changed health insurance providers
101-10425 Misc Receivables
4,897.00
101-41000-131 Employer Paid Health
1,041.00
101-43000-131 Employer Paid Health
3,856.00
Total
4,897.00
4,897.00
7 of 7
EXHIBIT B
CERTAIN WRITTEN COMMUNICATIONS
BETWEEN MANAGEMENT
AND OUR FIRM
Such communications include:
Exhibit B-1 Sample Management Representation Letter
EXHIBIT B-1
CERTAIN WRITTEN COMMUNICATIONS
BETWEEN MANAGEMENT
AND OUR FIRM
Sample Management Representation Letter
CITY OF SCANDIA
SCANDIA, NIIN MSOTA
April 8, 2014
Schlenner Wenner & Co.
St. Cloud, MN 56302
This representation letter is provided in connection with your audit of the basic
Scandia, Minnesota, as of and for the year ended December 31, 2013 for the pi
whether the financial statements are presented fairly, in all in" r; 1 respec
principles generally accepted in the United States (U.S. GAAP). �,
We confirm to the best of our knowledge and belief, as of April 8, 2014:
Financial Statements
1.
2
We have fulfilled our responsibilities, as set out in tl
2013, for the preparation and fair presentation of the
US. GAAP.
We acknowledge our responsibility
relevant to the preparation and f,
misstatement, whether due to fraud o
We acknowledge our responsi
prevent and detect fraud.
Significant assumpti
are reasonable and re
and our assumptions
Related
and nati
6. All events subsequent to
disclosure have beedi:
of the City of
an opinion on
th accounting
dated October 22,
in accordance with
internal control
from material
of internal control to
nting estimates, including those measured at fair value,
knowledge and experience about past and current events
.ist and courses of action we expect to take.
Xfflsactions, including interfund accounts and advances receivable
,ns, interfund transfers, long-term loans, leasing arrangements, and
;ordance with the economic substance of the transaction and
in accordance with the requirements of U.S. GAAP,
ate of the financial statements and for which U.S. GAAP requires adjustment or
or disclosed.
7. The effects of all known actual or possible litigation, claims and assessments, have been accounted for and
disclosed in accordance with accounting principles generally accepted in the United States of America.
We are not aware of any pending or threatened litigation, claims, or assessments that are required to be
accrued or disclosed in the financial statements in accordance with Statement of Financial Accounting
Standards No.5 and/or GASB Statement No. 10 and we have not consulted a lawyer concerning litigation
claims or assessments.
9. We have no direct or indirect, legal or moral obligation for any debt of any organization, public or private,
that is not disclosed in the financial statement.
10. We have complied with all aspects of contractual agreements that would have a material effect on the
financial statements in the event of noncompliance. In connection therewith, we specifically represent that we
are responsible for determining that we are not subject to the requirements of the Single Audit Act and OMB
Circular No. A-133, because we have not received, expended, or otherwise been the beneficiary of the
required amount of federal awards during the period of this audit.
11. We believe that the effects of the uncorrected misstatements aggregated by you and summarized below are
immaterial, both individually and in the aggregate to the opinion units of the basic financial statements. For
purposes of this representation, we consider items to be material, regardless of their size, if they involve the
misstatement or omission of accounting information that, in light of surrounding circumstances, makes it
probable that the judgment of a reasonable person relying on the information would be changed or influenced
by the omission or misstatement. �,6�11_
GENERAL FUND
ASSETS LIABILITIES
DESCRIPTION
CURRENT YEAR MISSTATEMENTS:
Accounts receivable overstated $ 4,897 $
EFFECT OF PRIOR YEAR REVERSING MISSTATEMENTS:
Reversed - Prior year payroll accruals overstated
Nonreversed opening Net Position Misstatements -
Current year effect ,'n} 897 $
Information Provided
12. We have provided you with:
a. Access to all it
of the financial
b. Additional info
c. Unre i a `dla
evidi
d. Miod
minutes
13. All material
statements.
CHANGEIN
NET
$ - $ (4,897) $ 4,897
- 2,603 (2,603)
$17r.. $ - $ (2,294) $
aware tha`is relevant to the preparation and fair presentation
ip,�cumentation, and other matters;
,bn th . - u h uested from us for the purpose of the audit;
to peons wit i the City from whom you determined it necessary to obtain audit
not yet
of the City Council or summaries of actions of recent meetings for which
been recorded in the accounting records and are reflected in the financial
14. We have disclosed to you the results of our assessment of risk that the financial statements may be materially
misstated as a result of fraud.
15. We have no knowledge of any fraud or suspected fraud that affects the City and involves:
• Management,
• Employees who have significant roles in the internal control, or
• Others where the fraud could have a material effect on the financial statements.
16. We have no knowledge of any allegations of fraud or suspected fraud affecting the City's financial statements
communicated by employees, former employees, regulators, or others.
17. We are aware of no instances of noncompliance or suspected noncompliance with provisions of laws,
regulations, contracts, or grant agreements, or abuse, whose effects should be considered when preparing
financial statements.
18. We are not aware of any pending or threatened litigation and claims whose effects should be considered when
preparing the financial statements and we have not consulted legal counsel concerning litigation or claims.
�;
19. We have disclosed to you the identity of the City's related parties and all tl�, . lat-p .; elationships and
transactions of which we are aware..
20. We have informed you of all significant deficiencies, includinT%#teriaN" M es, in design or
operation of internal controls that could adversely affect the Entity's an, to re rocess, arize, and
report financial data.f. .
21. We are aware of no communications from regulator�' gencies;. cern noncompliance with, or
deficiencies in, financial reporting practices. lk
22. With respect to the supplementary informationps�nted iigon to thencial statements as a whole:
a. We acknowledge our responsibility for ;' R �
g p ty o f resenli� of si n ,; on.
O �
b. We believe the supplementary includift - % for d£° content, is fairly presented in
accordance with accounting p� nei es gene , accepted m� it 'ates of America.
c. The methods of measurement an -sentation e supplementary information have not changed from
those used in the pri re` d and �e%ve disclose you any significant assumptions or interpretations
IMRI
underlying the meemend, reseno of the supplementary information.
d. When supplement} info io, �t preseteIF
d with the audited financial statements, we will make the
audited financial s RReK nl eadil ' Yl ble to the intended users of the supplementary information no
later �f'
thaieaissue suppfrieary information and the auditors' report thereon.
y. �te we f
23. With reIfflo,
t to ear �� a on
t the information presented as required by Governmental Accounting
Standard o asic financial statements:
a. We acknowledg
p our for the presentation of such required supplementary information.
�`nsibility
b. We believe sucired supplementary information is measured and presented in accordance with
guidelines prescribed by accounting principles generally accepted in the United States of America.
c. The methods of measurement or presentation have not changed from those used in the prior period, and
we have disclosed to you any significant assumptions or interpretations underlying the measurement and
presentation of the supplementary information.
24. During the course of your audit, you may have accumulated records containing data that should be reflected
in our books and records. All such data have been so reflected. Accordingly, copies of such records in your
possession are no longer needed by us.
Compliance Considerations
In connection with your audit, conducted in accordance with Government Auditing Standards, we confirm:
25. We are responsible for:
a. Compliance with the laws, regulations, and provisions of contracts and other agreements applicable to the
City of Scandia
b. Establishing and maintaining effective internal control over financial reporting.
26. We have identified and disclosed to you:
c. All laws, regulations, and provisions of contracts and
effect on the determinations of financial statement ar
objectives.
Violations (and possible violations) of laws, regulations, and
whose effects should be considered for disclosure in theed
27. We have implemented a process to track the status of
28. We have provided you with our views on your
29. Colleen Firkus, Treasurer, who has
and approved, and we take full resp
the auditor's role in the preparation c
Colleen Firkus,
and material
giant to audit
agreements
recommendations.
eenee; has supervised, reviewed,
and related notes and acknowledge
IUIJLIIIa laMIUL, LILY tiUIIIIIllJLIALUr