10.a 2021 Report to the Members of Governance
City of Scandia,
Minnesota
Report to the Members of
Governance
May 31, 2022
CITY OF SCANDIA, MINNESOTA
TABLE OF CONTENTS
Introductory Letter...................................................................................................................................................... 1
Required Communications ......................................................................................................................................... 2
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St. Cloud
320.251.0286
Little Falls
320.632.6311
Albany
320.845.2940
Maple Lake
320.963.5414
Monticello
763.295.5070
www.schlennerwenner.cpa
Members of Governance
City of Scandia, Minnesota
We are pleased to present this report related to our audit of the basic financial statements of the City of Scandia (the
City) as of and for the year ended December 31, 2021. 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 management, 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
May 31, 2022
CITY OF SCANDIA, MINNESOTA
REQUIRED COMMUNICATIONS
2
Generally accepted auditing standards (AU-C 260, 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.
Our Responsibilities With Regard to the Financial Statement Audit
Our responsibilities under auditing standards generally accepted in the United States of America and Government
Auditing Standards issued by the Comptroller General of the United States have been described to you in our
arrangement letter dated February 25, 2022. Our audit of the financial statements does not relieve management or
those charged with governance of their responsibilities, which are also described in that letter.
Overview of the Planned Scope and Timing of the Financial Statement Audit
We have issued a separate communication dated February 25, 2022 regarding the planned scope and timing of our
audit and identified significant risks.
Accounting Policies and Practices
Preferability of Accounting Policies and Practices
Under generally accepted accounting principles, 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. The
City did not adopt any significant new accounting policies, nor have there been any changes in existing significant
accounting policies during the current period.
Significant Accounting Policies
We did not identify any significant accounting policies in controversial or emerging areas for which there is a lack of
authoritative guidance or consensus.
Significant Unusual Transactions
We did not identify any significant unusual transactions.
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 determine and record these accounting estimates. The only estimates we have deemed significant to the
financial statements are the estimates included in the calculation of overall net pension liability/asset and deferred
inflows/outflows of resources for the pension plans in which the City’s employees participate.
Audit Adjustments and Uncorrected Misstatements
Audit adjustments have been proposed by us and recorded by the City and relate to the adjustment, reclassification or
recording of receivables, interest earnings, capital assets, payables, net pension liability, accrued expenses, and special
assessments.
We are not aware of any uncorrected misstatements other than misstatements that are clearly trivial.
CITY OF SCANDIA, MINNESOTA
REQUIRED COMMUNICATIONS
3
Departure From the Auditor's Standard Report
Our Independent Auditors' Report includes several additional or non-standard paragraphs that you should be aware of
as follows:
Other Matters related to Required Supplementary Information, Supplementary Information, and Other
Information
Other Reporting Required by Government Auditing Standards
Observations About the Audit Process
Disagreements with Management
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.
Significant Difficulties Encountered in Performing the Audit
We did not encounter any difficulties in dealing with management during the audit.
Difficult or Contentious Matters That Required Consultation
We did not encounter any significant and difficult or contentious matters that required consultation outside the
engagement team.
Internal Control Matters
We have separately communicated the material weaknesses and significant deficiency in internal control over
financial reporting identified during our audit of the financial statements, as required by Government Auditing
Standards, and this communication is included within the compliance section of the City’s financial report for the year
ended December 31, 2021.
Significant Written Communications Between Management and Our Firm
We have requested certain representations from management that are included in the management representation letter
dated May 31, 2022.