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<br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br /> <br />CITY OF RAMSEY <br /> <br />Schedule of Findings and Responses <br />Year Ended December 31, 2008 <br /> <br />This schedule summarizes findings and recommendations related to the audit of the financial statements, <br />internal controls over financial reporting, compliance with laws and regulations, and Minnesota Statutes. <br />The auditor, Malloy, Montague, Karnowski, Radosevich & Co., P.A. (MMKR), is responsible for <br />providing the information under the headings "Criteria," "Condition," "Context," "Cause," "Effect," and <br />"Recommendation." The City of Ramsey, Minnesota (the City) is responsible for providing the <br />information under the heading "Corrective Action Plan." <br /> <br />A. FINDINGS - FINANCIAL STATEMENT AUDIT <br /> <br />None. <br /> <br />B. FINDINGS - MINNESOTA LEGAL COMPLIANCE AUDIT <br /> <br />2008-1 COLLATERAL <br /> <br />Criteria- Minnesota Statute ~ 118A.03. <br /> <br />Condition - Minnesota Statute ~ lI8A.03 requires that if a city's deposits exceed federal <br />insurance coverage, excess deposits must be covered by corporate surety bonds or collateral that <br />has a market value of at least 110 percent of such excess. This requirement was not met for the <br />City's deposit account at December 31,2008. <br /> <br />Context - This was one instance out of multiple depository institutions tested. The City had <br />$368,967 of uncollateralized deposits out of $22,815,979 of total deposits as of December 31, <br />2008. <br /> <br />Cause - Several investments were called by the City's brokers near year-end which caused the <br />City's local bank to not have sufficient collateral or FDIC coverage on December 31. <br /> <br />Effect - Deposits exceeding federal insurance coverage or proper collateral may be lost in the <br />event of a bank failure. <br /> <br />Recommendation - We recommend that the City obtain corporate surety bonds or collateral that <br />has a market value of at least 110 percent of city deposits that exceed federal insurance coverage. <br /> <br />Corrective Action Plan <br /> <br />Actions Planned - The City has since invested the funds where they are covered by adequate <br />collateral. <br /> <br />Official Responsible - Diana Lund, Finance Officer. <br /> <br />Planned Completion Date - January 5, 2009. <br /> <br />Disagreement With or Explanation of Finding - The City is in agreement with this finding. <br /> <br />Plan to Monitor - Diana Lund, Finance Officer, has since moved (swept) the excess deposits into <br />an account backed by the FDIC that offers adequate collateral. This sweep is performed daily. <br /> <br />-4- <br />